Study finds personal debts in Wigan have decreased

New data from personal insolvency provider, Creditfix, has revealed that average debt levels in the borough have gone down by 16 per cent since 2020.

The Personal Debt Index is compiled by using data from over 185,000 people across the UK who have received help with their finances through an IVA or Trust Deed with Creditfix.

As the cost-of-living crisis continues, many households are struggling financially and increased levels of debt is a real worry for many.

According to the Office for Budget Responsibility, UK households will spend £83bn in servicing debts (mortgages, credit cards and personal loans) in 2023-24 – an increase of 52 per cent from 2022.

By the end of December, Creditfix revealed the average total of unsecured debt per adult stands at £14,400.46 in the UK

However, Wigan has seen debt levels drop since 2020, from £19,890.64 to £16,591.96, with 26 to 35-year-olds holding the lion's share of it (42.4 per cent).

While this is encouraging news, since 2022 Creditfix has seen a whopping 408 per cent increase in customers reporting that they are struggling with debts under £2,000.

Layla Johnson, regional manager at Creditfix said: “The cost of living crisis has wreaked havoc on the economy with the UK currently experiencing the highest inflation rate in over 40 years and the biggest drop in living standards in over 60 years, and it looks like people are struggling and seeking debt help with lower levels of debt sooner.

“Salaries have stayed pretty much the same between 2020 and 2022, the increase in the number of people struggling to manage smaller levels of debt in 2022 and going into 2023 would indicate salaries just aren’t stretching as far after the pandemic with inflation on the rise.

“It’s great that more people are beginning to feel comfortable speaking about and seeking support for their financial worries, but these findings highlight that more people are financially over-stretched and finding it difficult to pay off smaller levels of debts.

“It is also worth remembering that, whilst the economy is set to return to normal during the tail-end of 2023, it could be late 2024 until the cost of living decreases and the impact of these changes are fully felt by the consumer.”