Millions of Brits 'permanently overdrawn'

Millions of consumers in the UK are living off their overdraft, new research has revealed.

According to the study by moneysupermarket.com, five million Britons are permanently overdrawn, with one in ten using their overdraft for all their day to day financial outgoings.

This is an improvement on a year ago when 17 per cent of respondents were permanently overdrawn, with only 38 per cent of people falling into the red in the last 12 months, compared to 52 per cent in 2009.

Kevin Mountford, head of banking at moneysupermarket.com, said: "Whilst it is encouraging to see less and less people reliant on their overdrafts, we should be concerned that there are still such a large number of people permanently overdrawn."

He added that with inflation on the rise, it is likely to prove difficult for many people to get out of the habit of being in the red and more consumers may find themselves in this position as living costs increase.

It could be said flats to rent in Hammersmith or another art of London offers Britons the chance to get back into the black, as such property is typically cheaper than similar homes to buy in the same area.

Renting a home could also give people a chance to save, with NS&I recently revealing the average Britons first begin to think seriously about putting money to one side at the age of 25.

Written by Ben Carter

Published 24th February, 2010

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