More than 8m UK adults have ‘problem debt’

One in six UK adults have financial worries, with households in Sandwell in the West Midlands and parts of the valleys of south Wales being the most likely to be overburdened, according to latest research.

The Money Advice Service, which is an independent body set up by the government to offer money guidance, estimates 8.2 million adults, or 16.1% of the population, live with problem debt – with younger adults, larger families, single parents and renters particularly at risk.

Nearly one in four people in Sandwell, Blaenau Gwent and Merthyr Tydfil were defined as over-indebted, making these the biggest problem hotspots. Meanwhile, households in East Dorset, and in East Renfrewshire and East Dunbartonshire in Scotland, are the least likely to be over-burdened with debt. Around 16,000 adults were compared to identify the characteristics of those who were over-indebted or not.

The analysis indicated a link between debt levels and having children, with becoming a parent raising your likelihood of debt problems by more than 50%. The figures show that while 19% of adults with one or two children were defined as over-indebted, this increased to 26% among those with three or more. More than one in four (28%) single parents are living with problem debt, equating to a million single parents.

Renters are twice as likely to be over-indebted as those who own their home, at 25% against 12%, the MAS said. For those renting social housing this increases to nearly one in three, at 29% against 21% of those renting privately.

Young adults are the age group most likely to be living with a debt problem, according to the MAS. Among 25- to 34-year-olds, one in four live with debt problems.

Caroline Siarkiewicz, head of debt advice at the MAS, said: “We know that debt advice works, but currently only one in five people with financial difficulties seek it. Today we are calling on everyone with problem debt or money worries – no matter how large or small – to access free advice as soon as possible.”