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Debt worries are rife in young people’s minds
A survey has found that more than a third of young people in the UK have debts of around £3000 and are experiencing significant concerns about money. The survey of 2042 people aged between 18 and 24 was conducted by YouGov for the Money Advice Trust.
They found that those surveyed borrow by using credit cards, overdrafts and loans from friends and family. Over half of those surveyed said they regularly worry about money and 32% feel that their debts are a ‘heavy burden’. Women were also found to be more likely to worry about money than men.
The average debt for this age group is currently £2989 excluding student loans and mortgages; the average student loan currently sits at £25,505. The findings of the survey come at the same time as National Debtline, run by the trust, commented that not enough young people are seeking the free advice on offer from debt charities.
They published a new report entitled ‘Borrowed Years’ which spoke about a number of measures which could help those under-25 to manage their money and avoid problems financially. Those proposals are:
- Practical reforms to student finance payments
- Earlier financial education which is more co-ordinated
- A wider role for employers to support money management for young workers
- Support for first-time borrowers or credit card holders
Speaking about the survey findings and the new report, the trust’s chief executive Joanna Elson said; “With many young people beginning to build up debts soon after they turn 18, we have a real battle on our hands as a society to make sure they receive the support they need. Worryingly, far too few under-25s are seeking advice… If we let this situation continue, there is a real risk that young debts will become old debts.”
On a more positive note, the survey found that most under-25’s try to manage their own finances as effectively as possible. Around 69% have a budget they try to stick to and 71% check their account balance via internet banking at least once every week.
But the causes for concern just keep on coming as 37% of those currently in debt in this age group have no plan in place to repay what they owe while 42% found that managing their money is more difficult than they thought it would be.
In their article about this survey, the BBC put together ten tips for those under-25 to help them manage their money. These are:
- Earn or obtain more money through a second job or selling possessions
- Draw up a budget and try to stick to it as much as possible
- Take care with any contracts you sign
- Choose your bank wisely
- Spend less where you can
- Save as and when you can
- Plan for the future and plan your finances on a month by month basis
- If you have to borrow, borrow from reputable sources and make sure you are aware of terms and conditions
- Look after your student finances
- Get free debt advice from a number of UK debt charities including National Debtline