The Great Britain officially entered into its "Great Recession" in the spring of 2008 and concluded in the autumn of 2009. The economy jumped out of the recession in a quick time than expected but faltered again in the closing quarter of 2010. So, the question arises, How big is UK's debt problem?
In the last fiscal year, UK had one of the worst budget deficits in European Union, which accounted for more than 10% of GDP whereas in the first half of 2011, the total personal debt decline continued. This arises yet another question, What are the causes of this decline? Strict lending policies by Banks, increased awareness of debt management plans, and the interest rates continuing at 0.5% are the reasons causing the rise in the figure. However, with the mortgage interest rates predicted to go up in the near future, individuals need to be aware of higher monthly payments and plan their future expenditures effectively.
The debt levels in UK are still very high. Britain owed £910bn in April, and the recent figures show total personal debt amassing to £1,452bn. The facts make it apparent; UK people owe nearly the same amount as the country produced in the entire 2010. In the first quarter of 2011, UK banks and building societies wrote off £1.89bn to individuals, taking the figure to £9.5bn of loans in 4 quarters to end Q1 2011. The amount equals a write off of £20.71m per day.
Here are some numbers
- 14 - A property in UK is repossessed every 14 minutes.
- 1,384 - The daily lay off number whereas 850,000 people stay jobless for more than a year.
- £68.45 - The average cost to fill a 50 litre car tank with unleaded petrol.
The scenario is not at looking good, furthermore there are no signs of improvement as all the predictions for UK are dark. If you're one of those households struggling with debt, here's an advice - Seek financial help and figure out the options to tackle your debt before the debt tackles you!
Infographic by Money Debt & Credit
