Starting a family causes 10% of serious debts

Updated: 

Andrew Matthews/EMPICS Sport


Whilst unemployment, illness and divorce remain the largest factors for debt, research by debt forum IVA.co.uk has revealed a surprisingly large number of people citing starting a family as another major factor.

The survey was conducted amongst members of IVA.co.uk, with debts ranging from £1,000 upwards, and 45% of whom had over £30,000 of debt. 10 percent of respondents said the costs of having children pushed them into debt.

Only 17 percent of survey respondents believe that they will eventually pay back all their debt by themselves. Over half say they have already tried to manage their debts themselves and have failed, while the rest moved straight to a planned debt solution once the problem became acute.

One third of those surveyed admitted to being 'very worried' and said that they 'think about their debts every day'. However, all of those who entered bankruptcy found it a final solution to their debts, and 97 percent of those who had entered an IVA believe 'it is working'.

The source of our debts

The largest group (51 percent) admitted that the easy lure of credit cards was the main factor in getting them into debt. Meanwhile, 10 percent cited the cost of children and the reduced income that having a family led to as the main reason for their debts.

11 percent said the cause of their debts was unemployment, business failure or reduced income, while 12.5 percent cited divorce as the major factor in their debts, with 2 percent of respondents saying their ex-partner has taken out a credit card without their knowledge.

An alarming number stated that easy credit when a student had led to a build up of debt – 8.6 percent said this was the reason for their debts.

The surprise statistics

Andy Davie, spokesperson for www.IVA.co.uk said: "It is clear that our respondents overwhelmingly turn to easy credit when life gets tough. Unsurprisingly, the triple disasters of unemployment, divorce and illness account for one third of unmanageable debts. However, it is more surprising that the happy event of children caused 10 percent of the debts in the survey"

He also expressed concerns over the lack of information about the financial strain of starting a family, saying it was a side "rarely discussed in parenting magazines."

He continued; "Perhaps Mumsnet and other similar forums should spend more time focusing on the hard financial realities of giving up work to have a child (or alternatively paying for childcare), rather than the softer side of starting a family?"

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