Problem debt among women is rising

Debt levels are rising amongst women, as they rely on credit to fund their lives. This leaves them vulnerable and in a cycle of debt, causing both mental physical health issues, according to a new report conducted by the Debt Advisory Centre.

Low incomes and family breakdowns are now forcing almost 70 per cent of women to borrow money to pay for lifestyle choices, such as holidays and clothes, or to cover essentials such as food, heating and housing.

The study showed that one in ten women has at least £10,000 of debt, while the average amount of unsecured debt amongst women stands at £4,235 – the highest levels being among those under the age of 45.

Credit cards are the most popular form of money borrowing for women, with 53 per cent admitting to having at least one. The biggest reason women use a credit card is to pay for housing, utility bills or food shopping, with a quarter of those relying on credit cards to cover everyday living costs.

A further 14 per cent have a store card, with a similar number paying by instalments when shopping from catalogues. Around ten per cent of women take cash advances on their credit cards when their regular income runs low.

Worryingly, almost 80 per cent of women admit that debt is now impacting their lives negatively. Two-thirds said their physical and mental health has suffered because of debt stress, with the worry also impacting relationships with family and friends and low credit history preventing job offers.

"For a growing number of women who are using credit to fund their lives, making debt repayments has become unmanageable. Typically having lower pay than men, being more likely to take time away from work to care for families, and unexpected life events such as relationship breakdowns or redundancy, is impacting women’s ability to successfully manage money," the report stated.

A third of women admit to falling behind with payments on unsecured credit and household bills due to having a low income that isn't sufficient to cover costs. Almost a fifth of those in arrears are at least four months behind with their payments. The biggest causes of arrears are failure to budget, a fluctuating income, ill-health, becoming a mum and relationship breakdowns.

Single mums tend to see the greatest impact of debt. 53 per cent of single mothers say they regularly can only just afford debt repayments or fail to make them, compared to just 29 per cent of married mothers.

In addition, two-thirds of single mothers with problem debt have faced mental health problems – the largest number across all demographic groups questioned.

Of the 2,500 women questioned, 30 per cent said that money is the aspect of their lives that causes them the greatest anxiety – more than their health, family, appearance, work or relationship.