Less saving and more debt

I see many stories about how personal debt is increasing in the UK. The Office for National Statistics confirms this in this section of their site. From the 2nd quarter of 2004 until the 4th quarter of 2005 the levels of gross saving was going up. Since the beginning of this year it's gone down by a certain amount each quarter - which is worrying, considering spending is on the increase.

If people save less, they won't be able to afford as many things that they want - it's simple logic. If people still want to get things - they'll then get loans. However, if saving is going down - how can you repay the loans? I certainly can't answer that question.

The following quote is from Credit Action:

"Total UK personal debt has exceeded £1 ¼ trillion and at the end of October 2006 it stood at £1,268bn. The growth rate increased to 10.4% for the previous 12 months which equates to an increase of ~ £110bn.

Total secured lending on homes has exceeded £1 trillion (£1,000 billion) and at the end of October 2006 it stood at £1055.9bn. This has increased 11.3% in the last 12 months."

Yes, there's an increasing population - that would affect total debt figures. However, it is still very worrying that it's going into the trillions. This graph show debt statistics for the UK since the end of 1993. It shows not only that there is a massive increase in consumer borrowing, but also that there's a fairly large increase in borrowing using a credit card.

There are definitely a lot of people who can repay debts, but with the increases in lending highlighted above, there's will probably be an increase in the already large amount of people who can't cope with debt.

I'm really worried about this and I hope the population realise that heavy borrowing isn't going to solve anything and that they should save before they spend.