62% of all adults have debt, with 16% taking on at least £20,000 of debt excluding mortgages, new data from LV=’s Wealth and Wellbeing Research Programme has revealed.
According to the quarterly survey of 4,000 adults, parents were under the most financial strain, with 84% holding more than one type of debt.
Excluding mortgages, 43% of parents surveyed with children under the age of 18 said that they have debt of £20,000 or more.
The most popular type of debt other than a mortgage was having at least one credit card (39%)
People aged 18 to 34 were more likely to have higher debts from student loans (25%), bank loans (15%) or car finance (13%).
Alternatively, 16% had borrowed money from family or friends, while 7% had either a debt management plan (DMP) or an Individual Voluntary Arrangement (IVA) to consolidate and pay off their debts.
Adults aged 35 to 54 were more likely to face increasing financial pressures such as parenthood, mortgage costs and ageing parents to support.
59% were struggling or failing to afford day-to-day bills, with 7% missing payments on utility bills within the past three months.
Despite two-thirds (67%) of retirees stating that they could comfortably afford day-to-day costs, 41% would struggle to pay an unexpected cost of £500.
A third (33%) held non-mortgage related debt such as credit cards and loans in retirement, which can be worrying for those living on a fixed income.
David Hynam, LV= chief executive, said: “Our research highlights the real impact of the current economic environment showing that when finances are stretched, many people will turn to credit cards, loans or family assistance.
“As levels of debt increase, it is important to try and not neglect future finances either.
“About 20% of working people have reduced or stopped their pension contributions in the last quarter alone to help households with everyday bills.
“Cutting back on savings and pensions to cover costs now, could affect people’s chances of achieving a more secure retirement in the future.”
