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Personal insolvency rates continued to rise in Q3, representing the highest third quarter figure since 2010.
The figures, released by the Insolvency Service on Wednesday, revealed that there were 30,879 individuals entering either bankruptcy (4,122), a debt relief order (6,784) or an individual voluntary arrangement or IVA (19,973) in the third quarter of 2019.
Further, the statistics show that one in 365 adults entered a personal insolvency procedure in the rolling 12 months to the end of quarter three, being 30 September 2019, up from one in 382 adults in the rolling 12 months to the end of quarter two.
“As we predicted, despite already seeing near decade long highs over the last 18 months, personal insolvency numbers continue to rise and have exceeded 30,000 for the fourth successive quarter for the first time since 2011 and recorded the highest quarter three total since 2010,” said Alec Pillmoor, personal insolvency partner at RSM.
According to Mr Pillmoor, these figures are anticipated to increase further, with a recent YouGov poll revealing that 29 per cent of Brits expect their finances to actually get worse in the next year.
“Whilst there are certain macro and micro economic factors at work, particularly given the current economic and political uncertainty, personal insolvency numbers continue to indicate that despite high employment levels and low interest rates, customers remain over-optimistic when it comes to estimating their ability to meet repayment demands when they fall due,” said Mr Pillmoor.
“Looking into the numbers, we continue to show concern at the steady rise in the proportion of personal insolvencies affecting the 18-25 age group. We estimate this age group now accounts for over 7 per cent of the total insolvencies in a single quarter for the first time.”
He warned that with continued access to easy money and the prevalence of a cashless society makes it increasingly difficult for consumers to monitor their spending and maintain a budget effectively.