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A third of FTBs borrowing five-times income

A third of 18 to 25 year olds have a mortgage worth five times their salary, research from Equifax reveals.

It claims that young people are setting themselves up for a poor retirement with women potentially most at risk.

Some 50 per cent of 18-25 year olds already have over £5,000 of short term debt and 33 per cent of this age group that have a mortgage, have borrowed more than five times their salary.

With this group of consumers being the most vulnerable to job change, combined with the high risk of further interest rates rises, Equifax is warning that they could find themselves in serious financial difficulties.

Additionally, 75 per cent of 18-25 year olds do not have any form of pension. Yet with the debts already adding up, the survey suggests that borrowing is starting earlier than ever amongst UK consumers.

Equifax external affairs director Neil Munroe: “It looks like young people simply aren’t thinking about their financial future – even 10 or 15 years hence, let alone their retirement.”

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