Debt Advice Now urges people to get help with debt 

Household debt in the UK is at 106% of GDP, which could slow down growth of the economy. Debt Advice Now is urging people to get the help and advice they need if they are struggling with debt.

by Melanie  Taylor Monday, October 24, 2011
Debt Advice Now is asking residents of the UK who have problems with household debt to get the help they need, as experts reveal that combined household debt has reached 106% of GDP.

The Bank for International Settlements (BIS), the world's oldest international financial institution, says that the current level of UK debt in relation to GDP is 'bad for growth'. It puts us among the worst three developed countries for debt levels, alongside Portugal and Canada, although some other countries do have more debt in other areas.

The report looks at three types of debt: household debt, corporate debt and public sector (government) debt. Household debt in the UK currently reaches 106% of GDP, whereas the BIS believes it should be closer to 85% to avoid damaging economic growth. By comparison, Australia (113%), Denmark (152%), the Netherlands (130%) and Portugal (106%) are the only other countries with household debt above 100% of GDP.

BIS supports the view that debt 'beyond a certain level' is bad for economic growth and advises countries with high debt to address their fiscal problems. In the long term, countries should have a 'fiscal buffer' for 'extraordinary events' by keeping debts below the recommended threshold.

A spokesperson for Debt Advice Now commented:

"We are concerned by the high level of household debt in relation to GDP in the UK. Although the events of the past few years have encouraged some people to be more careful about debt, it's clear that debt remains a big problem for many.

"Debt is a way of life for many people in the UK these days, and that needn't be a problem as long as the debt is manageable. But there are many people in the UK with debts that they simply can't afford - some saddled with debt repayments that are even larger than their mortgage or rent payments.

"It's important that people acknowledge when their debts have become a problem. Alarm bells may begin to ring if your personal unsecured debt is larger than your annual income, if your unsecured debt repayments take up a large proportion of your income every month, if you have fallen into arrears, if you are considering borrowing more to repay what you owe, or if you have an unfortunate change of circumstances such as an illness or losing your job. Whatever the reason, anyone concerned about their debt should seek out help and advice sooner rather than later.

"Most people in the UK have some sort of debt, but with the right action you can eventually become debt free, and in some cases, sooner than you think."

Debt Advice Now provides debt help and advice to UK residents. It''s part of the Think Money Group, which is one of the UK''s leading financial solutions providers and delivers a comprehensive range of financial services, including debt, insurance and banking solutions. For more information, visit the Debt Advice Now website at:

General | Categories: financial, debt
0    submitted by Melanie  Taylor
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