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| Young people worst affected by debt crisis, say charities | Young people worst affected by debt crisis, say charities |
| (about 9 hours later) | |
| Rent arrears, benefit changes and insecure work contributing to rise in number of young people seeking advice | |
| Phillip Inman | |
| Wed 20 Sep 2017 12.47 BST | |
| Last modified on Wed 20 Sep 2017 15.27 BST | |
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| Debt charities have reported a jump in the number of young people seeking help with bad debts as growing numbers of under-30s struggle to pay household bills, interest on bank overdrafts and rent arrears. | Debt charities have reported a jump in the number of young people seeking help with bad debts as growing numbers of under-30s struggle to pay household bills, interest on bank overdrafts and rent arrears. |
| Citizens Advice said that the failure to cope with payday loans and other forms of high cost credit was one of the main reasons for the influx of distressed young people seeking advice. | Citizens Advice said that the failure to cope with payday loans and other forms of high cost credit was one of the main reasons for the influx of distressed young people seeking advice. |
| The charity, which helped 350,000 people last year, said there was 34% rise in the number of under-25s seeking help with high cost credit in the last two years. | The charity, which helped 350,000 people last year, said there was 34% rise in the number of under-25s seeking help with high cost credit in the last two years. |
| StepChange, which also helps people with debt problems, said that in the first six months of 2017 almost two-thirds (64%) of all clients who sought advice were under 40. In 2013 only 53% were aged between 18 and 40. | StepChange, which also helps people with debt problems, said that in the first six months of 2017 almost two-thirds (64%) of all clients who sought advice were under 40. In 2013 only 53% were aged between 18 and 40. |
| “The people coming to us for advice is getting younger and has been for the last five years. The average age of our clients is now 41,” the charity said in its half-year report. | “The people coming to us for advice is getting younger and has been for the last five years. The average age of our clients is now 41,” the charity said in its half-year report. |
| “We are seeing fewer homeowners and an increased number of renters contacting us for advice and support with their problem debt,” it said. The charity said four out of five (80%) clients are renters. | “We are seeing fewer homeowners and an increased number of renters contacting us for advice and support with their problem debt,” it said. The charity said four out of five (80%) clients are renters. |
| Peter Tutton, head of policy at Stepchange, said: “The feedback we get is that young people are disproportionately affected by insecure work and zero-hours contracts, which can make their income erratic. The also suffer from recent benefit changes, which can be especially harsh on single parents, and the shift away from homeownership to renting.” | Peter Tutton, head of policy at Stepchange, said: “The feedback we get is that young people are disproportionately affected by insecure work and zero-hours contracts, which can make their income erratic. The also suffer from recent benefit changes, which can be especially harsh on single parents, and the shift away from homeownership to renting.” |
| The findings chime with a report by the Resolution Foundation, which found that adult millennials are spending three times more of their income on housing than their grandparents. | The findings chime with a report by the Resolution Foundation, which found that adult millennials are spending three times more of their income on housing than their grandparents. |
| The thinktank warned that people in the generation currently aged 18-36 are typically spending over a third of their post-tax income on rent or about 12% on mortgages. This compares with 5%-10% of income spent by their grandparents in the 1960s and 1970s. | The thinktank warned that people in the generation currently aged 18-36 are typically spending over a third of their post-tax income on rent or about 12% on mortgages. This compares with 5%-10% of income spent by their grandparents in the 1960s and 1970s. |
| Tutton said: “In the social rented sector we see much higher levels of arrears than in the private rented sector, but that doesn’t necessarily mean young people who rent from private landlords in places like London are not struggling. They have much less security of tenure and simply cannot risk going into arrears. They will be in arrears on their council tax and other household bills, credit cards and loans.” | Tutton said: “In the social rented sector we see much higher levels of arrears than in the private rented sector, but that doesn’t necessarily mean young people who rent from private landlords in places like London are not struggling. They have much less security of tenure and simply cannot risk going into arrears. They will be in arrears on their council tax and other household bills, credit cards and loans.” |
| Citizens Advice said people under 35 were much more likely to have high cost credit issues than those over 35, who tend to have more mainstream debts from credit cards and loans, it said. | Citizens Advice said people under 35 were much more likely to have high cost credit issues than those over 35, who tend to have more mainstream debts from credit cards and loans, it said. |
| “In the last 12 months 43% of people who sought help for high cost credit issues were under 35. In comparison, only 25% of people who sought help for mainstream consumer issues were under 35,” it said. | “In the last 12 months 43% of people who sought help for high cost credit issues were under 35. In comparison, only 25% of people who sought help for mainstream consumer issues were under 35,” it said. |
| Borrowing & debt | |
| Britain's debt timebomb | |
| Young people | |
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