50 days of salary 'pays off debt interest'

22 February 2010

British workers will start earning money for the first time in 2010 this week, it has been claimed.

Price comparison service Unbiased.com has dubbed February 20th as Debt Freedom Day as this is when payments actually start to reduce the amount owed.

Figures from a new report by the organisation have revealed that Britons are using the first 50 days of their earnings servicing the interest on their credit card debt.

The report also revealed that the UK's credit card debt now stands at more than £54 billion after an increase of £4 billion in 2009.

Karen Barrett, chief executive of Unbiased.co.uk, said: "It may come as a shock that Debt Freedom Day actually only marks the day when we have paid off the interest on our debts, rather than the actual debt itself.

"Debts can quickly mount up to a considerable sum and this date demonstrates that debt is something that we need to take control of and actively manage."

Spiralling debt concerns could be eased for those who have invested in property.

Homeowners could pay off the full amount of their credit card debt with a lump-sum payment taken from the value of their property through an equity release scheme.