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UK Personal Debt Rose a Third in 2022

Spiralling bills and costs have seen the average adult’s debt (not counting mortgages) in the UK rise from £25,879 to £34,566 (£8,687) in 2022, with four in five adults revealing they will start the new year in debt, up from three in five in 2021.

Over two-thirds of UK adults (68%) have felt stressed due to the cost-of-living’s impact on their finances this year, with almost half (46%) in debt as a result of the crisis.

Credit card debt is most common among UK adults, with a third (32%) carrying some into the new year. Personal loans and overdrafts follow, with 16% of adults indebted for either respectively, according to the annual debt index.

One in 5 (19%) of adults’ debts are from the last 1 – 6 months, and another one in five (19%) are from 1 – 2 years ago, suggesting an influx of debt caused by the cost of living crisis and the Coronavirus pandemic.

weight of debt

James Andrews, personal finance expert at, comments: “Between soaring energy bills and volatile mortgage rates, 2022 has been an unstable economic year for the UK.

“Bills, like energy and water, have had the biggest financial impact this year. More than half (53%) of those who have seen their debts increase thanks to the cost-of-living crisis feel that they would be debt free if not for costlier bills. Living expenses such as groceries were the second most impactful expense, affecting 48% of those whose debts are a result of the cost of living.”

Debts are generally higher in the East Midlands, with 17% of residents reporting outstanding debts between £10,000 – £50,000, compared to just 3% in Scotland. However, Londoners were most likely to have the largest debts, with 9% of the capital’s population owing upwards of £50,000.

The average UK credit card holder will go into 2023 with £2,647 of credit card debt, with citizens of Belfast averaging £3,910, the most of any UK capital. This is 271% more than Edinburgh (£1,052), 228% more than Cardiff (£1,193), and 73% more than London (£2,260).

46% of 25-34-year-olds have taken out an additional credit card or loan to cope with rising costs this year, compared to 9% of Brits 55 and older. Nearly half (46%) of those earning £45,001 – £55,000 have also done this, despite earning more than the average UK wage.

Allocating monthly income is how the majority (47%) of the UK expect to pay off their debts, in 2023 and beyond. While 14% plan to consolidate their debts to make repayments more affordable, one in ten adults is not sure how they will cover their debts at all.

Two-thirds (66%) of 16-24-year-olds have transferred their debts in order to take advantage of better interest rates. This is the most of any age bracket, compared to over half (53%) of residents aged 45-54, and one-third (32%) of residents aged 55 or older.

When it comes to saving money, residents in Newcastle put the most aside a month. At £399, they save 58% more than the UK average (£252). Those living in Norwich are able to contribute the least to their savings, with just £130 a month, almost half (52%) of the national average.

Over half of the UK adult population is in debt

More than half (51%) of UK adults are in debt and worried about paying it off. These feelings are most consistent among 25-34-year-olds, with two-thirds (66%) concerned with their finances. Over 55s are considerably less worried, with less than a third (32%) worried about their debts.

Greater London residents use a quarter (25%) of their wages to pay off their debts, the most of any UK region. Those in the South West allocate the least of their income to repaying their debts at 4%, 11% less than Londoners and 4% less than the UK average (14%).

Six in ten (60%) of UK adults reported having their finances worsen over the course of 2022, as a result of the cost of living crisis.

Tips on how to save money

James Andrews, personal finance expert at, offers his tips on how to save money: With debts consistently rising each year, saving where you can is even more important, but difficult than ever. 

“The first thing you need to do when looking to boost your savings is to take stock of your current position. We’ve got a full guide to writing a budget here if you need a little help.

“Once you’ve done that, it’s time to assess where your money’s going. If things are tight, or even if they’re not, it makes sense to reduce your costs.

“If you can pay less interest on your debts – by moving to a cheaper loan or even a 0% credit card – you should. After all, it makes no sense to pay banks more than you need to.

“There are a string of other bills you can cut without having to change your lifestyle too – from broadband to mobile phones to insurance.

“If you’ve got a monthly surplus at the end of this process, diverting some of that to a savings account you can draw on in times of need makes sense. 

“Setting up a direct debit to move cash straight into your savings account each month helps automate the process, letting your savings build up without you thinking about it.

“However, it makes no sense at all to go overdrawn as a result of this – so you might prefer to make the payments yourself.

“If you’re doing that, the day before payday is a great time to move money – as you can see exactly how much you have left over to move. Setting a reminder in your calendar to check this will help you remember to act.

“You should also look to make the most interest you can on the money you’re putting away. The top-paying instant access accounts are currently offering more than 2% interest, so any money you have that’s earning less than that should be moved.”