With inflation driving up costs, global debts are nearing record highs at $305 trillion – around $45 trillion higherthan pre-pandemic levels.Moreover, a worldwide recession has been warned for 2023 at the World Economic Forum earlier this year in the face of rising debt vulnerabilities.
But which country has the biggest debt slaves?
Keen to find out, the finance experts at Moneyzine analyzed consumer credit levels across 65 countries, and provided their guidance on how to avoid getting into debt traps.
Bulgaria ranks 24th in the ranking, with a Consumer Credit in Millions USD of $18699.637. The Consumer Credit per Capita in the Balkan country is 2.719 USD. In addition, the Consumer Credit per Bulgarian citizen aged (15-64) is 4.276 dollars.
Moneyzine revealed that Switzerland has the most consumer credit debt per person worldwide, with $193.10 of debt per person. This is a staggering 93% higher than the world average consumer debt per person, at $12.98 per person. Being among the top three countries with the highest cost of living, nearly 1 in 6 lives in a debt-laden household in Switzerland.
Coming in second is Australia, clocking in at an average of $137.86 of credit debt per person. As monthly credit card purchases in the country hit an all time high of $33.5 billion in January, credit card debt was further found to be the top concern for Australians phoning the National Debt Helpline, overtaking electricity bills.
In third place is Norway, averaging $108.76 consumer debt per person. Reported to be the ninth most expensive country to live in, Norwegians are saddled with debts as they shoulder a monthly cost of living totalling $2,074.
Japan ranks fourth with $47.53 of consumer debt per person- a significant 56.3% less than Norway in third. Following closely behind is France where consumer debt averages $44.40 per person.
Jonathan Merry, CEO of Moneyzine, offered his top tips on avoiding debts:
“In general, consumer credit isn’t a dangerous thing – there can be many upsides such as improving your credit rating if you pay the debt off in time, and getting items you want before needing to save for them.
The danger comes when people continue to take out loans or finance options to buy things they can’t afford. When you’re paying $15, $20, $30 for each loan every month – it adds up very quickly and could easily get out of control, which is why debt is one of the highest reported factors relating to low moods in adults.
One of the best ways to avoid getting into financial situations that you can’t afford is by keeping track of your spending every month. Some like to do this in a notebook, others in a spreadsheet, however you like to do it; It’s important to keep track of your in and outgoings every month. By tracking your spending you can better prepare for the future and reduce the need for payday loans with high interest rates.“