According to accountancy giant PricewaterhouseCoopers (PwC), the amount of money consumers are spending beyond their means is to blame for the growing numbers of IVA applicants, website This is Money reports.
“People are simply spending too much,” said report author, PwC partner Pat Boydon.
“Expenditure in excess of income, with 83 per cent of those surveyed giving it as a reason, is the principle cause of failure, not loss of income or occupation, or marital breakdown.”
Results of the survey come after the government has released figures that show that the number of bankruptcies is at the highest level for over a decade.
However, whereas bankruptcies were previously blamed on poor trading or major crises such as a divorce, the rise in personal debt and poor financial planning by individuals are now cited as the chief cause.