Generation-Y keeping debt collectors busy

Young people account for the largest proportion of debt referred for collection, according to new Dun & Bradstreet figures.

Young people account for the largest proportion of debt referred for collection, according to new Dun & Bradstreet figures.

The data also shows that young men have higher average debt levels than females. The average value of debt for males in the June quarter was $1300 – a staggering 28% higher than for female counterparts.

D&B says men in Queensland, Victoria and New South Wales are increasingly finding trouble with debt.

More than half of the debt referred to debt collectors are for amounts less than $400, but D&B chief executive Christine Christian says this proportion is in itself a worry.

“Low-value debts are a cause for concern, and need to be taken seriously. Defaulting on a $400 bill demonstrates that consumers are in very serious trouble or they don’t fully understand the consequences of missing payments. Every credit commitment must be taken seriously.”

Consumers aged between 18 to 24 have the highest average debt value, with $825 of debt, an increase of 10.5% from one year ago . Those aged 65 and over have the lowest average debt value at $485.

Consumers in NSW, Victoria and Queensland account for a combined total of nearly 80% of all debt, while NSW consumers have the highest average debt levels at $800.

“That more than half of all debtors are younger than 35 is a sign that this group in particular are experiencing significant debt stress,” Christian says.

“The current economic climate is making it increasingly difficult for consumers to manage their budgets, and as we approach Christmas it is even more tempting to spend without thinking about the consequences.”

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