Edinburgh second in UK debt league

Published on Monday 5 April 2010 23:08

THE average British adult owes nearly £6,000 in non-mortgage-related debt, according to a new survey.

Figures released yesterday showed the average UK resident owes 1,747 on credit cards, has loans totalling 3,077, finance deals of 646 and bank overdrafts of 518.

Edinburgh is the country's second most debt-ridden city, with 6,922.22 non-mortgage-related debt. Exeter came top of the survey of 3,000 people, followed by the Scottish capital, Cardiff, Cambridge and Leeds.

Almost half those questioned said they had got into debt by spending more than they earned, while a third said they were bad at managing money.

A third questioned said they had borrowed money to pay for something specific, such as a new car or home improvements.

A quarter said they had had to borrow to pay for essentials such as food or heating.

A spokesman for Citizens Advice Scotland said that there were increasing concerns about levels of personal debt.

"Debt is the single biggest issue brought to Citizens Advice Bureaux in Scotland.

"Last year we found that the average debt among people who came to us had increased by 50 per cent over the last five years.

"People who come to us with debt problems owe an average of 28 for every pound they earn.

"The problem is that debt breeds debt. People who get into trouble will often take out more loans to pay off existing debts and that just leads to greater debt, which then leads on to additional problems such as health issues and family breakdown.

"Anyone who is concerned about debt should come into their local Citizens Advice Bureau as soon as possible."

Some 12 per cent of those surveyed said their financial difficulties began after losing their jobs.

Half of those questioned said they expected to be in debt for at least four years, with half of people also saying they could only afford the minimum payment each month.

A spokesman for finance website lovemoney.com, which carried out the survey, said: "It was way too easy to borrow during the economic boom and it'll be a long time before we've all nursed our finances back to good health.

"If you've got big debts, it's crucial that you should start budgeting. Find out exactly how much money you're spending every day and then you may be able to spot areas where you can save."

And he added: "The worst thing to do is put your head in the sand. Tell your lender that you're struggling and you may get a more sympathetic response than you expect.

"It's also worth trying to increase your income if you can. Could you possibly get a second job at the weekend, or maybe rent out a spare room in your home?"