How will the interest rise affect you?

Consumer debt has reached a new high with Britons borrowing a record £10.7bn last month.

The Bank of England has increased interest rates by a quarter of a point to counter the debt boom.

Official figures showed that the credit surge was driven mainly by mortgage lending.

Bank of England policymakers hope that raising rates will slow down galloping debt levels and house prices.

How will the increase in interest rates affect you? Have you been borrowing beyond your means? Email us your experiences of debt boom and gloom.

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This debate is now closed. Read your comments below.

Your reaction:

Don't live beyond your means Deborah Chan, UK

I migrated to the UK from S.E. Asia with £400 cash in my pocket. It was not before another three weeks that I got my first month's salary. It was just before Christmas so I had to get warm clothes, pay for transportation (to work), accommodation and food, etc. In order to get by, I ate twice a day (home-cooked) and tried to get the cheapest of everything. Eight years on I have got 12k savings and I can enjoy good quality things (but not necessary designer labels), holidays, social life, entertainment etc. I have never borrowed money and always pay my bills in full. My experience is: don't live beyond your means. I hope the interest rate can rise to a more reasonable level.
Deborah Chan, UK

All the signs have been there for several months for a major rise in interest rates and the end result will be unemployment and recession. Those with any sense have already curbed their borrowing and started saving for when things get tight.
Fred, England

Interest rates are at a 48 year low and have dropped 50% in only 3 years. If people are getting into difficulties now what on earth were they doing 3 years ago?
Tony Peel, UK

I'm worried where interest rates will be in a few years time when my fixed rate period ends. We should be able to lock in a fixed rate for 25 or 30 years as in other countries so that we aren't exposed to wild fluctuations in interest rates.
ML, England

As a lot of students in my position, I am over £20,000 in debt. £12000 to the SLC, £6000 to a bank loan, and £3800 on credit cards. How often do I go to clubs? Most nights actually. Until recently I have been working 5 nights as a doorman at various pubs and clubs along with anything up to 40 hours a week in a shop during the day. This is all during my final year as well! I don't think students should get a free or easy ride, but I do think that the level of support provided by the government and local education authorities is disgraceful. Unless your parents are either really rich, divorced, or dead, then don't bother with uni. It's far too expensive!
Pete,UK

We only use a credit card in an emergency Ian, England

By forgoing luxuries and "toys" we only have an 'affordable' (ie:2.5 times income) mortgage to pay back, no loans (anymore) and we only use a credit card in an emergency. As for the rest, if you can't afford it don't buy it! But we shall be penalised because of irresponsible banks and shopping addicts. Tell us please, where is the incentive to be sensible with money?
Ian, England

It amazes me that everyone so far has gone on about self. This probably explains the mess the UK gets into over debt. No one comments on the effects on manufacturing, or how poorer areas of the UK have to suffer for overheated parts.
Bruce, Scotland, UK

Having a single weapon of Bank interest rate seems very crude and unbalanced. Industry need low interest rates but that leads to house inflation. If house inflation is a problem then slow price rises by a tax on house moves e.g stamp duty so that business is not affected. Targeted tax rises are far more equitable than blanket broad-brush strokes
Tony Mitchell,UK

Thank you Bank of England, just make it even more difficult for us first time buyers to get in the property ladder! Is there anything in this country we don't have to pay through the nose for?
Chris Ashbey, UK

Low interest rates and low inflation have not had the promised good effects Stephen R, UK

Low interest rates and low inflation have not had the promised good effects - stock market performance has been rotten, house prices have rocketed and industry has cut costs by sending jobs to cheap labour abroad. Credit card companies never brought their rates down low and banks usually lend at much higher than base rate. Higher base rates even up to double what they are now will not be disastrous - people might just be a bit more careful, which is no bad thing.
Stephen R, UK

In the past, I have always saved to get what I want unless you get 12 months interest free credit by which time I make sure I have paid off what I owe. That way I didn't feel I was wasting money and I really valued what I had bought. Now I own my own house and I haven't really bought anything that before I would have 'needed' because I refuse to get in a spiral of debt. Agreed, if no one spends any money, then we are all in trouble, but strike a balance people!
Sandy, UK

Here it comes. The Bank policing interest rates when it derives income from same is criminal. Having encouraged borrowing by lowering rates, it is now set to cash in by raising them again. Did nobody else see it coming??
Terry Taylor, England

No I have not been borrowing more than I can afford. I got stung in 1992 for which I am still waiting for compensation. However this time round there was not excuse and anyone caught out this time has had to have been short-sighted. I am just waiting for the crash and sanity.
Tony, Welling, Kent

Having lived through periods when base rates routinely went to double figures for long periods of time I cannot see why small rate rises like this could cause this much panic. By all means raise the rates to bring down the debt levels and maybe people will learn that what you borrow you eventually have to pay back.
Dave, UK

Increasing interest rates to discourage people isn't the answer H Stiles, England

I think it's pretty obvious this country has a debt problem. People are going on more expensive holidays, buying more expensive consumer items and the reason for this is simple. People think in terms of monthly outgoings not in terms of total amount owed. You want a nice new car? No worries, you can get one for only £300 a month. Increasing interest rates to discourage people isn't the answer - you'll trigger a housing crash and massive numbers of people defaulting on secured loans, which will directly increase the burden on the welfare state, leading to yet more tax rises to pay for the increased social security expenditure.

This matter needs to be dealt with in a sensible manner. Credit companies should be physically barred from lending more money to people with more than a certain percentage of their net income as debt (mortgage maybe excepted). This issue needs to be addressed in a way than benefits the public, not private enterprise.
H Stiles, England

Debt does not directly impact me, but its consequences do. As an individual, I'm concerned about the levels of private debt, and the ease of borrowing. I'd love to see interest rates go up, so that the value of my investments goes up and some sanity is restored to the housing markets. As a business owner, however, the last thing I need is sustained upward pressure on interest rates, which depresses demand and prevents other businesses from buying the services my company provides.
John,England

If everybody saved then the country would collapse - fact. It is no good having savings that are never spent. Debt is always relative.
R.C. Robjohn,UK

What you must ask yourself is, 'do I really need that or do I only want it after it's been hyped up by the company trying to sell it to me!' People must not lose sight of life; it's not about how much you earn, how big your car is, or how much your shirt is! Look around you and take in your surroundings, appreciate what you have and don't try to aspire to something that someone else wants you to be!
John S,UK

I'm just making sure that I haven't got to save for years on end to afford what I need now Ian W,UK

Having just applied for a loan for £15k I feel I should make a point, A lot of people out there get into debt thinking of it as easy money and not looking into the fact that they are going to be expected to pay it back and rely on other schemes to get out of the debt. I'm getting into this debt of my own free will fully aware that I can pay for it, I'm just making sure that I haven't got to save for years on end to afford what I need now. Maybe others in this country should check that they can make the payments before they go using credit.
Ian W,UK

Personally, I hope rates go through the roof so that my limited savings are worth having again. Then there are a few smug homeowners I know who I'll go up to and say "hey, just look how much less I need to buy a house this month - isn't that great?".
Mick,UK

Debt is a self made situation; simple answer is don't spend what you don't have. Its a mugs game - Oh yeah and the government are not there to bail you out either.
Stuart, UK

It would be nice if people would only borrow what they aren't going to default on. The Bank of England can influence the rates we receive, but it is ultimately the market that drives rates. If too many consumers borrow too much money and then default on it, the banks have to charge higher rates because of the lower likelihood of getting their money back. Please don't default, as I don't like having to pay for someone else's sins.
Graeme Phillips, Germany, normally UK

Now at last my savings will make some money...or will the never-never mob drag us all down. Interest rates, the higher the better!!
Colin Harrison, England

In all, people in this country should save more and borrow less LIANG JI, China

I guess it's all down to the consumer mentality here. People in the UK, through my observation having lived here for five years, are encouraged to spend on a daily basis. Apparently, its called consumerism and it's good for the economy because companies will make more money hence more jobs. Therefore, if you don't have the money, borrowing is good as long as you keep spending and can pay it back on time. Banks and Loan companies call it credit, which not a long ago was called DEBT. People should know what appears on the balance sheets of banks and loan companies as ASSETTS are your liabilities. In all, people in this country should save more and borrow less.
LIANG JI, China

No credit card debts, no outstanding loans, a mortgage of a third my property's value and less than double my base salary. No problemo, but I made a decision not to wear designer clothes, drink in the "top" nightspots every evening or drive a brand new car.
John B,UK

I'm on 31k but that's only because I work down south, and my outgoings per month are ridiculous as I'm paying rent for a bedroom during the working week, with extortionate petrol prices on commuting (I'm soon to get a diesel!) and also paying about £600 per month on a rented two bed flat back in Birmingham with my girlfriend. I'm not struggling to pay my debts but with my circumstances I have no choice in spending MOST of my money I earn to LIVE in this world. I really would love to have my OWN home to do what I WANT to it but I just cant afford one now and as far as starting a family, I cant see that happening in the near future.
Stu, UK

I think low rates and new house building at an all time low are sustaining this boom. Everyone I know is buying additional property, even at these silly prices in the hope of making money through buying to let. Now if that isn't the making of a bubble, I don't know what is. However, I think gradual increases in the base rate could get the country of the hook? What do others think?
Ash, UK

Quite simply, my family has a budget and we stick to it Tim Rollinson, UK

Fortunately for us, we have no debt. Quite simply, my family has a budget and we stick to it. We enjoy the limited pleasures we can afford and are philosophical about some of the things that we would like to do but cannot afford! One thing is for sure, we look beyond marketing and advertising to obtain the true lifetime cost of a product. This brings true benefits in terms of what we own and in particular our health and allows us to be firmly in control of our own lives. We recommend it to everyone.
Tim Rollinson, UK

A lot of people seem to think student debt mainly goes on beer. I would like to show how that view is incorrect at the good institutions where you actually have to work:

Textbooks (unless lucky enough to get library copy): £400-£600/year
Self catering halls accommodation: £3,600/year
Tuition fees: £1,125 /year
Lab books: £20 /year
Paper, pens etc.: £50
Economy food: £200+ /year
Minus student loan £3,700
Minus summer work <£2000

Leaves minus £108 for social things.
Chris, UK

Staying out of debt is simple, if you hard work. Going to the pub with friends? - drink tap water, it's free. Spotted some nice clothes you'd like? - wait until your present clothes have holes too big to be mended. New CD just out? - listen to the radio instead. Don't spend unless you absolutely have to. It got me through uni with only £2k of debt. And yes, I ate economy baked beans on a jacket potato most of the time.
AH,UK

I see a lot of these comments are from people using their children as an excuse to get into debt. If you can't afford to have children then don't have them, no-one forced you. I don't have any credit cards, and the only debt I have is my mortgage. By the way, I don't have any children and neither me or my husband want any, we've seen to many of our friends struggle and split up because of money problems and children.
Rachael, UK

I think we live in a society now where we always have to have the best of things Yvonne, UK

My partner and I are both in our late 20's; good jobs, but that doesn't mean they pay well. The only debt we have is the mortgage; we have 4 credit cards between us which we pay off monthly. I was brought up with mentality "don't buy what you can't afford" and it seems to have stuck. A lot of my friends are in debt - not badly, but enough to worry. I think we live in a society now where we always have to have the best of things... and that means more spending (cars/houses/lifestyle).
Yvonne, UK

There should be absolutely no restrictions on lenders and credit card companies. Just because a few people cannot see that allowing expenditure to exceed income is a recipe for disaster is no reason to penalise the sensible majority. If you can't afford something you want, save for it. If you can't save, you definitely shouldn't even think about borrowing.
Kulu, UK

If all these correspondents on high joint incomes have trouble affording property and living costs what chance do minimum and low wage earners have of staying out of debt? They have to live also. It's ok to say don't spend what you don't have, but what if you have nothing to start with?
James Crowther, UK

You can say "don't borrow money", but nobody would own a house without a mortgage. Then when you get a mortgage, you are careful, and get insurance against unemployment. Then when you lose your job, the insurance department of the bank pay out nothing for eight months - but the mortgage department of the same bank take court action to repossess your house in the meantime. Now, there's being careful about money and then there's being paranoid. But as the saying goes, "just because you're not paranoid doesn't mean they're not out to get you." Not everyone in debt is there because they are stupid, or because they didn't plan ahead.
Simon Richardson, UK

People should have learned their lessons from the last period of high interest rates Ian, UK

People should have learned their lessons from the last period of high interest rates. Borrowing to the maximum of what you can afford when rates are low is sheer lunacy - you should have set your limits based upon reasonable historical rates and made better use of the spare income. I did and paid my mortgage off early. Higher interest rates benefit us all if we are sensible - lower house prices and higher income from savings which in the long term lead to higher pay rises all of which combine to reduce the proportion of ones salary that is used to repay long term loans and mortgages.
Ian, UK

Ian is right. Higher interest rates are an indication of higher inflation. Low inflation is not good for the homeowner or the saver because inflation eats into your debts in real terms lowering them and inflation also raises interest rates seemingly giving a better return on savings. Additionally to this, you get better pay rises.
Kev, UK

My husband and I left University with large debts and worked to pay them off. We made some money on the stock market and also from the sale of our previous house. Even though we have a joint income of £80K we can't find a house that seems to be worth the inflated prices that low interest rates have thrust upon this country. We are therefore renting a fabulous house for very little per month and enjoying a quality of life that would not be available to us if we scrambled to get on the property ladder now. We are saving a massive deposit for when we decide to rejoin the rat race but right now we are enjoying been debt free!
Jessica, Scotland

In response to Rich, I don't know your experiences but changes in circumstance can be accommodated with some care. In a period of 18 months our baby was born and my wife died. We were not burdened with debt before the baby (80% mortgage only) and this was being paid off faster than necessary. My wife did not return to work after our baby was born so we lived on my salary (nothing spectacular) and still paid off the mortgage faster than necessary. We lived by the maxim that if we couldn't afford it in cash we didn't have it. We were, and still are, well fed, clothed, and warm. What more do you need?
Ant, UK

You don't think about the consequences that much when your kids are hungry Dan O'Brien, United Kingdom

You don't always have much of a choice. What do you do when you have no money because the benefits are screwing you around, and your bank is offering you credit cards? You don't think about the consequences that much when your kids are hungry. Don't tell me people with credit cards are stupid. You obviously haven't been in real need.
Dan O'Brien, United Kingdom

We spend too long working to pay debts for things we don't need to impress people we don't like. I don't want to see a rate rise because I have a mortgage. We need to stop borrowing on things that don't appreciate and also not be greedy with the "I am OK. No mortgage and renting other places out. Let rates rise, my savings will love it."
Richard, UK

I am a credit card company's nightmare customer. I have just one card which I pay off in full each month, so I never pay any interest. They give me 0.5% cash back on everything I spend. I cost them money! In the past I got into the spiral of having more on the card than I could afford to pay off. I learnt my lesson. My only debts now are my share of the mortgage and a low-rate car loan.
Lisa T,UK

The difference in cultures is amazing. Where I come from, only about 30% of people own property and debts are something that is utterly to be avoided. Nobody spends money they do not have, and in return the German consumer market is utterly struggling, with a knock-on effect on the job market (although the country is now the biggest exporter of goods in the world, even before the US). In contrast, the rapid rise in house prices has resulted in a boom of the British economy that is almost entirely consumer driven. People buy buy buy. Where does this end? I live by the best of both cultures: I own a house that is already partly paid off, has doubled in value and I have no consumer debts. I actually wish the interest rate for my savings were higher.
Conny, UK/Germany

An across-the-board rise in interest rates will help nobody (except the bailiffs) Phil, UK

An across-the-board rise in interest rates will help nobody (except the bailiffs). There is no justification for stinging those of us who have already borrowed, just to stop others from borrowing. The answer is to squeeze how much is loaned in future, not to throw existing mortgage payers out of their houses. This would require restraint on behalf of the lenders so I can't see it happening.
Phil, UK

Are our memories so short or are new mortgage applicants generally less than 25years old? The last collapse of property values was in 1990-92 and was triggered by rocketing interest rates on borrowing. Many thousands of homeowners defaulted on their mortgage payments and lost their homes and savings. History is about to repeat itself and it is really too late to warn the many homeowners who have extended themselves to the limit financially. Even a small increase in Bank of England interest rate will prick the property balloon, panic the flock of sellers and stop potential buyers in their tracks. Is there someone we can blame for our short memories or youthfulness?
Bernard, UK

As a family, we had debts. Not through extravagances, just trying to bring up a family. We moved to a smaller house a few months ago. Made a profit, cleared the debts and now pay half the council tax. It is a nicer house too. "Let money be your servant not your master"
Ian, UK

To kill off this massive borrowing binge, just like after the last property boom interest rates have to go up substantially, not by Mickey Mouse amounts. Here in NZ where the interest rate's 5% and mortgages are around 7% and like the UK NZers are heavily in debt with a runaway property boom - I reckon the interest rate need to double! To bring people down to earth. I don't own a house and do not have any debts... am awaiting a spectacular, mother of all property crashes...
Charles Waddams, New Zealand

It all fell apart, I lost my job and was unable to pay any of the outstanding debt Joanna, UK

I do find it strange how some people find debt to be amusing. Well I can say for definite it is not. I used to have the attitude that it did not matter, it would all work out in the end. Then it all fell apart, I lost my job and was unable to pay any of the outstanding debt. In the end this leads to CCJs, Debt Collectors, Depression (which makes it even harder to get a new job to recover) and a sense of despair. So do yourselves a favour, avoid debt now and avoid what happened to me.
Joanna, UK

My girlfriend and I met at university, and graduated a couple of years ago with a combined debt of almost £30k. Our total household income is just over £32k before tax. You do the maths!!
Adam, UK

I was stung once when I was younger, losing my job a few weeks after taking a holiday on borrowed money. Since then, I've wised up, and become a believer in "if I can't afford it now, don't buy it now". Alas, too many people are getting caught in the "must have it now, pay for it later" which as the expression goes, is just borrowing from your future self.
Martin, England, UK

There is a role for credit but how can it be morally acceptable to lend money to people (and unfortunately this includes at least a third of the British public) who don't understand the basics of how compound interest works? Before taking out a credit agreement borrowers should be required to prove that they have sufficient mathematical qualifications to understand what they are getting themselves into. I could also ask why we allow the same, innumerate, people to vote thus imposing their borrow, waste and wait for someone else to pick up the bill lifestyle on the rest of us.
B Essada, UK

There seems to be two types of people, those with no debt (me) and those with loads - this makes the average more scary as it is concentrated on a smaller population than imagined. I've never borrowed a penny- and with the exception of a possible mortgage (after crash natch..) I never will.
Wendy, UK

Debt is misery, plain and simple Graham, UK

Debt is misery, plain and simple. If at all possible it is worth trying to do without things for a while in order to be free of it. It is very annoying for poor people to listen to rich people telling them this however.
Graham, UK

It's obvious something is wrong when a standard three bedroom semi ex-rental council house is on the market for 200K! Going on a borrowing figure of 3.5 x annual salary! You'd need to be earning 60K a year to get a safe mortgage! Bring on the rate rises & watch the bubbles burst!
Tim, UK

By allowing house prices to spiral ever upwards the Government, of either colour, has a ready made method of controlling inflation by tying up surplus spending power in telephone number house values. Those who borrow on credit cards are just plain stupid.
Barry P, England

I've paid off all my debts. Including my mortgage and am now completely in the black. I'm hoping the interest rate goes up. If you can afford a credit card or a loan then you don't need it. If you need the card or the loan then you can't afford it.
Colin Smith, UK

I read this and other UK web sites and the all continually mention the level of house prices and debt. If my wife and I were to return to the UK, I would have to trade a four bedroom house in a nice area west of Toronto plus our condo up at the ski hills and be lucky to get a two bedroom flat in London (not that we would do that to the kids). Emigration is not for everyone I admit as you give up a lot, but it may be better than killing yourself to pay a huge mortgage in the UK.
Graeme, Canada

I have just qualified as a barrister. I guess that the general public thinks that that means I'm rolling in money. But instead I'm £10,000 in debt from student loans at uni and have a £15,000 bank loan for my law school fees, despite working part time throughout my studies. I want to practise in criminal law - the starting point is earning £10,000. Students today are in a worrying position and something urgently needs to be done about the escalating levels of debt that are faced by young people.
Anon

Not all debt is bad if one is responsible and doesn't squander the money on luxuries Msmo, London

I was told many years ago that there's good debt (mortgage, home improvements) and bad debt (credit and store cards). Based on this, we have built up a portfolio of rental properties from an initial investment of £4,300 just five years ago. Using mainly the bank's money via remortgaging and having our tenants pay off the mortgages has been good to us. Most of our tenants are DSS to whom we provide a clean, comfortable and well maintained home. They benefit from a caring and responsible landlord and we benefit by having a "guaranteed" rental. We are soon to retire and will not be living off the state. Not all debt is bad if one is responsible and doesn't squander the money on luxuries that soon lose their value.
Msmo, London

I graduated in mid 2000 with five thousand pounds of debt, primarily by working long hours in a bar to minimise my credit exposure. By late 2002 I'd paid it all off despite earning only fifteen thousand a year. If you want to pay off your debt you can do it, just take each day at a time. I used own brand supermarket food, caught buses everywhere rather than running a car, and went out to the pub less than once a fortnight.

After a while I became increasingly alarmed at the materialistic nature of most people. We don't need most of these things that are being offered to us. A five year old car will often work just as well as a new car would for example. Before anyone asks, this working holiday has been paid for by savings, not credit. Learn to say no.
Alex, UK Expat enjoying a year long holiday in Oz

I have about ?80,000 worth of credit available. I owe about ?700. However because I have been the master of my credit cards and not become the slave they have worked very well for me. I have some times taken a ?10,000 advance via a promotional rate of 0% for 6 months. Paid that into my high savings account and paid back into the credit card account just before 6 months. Yes I agree credit cards are bad for banks with people like me about they have no chance of making money.
Phillip Baker, UK

Whole generation of students are having debts similar to mortgage debts Karel Herman, UK

Credit card companies/banks are charging interest rates of 400% to 500%above the base interest rate of the Bank of England. This greed will lead to an increase of the amount of bad debts where these institutions will lose out. Also a whole generation of students are having debts similar to mortgage debts.
Karel Herman, UK

People go on about the iniquities of credit cards, without realising they are the cheapest way to borrow, for up to six weeks. They should be primarily for spending without having to carry cash or a cheque book. If you know what you need each month and are able to pay it back, at the end, use a credit card, for an easy life.
Nick, Wales, UK

Henrik Ibsen said that "Home life ceases to be free and beautiful as soon as it is founded on borrowing and debt." He was spot on.
Richard, UK

My bank makes a big deal out of having an 'ethical' policy but they seem to have no scruples about trying to get people into debt. When I pointed out that I considered their actions to be immoral and hypocritical they soon stopped offering me large sums of money to spend 'any way I like'.
John M Johnson, UK

5 years ago I had got a loan for a car, loan to pay off a credit card and a credit card full to the max. After leaving college banks were falling over themselves to lend me more and more and weren't too fussed about my ability to pay it off. 5 years ago a few things went wrong in my life all at once. Debts were being called in that I couldn't repay. Through hard work and a lot of sacrifices I've now repaid 85% of that money and am a few months away from being able to enjoy all my wages. Since that day I've not borrowed a penny and everything I've wanted (that I used to think I NEEDED) I've saved for, it's much more enjoyable taking something home that you own outright.!
Phil, England

They pick on the vulnerable and charge enormous interest rates Heather, UK

My father always told me to remember that bank and credit/finance companies lend you an umbrella when it's sunny and take it away when it starts to rain. They pick on the vulnerable and charge enormous interest rates and the government allows them to get away with it. There are already houses being repossessed where my sister lives, if interest rates rise I'm sure there will be an awful lot more. No doubt the Banks will allow you to pay your debts off for the next 200 years by passing the debt onto your children and grandchildren.
Heather, UK

Those who think a tax on second homes is a good idea have clearly missed an important point. Who do you think will end up paying that tax? Your landlord? No, you will - in increased rent.
Keith,Bristol, UK

I don't think there is a week that goes by where I don't recieve at least two offers of a credit card or a loan. You cannot turn the TV on and not see an advert for a consolidation loan. As for the shocking state of self cert morgages is it any wonder people are in this mess. I agree with John of Bath whilst we have all been focused on inflation and interest rates, money has been taken out of our pockets in bucket loads to pay for the inflation busting rises in council tax and the increased taxes on fuel. It's time governments and banks became more accountable to the general public. The general taxpayer should not have to pay for errors made by these professionals
MCL, UK

I agree with most comments but agree with the point that tax should be increased on those who have second homes. On £30k per annum I cannot afford to buy a one bedroom flat! Something has got to change to get Britain out of this position!
Paul Narciso, UK

When I finished University I was overdrawn and had 3yrs worth of student loans to pay. On starting my first job I was offered a two grand loan by the bank and so started years of debt. I went from there to credit cards (and then a loan to pay off the credit card). I am now happily debt free after clearing my credit card and loan with my savings (the interest was hardly worth it), it took me seven years to do it though!
Louise, London

My attitude has been to always wait for something until I can afford it - unusual in this day and age Jamie, Herts, UK

Why do people have this attitude to debt these days? I am thankful to have inherited my parents views (very unusual for someone my age - 35) in that I have never paid a penny interest on any loan apart from my mortgage. Everything else I have paid cash for (or occasionally over several months if it is 0% interest deal). Consequently I almost own my own house outright (about two years to go), and am not in debt at all to anyone else. My attitude has been to always wait for something until I can afford it - unusual in this day and age, but paying interest to others to finance day to day spending? No chance! Of course not drinking or smoking helps too!
Jamie, Herts, UK

I have a student loan to the tune of £11k but to be honest the interest rate on it is pretty trifling, and I have a steady job so it doesn't concern me. I've also got a graduate loan (bought a car), and I frequently use my credit card. I'm good with my finances, I always pay off the balance on my card. I'm living at home right now, this could all change once I move out, but for now being in debt doesn't bother me in the slightest.
Damian Leach, UK

People get into debt because they're greedy. Why can't everyone live by my simple rule? - If you can't afford it, you can't have it.
Louise, UK

Louise, UK said "If you can't afford it, you can't have it". I'm very poor and in a lot of debt because of low pay in my job. I struggle through building more debt each month and as a result I can't afford food or housing. Does that mean I can't have it?
Jon Lipscombe, UK

More and more people are starting out with the burden of student debt. Who's to say that some of these people might not get further into debt? They are used to the idea and can't afford to move on in life because of ridiculous tax levels and housing costs. I am currently living with my parents and can't even think of moving out, much as I want to get on in life. I just can't afford it with a low wage. All the while, my debt is growing and growing because of the interest. It is frightening.
Sarah, UK

The old adage "Neither a borrower nor a lender be" is just as valid today as it always was Robbie, UK

The population of this country seems to have lost all its senses when it comes to money. The old adage "Neither a borrower nor a lender be" is just as valid today as it always was. Clearly most people need to borrow to buy a house, but apart from those people in very expensive areas, why buy a larger property that can put you beyond your means?
Robbie, UK

Credit is thrown at people which makes it so easy for people of all ages to get into debt and spend above there means. For how much longer are things going to increase. It's soon going to be impossible to get on the housing ladder with the housing boom and debts that are also taken into consideration.
Anna-Marie, UK

I can't understand these "people have to rely on debt" statements. Debt costs you more! Debt is more expensive... It is cheaper to have no debt.
When will people learn?
Andy, UK

Recently in a meeting with my bank I was asked 'Is there any reason why you don't have a credit card?' to which I answered 'I don't spend money I don't have'. They looked horrified and tried to convince me to get one! I think this encouragement is very wrong, especially since they clearly saw that even on an average salary I very rarely go into an overdraft... Weird credit card culture!
WM, London, UK

Hey, I spend to much money. What's the solution? Spend less? Hell no, give me a fat loan secured on my families home. In this 'live for today' culture, no-one cares about the problems they are creating, yet blame everyone but themselves when it all goes wrong. House prices go up/ go down but debt stays forever.
Rob Smith, UK

Everything is OK for us as long as interest rates remain fairly static. When I say OK, I am of course being an ostrich about our endowment policies. We can afford the interest on our mortgage because we didn't borrow recklessly, but the endowments are going to fail to meet the promised amounts and this is a real worry further down the line. So from time to time I squander some cash on the Stupid Tax and buy a lottery ticket. Well, the "sound" financial advice we followed with regards to these endowments has hardly been true to its word, has it.
CCC, England

People should be using low interest to eat deep into their debts, not to add to them Graeme, England

Over the last 5 years I have been doing everything I can to reduce my debt. I now owe nothing except for a small mortgage. It is only greed for processions and short-sightedness that has lead to such huge debts. People should be using low interest to eat deep into their debts, not to add to them.
Graeme, England

Debt? What's that? Interest is something other people pay to us prudent types. I own my house outright, pay off my credit-card bills in full every month, and don't have any loans. I look forward to an increase in interest-rates because that will increase the returns on my savings and investments.
David Moran, Scotland/Australia

Wage rises are low, meanwhile the cost of housing, council tax, utilities and transport is increasing far too rapidly. Small wonder most of us are struggling to survive and relying on debt.
John C, Bath, UK

I agree with John. The cost of mortgages may have gone down but this has been wiped out by huge increases in council tax, transport, utilities, etc. Borrowing is the only way of surviving. If interest rates shoot up then the country is going to be in serious trouble with many new homeowners mortgaged up to the eye-balls.
Mark, England

I don't find this surprising at all. Look around at the houses being built in your area. Are there any under £120k? If there are you are very lucky!
Until we start to build more affordable new homes, people will be forced into huge amounts of debt!
Gordon, Scotland

I moved to London from Scotland a couple of years ago for the better employment prospects and now find myself £15k more in debt than I was to start with. I'm also a bit stuck here now because my salary - which I need to keep up repayments, would be less if I moved elsewhere and I'd be no further forward really, so it's a Catch-22. I've obviously found out the hard way that the streets of London are definitely not paved with gold!
Joseph, UK

I agree with Jo. I have been saving for retirement for the past few years and get next to no interest on my savings. We are retiring abroad and have to live in a rented flat at the moment. The landlady is greedy and will not carry out repairs that are necessary. It's time that those with more than one property, especially the buy to let crowd, are taxed more highly on this income. If the current situation continues these people may find themselves having to do the menial tasks as they have driven out all the workers who cannot afford decent housing!
Gerry Cuthbert, UK

Not all debt problems are caused by greed Louise, UK. A change in personal circumstances can cause rapid deterioration of your finances such as the loss of a partner or the arrival of a new baby, and that can happen to even the most frugal of us.
Rich, UK

House prices have rocketed far too high which does not help anybody apart from property speculators. My wife and I struggled with a mortgage for 25 years which swallowed up most of our disposable income. Now we have no mortgage and our house is worth a bomb but I have sympathy with young first time buyers who are virtually squeezed out of the market. It reminds me of when my wife and I first married 32 years ago. Nothing has changed that much!
R Steward, England

I for one really hope they bring on those rate rises and precipitate a housing market crash! Jo, UK

As we don't owe any money to anyone, and are trying hard to save for a house deposit, I for one really hope they bring on those rate rises and precipitate a housing market crash! Might sound harsh, but then sanity might return and my husband and I might be able to afford a house on our £55k joint wage. At the moment we couldn't buy the tiny one-bed flat we currently rent. The only people who'd lose out are those greedy enough to fuel the boom in the first place by buying up loads of buy-to-lets! And those with savings will benefit.
Jo, UK