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Number crunching: the statistics concerning debt consolidation

17th November 2010

As we emerge from one of the most memorable recessions in living history, there are many of us who are trying to remove the debt that we might have accumulated in this period due to unemployment or other financial strains. In this article, we are going to look at some of the vital statistics that surround debt consolidation, one of the recognised ways in dealing with copious amounts of money owned to lenders.

The credit card industry certainly hasn’t helped with this situation. Even though they can help us to manage the money that we owe, it can be the cause of many problems. At its peak there were over 1,700 different types of plastic to choose from as a consumer, but the market has certainly died down with unfavourable interest rates being one of the primary reasons.

The amount of money involved in debt consolidation doubled in three years alone. Even though it was around £20 million in 1999, £40 million were the new estimates from the experts in 2002. It has been expected that the number has elevated immensely in the eight years since this data was released.

The need for debt consolidation services are surely being accentuated by the amount of income that some people are using to pay off the money they owe outstanding – some people struggling to satisfy other commitments that they have (such as the rent) in the process. A tenth of women in the UK use half of the earnings which they receive in a monthly period to pay off creditors who are making demands. Debt consolidation has become more prominent in society as people try to reduce their monthly payments so their situation doesn’t worsen.

Of course, the reason for this high proportion of repayments amongst wage packets is because of the average amount of money that women in particular owe to creditors – an estimated £30,000 on average. This could be deemed as a more severe case of debt consolidation too, with help for many people in financial trouble starting after a few thousand pounds.

Debt consolidation services normally help those who are between the ages of 25 and 30, with those who are aged 50 or over likely to be more responsible about how they handle their credit cards. As we have seen from the data so far in this article, age and gender can be two of the factors which matter with regards to how people handle their debts.

All in all, statistics only tell us so much – and there are plenty of stories behind the numbers which provide insight into individual circumstances and how different people got in debt. The advice can be clear – be sure to get help on your own circumstances, as you may not conform to the research which has already been conducted into the levels of debt that people have and why all of this is the case.