Interest on debt is taking a month to pay off

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Interest on debt is taking a month to pay off

Thu 1st Feb 2007

New figures released by independent financial advisers monitor Unbiased show that employees in the UK are spending an average of 31 days clearing off debts they have accrued on plastic cards and loans.

To coincide with Debt Freedom Day, Unbiased has underlined the extent of the debt problems facing some Britons, and discovered that workers' salaries from the month of January would just be enough to wipe out loan and credit card debt.

With official figures analysed by Unbiased, it found that 31 days paying off debts racked up was based on a person earning the UK average of £23,556 with the UK average level of interest on credit card and loan debts being £2,012.

David Elms, chief executive of Unbiased, said: "Although Debt Freedom Day is of course a hypothetical point in the financial calendar, it does serve a real purpose and should be seen as a wake up call to those who carry personal debt."

As this figure of 31 days only refers to the interest built up on debts, the debt is not actually reduced. Mr Elms said people should visit an independent financial advisor to assess their money situation and improve planning.

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