It seems more families are spending money they don’t really have
According to a new report, household debts have increased by more than 40 per cent in the past six months.
A study of more than 2,000 people by insurer Aviva, found the average family has £13,520 of personal debt, up sharply from £9,520 last summer.
This includes personal loans, store cards and credit cards.
This latest figure is the highest since summer 2013, when the average family owed £16,300.
Aviva spokesperson Louise Colley said: “The alarming levels of rising household debt, along with a recent reduction in income and savings levels, paints an uncertain picture for the family purse in 2016.
It comes amid reports we could see the Bank of England raise interest rates this year.
‘Mild’ deflation had continued In October with the cost of living falling again for British households.
Ms Colley added: “Families who have grown accustomed to cheaper credit – particularly those who have spent heavily over the Christmas period – need to ensure they are still fully prepared to manage debt repayments, as well as other monthly outgoings, should rates go up.”
The report also found that the typical family’s monthly net income has fallen for the first time since July 2012, now standing at £2,024.
Mums and dads with two or more children tend to have the biggest debts, owing £18,830 on average, the report found.
It comes as more and more children are being brought up by relatives.
According to a study by the University of Bristol, 150,000 English children are growing up in a home with relatives other than their parents.
Experts have blamed the increase on poverty and deprivation, with many parents also relying on grandparents to help them bring up their children.
For help with finances visit: www.moneyadviceservice.org.uk