June 19 2013 Latest news:
Adam Aiken, Editor
Monday, February 27, 2012
Nearly a quarter of so-called discretionary spending – the money we can spend once our regular bills are taken care of – is eaten up by interest payments, with a “debt noose” said to be tightening around a growing number of households.
Even though the amount of interest we pay has fallen marginally, the rising cost of essential items, such as petrol and domestic energy, means there is less discretionary spending available to households – which is why the proportion spent on servicing interest has risen.
The findings are published in the latest quarterly report from debt charity the Consumer Credit Counselling Service (CCCS).
At the end of 2011, the average household was paying almost £200 a month in interest, representing nearly a quarter of available income, the CCCS said.
The charity also found that middle-aged and elderly people will be increasingly affected by debt problems. It said its share of clients aged 45-plus will rise from 28pc seven years ago to nearly 50pc by the end of 2014.
“While debt levels continue to decline, interest payments are a growing burden on too many UK households,” said CCCS chairman Lord Stevenson.