The latest statistics from the Insolvency Service show that insolvency rates in England and Wales among 18-34 year olds are growing faster than any other age group.
The figures show that in the 18-24 age bracket, the number of cases per 10,000 people grew from 6.4 in 2015 to 9.1 in 2016, while in the 25-34 age group, there was an increase from 23.4 to 29.9.
The overall number of personal insolvencies per 10,000 people in England and Wales also rose in 2016 for the first time in seven years. In total, there were 19.7 personal insolvencies per 10,000 adults in England and Wales, up from 17.6 in 2015.
The figures also show the insolvency rate for women was higher than men for the third successive year last year.
Commenting on the figures, Alec Pillmoor, personal insolvency partner at RSM said:
‘Worryingly, these latest figures indicate that the 18-34 age group has shown the largest increase in personal insolvencies. For this new generation of borrowers who have never experienced a rate rise, the concern is that many are not budgeting for the potential increased costs of repayments on loans, mortgages and car finance deals. With the prospect of a rise as early as this year, this could spell trouble.
‘In the last few years, we’ve also seen a developing trend whereby more women than men are entering into some form of personal insolvency. The numbers don’t tell us why but there could be a number of factors at play such as the increasing financial independence of women, different spending pressures or gaps in periods of income.’