Young people are burdened with stifling levels of debt

(Johnny Green/PA)

If you're struggling to stay out of the overdraft and have amassed a fair chunk of debt, you're not alone.

A new generation of young people are burdening themselves with "stifling" levels of debt, Citizens Advice has warned, after seeing the number of requests for help from this age group surge by a fifth in a year.

Across England and Wales, people aged 17 to 24 have asked the charity for help with 102,296 debt issues in the last year – a figure 21% higher than the previous year.

Citizens Advice also said its analysis of official data, covering the UK as a whole, found that young people have £12,215 of "unsecured" (non-mortgage) debt on average, more than three times the average £3,988 debt just before the financial downturn between 2006 and 2008.

There have also been changes in the types of loans they are shouldering.

The charity said that while much of the debt rise is due to student loans, there has also been an increase in "formal" loans such as bank or payday lending, as well as borrowing from friends and family.

Between 2006/08 and 2012, there was a fivefold increase in the average size of a formal loan debt, from £969 to £4,577. Loans from friends and family rose from an average of £30 to more than £1,000.

By contrast, the average credit card balances of this age group decreased from £332 to £234, the charity found.

Citizens Advice said its own data shows other age groups are twice as likely to go to the charity with credit card problems than 17 to 24-year-olds.

The charity said it also helps a higher proportion of young people than older groups with debt relief orders (DROs), which are a type of formal personal insolvency often taken out by people who have run up consumer debts they have no prospect of paying off.

Gillian Guy, chief executive of Citizens Advice, said: "A new generation of young people are starting out with stifling levels of debt.

"Many young people already face challenges getting on the career and housing ladders – doing this while saddled with huge unsecured debts makes it an uphill struggle."

(Rui Vieira/PA)

Joanna Elson, chief executive of the Money Advice Trust, the charity that runs National Debtline, said the country is "facing the very real risk that debt becomes the norm for young people".

She said: "We need to do more as a society to give all young people the skills and knowledge to manage their money well, and to know where to turn for free advice when they need it."