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65% slow to realise debt levels

Two-thirds of people only start to worry about debt once it is too late, according to research commissioned by Kensington Mortgages.

It says the amount of money that people owe has reached historic highs – currently £140.1bn excluding mortgages and up by 122 per cent since 1995 – and that we are not a nation of good financial planners.

The survey shows 65 per cent of people have a variety of different events that provoke concern about borrowing levels. The principal trigger for worry – accounting for 26 per cent of those questioned – is when people miss payments. This is followed by borrowing more than you earn (20 per cent) and being unable to provide for the family (19 per cent).

However, 7 per cent would only become concerned about debt level if their home was repossessed and another 4 per cent would only become worried if they lost their partner as a result of debt.

Another 4 per cent would begin to be concerned about debt levels if they were ref-used further credit and 2 per cent if they were treated as a charity case by friends.

The research was carried out in September by RSGB from a representative sample of 1,000 adults.

Chief executive John Maltby says: “To most of us, debt in some form is an everyday reality. However,it is widely recognised that people often have no idea or have a laidback attitude towards their money problems and the earlier that the problem is detected and dealt with the better.

“A simple matter of defaulting on your credit card, loan or mortgage could if not dealt with early on, could easily snowball into a bigger problem which will have a knock-on effect on all aspects of a person&#39s life.”

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