Family Debt in UK Rises by Almost 50% in 2011

Aviva Family Finances Report published today revealed that UK family debt increased by almost 50% in the past year.

Now, an average family debt, excluding mortgages, has risen from 5,360 pounds in January 2011 to 7,944 pounds in January 2012. This constitutes as much as 32% of average household income, which has also increased over the past year.

The typical monthly family income in the UK has risen to 2,066 pounds, which is 7% higher than at the same time last year.

Commenting on the findings, Louise Colley of Aviva said: "Families in the UK are still very concerned by the rising cost of living and levels of unemployment. While average incomes have increased over the past year, the prices of essential goods and services have also increased, meaning that families are struggling to keep up."

She highlighted that it is important to think of a protection buffer that would protect families against financial shocks.