An in-depth look at 300,000 people with £2.4bn of debt in the first half of 2016

PERSONAL DEBT FIRST HALF 2016

Mid-YearbookStatistics

StepChange Debt Charity research2

Main findings from the first half of 2016

London is the region with the most clients, over 50,000 Londoners contacted us in the first half of 2016. The North East now has the most clients per local population.

The first half of 2016 has seen 1.7 million visits to the charity’s website, a 114% increase on three years ago.

313,679 people contacted the charity for help from 1 January to 30 June 2016 and 176,347 became new clients.

Mid-year 2016 figures are based on data from the 176,347 new clients, apart from overall demand figures on p.3.

Demand for debt advice

More people contacted StepChange Debt Charity in the first half of 2016 than any previous six-month period. 313,679 people contacted StepChange Debt Charity for help between January and June 2016, up 11% on the same period in 2015.

1 Not including arrears on essential household bills or loans from family and friends.

What debts do people have?The average unsecured debt of our clients in the first six months of 2016 was £13,8261. Clients have on average 5.7 debts. Credit cards continue to be the most common unsecured debt, and levels of arrears on essential household bills remain elevated. A notable growth area for our clients’ debt is loans from family and friends; 28% of clients now have such debts compared to 20% in the first half of 2014.

Who’s seeking advice?Clients are younger, more likely to be renting and more likely to be working. More of our clients are in work than in any period since 2011. However, the proportion of clients in part-time work or self-employed is steadily increasing.

The number of clients who rent their homes continues to grow, now at 77% of all clients. This compares to a little over 50% five years ago. Clients are on average younger than ever; 59% of clients are under 40, from 51% five years ago.

A change to income or employment is still the most common reason for our clients falling into debt. One in five clients fell into problem debt due to losing their job, and 15% due to injury or illness.

Average (mean) take home income stands at £16,650. The number of clients with a negative budget left at the end of the month has risen. This is to say that after completing our debt advice and budgeting process, over 50,000 clients (29%) had insufficient income to make ends meet.

Statistics Mid-Yearbook: Personal Debt 2016 3

Source: ONS mid-2015 Population Estimates, 2016

Demand for debt advice

OVERALL DEMAND

Website visits (m

illions)

1.8

1.6

1.4

1.2

1.0

0.8

0.6

0.4

0.2

02009 2010 2011 2012 2013 2014 2015 H1 2016

400,000

350,000

300,000

250,000

200,000

150,000

100,000

50,000

0

Con

tact

s

First half of the year Second half of the year Website visits

REGIONAL DEMAND

The highest level of demand now comes from the North East, with the first half of 2016 seeing 68 clients per 10,000 local population, overtaking London.

The highest number of clients continues to come from London, with over 50,000 in the first half of 2016.

Clients per 10,000 population in the first half of 2016

21-30 31-40 41-50 51-60 61-70

RANK 2 62

RANK 1 68

RANK 3 57

RANK 9 43

RANK 8 43

RANK 10 31

57 RANK 4

25 RANK 12

51 RANK 6

47 RANK 7

55 RANK 5

RANK 11 29

£3,176

£3,372

£3,570

£3,772

£4,046

H1 2014

H2 2014

H1 2015

H2 2015

H1 2016

20%

23%

26%

27%

28%

AVERAGE DEBT

% OF CLIENTS DEBT ADVISED

£1,098

£1,380

£2,046

£1,354

£8,657

£1,679

£8,078

CATALOGUE

36.1 %

PAYDAY LOAN

16.1%

STORE CARD

12.4%

PAYDAY LOAN

15.7%

AVERAGE DEBT AMOUNT

CREDIT CARD

66.8%

PERSONAL LOAN

43.9%

OVERDRAFT

52.8%

HOME CREDIT

8.1%UNSECURED DEBT TYPE

% of clients with each type

of debt

StepChange Debt Charity research4

Unsecured debts

UNSECURED DEBTS

UNSECURED DEBT OVER TIME LOANS FROM FAMILY & FRIENDS

2011 2012 2013 2014 2015 H1 2016

Ave

rage

tota

l uns

ecur

ed

debt

per

clie

nt

£10,000

£20,000

£15,000

Statistics Mid-Yearbook: Personal Debt 2016 5

Arrears on household bills

ARREARS ON ESSENTIAL HOUSEHOLD BILLS H1 2016

ESSENTIAL

Household Bills

AVERAGE ARREARS ON EACH BILL*

COUNCIL TAX

£957

WATER

£739

GAS

£543TV LICENCE

£78

ELECTRICITY

£660

RENT

£954

MORTGAGE

£3,037

CLIENTS WITH ARREARS ON ESSENTIAL HOUSEHOLD BILLS

Average amount for clients who have these debts.

*Average arrears amounts are additional to the £13,826 average unsecured debt.

Pro

port

ion

of c

lient

s

2011 2012 2013 2014 2015 H1 2016

50%

40%

30%

20%

10%

StepChange Debt Charity research6

Arrears on household bills

*Based on clients with this type of expenditure only

Council Tax 14.0% 21.8% 25.1% 28.3% 30.1% 30.1%

Electricity 8.3% 11.5% 13.3% 14.2% 13.8% 13.4%

Gas 8.2% 11.2% 12.9% 13.6% 12.7% 11.8%

Mortgage 24.2% 28.3% 29.9% 27.1% 24.1% 23.4%

Rent 14.5% 20.6% 23.6% 25.0% 24.9% 23.5%

TV Licence 3.4% 5.3% 6.9% 7.0% 7.6% 7.8%

Water 10.9% 15.8% 19.9% 22.4% 24.2% 24.2%

2011 2012 2013 2014 2015 H1 2016

ARREARS ON ESSENTIAL HOUSEHOLD BILLS OVER TIME

proportion of clients*

Statistics Mid-Yearbook: Personal Debt 2016 7

80%

70%

60%

50%

40%

30%

20%

10%

A picture of those in debt

EMPLOYMENT STATUS

INCOME AND SURPLUS

Annual (net) income % of clients with a negative budget

* The proportion of clients who, after undertaking the debt advice and budgeting process, have a negative balance at the end of each month.

HOUSING TENURE

Ann

ual (

net)

inco

me

2011 2012 2013 2014 2015 H1 2016

£17,100

£17,000

£16,900

£16,800

£16,700

£16,600

£16,500

£16,400

£16,300

£16,200

35

30

25

20

15

% of clients w

ith a ne

gative budget *

30%

25%

20%

15%

10%

5%

Pro

port

ion

of c

lient

s

Employed full time

Employed part time Full-time carer

Looking after the family Retired Self employed Student Unemployed

2011

2012

2013

2014

2015

H1

2016

2011

2012

2013

2014

2015

H1

2016

2011

2012

2013

2014

2015

H1

2016

2011

2012

2013

2014

2015

H1

2016

2011

2012

2013

2014

2015

H1

2016

2011

2012

2013

2014

2015

H1

2016

201

120

1220

1320

1420

15H

1 20

16

2011

2012

2013

2014

2015

H1

2016

Pro

port

ion

of c

lient

s

Homeowners Renters

44.6%

55.4%

39.0%

61.0%

33.3%

66.7%

28.6%

71.4%

24.6%

75.4%

22.7%

77.3%

2011 2012 2013 2014 2015 H1 2016

FAMILY COMPOSITION H1 2016

80%

70%

60%

50%

40%

30%

20%

10%

37.6%Single without children

(34% UK Av.)

26.5%Couples with children

(23% UK Av.)

20.2%Single with children

(7% UK Av.)

15.7%Couples without children

(36% UK Av.)

Pro

port

ion

of c

lient

s

UK AverageSource: ONS Families and Households, 2015

AGE

Editor: Henry Hall For data tables, including additional raw data, visit the StepChange Debt Charity website here For help and advice with problem debts call (Freephone) 0800 138 1111 Monday to Friday 8am to 8pm and Saturday 8am to 4pm, or use our online debt advice tool, Debt Remedy.

Email: policy@stepchange.org | Web: www.stepchange.org | Twitter: @stepchange

© 2016 Foundation for Credit Counselling, Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. Authorised and regulated by the Financial Conduct Authority.

2011 2012 2013 2014 2015 H1 2016

Under 25

60 & over

40-59

25-39

Pro

port

ion

of c

lient

s

45%

40%

35%

30%

25%

20%

15%

10%

5%

0