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Do you know what really causes bad debt?

Surprising CCCS findings explode debt myths

There is widespread public misunderstanding over the causes of bad debt, according to new research published in the Consumer Credit Counselling Service‘s (CCCS) statistics yearbook.

Bad debt: pay cuts and job losses rather than overspending are the main causes

The infographic below shows the difference between public perceptions of the causes of bad debt, compared with the reality as reported by CCCS clients.

Which? credit and debt expert Martyn Saville commented: ‘This new infographic from the CCCS explodes the myth that anyone struggling with problem debt has brought it on themselves through overspending. By far the biggest effect comes from unexpected “life shocks” such as unemployment, bereavement or divorce.

‘In an ideal world, everyone would have income protection cover to get them through difficult times, but this just isn’t affordable for many people. Thank goodness there are free, independent debt advice organisations such as CCCS, National Debtline, Citizens Advice and Payplan that can advise and help consumers struggling with debt or who are hardest hit when disaster strikes.’

CCCS causes of debt infographic

Which? borrowing and debt advice

For more analysis of the figures in the infographic above, you can also read and comment on a new blog post by the CCCS’s Peer Lawther on the organisation’s Moneyaware website.

If you’re struggling with debt, read the Which? guide How to deal with debt, including 10 reasons you should never use a commercial debt management company.

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