The average consumer borrowing via credit cards, motor and retail finance deals, overdrafts and unsecured personal loans has risen to ?4,107 per average UK adult at the end of March 2006. This has grown 52% in 5 years, but is it this 'deliberate' borrowing that is the real cause of the debt crisis?

Debit cards accounted for 37% of all retail spend in 2005, ahead of cash at 34% and, according to National Savings and Investments' (NS&I), 39% Brits overspend on their debit cards on day-to-day purchases and the most common reason is because psychologically, they feel they are not spending any money! This sneaking, pernicious and yet somehow casual accumalation of debt seems to catching people unawares.

A quarter of Brits (25%) have no idea how much they spend in a week, and a similar number (26%) have no idea of their monthly cash flow. This lack of knowledge extends into other financial aspects of life. Only half (51%) the population know the balance on their credit cards and nearly half (46%) have no idea what interest rates they receive on their savings or are paying on their accounts and debts. With the ever rising personal debt levels in Britain, financial education would seem a pressing issue.

In 2004 there were 190 million plastic cards in issue in the UK. This works out at an average of 4.1 cards for every adult in the UK. It is, perhaps, little wonder that we find ourselves in the mire when 'flashing the plastic' has become so commonplace (a habit not shared by some of our European neighbours). According to APACS there are now more credit cards in the UK than people!

The result of all this spending? A recent Financial Services Authority (FSA) report states that two million households are 'living on a financial knife-edge', and a further half million households are already in serious financial difficulty with paying bills and meeting debts. 14 million adults are relying on their overdrafts to get by each month; 3.5m are permanently overdrawn, while two million workers start the month in their overdraft, even after they have been paid!

Who then is to blame? A recent study by uSwitch highlighted serious failures in the lending practices of some UK banks when issuing credit cards. Perhaps the most shocking statistic revealed by the survey is that nine out of ten credit card borrowers were issued cards without the lender carrying out any checks to verify that they could afford to repay the debt! The majority of people who successfully applied for a credit card during the last year were asked neither for proof of their annual income, nor to show evidence of their outgoings.

So, what is the answer? That really depends on exactly how deep a financial hole you currently find yourself but, however far down you are, one thing is clear: it's time to Stop Digging! You may need to consider going down the route of Debt Consolidation, Debt Management or even Bankruptcy but, while you're considering options, try not to make things worse. Instead of 'flashing the plastic', how about 'trashing the plastic' - or at least some of those 4.1 cards in your wallet!