Families in the UK are gradually trying to pay off debts but not getting very far very fast, a new research report has suggested.
The Precious Plastic report from PricewaterhouseCoopers (PwC) found that the average UK family has been paying off debts for three years but the average amount owed on finance such as personal loans, credit cards and overdrafts still stands at £7,900.
In 2011, the average household shaved £355 off their unsecured debts. However, the report finds that UK households remain "among the most indebted in the world".
The PwC report predicts that borrowers will continue trying to shift their debt. The average household debt is expected to shrink to £7,500 by next year.
However, the study also flagged up some potentially worrying spending trends. It found, for example, that a quarter of 25 to 34-year-olds have used a credit card to pay for day-to-day essentials.
Simon Westcott, director in PwC's financial services practice, said, "UK consumers are among the most indebted in the world, with the average UK household still saddled with nearly £8,000 of unsecured debt.
"Although the UK Government's austerity drive appears to be hitting home, with households paying off an average of £355 worth of their debt in 2011, three years of austerity by UK consumers has only made a small dent in the total levels of borrowing.”
