Cases of insolvency continue to soar in the UK with the most recent statistics showing that 1 in every 541 adults in England and Wales became insolvent, with women being the hardest hit.
A recent report by accountancy firm Moore Stephens, showed that women now account for 65% of personal insolvencies in the under 25’s and for more than 50% of those aged 25 to 34. In short, women now account for far more insolvencies than men.
Commenting on the findings Hill Dickinson Insolvency Lawyer, Kathryn Maclennan said: “Although there are a number of possible reasons for this trend the most obvious one is simply that women do not earn as much as men.
“Women typically have lower levels of income whilst facing the same expenditure as their male counterparts and in some cases they have increased expenditure.
“The Office for National Statistics confirms that 1 in 3 young men still live at home with their parents while only 1 in 5 women are in the same position, so young women are also appearing to suffer the increased cost in the rental market.”
And childcare costs play another significant factor in womens’ debt issues. Kathryn Maclennan continues: “Women are more likely to be in part time work in lower paid jobs and will often not return to work after having a baby due to prohibitive child care costs. This is particularly true for single mothers and also affects people who are looking after elderly relatives. There can be unequal care arrangements within family structures and the burden of responsibilities mainly falls on women which can leave them turning to credit to make ends meet. It remains the case that women are far more likely than men to be financially dependent on someone else.
“The availability of credit is also a factor in soaring debt. Credit cards and store cards remain readily available but where they are not women become vulnerable to the pay day lender market. Without seeking professional advice women can enter into debt repayment agreements which they are not comfortable with or which are unsustainable and this simply compounds people’s problems rather than presenting a solution.”
Kathryn concludes: “Female unemployment is decreasing but the gender pay gap is still very much an ongoing issue. Striking a more positive note however, women are more likely than men to seek advice in respect of unmanageable debt and this is absolutely essential in stopping the situation from escalating.
“A change in the trend for women in the debt market will inevitably be slow given the number of reasons why women may face insolvency in the first place. However, it is essential that people get professional advice at the earliest opportunity.”