Brits ‘repaying debts’ rather than saving

Britons have been paying back more money in an effort to work towards becoming debt free, figures have suggested.

Research by Unbiased.co.uk found that at the end of last year, UK adults were repaying £1.76 for every pound that they saved.

This compares to 66p for every pound saved at the beginning of 2008, before the effects of the credit crunch took hold.

The firm noted that the economic downturn has had an effect on the debt habits of Brits, with 2008 being the first year in the survey’s eight-year existence that the population paid off more than they borrowed.

During the course of last year, people repaid £38.6 billion of non-mortgage debt, a figure the company described as “staggering”.

“The financial turmoil which hit Britain last summer prompted a dramatic retreat from savings in favour of starting to pay down personal debt,” commented spokesperson David Elms.

Recently, a Norwich Union poll found that 75 per cent of Brits have become more “frugal” since the economic downturn.

By Jamie Price

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