R3: Almost half of adults in Scotland worried about current debt levels

Richard Bathgate

This is notably higher than in April last year, when 35 per cent of adults in Scotland said the same thing.

In Britain, 40 per cent of adults say they are worried about their current level of debt, a figure which has grown from 34 per cent in April 2018.

Overall in Britain, half (48 per cent) of adults who say they are worried about their current level of personal debt cite credit cards as worrying, followed by overdrafts (18 per cent), mortgage repayments, bank loans (both 16 per cent), and loans from family or friends (14 per cent).

The percentage of adults in Scotland who say they do not have any savings at all at the moment – a quarter (23 per cent) – has increased slightly since April last year (20 per cent). The relatively large numbers of people without savings is of concern, as the volume of outstanding consumer credit has been growing ever since the end of 2012.

Nearly half (47 per cent) of adults in Scotland report that they often or sometimes struggle to make it to payday, higher than the figure for all British adults (40 per cent), and greater than the proportion of adults in Scotland who said the same in April 2018 (33 per cent).

In Britain overall, people who said they struggled to make it to payday named the cost of food (52 per cent), household energy costs (excluding petrol/diesel) (42 per cent), fuel or transport costs (35 per cent), and making credit card repayments (24 per cent) as the key reasons they struggle financially.

Richard Bathgate, committee member for R3 in Scotland and partner at Johnston Carmichael, said: “The picture painted by our research of people’s personal finances in Scotland is quite a concerning one, with the proportion of people who say they are worried about their current level of debt having ticked up since April 2018.

“Unemployment rates in Scotland are at a record low, but with many Scots reporting that they don’t have any savings, it appears that levels of financial resilience are lower than they should be. The figures on the proportion of people who say they struggle to make ends meet until payday back this up – too many people are short of money at the end of each month which makes getting an unexpected bill challenging to deal with.

“The rises in minimum wage levels this April will bring a measure of relief for lots of people, but will be partly offset in some cases by the increase at the same time of automatic pension enrolment contributions. With wage growth having trailed inflation for a long period, there’s still a lot of catching up to be done before the difference is felt in people’s pockets.

“The downturn in Scotland’s personal finance indicators is worrying, and indicates that too many Scots are using credit to deal with money woes. Anyone in this position should talk to a regulated and professional advisor, and get appropriate help and support – there is always something that can be done to help, once that initial step to speak to someone has been taken.”