- Households with unsecured debts (like credit cards and loans) spend an average of £259 a month on them.
- In debt hotspots, 16% of income is being spent on repaying unsecured debts.
- In the most debt-laden area of the country, those with debts owe an average of £4,623 – compared to £1,675 in the areas with the lowest debts.
- The more we earn, the more we owe – so households containing the top fifth of earners have average monthly debt repayments of £415 (excluding the mortgage), while the lowest fifth have £73.
- In November, the annual growth rate for all consumer credit was 8.1% and for credit cards it was 12.1% – the highest since January 2024 (Bank of England).
Figures from the HL Savings & Resilience Barometer, September 2025 (except where otherwise stated). If you want to know more, please ask. It’s not a survey we do, it’s some very detailed and complex analysis, and if you’re ever looking for a data point, there’s a good chance the Barometer has one.
Sarah Coles, head of personal finance, Hargreaves Lansdown:
“Debt becomes more of a pressing issue for millions of people at this time of year. The UK already borrows hundreds of billions of pounds, but the extra cost of Christmas can tip the balance, so debts become a major concern and repayments take a horrible toll.
Debt hotspots
These debts aren’t held equally. Partly because it’s easier to borrow when you’re on a higher income, and partly because those on higher incomes are more confident they can afford repayments, the Barometer shows that the more people earn, the more they tend to borrow. Those on lower incomes will tend to fall behind on bills rather than running up major consumer credit debts.
It’s why the debt hotspots, with the most monumental piles of debts, include well-off areas in the South West. It’s also why those with the smallest consumer credit debts are in the North East, and parts of Wales, where for many, money is tighter.
For a clearer picture of those areas where debts are more of a strain, we can look at the percentage of people’s income which goes on debt repayments. This reveals some debt hotspots. There are several within commuting distance of London. Here, pay is higher than the national average, but outgoings are also high in the commuter belt, and as a result, consumer debt repayments make up an eye-watering proportion of income.
Those at the very top of the income tree may well buck the trend, because their incomes are so high that it’s hard to spend it all – let alone run up debts. It’s one reason why debt repayments are a smaller proportion of income in incredibly wealthy areas – like Kensington and Chelsea, and Westminster, where repayments make up an average of 7% of income. However, this is followed fairly swiftly by areas where incomes tend to be lower – including Newcastle Upon Tyne, Hackney and Middlesbrough, who are spending 9% of their income on repayments. In many cases, this owes something to those on lower incomes not being able to borrow significant amounts of money.
The impact
Earning more doesn’t make your finances bulletproof. In fact, running a household with higher income, spending and debt makes you less resilient if your circumstances change.
When you’re carrying significant short-term debts, interest rates tend to be much higher than on your mortgage, and compounding is working against you. Every month, you’re paying high rates of interest, and then paying interest on your interest, so the costs really mount up.
It can tie up such significant sums that it means you have less money at the end of the month, and less available to save – denting your short-term resilience. It also means you can fall short on investment and pensions, so you pay the price for life. It means even if you feel you can handle your debts, it’s worth taking five steps to get on top of them.
5 steps to clear your debts
- Know what you owe
This includes credit cards, overdrafts and buy-now-pay-later deals as well as loans. Keep a note of the minimum repayment for each so you don’t fall short – but you need to be doing much more than the bare minimum.
- Commit to repayments
Work out what wiggle room you have in your budget for repayments, and commit to them on payday – before you have a chance to spend the money elsewhere. It makes sense to automate repayments, so direct debits wipe out your debts without you having to remember to do the right thing.
- Make a plan
If you can’t repay in one fell swoop, you need to prioritise. It’s a good idea to pay the debts with the highest interest rates off first, which is known as the ‘avalanche’ technique. It means you’re spending less on interest payments, and more repaying the debt.
- Consider consolidating
If it’s going to take a while to clear, you can open a card that’s interest-free for balance transfers – so you don’t waste money on interest in the interim. However, you need to be very careful. The temptation will be to use it as a chance to build up debts elsewhere again. This should be a step towards clearing your debts, not a chance to make them worse.
- Don’t use debt repayments as an excuse
They should be a priority, but if you regularly fall into expensive short-term debt, don’t use it as an excuse to neglect other parts of your finances. You should be paying down those debts, but also considering emergency savings, building investments and your pension at the same time. That way you can build more financial resilience for every stage of your life.”
Debt hotspots: areas with the highest debt repayments as a percentage of income
Debt notspots: areas with the lowest debt repayments as a percentage of income
Areas with biggest debts
