Debt can be a scary word for some people, but it doesn’t need to be. It’s something that most people have to deal with at one point or another in their life. It’s important to know as much about debt as possible so that you can take control of it and not let it control you. Here are the 10 interesting facts about debt.
Fact #1: Medical Debt Has the Biggest Effect on People’s Satisfaction
The report found that medical debt has the biggest effect on people’s life satisfaction. This is because of all types of debt, it creates a bigger financial burden than any other type.
When an individual cannot pay their bills for healthcare services rendered, they then feel guilt or shame which impacts their overall happiness.
Fact #2: Millennials Have the Lowest Average Credit Card Debt
One of the biggest misconceptions about millennials is that they spend a lot and have high levels of credit card debt. The reality is, most millennials don’t even own one a credit card.
Fact #3: When Do New Couples Reveal Their Debt?
Studies found that the average couple only reveals their debt 10 months into their relationship. This is because couples are often very secretive about their debt when they first start dating.
#4: The UK Government Is the Largest Debtor in the World.
A quarter of UK government debt is owed to the UK government itself. In fact, a quarter of all government debt owed, is owed by one country to itself: The United Kingdom
#5: The UK Government Is Virtually Paying the Lowest Amount of Interest on Its Debt
Interest rates1 on the UK government’s debt are at their lowest level they’ve been in decades. In fact, Britain is currently able to borrow cheaply by global standards and has been since 2016 – when it was first allowed a return to international capital markets for three months.
Fact #6: Unsecured Personal Debt Is Rising Rapidly
In the UK, unsecured personal debt is rising rapidly and a lot of this has to do with credit cards. The average consumer in the UK spends £16-billion each year on interest payments for their card balances.
Fact #7: People Vastly Underestimate Their Debt
The report found that many people vastly underestimate how much they owe. What’s more, 50% of UK adults who don’t have a mortgage2 say their housing costs are less than £750 per month.
Fact #8: Credit Card Debt is 22% Greater Than People’s Savings
The report found that 22% of people in the UK have more credit card debt than savings. As a result, they are living paycheck to paycheck and one unexpected expense could be enough to send them into poverty.
Fact #9: Auto Loan Delinquencies Are up 21% Since 2012
The report found that auto loan delinquencies are up by 21% since the year 2012. Since then, many people have been struggling to find steady employment and make ends meet – which has led them into a vicious cycle of debt.
Fact #10: Baby Boomers & Gen Xers Have the Most Debt
The report found that Baby Boomers and Gen-Xers have the most debt. This is because they’re nearing retirement age3, which means their mortgage has probably been paid off; but many of them also find themselves with too few financial resources to retire in comfort.
What's the Most Important Thing I Need to Do if I Have Debt?
Find out what your options are. Talk with a counselor or financial advisor about which option is best for you and your family, including bankruptcy.
What Is the Average Debt in the UK?
The average debt in the UK is £27,300. This figure includes mortgage and unsecured loans, credit cards, and overdrafts, as well as any other outstanding debts from gym memberships to utility bills.
Will My Credit Score Be Affected by Not Paying My Debt?
Not repaying a debt will affect your credit score. Your creditors may contact the third-party agencies that keep track of this information and request an update or they can send you correspondence in regards to obtaining their money (including interest).
What Does Debt Consolidation Mean?
Debt Consolidation is when a person takes out one loan or line of credit to pay off all their other debts. This can be helpful for people who are having trouble paying back multiple loans because it allows them to focus on just repaying the one larger loan, rather than juggling many different ones.
Debt is a complicated topic and one that people want to know about. We’ve got many more articles written on debt with facts you may not have known about debt, so be sure to check them out. Whether you are in debt or just curious, these facts can help shed light on the murky world of debts and loans.