One in five bankrupts is now under the age of 30 as student debt and the consumer spending splurge starts to bite. The proportion of bankruptcies among the 18 to 29-age group has jumped from 7.9% in 2001 to 18.7% last year. The average age of a bankrupt has fallen from 43 to 41 in the last four years but female bankrupts tend to be younger than male bankrupts.

The figures, from the Insolvency Service, highlights a worrying trend for a Government that is trying to encourage pension saving amongst the young. The UK's consumer debt mountain, which includes mortgages, currently stands at £1.2 trillion and shows no signs of shrinking.

It also echoes today's call from the Financial Services Authority that young people need better finance education while at school. The City watchdog said a generation are growing up with no savings, no pension and huge debts.

Philip Long, head of corporate recovery at accountancy firm PKF, described the figures as somewhat worrying.

He said: 'It's easy for young consumers to get credit. As soon as they finish college they are offered consolidation loans for their student debts and it's too easy to make the situation worse.'

He predicts the average age of a bankrupt will continue to fall when student fees are raised later this year. Debt to the Student Loans Company is currently outside of bankrupt laws, but by consolidating it to a normal bank loan, the individual can claim for bankruptcy.

Long added that banks are failing to do properly assess a borrower's ability to repay. He said: 'We had a bar maid come to us who earned £1,000 a month gross, living in London. She had £30,000 worth of store card debt.'

Insolvency Service director of policy Mike Norris said: 'The research gives us some interesting information about the characteristics of bankrupts over the period.

While the profile might be changing in some respects, men in their 30's and 40's continue to account for the largest number of bankruptcies and average scheduled debts continue to fall between £45,000 and £50,000.'

Nearly two-thirds of individual bankrupts in 2005 were men, according to figures from the Insolvency Service, with the average bankrupt owing £46,000.

However, the proportion of women filing for bankruptcy is rising, up by seven percentage points to 39% last year.

The national statistics were mirrored by regional figures, with men more likely to be bankrupts than women in all seven regions featured.

It added that all regions had seen an increase in the number of young people becoming insolvent, with the Midlands and the South West seeing the biggest jump.

Copyright © 2005 First Mortgage Trust