Keeping up with friends 'leads to debt problems'
Published On 17 August 2007
People in the UK are risking debt by overspending in an effort to impress their friends, new research suggests.Consumer website CreditExpert.co.uk found that one in five people in the UK are typically spending £5,874 a year more than they can afford in order to keep up with their friends, colleagues and family.
Over a quarter (26 per cent) said that they feel pressured to run up debts because they are embarrassed about their financial situation.
Around half (48 per cent) revealed that they end up overspending when buying presents for friends and family and a similar number said that feel they are forced into buying large rounds of drinks when out.
In total, the website calculated that people in the UK spend £45 billion a year that they cannot really afford.
"It's staggering to see how much we're overspending just to keep up with our peers," commented Jim Hodgkins, managing director of CreditExpert.co.uk.
"Spending beyond your means because of peer pressure can result in mounting debts which could lead to a bad credit rating and, unfortunately, if your credit rating is unattractive to lenders they will be less inclined to offer you credit."
Figures from Credit Expert show that total consumer debt in the UK reached £1.34 trillion by the end of June.
