The sun sets behind the skyline and the headquarter of the European Central Bank (ECB) in Frankfurt, Germany, April 6, 2025. REUTERS/Kai Pfaffenbach

BERLIN (Reuters) -Over-indebtedness among German adults is climbing again after years of decline, as economic weakness and rising costs squeeze household finances, data from credit agency Creditreform showed on Friday.

About 5.67 million people aged over 18 are over-indebted - defined as total expenditure exceeding income - in 2025, up 111,000 or 2% from last year, pushing the rate to 8.16% from 8.09%.

"The trend reversal is here – and it was predictable," said Patrik-Ludwig Hantzsch, head of economic research at Creditreform, citing depleted savings buffers after years of crisis-driven spending caution.

The surge spans nearly all social groups, including middle-income households seeking to maintain living standards through deferred consumption.

Young adults under 30 and seniors over 60 are particularly vulnerable – the former due to credit-fuelled spending and online purchases, the latter to rising living costs and limited pensions.

Creditreform warned the situation could worsen in 2026 as high interest rates, a softer labour market and persistent inflation weigh on consumers.

"Over-indebtedness risks becoming a major social issue again," Hantzsch said.

(Reporting by Klaus Lauer, Writing by Friederike Heine, Editing by Miranda Murray)