Pointing to research from the Association of Investment Companies revealing that university attendants are taking on more levels of debt than ever before, Callcredit has suggested that this could impact upon their ability to access borrowing after graduation, as they struggle to pay off credit cards and loans. And by constantly choosing to fund holidays and nights out through borrowing consumers could well be left with a "debt mountain" after leaving higher education.



The company pointed to the example of Lee Barnes. After graduating from Leeds Metropolitan University, the 25-year-old found himself owing more than 60,000 pounds as he increasingly took out personal loans to cover daily expenses such as paying rent. "The problem was I got used to spending money. I wasn't even aware of how much I was taking on," Mr Barnes commented.

Melanie Mitchley, Callcredit's director of industry relationships, claimed that although higher education can prove to be a great experience, young people should take caution of the monetary difficulties they can incur if they do not plan their spending wisely. She said: "We are urging all students - whether freshers or in their final year - to be aware of the potential pitfalls if they don't take control of their financial affairs".

"If you do decide to borrow money be aware of the amount you are borrowing and think about how you will repay it. Our experience has shown that taking on credit needn't be a problem if you manage your finances well and ensure you keep up your repayments."

Consequently, those considering taking out a loan or making an application for a credit card were advised to "think" before taking such action. The consumer debt expert also recommended that people should get a copy of their credit history as it will help them to "get an overall picture of the current state of your finances" and decide whether they will be able to successfully manage to take on further borrowing.

However, earlier this year, Mintel suggested that a rising proportion of young people are aiming to take the "easy" way of unmanageable money problems. According to a study carried out by the firm just over a fifth of consumers aged 18 to 34 - an estimated three million - are willing to file for an individual voluntary arrangement or bankruptcy should they find themselves unable to make debt repayments.

Senior finance analyst Todd Davis claimed that as overdraft extensions, credit card deals and student loan uptake all rises, those in this age group no longer have a "stigma" about getting into debt. Meanwhile, such consumers were reported to have above average levels of unsecured borrowing as an estimated 60 per cent of respondents in the age bracket have taken out the form of credit. With more than 3,200 pounds revealed to be taken out, young people were shown as owing more than four times the amount that over-55s do via credit cards and personal loans.