In this world of instant finance, it seems that everyone is in debt, but where did it all come from? When did it all start? And we are not talking about mortgages! 

Over the last 20 years we have seen a gradual increase in personal debt all over the world, and while many people are having trouble financing some of their debts, it seems to be on the up and up.  When you consider that one of the recent growth markets in the finance industry was advice on Bankruptcy and Individual Voluntary Arrangements (before the rules changed), you may well get the picture.

So how far back can we trace the build up of debt, and who’s fault is it?

While it has always been easy to obtain debt for the masses, whether via credit cards, loans, etc it seems that many people joined the slippery slope with such a simple thing as an interest free overdraft.  These have been dished out by the banks to almost any customer which they have come across, in the knowledge that it can lead to many more lucrative sales. 

We have seen massive increases in overdrafts which incur a monthly charge as well as an interest payment.  Many of these will lead to personal loans when they get out of hand, or even push the customer towards the credit card market.  Once they are in the clutches of the credit card industry, the ease with which a card can be used seems to appeal to the masses.  Slowly but surely larger and larger amounts are left unpaid at the end of each month, as slowly but surely the interest payments rise.

When people are in employment they are very often able to service their debts at a struggle, but with the property market showing signs of cracking, and the economy set to fall back next year, the UK consumer may be about to hit the buffers.  There have been numerous calls for debt to be curbed but the banks just keep releasing offer after offer and offer. 

Judgement day is coming for many, and while the banks will squeeze as much out of you as possible, the customer will be the one who suffers most, with their credit rating tarnished forever, and worse.  However, at the end of the day, it is for the consumer to say no, to look at their finances and see that trouble is brewing, but as they say “its easy to make hay while the sun is shining”.