The average British household now owes a massive £15,385 in unsecured debts, according to new research that found the country’s debt mountain has reached record heights.
Unsecured household debts on credit cards, overdrafts and other credit lines increased by £886 in 2018 to £15,385 per household, TUC research found, with the total amount of household debt hitting a new high of £428bn.
The TUC blamed the sharp rise in household debt, which excludes mortgages but includes student loans, on years of punishing austerity and stagnant wages.
As a result unsecured debts as a share of household income has hit an all time high of 30.4 per cent, the TUC said.
Millions of households now have to rely on borrowing to make ends meet and working families are on average poorer than before the 2008 financial crisis, the TUC added.
TUC general secretary Frances O’Grady said, “Household debt is at crisis level. Years of austerity and wage stagnation has pushed millions of families deep into the red.
“The government is skating on thin ice by relying on household debt to drive growth. A strong economy needs people spending wages, not credit cards and loans.”
Calling for a minimum wage of £10 an hour “as quickly as possible”, O’Grady added, “Our economy is not working for workers. They need stronger rights and bargaining powers.”
Unite general secretary Len McCluskey said rocketing levels of household debt are a direct result of Conservative policies and that a change of government is needed to rebalance the economy.
McCluskey said, “This is what Tory austerity does. It causes wages to stagnate and pushes the cost of living burden onto people who can ill afford it.
“Tory economics are a busted flush. Change is needed to build a country for the many.”
To find out more about Unite’s Credit Union Service, which aims to provide members and their families with access to affordable finance and competitive savings products, click here.