Archive for the ‘Debt News’ Category
Monday, November 28th, 2011
With the Christmas season pretty much upon us many consumers will be gearing up to start shopping for their Christmas purchases, which could include gifts, clothes, extra food, tickets for travelling to see friend and relations, and more. However, many people will not have the available funds saved up in the current financial climate and will therefore be relying on credit in order to get them through.
Credit cards, of course, are used heavily over the festive season by those that need to buy their purchases using credit and this can lead to a worrying amount of debt, with many experiencing bill shock in January after getting carried away with their credit card spending. However, for those who do not have a credit card or cannot get further credit card finance there is another type of debt that is causing concern, which is payday loans.
Whilst payday loans can provide a financial lifeline for those who have a financial emergency and need to bridge the gap until they get paid, using these loans to pay for purchases and luxuries over the Christmas period can lead to spiralling debt, particularly for those that find they have to rollover the debt because they cannot afford to repay it in January.
One official said: “Many people might thing that a payday loan is the easy solution to getting finance to make purchases for Christmas, partly due to the ease of getting this finance and the speed at which it can be obtained. However, for those who are unable to repay the debt in full when they get paid in January the interest can be crippling and it could lead to spiralling debt, which is not the ideal way to kick off the New Year.”
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spending,
festive season,
gap,
credit card finance,
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Wednesday, November 23rd, 2011
Personal debt levels have become a huge problem for many individuals and households, and these are further exacerbated with the use of things such as credit cards and store cards that come with crippling rates of interest, leading to spiraling and unmanageable debt levels for some people. However, when it comes to store cards many consumers end up taking out these costly cards because they feel pressured into it by sales staff.
This is something that has now been recognized by officials and according to recent reports shops and stores are now going to be banned from using hard sell tactics in order to boost the number of people taking out cards, which includes a ban on free gifts and discounts, which are often used to lure people into spending money that they do not have.
For struggling shoppers whose finances are tight, the offer of a store card along with discounts and free gifts can seem like a very tempting offer. However, once they start using the card, unless they are able to repay the balance in full each month, they are charged crippling amounts of interest and the debt can quickly spiral out of control.
Financial Secretary to the Treasury, Mark Hoban, said: “The public told us that consumers can be tempted into taking out a store card by being offered a discount at the till. We’ve listened to these concerns and have worked with industry to develop a strong package of measures in response. This ban will mean that stores will not be able to offer discounts, free gifts or similar incentives to encourage consumers to take out store cards at the point of sale, or for the first seven days.”
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treasury,
staff,
debt,
strong package,
British Retail Consortium,
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Saturday, November 19th, 2011
Many people in the Wrexham area who are struggling with their debts will be delighted to hear that a new debt advice service designed to help people in the area has been awarded a quarter of a million pounds in lottery funding. The money is to be used to fund the three-year Shelter Cymru project, with around two hundred households a year receiving valuable debt related advice through the service.
The service started this autumn and prior to this the recruitment of staff was taking place. The charity has described the cash injection from the National Lottery as ‘a really big deal’ particularly given the high debt levels that have been identified amongst younger people in the area. An official from the charity said that being able to get the right advice at the right time would make a huge difference to many of those that are struggling with debt in and around the Wrexham area.
He said: “We know that people are finding things tough financially at the moment. We see it every day in our casework, while a survey carried out for us by YouGov earlier this year showed that more people are starting to use their credit cards to cover day to day expenses.”
The £250,000 grant that is given to the charity by the National Lottery will help to support the work of the group in many ways, enabling officials to help both those with easily resolved debt related issues as well as those that have more complicated debt problems that will involved a lot of liaison with creditors and other companies in order for a solution to be reached.
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shelter,
wrexham area,
cash injection,
new debt advice service,
autumn,
charity
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Friday, November 11th, 2011
As most households are only too well aware, the cost of living in the UK has soared over the past eighteen months, with essential costs such as petrol, food, and energy usage going through the roof whilst wages remain frozen for a huge number of workers. This has resulted in many households facing a severe struggle to make ends meet, with many having to take on more debt in order to cope with the rising cost of living.
In fact, according to recent reports Brits have taken on the highest levels of debt since the recession in the UK hit its peak in May of 2009, with many now having no other choice but to take on more debt in order to keep up with increases in the cost of living. Households are now said to have around £208.6 billion in outstanding debts on credit cards, loans, overdrafts, etc. which equates to around £9070 of debt for every household in the country.
Household debt, excluding mortgage debt, is said to have increased by around £5 billion in the past year alone, which the Bank of England said is the biggest annual increase since the recession. Brits have increased their debts by £629 million in the past month alone, and economists have said that people are now having to increase their debts simply to find their day to day living costs.
One economist said: “The rise in unsecured consumer credit suggests increased ‘stressed borrowing’ is occurring, with more people having to borrow to help finance their spending. This is a consequence of the extended squeeze on their purchasing power coming from elevated inflation, low wage growth and tighter fiscal policy. In addition, job losses are rising.”
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choice,
May,
UK,
job,
eighteen
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Monday, October 31st, 2011
A recent report has highlighted how stagnating wages in the UK are making debt problems for consumers even worse, with many people struggling to make debt repayments due to their income levels compared to soaring inflation and living costs. There are many people who have seen their wages frozen or even dropped over the past couple of years, putting intense pressure on them with regards to their finances.
As most people are aware, the cost of everything from petrol and food to energy usage has soared over the past year or two. However, at the same time the wages that people are earning have increased only marginally or not at all, leaving consumers facing the difficult task of making their income stretch much further than it did in the past. For those that have debt this has made it difficult to make anything more than the minimum repayment on their debt. In addition to this many people may have been forced to get even deeper into debt by borrowing money to make ends meet.
There are now concerns that this difficult situation could result in the already worrying personal debt problem in the UK becoming even worse, and household debt is expected to soar to £2 trillion by 2015, which many believe could be a real threat to the nation’s economic future. Some believe that economic growth will be severely hindered as a result of this situation and more and more people may end up having to turn to solutions such as insolvency to try and solve their debt problems.
One union official said: “As wages have stagnated, debt has soared. As incomes are squeezed further, the Office for Budget Responsibility expects household debt in this country to reach over £2 trillion by 2015 – an albatross around the neck of our economic future.”
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result,
albatross,
living costs,
cost,
report
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Sunday, October 30th, 2011
If you are struggling with debt, a debt consolidation loan (or remortgage) can be a lifeline. It can allow you to stretch your repayments over a longer a period of time, meaning your monthly repayments and interest rates are potentially lower – especially if you are consolidating debts from high-interest credit such as certain credit cards (although the total amount you repay may be higher in the long run).
But many people with smaller debts simply want to benefit from the convenience of a single, potentially lower monthly payment.
Useful for smaller debts
A spokesperson for Think Money says that a debt consolidation loan is equally valid for smaller debts as it is for larger ones. “You don’t have to be dealing with serious debts to look for a loan,” she says. “While we do help a lot of people in serious debt with our debt consolidation and other debt management services, an increasing number of enquiries are from people more than capable of paying their debts off, but who want to do it on a more flexible basis.
“Take for example an overdraft – a debt consolidation loan could be a quick way of paying it off and keeping the bank happy, while at the same time setting up a regular payment to pay off the loan gradually. Often that’s a lot more effective than paying the overdraft off in bits when you have the spare cash, and avoids the extra interest that would build up if the overdraft was left for longer.”
But that’s not to underestimate the potential benefits of a debt consolidation loan to those with more substantial debts, the spokesperson continues. “The flexibility and convenience a debt consolidation loan offers could be the difference between being able to afford to repay your debts and falling behind on payments if something unexpected happens in your finances.
“If you are in serious debt, it’s essential that you speak to an expert debt adviser. They can advise you on a range of debt solutions, including debt management plans, IVAs etc., and help you decide which is best for you.”
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Tuesday, October 25th, 2011
Figures have revealed that a larger number of people in Scotland are paying off their debt that in other parts of the UK. The figures come from the Credit Confidential Credit Index and have shown that more than one in four Scots are now in less debt than they were at the same time last year. In total 27.6 percent of Scots now owe less money on their debt than a year ago, reflecting how they have been paying off their debts.
The number of Scots paying off their debts in Scotland is even higher than the Scottish national average, with figures showing that 32 percent of Glaswegians are now in less debt than they were a year ago. This reflects an increase of 10 percent compared to the same survey that was carried out in July. Edinburgh came in at lower than the national average, with around 19 percent saying that they are in less debt. Despite being below the national average, it still beat other capital cities, including London where 15 percent were in less debt than a year ago and Cardiff where only 4 percent were in less debt than a year ago.
An official from Credit Confidential said: “The recent debate, stoked by David Cameron suggesting people pay off their credit card bills, seems to be redundant for many Scots as they have been offloading debts in the past three months anyway. However, with Christmas coming, unemployment rising and inflation increasing, if consumers cannot access credit easily from the high street and traditional lenders, some may be forced to borrow from less reputable sources such as loan sharks.”
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David Cameron,
capital,
three months,
london,
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Wednesday, October 19th, 2011
Every year there are huge numbers of people who make resolutions to resolve their financial problems, reduce their outgoings, and streamline their budgets. Already, there may be people who are planning to have improving finances as their main New Year’s resolution when 2012 comes around. However, for those that plan to stick to this resolution it could pay to take action now rather than wait for the New Year to actually come around.
By taking action early, those that want to improve their finances can start the New Year as they mean to go on rather than waiting until 2012 before taking any action at all to resolve their financial problems. One of the main ways in which consumers will be looking to improve their financial situations is simply through reducing their outgoings, which is easier said than done. However, there are a number of ways in which this can be done, and the earlier consumers take action the better.
One way to reduce financial outgoings is through debt consolidation, which involves consolidating all existing unsecured debts, such as credit cards, loans, and overdrafts, into one lower interest loan. This can help many people to reduce the amount that they are paying out on their debts each month and comes with the added benefit of making it easier to deal with finances due to having fewer creditors to deal with.
Another way in which people can streamline their finances is by switching various services to a cheaper plan or provider. This can include energy suppliesr, broadband and phone services, home insurance, vehicle insurance, and more. All of these little savings can add up to a tidy monthly sum, which can help to ease the strain on finances that little bit more.
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credit cards,
Business Finance,
creditors,
New Year,
month,
healthier new year,
credit
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Wednesday, October 12th, 2011
It is likely that many people in the current climate will be turning to finance and borrowing in order to get the money to make purchases over the up and coming Christmas period. This includes purchases such as gifts, new clothes for going out, entertainment and socialising, and extra food and drink for the festivities. However, many of those who take out finance to fund the festive season could end up paying a fortune in interest if they choose the wrong financial products.
By using some common sense and thought consumers who are having to fund Christmas with finance can avoid having to pay any interest, which can bring down the cost of Christmas considerably compared to spending on a high interest store card, overdraft, or other form of borrowing where you will end up paying interest on the cost of your purchases.
One way to avoid debt from high interest borrowing over the Christmas period – which can really bump up the cost of the season – is to look at taking out an interest free purchase credit card, which enables you to spread the cost of Christmas over a reasonably long period of time without being charged any interest. The period of interest free credit can vary based on the card that you take out.
There is also an option for those that are looking to pay off their spending within a few weeks following Christmas and New Year, which means that they would not be charged any interest anyway. In this situation a rewards credit card could be the ideal option, as it means that you can earn a little something back for using the credit card, which could anything from loyalty points or air miles to cash back and discounts.
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Personal finance,
Christmas and holiday season,
option,
festivities,
order,
anyway,
gifts
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Saturday, October 1st, 2011
It has been reported that a rising number of people across the UK are now struggling to keep on top of their rent payments, with rents having soared over recent months leaving many people unable to afford the payments. On top of this renters have had to put up with soaring living costs, with the cost of food, petrol, energy usage and more having gone up over the past twelve months.
One leading debt charity has said that it has seen an increase of 84 percent since the onset of the recession in the number of people that are getting in contact with regards to problems with rent arrears. Officials from National Debtline have said that figures have been increasing dramatically partly due to the soaring number of people that are going into rented accommodation each year because they cannot get a mortgage to get their own property.
Since 2005 the number of people that are renting homes in England is said to have increased by a massive 40 percent according to the English Housing Survey, which was carried out earlier this year. Demand for rental homes has been outstripping supply for some time now and this has helped to push the cost of renting even higher, putting struggling consumers in an even worse situation in terms of their finances.
Joanna Elson OBE, chief executive of the Money Advice Trust, said: ‘A few years ago many people in today’s rent market would be planning on buying their first home, but now it seems they are struggling to even pay the rent. On top of those people who call National Debtline with specific problems in affording the rent, there will be even more who are cutting back sharply elsewhere to make sure they can cover rent payments. This in turn can lead to other debt problems, with credit cards, overdrafts and loans being relied upon to pay for food and other essentials.’
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recession,
obe,
elson,
rent payments,
Credit card,
twelve months,
energy usage
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Monday, September 26th, 2011
For most people the variety of bills and debts that has to go out of their money each month can become very confusing to deal with. Most people have enough to deal with each day without having the constant worry of what is going out of which account and when. This is why so many people end up inadvertently missing payments or making late payments, which can lead to all sorts of problems.
One of the major pitfalls of missed and late repayments is that many companies will then impose a hefty fee on your account, which is money that you are essentially paying out unnecessarily. Another issue with this is that it can impact heavily on your credit rating, which can of course have a serious knock on effect on your ability to get affordable finance and credit in the future.
The debt levels that consumers and households are facing have soared over recent years, with many struggling to find enough cash to keep on top of their debt repayments.
One official said: “It’s worrying to see such a high number of people needing to use so much of their income just to service existing debt.”
With consumers already facing overstretched finances due to their debts the last thing that many can afford is added charges and fees for late and missed payments. Industry expert have said that setting up a direct debit for payments can save consumers time and hassle as well as helping to ensure that payments are never missed or late.
One industry expert said: “Setting up a direct debit helps consumers avoid missing payments and forking out significantly more than expected in interest payments and fees.”
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late payments,
pitfalls,
future,
Most people,
overstretched finances
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Saturday, September 17th, 2011
Over recent years the number of people that have required debt advice to help them to deal with their rising levels of personal debt has shot up. Debt advice firms and charities have found themselves under mounting pressure with regards to dishing out the advice that people need and waiting lists for seeing debt advisors have been growing longer and longer as more and more people find themselves in a difficult situation where they are unable to afford their debt repayments.
When the coalition government announced that it was launching an austerity drive last year many people thought that the demand for debt advice would soar even further, as more people found themselves under increased financial pressure due to factors such as cuts in benefits, job losses in the public sector and the private sector, and soaring living costs. However, it has been claimed recently that the situation could be worse than initially imagined as a result of the many other countries that are taking similar action, which will also have a knock on effect in the UK.
Some officials believe that with the situation as it is the UK could be in line for another recession in the near future, which would have a huge impact on businesses and jobs. There are now fears that if more and more people end up losing business or jobs the level of demand for debt advice could go through the roof. If the base rate rises over the coming months from its all time low of 0.5 percent this will also have a huge impact on consumer finances.
Speaking about the economic climate and austerity drive in the UK, one official said: “At the moment it just seems to be a worldwide trend. I think the inevitable consequences of that is it is going to be a difficult period ahead, not just for the UK but for much of the world.”
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line,
rate,
result
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Monday, September 12th, 2011
Whilst most people these days face a range of financial pressures, such as rising living costs, soaring bills, a freeze on salary or a drop in income along with soaring debts, there are different age groups that are more likely to experience different financial problems at various stages of their lives. This is according to a recent study and report from Standard Life.
The report is called Your commitments, Your Future, and it is part of a campaign to help people to develop greater understanding when it comes to their financial commitments and debts, and how their financial commitments can change at different times and stages of their lives. This, according to officials, will prove very helpful in the long terms to many people.
An official from Standard Life said: “This understanding can help substantially with planning our personal finances so that we can feel confident about the future and achieve our goals. If people were to dedicate more time to their long term financial planning, they wouldn’t just be better off financially, they’re likely to be better off all round.”
The report shows that the greatest financial pressure in terms of finances and debts is faced by people who are aged between their mid-thirties and mid-forties, when spending on credit cards and mortgages tends to reach its highest level. Spending on bills, household spending, and debts for people in this age bracket averages around £1160 according to the report.
For people in this age group mortgage repayments come in around £600 per month whilst credit card repayments are around £350. When it came to loan repayments, however, the over 55 age group took the lead in terms of financial pressure, although this data excluded student loans.
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different times,
round
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Monday, August 29th, 2011
A recent report has indicated that many people are being forced into so much debt as a result of the government cutbacks that they are being steered towards getting money from legal loan sharks, putting them in an even worse financial situation that it even more likely to spiral out of control. The left wing pressure group Compass has released the report, claiming that the widespread cutbacks have had a profound negative effect on the financial situations of many people.
The report claims that many people are now being forced to turn to legal loan sharks in order to get the money that they need to keep their heads above water financially, which means that they are getting deeper and deeper into debt and financial trouble. The group carried out interviews with over 250 social housing tenants in the West Midlands and 28 percent said that they now found that their debt levels were unmanageable.
Of those that were polled the average income was less than £8000 per annum yet the average amount of debt that was being paid out was £1200, which meant that around a quarter of income was being eaten up by debt. With many of these households on such a low income anyway this impact of paying out a quarter on debt is financially crippling, particularly given the soaring cost of living.
One official involved in the research said: “What makes this particularly alarming is that the Government is banking on personal debt increasing as a way to reduce the deficit but 28 per cent of those we surveyed are finding debts increasingly unmanageable. The Government’s economic plan could be driving borrowers into the arms of legal loan sharks which is a particularly unpleasant experience.”
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cost,
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Friday, August 19th, 2011
It has been reported that factors such as high living costs, households debts, and a drop in income is results in millions of households across the UK being unable to save any money. New research has been carried on to show that around five million households in the UK are failing to save enough money whilst almost 50 percent of them are concerned about their debts.
The report was commissioned by the debt charity the Consumer Credit Counselling Service. Figures that were released by the Financial Inclusion Centre have revealed that around 4.3 million households have no savings at all and over 1 million households with savings of less than £1000.
Many of these households are already at risk of facing problems if there are any unexpected costs that they incur. The Department for Business, Innovation and Skills (BIS) found that around 27 percent of households that had no savings had become reliant on credit for day to day spending on a regular basis compared to 9 percent of those that had savings of between £1000 and £10,000.
The Consumer Credit Counselling Service also revealed that only 5.4 percent of people that sought help from the debt charity had any form of savings in place, and officials from the charity think that the situation could become increasingly worse due to inflation and high living costs. There are also rising concerns that struggling households could turn to high interest borrowing because they cannot get finance in the traditional way.
One official said: ‘Households that are already struggling may find traditional lenders unwilling to provide further credit and are therefore drawn to short-term credit solutions. Individuals turning to short-term loans and credit cards should be wary of the high interest rates that often accompany these products. Overall debt can quickly snowball out of control.’
Tags:
Inclusion,
savings,
snowball,
Overall debt,
households
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Thursday, August 4th, 2011
An industry expert has recently stated that Brits need to make sure that they are not saving money when they have a lot of high interest debts that they need to pay off. There are many people who, although they have high interest debts such as credit cards, store cards, loans, and overdrafts, continue to put any spare cash into their savings accounts rather than using it to repay some more of their debt.
Justin Modray of online resource Candid Money said that in the current financial climate it was important for people that had high interest debts to focus on using their money to repay these debts rather than using it to put to one side. This has become particularly important given that the base interest rate has remained, once again, at an all time low of just 0.5 percent, which means that savers are unlikely to get much if anything by way of returns on their savings.
Modray said that the sensible option for consumers in debt was to make sure that they made payments on their debts and tried to get themselves back on track financially rather than putting money into savings where they would get little in the way of interest whilst paying off debt that came with a shed load of interest added. This way, consumers could get themselves back on track and avoid paying a lot of unnecessary interest.
He said that those who already had savings could use them to repay debt and could put extra money toward making debt repayments without the worry of saving for emergencies.
Modray said: “Those fortunate enough to have savings can use them to stave off debt, but I think for many it’s more a case of just trying not to drown in debt and saving for the future remains a pipedream.”
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savers,
spare cash,
home,
saving money,
worry,
financial climate
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Saturday, July 30th, 2011
According to a recent report there are many people in the UK who have a lot of debt and who hope that getting some sort of inheritance at some point will help to sort out their debt problems. Many people try and keep things ticking over with regards to their debt payments in the hope that at some point a relation will leave them some money or assets that they can use to clear this debt.
However, officials have warned that those with debts need to stop relying on inheritance and windfalls to try and clear their debts, stating that many could end up being disappointed because they end up getting nothing. In fact, according to a recent survey a large number of people who leave wills actually leave more money to their pets and animals than they do to other people.
A survey was carried out by More Than and revealed that around 40 percent of people leave more money to their pets than they do to other people. The survey showed that 70 percent of people were worried about what would happen to their pets if they were to die and wanted to leave the money to ensure the long term care of their beloved animals so that they did not end up in a rescue centre.
An official from More Than said: “Pet owners are naturally concerned about the long-term care of their pets and many are taking the necessary steps to make sure they are provided for in their wills.”
This means that many of those that may have been expecting money from a relation who passes away could end up with far less than they imagined, which is why people are now being urged not to rely on this sort of income to deal with debt.
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Credit card,
large number,
long term care,
debts,
Pet owners,
windfalls
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Monday, July 25th, 2011
It has been revealed in a recent report that people in Scotland have taken on more additional personal debt than people in any other part of the UK. The data comes from the insolvency trade group R3 in its quarterly personal debt report. The data showed that around 13 percent of people in Scotland had taken on more debts including debts from credit cards, loans and overdraft. This compared to 12 percent of people for the whole of the rest of the UK.
According to the report many people in Scotland are also struggling to make their money stretch from one payday to the next. Around 43 percent of Scots are said to be struggling to make their money last until payday. However, whilst this figure is high it was actually around 3 percent less than the rest of the UK.
In the past twelve months around 200,000 Scots have taken out a payday loan whereas for the rest of the UK this figure came to two million. The R3 data showed that one in every five Scots was struggling to repay their payday loans whereas in the rest of the UK this figure fell to one in ten. Officials from Citizen’s Advice Scotland said that they were not surprised by the figures, as evidence has shown that debt has been a huge issue in Scotland for quite some time.
R3 Scottish council member John Hall said: “It is extremely worrying that such a large percentage of people are struggling to make it to payday and that many are using payday loans to bridge the gap. These loans tend to have high interest rates and often those who use this type of credit find themselves in a vicious debt cycle, especially if they then experience a sudden job loss.”
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Monday, July 18th, 2011
It has been revealed in a recent report from a leading debt charity that many people who are on lower incomes are struggling with their debts, with a range of factors having affected their ability to hand existing debt and forcing them to get deeper into debt over the past few years. For many people it has become increasingly difficult to cope with debt repayments due to so many other factors that have affected their finances.
Officials from the Consumer Credit Counselling Service said that people on lower incomes were really struggling with debts now, having become increasingly reliant on things such as credit cards and loans and having found it more and more difficult to cope with the repayment increases. This is due to factors such as the rising bills, soaring inflation and living costs, frozen or cut wages, job losses, and government cutbacks amongst other things.
The CCCS said that people that were earning less than £13500 a year tended to owe around 20 percent more in unsecured debts than they actually earned. This would mean, for instance, someone earning £10,000 a year owing around £12,000 in unsecured debts such as credit cards and loans. This data came from the charity’s recent report, the Debt and Household Incomes report.
One industry official said that things could get worse in the foreseeable future for some people, stating: “Many people who scraped through the recession are going to find the next few years even harder.”
The CCCS stated: “Unfortunately, these figures confirm our fears – that troubled times lie ahead for many people in the UK. This pain is going to spread wider and affect many more people than commentators previously assumed.”
Tags:
repayment,
debt consolidation,
instance,
Financial Planning,
job losses,
government
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Thursday, June 30th, 2011
Getting into a worrying amount of debt is, sadly, part and parcel of getting an advanced education for many people these days. Rocketing student fees has meant that those wishing to go to university and better their educations have to resign themselves to the fact that they will be paying off debt for many years after leaving university.
However, previously students were able to justify being in debt for years after leaving university by the fact that they would be able to get a good, well paid job after leaving university, which would effectively help them to repay their student debt. In the current climate many students do not have the luxury of being able to count on a good, well paid job despite the fact that they may have a degree.
For many people that have left university debt has taken over the lives, resulting in their having to put many things on hold in order to focus on their debts. Uswitch.com carried out research that showed how almost 60 percent of students had been unable to save money because of their debts. The research also showed that close to 50 percent had been forced to put off buying a home.
Debt is affecting students in many others ways when it comes to living their lives. For example, nearly 30 percent had been unable to start a pension when they wanted to. Even getting married has had to be pushed to the back burner, with around 30 percent putting off plans for marriage because of their debts.
One official said: “The fact that graduates have to put their life on hold because they are knee deep in student debt is a sorry state of affairs. And as fees go up, students risk running up even bigger debts. But without a degree, getting a job in today’s stagnant market may be even harder.”
Tags:
bigger debts,
Research,
Higher education,
state,
market,
getting a job
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Saturday, June 18th, 2011
According to recent reports there are concerns over the spiralling levels of personal debt that are being seen in the Crewe area. Over the past few years personal debt has become a big problem in areas all around the UK, with many people finding themselves unable to manage with their high debt levels for a range of reasons, many of which are out of their control.
Concern has now been voiced by the debt charity the Consumer Credit Counselling Service over the level of debt that has been seen in the Crewe area. According to recently released figures the average amount that was owed by people contacting the charity in 2010 was £23,177. This figure related only to unsecured debts and was significantly higher than the national average of £19,338.
A new map on the CCCS website has revealed that level of debt in the Crewe area as well as other areas around the UK. The map is called Debt View and allows personal debt levels to be broken down by regions, areas and postcodes. In 2010 568 people from Crewe contact the CCCS for assistance with debt problems and this reflected an increase of 34 percent over a two year period. People have called the charity to get free and confidential advice relating to their debts.
An official from the CCCS said: “I am very concerned – not only by the high levels of debt we are seeing in Crewe, but also by the continuing squeeze on household budgets that is making it increasingly difficult for debtors to repay what they owe. I would urge anyone in Crewe who is worried about how to deal with their debts to seek free advice from a charity such as CCCS as early as possible.”
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Tuesday, May 31st, 2011
It has been claimed in a recent report that many workers in the low and middle classes in the UK may be destined to struggle with debt for the next few years. The report claims that many low and middle class workers will not see any sign of a pay rise until at least 2015, which means that they will be stuck on the salary that they are currently on – or may even have their salary reduced – for at least the next three years or so.
In the meantime, the cost of living continues to soar, which means that whilst these workers have to cope with the same level of pay they are having to pay more for everything from the cost of energy usage to the cost of running a car, putting food on the table, and paying their bills. In addition to this, when the base interest rate increases from its all time low of 0.5 percent, many will be tipped over the financial edge, as their mortgage repayments rocket.
The report was released by the think tank Resolution Foundation, with officials from the group stating that it would be around 2015 before people in these classes saw any improvement with their pay scales. The report said that this was down to the effects of the recession and government cutbacks and could cause serious problems for those that see their outgoings steadily increasing whilst their income remains static.
James Plunkett, who authored the report, said: “We all know that the recession has hit living standards hard. But something deeper has changed in our economy — even during the so-called boom years, ordinary workers weren’t seeing their living standards rise. The big question now is what will happen when growth resumes — will ordinary workers reap any of the benefits? This report suggests that is far from certain.”
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Saturday, April 23rd, 2011
There is little doubt that many people of all ages and both sexes are struggling with huge levels of debt these days, with many finding it difficult to keep on top of their financial commitments or even make basic everyday purchases because of their difficult financial circumstances. However, despite the current financial climate there are many people that are still not concerned about their debts according to a recent report.
It is reported that people do not tend to start worrying about their personal debt levels until they reach around £9700 or above, even though those with less debt may still be struggling. The average level of debt is around £8400 but many people will wait until it is far higher than this – around£10,000 higher – before they decide to take action and seek advice about how to handle their debt.
Research also showed that it was men who had higher personal debt levels than women, with an average 24 percent more personal debt amongst men compared to women. This comes despite the fact that many men assume that women simply spend spend spend on clothes and shoes using their credit cards and loans!
One industry official involved in the research said: “It is worrying to see that while people become concerned about their debt at £9767 it takes a further £10,000 to trigger a need to seek debt advice. For most people paid advice, such as a fee-charging debt management plan, is a last resort and consumers should explore do-it-yourself solutions and fee-free debt advice from some of the many debt charities such as the Consumer Credit Counselling Service, Money Advice Trust or Citizens Advice Bureau.”
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Saturday, April 23rd, 2011
For many people that have debts and money worries one way to try and reduce outgoings is to look for bargains in supermarkets when doing the shopping. Many supermarkets are riding out the stiff competition that they face from their rivals by offering a huge number of buy one get one free or even buy one get two free deals on their products.
However, whilst these deals may sound really great, and in some cases can benefit people such as when buying frozen produce and items with a long shelf life, there are also many people that fall for the offer and purchase something that they did not want and did not need simply because they realised it was on offer. Often these offers are on items with relatively short shelf lives, and the people that spend their money on them end up not only wasting money on items that they would ordinarily not have purchased but also end up creating a mountain of wasted food because they are unable to consume the free products within the time that they have before they go off.
A recent report has claimed that Brits are creating a mountain of wasted fresh produce that is worth £13.7 billion a year as a result of these promotions. The average household is said to be wasting around £520 a year by taking up these offers and then throwing away the produce because they do not get around to eating it.
The Local Government Association has released the figures and said that the problem is being fuelled by these special two for one or three for one deals that the supermarkets are always promoting. Officials now want supermarkets to look more carefully at the way in which they promote perishable products in order to help reduce the wasted food mountain.
One official said: ‘With more than five million tonnes of edible food thrown out each year, way too much food is being brought into homes in the first place. Retailers need to take a large slice of responsibility for that. Buy one, get one free deals which give consumers a few days to munch through 16 clementines are not about providing value for money. They are about transferring waste out of retail operations and into the family home. Retailers should scrap multi-buy deals which encourage people to take more than they need and replace them with discounts on individual products which will help reduce excess consumption and increase customer choice.’
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Monday, April 11th, 2011
A new service has recently been launched to help consumers in the UK who are looking for advice relating to various areas of finances, ranging from debt and pensions advice to savings and mortgage advice. The service is a free and impartial one that is open to anyone that needs advice and assistance regardless of their financial circumstances.
The new service is called the Money Advice Service and has been launched through the government as an upgrade to its Consumer Financial Education Body, which was launched last year. The service will aim to offer impartial advice relating to a wide range of financial issues that can affect consumers, especially in the current climate, and will be welcomed by the many who have struggled to get financial advice relating to their debts because of the huge demand for these services.
There are a number of ways in which consumers will be able to access the new service should they wish to get advice. They can do this by going online to get the advice that they need, they can make a call to get advice, or they can even see someone in person if they prefer to do so. In addition to offering valuable advice this service will also provide consumers with access to a wide range of tools and resources that will help people to deal with easily with their financial issues.
An official from the Money Advice Service stated: “The Money Advice Service is here to make people’s lives easier and better. We’re not here to sell people anything and we won’t charge anyone – we are here to help people take decisions about their money and plan for a better future for themselves and their families.”
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Monday, March 28th, 2011
For many people the strain of debt and financial problems has really taken its toll on their quality of life, and with soaring living costs, job losses, and frozen or reduced income the situation could get worse for many people. Finances have been overstretched in many households for some time and many industry experts believe that things could get worse for some households over the course of this year with the budget having delivered little by way of immediate good news for those that are struggling to keep their heads above water in terms of their finances.
However, there are ways in which consumers can help to ease the strain by taking control of their finances. There are a number of steps that you can take to try and reduce your monthly outgoings, which means that you will have more disposable income either to deal with living costs or to reduce your debt levels. Some of these measures are outlined below:
- Switch your services: there are many services that you can switch to try and make reductions in your monthly outgoings, and it is surprising how much you can save collectively simply by switching handful of services. This includes things such as your energy supplier, your broadband and television provider, your car insurance provider, and your home insurance provider. Whilst you might only save a fiver here and a fiver there it can all quickly add up to a fairly tidy sum over the course of the month.
- Consolidate your debt: You may find that it is cheaper and more convenient to consolidate your various debts into one with a low rate consolidation loan. You can wrap up debts such as your credit cards, your store cards, any catalogue balances, smaller unsecured loans, and overdrafts in a bid to try and reduce overall interest and cut monthly repayments. You will also benefit from having just one repayment each month by doing this rather than a number of different payments to make to a range of providers.
- Cut back on your luxuries: Despite the difficult financial climate many of us still have luxuries that we pay for each month. If things are getting really tight consider cutting out these luxuries even if only on a temporary basis. You can do things such as freeze your gym membership if you have the facility, cancel subscriptions, reduce your broadband and television service down to a minimum, and cut back on shopping.
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Monday, March 28th, 2011
Over the past few years there have been many people who have found themselves facing a serious financial struggle due to tighter budgets and increased living costs as well as reduced or frozen income. More and more people, particularly those with debt, have found it extremely difficult to keep their heads above water. Many may therefore have been hoping that the Chancellor of the Exchequer, George Osborne, would therefore deliver some good news that would aid them with their financial situations.
There was some good news delivered by the chancellor, which included a cut in fuel tax rather than an increase, a new scheme to help first time buyers get onto the property ladder, and an increase in personal tax allowance. However, one industry expert has said that consumers should not have been relying on the budget to try and get out of financial difficulties, and instead they need to take control of their financial situations themselves.
Kevin Mountford from Moneysupermarket.com said that it was unlikely that people would feel much better in terms of their finances because of the budget. He said that the answer was to take greater control of their own budgets and take steps to try and reduce the financial strain. He added that further strain would be put on finances for many consumers due to government cutbacks and rising living costs as well as possible job losses.
Mountford said: “Apathy in the current climate really can impact consumers’ wallets and by simply putting a few hours aside to review their finances and shopping around for better deals, it is possible to make some serious savings.”
He said that there were some competitive deals around when it came to mortgages, credit cards, services, and even savings, so it was well worth consumers taking the time to shop around.
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Tuesday, March 22nd, 2011
For many people it has been difficult over the past few years to decide whether to put any spare money into savings so that they have cash to emergencies or for luxuries and treats, or whether to use their spare money to pay down their mortgage and clear other debts. Of course, few of us have what can be described as ’spare’ money these days. However, for those of us that have variable rate mortgages the repayment amounts have been much lower over the past couple of years because of the rock bottom interest rates stemming from the all time low base rate of 0.5 percent.
Many homeowners with variable rate mortgage have been delighted that interest rates have remained low for the past two years. This has seen their monthly repayments plummet in some cases, leaving them with far more in the way of disposable income each month. However, there are been mixed reactions in terms of how this spare money has been used each month by those that have saved on their mortgage repayments.
Whilst it is important to have some money in savings in order to fund an emergency of in case of a job loss it is important not to focus solely on saving the money each month. Even though many believe that the interest rates could increase soon it is still worth spending however long is left in terms of lower repayments using the money to pay off some debt. Some people have used the spare cash to reduce the mortgage by overpaying on it. However, for those that have unsecured high interest debts such as credit cards and loans it may be an idea to spend as long as possible paying these off with that money.
The first thing to bear in mind is that if interest rates do rise, as is expected, then monthly repayments will also increase. For some people this could come as a financial shock, and if there are also unsecured debts to cope with this could make things very difficult. Paying off the unsecured debts means that if rates and repayments do increase the financial changes will be easier to cope with.
Also, bear in mind that the current returns on savings are very low, which means that you will save far more by paying off high interest debt than saving money in a low interest account.
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Wednesday, March 16th, 2011
It has been claimed recently by a leading debt charity that many households are set to feel the financial squeeze as a result of a range of factors that is affecting affordability for many individuals and households. The warning comes from the Consumer Credit Counselling Service, which has said that middle earning families are likely to be most affected.
Amongst the factors that are thought to come into the equation are rising interest rates, fewer tax credits, and higher tax thresholds. According to the CCCS many vulnerable families would continue to struggle in terms of their finances, and this was especially true of families or households with a lot of children.
Homeowners are said to have a higher level of unsecured debt than those renting a property according the CCCS data. Almost half a million households were assessed as part of the study by the debt charity. The data showed that the typical age of the person seeking help from the charity was now forty two years, and the age of those in the most debt was between fifty and fifty nine years.
The CCCS said that a rise of just 2 percent on the interest rate could result in the average monthly mortgage increasing by £307, which would put additional strain on households.
The charity said: “The picture is undoubtedly bleak and it seems likely that many more families, including better-off ones, will be increasingly prone to over-indebtedness in the months ahead. It is also not a uniform picture across the country: public sector cuts in terms of jobs, spending and benefits will weigh disproportionately on certain groups of people. The incidence of unmanageable debt bears down harder on specific parts of the country, such as London and Yorkshire.”
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Monday, March 14th, 2011
As most people are aware the personal debt issue in the UK has spiralled out of control, with many people that have accrued debts such as credit cards, loans, and other forms of personal debt. However, it has recently been revealed that many also owe a lot of money to energy firms, with the soaring costing of energy leaving many unable to afford their bills.
The rising cost of living in general, along with factors such as a cut in income or welfare, job losses, and increasing outgoings, has left many people struggling to keep on top of their bills. Energy prices in particular have soared and with the last couple of winters having been so bitterly cold this has resulted in a rising number of people being unable to pay their bills.
It has been revealed that many people are now in debt to energy firms, with a total of £624 million owed to these firms. It is thought that the average amount owed by households is around £126 each. The data comes from the comparison site uswitch.com. Nearly 40 percent of energy customers said that they owed more to their energy firm now compared to last year. Just 14 percent said that they owed less compared to last year.
One uswitch official said: “Energy debt can be a catch-22. Despite knowing they could reduce their bills by moving to a cheaper energy plan, consumers can see debt as a barrier to switching. However, our research shows that while the average debt is £126, consumers could save up to £458 by switching. So while they may have to pay any outstanding debt to switch, by cutting the cost of their energy they could avoid falling back in to debt in the future.”
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Friday, February 18th, 2011
There have been some very gloomy predictions when it comes to personal debt levels and problems for 2011 recently. Many industry experts are predicting that the number of people becoming insolvent will increase sharply this year, with a number of factors being blamed for the ongoing financial issues that consumers and households are set to face.
With money already tight in many households consumers have had to cope with soaring living costs, and hike in VAT, which came into force at the start of this year, government cutbacks affecting benefits and other costs, and continued uncertainty about jobs. On top of all this many people are still struggling to cope with the debt that they accrued over the Christmas and New Year period, which has placed even greater strain on their finances.
With many people expected to be tipped over the financial edge this year consumers should take whatever action they can to avoid becoming a debt statistic in this challenging climate. Consumers who are struggling with debt are being advised to seek advice now, particularly given the fact that over the coming months interest rates may increased, resulting in many households having to cope with increased mortgage payments.
Several weeks ago there were dire concerns over whether enough debt advice resources would be available to consumers due to government cutbacks. However, the government has now found the money to fund these services for an additional year, buying consumers more time within which to try and sort out their debt problems and issues. Anyone that is experiencing problems, or is likely to do so in the near future, should take advantage of these services whilst they are available, as the ongoing cutbacks could mean that resources could be pulled at any time.
The CCCS recently announced that its online debt counselling tool was proving very popular, and that there had been a surge in use of this online resource since the start of this year. Consumers have a number of ways in which they can get the help that they need in terms of debt advice, but they should take action as soon as possible in order to avoid spiralling debt problems that quickly go out of control.
The Citizen’s Advice Bureau and various debt charities can help to point those with debt issues in the right direction, and can look at a number of different options to address the issue as quickly as possible.
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Friday, February 18th, 2011
According to recent report there was an increase in demand for debt advice online during the month of January, as consumers continued to struggle with their finances. New research has shown that there was a surge in the number of people getting online to seek advice about their debt problems in the month of January, with many struggling with the financial hangover from Christmas and the New Year.
The Consumer Credit Counselling Service offers an online debt counselling tool, and officials from the charity said that there was a sharp rise in the number of people that were using the tool. In total 8591 people are said to have used this counselling tool, called CCCS Debt Remedy, in January of this year, which was twice the number that used it in the previous month and a higher number than any month of the previous year.
In total last year 65,825 people used this counselling tool to get help with their debt problems. The CCCS believes that based on the figure for January there will be a sharp increase in the number of borrowers looking to online debt assistance over the course of this year. In fact, the charity believes that there could be a dramatic rise in those seeking help with their debts given the soaring cost of living, the VAT hike, and uncertainty over job security.
Delroy Corinaldi, CCCS External Affairs Director, said: “The next year will be very difficult for many people and I am concerned that those struggling with debt will end up being charged for debt advice because they are unaware that free advice and support is available. I hope that the availability of this free service which can be used at any time online will help prevent people paying for debt advice unnecessarily.”
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Thursday, February 17th, 2011
Over the past couple of years the situation regarding personal debt in the UK has become increasingly bad, with more and more people finding themselves plunged into debt as a result of a number of factors. The global financial crisis, restrictions in the financial markets, job losses, and the recession have all been blamed for the problems that many people have been facing when it comes to their personal debt levels.
According to industry experts personal debt levels and the number of people struggling to stay afloat financially could get worse over the course of this year, and this is due to the surge in unemployment levels amongst other things. In the last three months to the end of December unemployment is said to have rocketed by 44,000, taking the number of unemployed to nearly 2.5 million.
The coalition government has acknowledged the rise in unemployment, which is hitting younger people particularly hard, but has said that the situation is getting better. Employment Minister Chris Grayling said: “We’ve got a long way to go and I want to see these figures start to come down, but certainly the evidence is over the past month things have settled down and we are not seeing the increases we saw earlier in the last quarter.”
It is thought that a number of other factors will also exacerbate the debt problem. For example, the base interest rate is set to increased over the course of the year in order to keep a lid on inflation, and it is thought that once this happens and homeowners‘ repayments increase many will face increased debt issues and repossession numbers could increase again having fallen over the course of last year according to the Council of Mortgage Lenders.
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Wednesday, February 16th, 2011
A rising number of consumers in the UK are said to be retiring with debts still hanging around their necks. In the past most people had repaid their debts by the time retirement came around, enabling them to relax and enjoy a pleasant retirement with adequate funding. However, times are hard for all age groups at the moment and many that are coming up to retirement still have many debts to pay off.
It is claimed that a rising number of people coming up to pension age will have to look at continuing with work past their retirement age in order to have adequate funds to pay for living costs and pay debts. Many may have to work a couple of years past retirements by some may have to extend their working, albeit on a part time basis, by up to ten years.
A survey that was carried out recently by the Prudential showed that only 12 percent of people polled were happy to retire on time because they had an adequate pension in place to fund their lifestyle and enable them to keep up with financial commitments.
An official from the Prudential said: “This year will see the phasing out of the default retirement age, making it easier for those wishing to stay on at work. Additional retirement income is also becoming more important as the security of a defined benefit pension scheme disappears for many people.”
He also said that it was important for consumers to take the time to see a financial advisor and set up a good pension sooner rather than later to ensure that they would not have to work past retirement.
He added: “Seeking advice from a financial adviser should be a prerequisite to ensuring you achieve the level of pension income you want and need.”
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Wednesday, February 16th, 2011
In the past having high levels of debt is something that has commonly been associated with younger people. However, it has emerged that more and more older people are now struggling with personal debt levels, making it difficult for many to be able to enjoy their retirement. For those that still have a fair amount of debt when retirement comes around there is no other option other than to continue working, as otherwise they will find it impossible to make repayments on their debts.
However, those with a decent pension pot may find that they can still afford to retire and can use part of their pension money to repay any debt that they have outstanding at the time that they retire. In order to do this, however, consumers need to ensure that they have an adequate pension that will allow them to make these debt repayments and leave them enough to enjoy a pleasant and comfortable retirements rather than leaving them struggling to make ends meet.
A huge number of people in their 30s and 40s have little or nothing by way of a pension pot, and whilst retirement may seem like it is still a very long way off it can come around far more quickly than many expect. This leaves many people in the difficult situation of having to determine whether or not they can actually afford to retire on the pension that they will receive, which is particularly hard if you still have outstanding debt. For many the only option is to continue working in order to be able to afford living costs.
A survey was recently carried out by the Prudential showing that more and more people that were coming up to retirement age were considering staying on at work for up to ten years in order to earn more money and increase their pension pot. However, some forward planning means that future generations that are coming up to retirement in years to come may not have to face this difficult decision. Prudential officials have said that consumers should start planning their pension early and should seek financial advice from experts to ensure that they get the right pension for their needs.
An official from Prudential said: “This year will see the phasing out of the default retirement age, making it easier for those wishing to stay on at work. Additional retirement income is also becoming more important as the security of a defined benefit pension scheme disappears for many people.” He added: “Seeking advice from a financial adviser should be a prerequisite to ensuring you achieve the level of pension income you want and need.”
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Tuesday, February 15th, 2011
It was recently announced that the Citizen’s Advice Bureau was set to lose a large number of its face to face debt advisors as a result of government funding cuts, which would have had a serious effect on the ability of the charity to help the many people that approach it for debt advice each year. Demand for this sort of advice has soared over the past couple of years due to the financial crisis and recession, and there were concerns that the loss of services could have a profound effect on the ability of consumers to get the advice that they needed.
However, it has now been announced that the government has found an additional £27 million that it can plough into face to face debt advice for consumers, which means that the sector can benefit from funding for another year during which more people with debt related problems can receive the help that they need.
Many people have had to seek debt advice because of their financial issues over the past couple of years, and there are many more than will be looking for help this year as a result of soaring living costs, VAT increases, job losses, and possible interest rate hikes, which may come later this year according to some industry experts.
Secretary of State for Business Vince Cable stated: “It´s vitally important that everyone has access to free debt advice, and I am pleased to announce that the Department for Business will provide the £27 million necessary to maintain the programme of face-to-face debt advice. While the Government has maintained funding for this programme, it provides only a small part of the revenue necessary to keep the Citizens Advice network fully functioning. I would like to take this opportunity to call on the other funding streams, such as from local authorities, to help provide whatever support they can to keep this excellent service going.”
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Monday, February 14th, 2011
Concerns are rising that many homeowners in the UK could be hit with big debt related problems later this year as a result of base interest rate increases, which many believe will occur in the spring. Whilst the base rate has been at its record low of just 0.5 percent for twenty two months now many believe that it could rise in April or May, as the Monetary Policy Committee tries to keep a lid on inflation.
An increase in interest rates could send the repayments of some homeowners soaring by hundreds of pounds a month, and in the current financial climate this could lead to serious financial issues that tip some people over the financial edge. For those on fixed rate mortgages the interest rate increases won’t have any effect at present, but those on variable rate loans will see a difference in the amount that they have to pay each month.
For those who do have to make higher repayments on the mortgage following interest rate increases it could compromise on their ability to meet other financial commitments, which will lead many to seek debt related advice from financial experts in the field. The demand for debt advice is already sky high due to the financial problems caused by the credit crunch and the recession, and this could push numbers even higher.
One official said: “With all of the problems that are hitting consumers at the moment it is little wonder that more and more are looking for advice from financial experts. The high cost of living, VAT hikes, job losses, and government cutbacks are already playing havoc with consumer finances. An interest rate increase could be the final nail in the coffin for some people.”
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Thursday, February 10th, 2011
The level of personal debt in the UK has become an increasing concern, especially given the difficult financial and economic climate that so many people are facing at the moment. Increased living costs, a rise in VAT, higher risk of job losses, and government welfare cuts have left many people struggling with their everyday living costs.
The Insolvency Service recently released figures showing that although there was a drop in personal insolvency levels in the final three months of last year the number of insolvencies over the course of the year rocketed to record levels last year. The bad news is that officials believe that the number of insolvencies could rocket even higher over the course of this year.
Figures have shown that a huge number of people are now finding it difficult to make their money stretch to the end of the month when they next get paid, with many running short around two thirds into the month. This means that for one third of the period many people are relying on credit to get them through, and this is resulting in credit card balances, overdrafts, and loan debt spiralling out of control.
It has even been claimed by the Citizen’s Advice Bureau that problems with money have resulted in the increased number of cases of depression and mental illness.
Figures show that there were over 135,000 personal insolvencies last year, and this could increase to in excess of 150,000 this year.
One industry official said: “Unfortunately, it’s only going to get tougher as the government’s austerity measures are only just beginning to be felt in people’s wallets. I doubt that when the coalition government came to power last May, it envisaged that its austerity measures would result in such a startling increase in the cost of living. These spiralling costs, coupled with worldwide commodity shortage and conflicts in the Middle East pushing up oil prices, means that the future doesn’t feel that bright! We have at least begun pay back our debts, some £24 billion in the last 12 months but again this is marred when you consider that banks have written off nearly £10 billion of our debt over the same period.”
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Monday, January 31st, 2011
It has been suggested in a recent report that the debt advice system in the UK needs to be streamlined or order to make it more effective for those in need of such services. The suggestion comes as consumers gear themselves up for another financially challenging year, with the soaring cost of living, the VAT hike, government cuts, and potential job losses leaving many households in the financial edge.
If the year turns out to be as challenging as many have predicted it will be there could be further sharp increases in demand for debt related advice, as more and more people realise that they cannot keep up with their financial commitments in the difficult climate. The suggestion has come from the British Banker’s Association, which said that streamlining this sector could provide consumers with greater benefits.
The BBA said that consumers need to be given a better understanding of the system, and debt advice firms should be able to offer assistance to those struggling with debt at an earlier stage. Struggling consumers should also be given a wider range of options according to the BBA, as well as being offered clearer advice on what is available to them and how it can help. Officials from the BBA expressed concern over the confusion in the sector at present, with both formal and informal solutions being offered to consumers, and with some firms charging for advice and others offering it for free.
One of the people involved in the report said: “Our vision is to provide a clear and coherent process to help people facing debt difficulties, to intervene early where possible and to provide a simple debt resolution solution if those early attempts do not succeed. We want to unravel the red tape to bring about a more financially responsible solution for customers.”
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Wednesday, January 26th, 2011
Figures from the Bank of England have indicated that many people in the UK are still struggling with huge debt levels, with a lot of the debt having been accrued some time ago. The central bank has suggested that consumers had started to tighten their belts even before the VAT increase came into play at the start of this year. However, many still face huge levels of debt this year according to the report.
Many consumers are still paying off debt that was accrued last Christmas according to the data in the report. Figures have shown that over recent months consumers have been paying back debt rather than accruing it, and the VAT increase has resulted in more people tightening their belts so that they do not fall into further financial difficulties.
However, there are many factors that are out of the control of consumers, such as inflation levels, the VAT increase, job losses, and spending cuts, all of which could have a severe negative impact on the state of household finances. This means that even with the best of intentions many people could be set to face another difficult year with high debt levels to deal with.
Whilst personal insolvencies are said to have fallen officials are concerned that the level of insolvencies is still high. Many are calling for increased assistance for consumers to learn how to manage their money better.
One official from the insolvency service said: “Although personal insolvency levels are no longer rising, they remain stubbornly high, reflecting the high levels of personal debt that persist across the country. Prevention is much better than cure as far as personal finances are concerned. Review your personal finances frequently and make sure you are not taking on debt you can’t afford to repay.”
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Tuesday, January 25th, 2011
High personal debt levels have been a worry in the UK for many years, but over the past couple of years this is a problem that has increased. The global financial crisis and the recession have left many people in a very difficult position in terms of their finances, with many struggling to make ends meet after going through a few very challenging years.
A recent report from the Bank of England has warned that many people will face yet another year of financial difficulties and debt problems this year, and this is due to a number of factors. Many people are still paying off debt from Christmas, and many are still paying debt that has been accrued over a number of years. On top of this there is the VAT increase that consumers have to deal with, which has resulted in the cost of many items rising.
Sky high petrol prices are adding to the financial misery that many people are facing, as is the soaring cost of living in terms of food and energy prices. A final nail in the coffin is rising unemployment, with public spending cuts and other factors likely to send unemployment levels soaring. All of this will put a huge strain on finances for many people, leaving many on the financial edge.
It is little wonder that so many people are getting more and more worried about their finances, and those in debt will be particularly concerned because of the difficulties that they face when it comes to repayment. If you are one of the people who has been severely affected in terms of their finances by situations that are out of your control then you should look at seeking advice and assistance as early as possible so that you are able to address the issue before it spirals out of control.
There are many debt advice charities and agencies that will be happy to provide you with valuable advice and assistance with regards to your finances. It is always worth talking to one of these agencies if you are concerned about your debt levels, as they could provide you with help that could make a big difference. They can also help you to get a better grasp of managing your finances, so that you are in a position to handle the forthcoming problems such as soaring prices on goods and services.
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public spending,
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nail in the coffin,
High personal debt,
coffin,
European Union
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Tuesday, January 25th, 2011
In the current climate, and given the financial difficulties that most people are facing, it is not surprising that so many people have strong concerns about their credit card debt. Many people have racked up huge amounts of credit card debt over the past couple of years, with many even using their cards to make payments on their rent, mortgages, and bills.
However, although the level of concern over the huge amount of credit card debt that many people are in has increased it seems that many credit card providers are determined to encourage cardholders to get into increasing levels of debt on their cards. This is because some providers are now charging people that do not clock up debt on their credit cards by charging what is effectively an inactivity fee – a fee that is charged for failure to use the card.
It is likely that a rising number of credit card providers will now start charging these fees given the new regulations that have been brought in to provide consumers with a fairer deal when it comes to their credit card debt. These new regulations will mean that credit card companies suffer losses, and many people guessed that providers would try and find new ways to recoup the cash, such as by increasing interest rates and applying fees such as these.
One industry official said: “Consumers that use their cards and cannot repay the balance in full often get charged very high rates on interest on their borrowing. On the other hand, those that are trying to keep their heads above water by not using their cards and avoiding debt may now be charged. It seems as though you just can’t win when it comes to some credit card providers. For people that only want a credit card for emergencies this could be a big problem, as they will have to either use the card, emergency or not, or face paying a fee.”
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Monday, January 17th, 2011
A student’s life is meant to be all about learning, studying, moving up the educational scale, and even the odd bit of partying and travelling thrown in for good measure. However, these days more and more students seem to be joining the ‘real world’ by spending an increasing amount of time in paid employment whilst they are at college or university.
A study was recently carried out by the NUS and Endsleigh Insurance, and the information was compiled into a report called the Student Lifestyle Report. The information in the report looked at different areas of student life in order to analyse student lifestyles, and looked at areas such as debt, employment, education, and options whilst at university.
According to the analysis more and more students are now spending time in paid employment, and this is partly to cover their financial commitments and debts whilst they are at university. According to the research students worked an average of thirteen hours a week in 2008, but in 2010 this went up to an average of fifteen hours per week in paid employment.
The report also found that a rising number of students were working in paid employment during their holidays, when they were supposed to be spending time resting and studying for exams.
One official involved in the research said: “University offers a unique opportunity for students to grow and develop responsibilities, both academically and financially. It is perfectly healthy for students to seek paid employment whilst at university and in the holidays, particularly if this relieves financial pressure on living costs. However, it is equally important to make sure that students leave enough time to devote to their academic course in order to ensure they get the best possible qualifications.”
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Wednesday, January 12th, 2011
Over the past year or two many people have fallen into debt, with many accruing higher debt levels through no real fault of their own. In the past we used to borrow on loans and credit cards to pay for luxuries such as new cars and holidays. However, over the past couple of years this has changed, and people have started to take out loans and use credit cards to pay for every day purchases and essentials rather than just for luxuries and one off purchases.
The higher cost of living compared with the lack of increase in salaries means that people are now finding it more and more difficult to cope financially and make ends meet. Petrol and food prices have soared, the cost of vehicle insurance has rocketed, and many other basic living costs have risen, but wages have only increased slightly, been frozen, and for some people have even fallen.
The temptation to start relying on loans, credit cards, and other form of unsecured credit has increased amongst those that are struggling to afford the things that they used to be able to afford. This has led to more and more people turning to finance and credit for things that they normally wouldn’t have put on credit, and is of course contributing to an increased level of debts amongst households.
In fact, a recent survey was carried out by Scottish Provident showing that these days Brits have to be over £15,000 in debt in order to start worrying about their debt levels. Furthermore the survey showed that around 11 percent of people that were in debt and were struggling to pay bills and keep up with financial commitments would still be prepared to turn to finance and take out another loan.
With the new year only just starting now is a good time for those with debt to try and avoid getting into any more debt, and instead look at ways of addressing the situation so that they are not paying out more than they can afford each month, and can pay for essentials without having to turn to additional credit. This could means going to a debt advice expert or charity for help in budgeting more effectively, or could mean consolidating existing debt with a cheaper, lower rate consolidation loan, so that you do not owe any more money than you already do but can reduce the amount that you are paying out each month through lower rates and longer repayment periods.
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form,
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survey,
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loans,
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Wednesday, January 12th, 2011
A recent survey has shown that there are worrying trends when it comes to personal debt amongst consumers in the UK. The survey was commissioned by Scottish Provident, and seemed to indicate that consumers have a surprisingly high threshold when it comes to how much debt they will build up before they start to get worried about their debt levels.
The study results showed that it takes nearly £16,000 worth of debt for the average Brit to start worrying about their debt levels. Scottish Provident said that the results of the study are worrying because they indicate that consumers till have a fairly lax attitude when it comes to their debts, despite the difficult financial climate and the continued fragile economy, not to mention concerns about jobs.
For the average Brit the amount that they would have to have in personal debt would be £15,837 before they started to worry about their debt levels. However, for younger people this figure was even higher, coming in at £16,646. The total amount owed in personal unsecured debt on 5th January 2011, according to figures from the Bank of England, came in at £215,834,000.
An official from Scottish Provident said: “With the UK’s national debt figure dominating the headlines, it appears this could have had an adverse affect on how the nation views their own personal finances. To not believe they would be in serious financial difficulty before they reached debt levels of over £15,837 is a worry, and it underlines how debt has become too readily accepted in the UK. What starts out as a small level of personal debt can quickly spiral out of control, so Britons should ensure they keep on top of their personal spending.”
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Monday, January 10th, 2011
A recent survey was carried out the results of which showed that many Brits were regretting not paying off more of their debt last year. According to the survey, which was carried out by Internet banking giant First Direct, which is part of the HSBC group, around 53 percent of those polled as part of the survey said that their biggest financial regret of 2010 was not paying off more of their debt earlier.
The survey involved polling around one thousand adults in the UK, and 82 percent of them said that the area of their finances that they were most concerned and unhappy about last year was their loans and credit cards. There are fears that whilst debt has become a major problem for many people over the past couple of years the situation could get worse as a result of government cutbacks and further job losses, which are due to take place this year.
Many people may have made New Year’s resolutions this year to get their debts sorted out, and for those people it is important to take action as soon as possible rather than putting things off again as they may have done last year. Consumers can look at consolidation of their various debts with a low cost consolidation loan, particularly given that loans of £7500-£15000 are said to have come down in terms of interest rates as a price war breaks out amongst lenders.
One official said: “The New Year is the ideal time to reflect on your financial habits and change these for the better. The earlier people start to plan their finances and look to the future, the easier they will find their long term financial position.”
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loan,
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Saturday, January 8th, 2011
Getting debt advice has become more and more difficult of late, and for the past couple of years the demand for such surfaces has become huge as an increasing number of people have found themselves struggling with their finances. For many this has meant that they can no longer make ends meet in terms of their finances, and it has become necessary for them to seek advice to try and get their debts and finances sorted.
However, because of the number of people that are currently trying to get advice from debt charities and the like the waiting times for appointments to see a debt expert have rocketed. This has resulted in people having to wait for huge lengths of time to get the advice that they need, and for this reason many may end up going to a debt advice counsellor that charges.
One industry expert has now said that it should be everyone’s right to be able to access timely free debt advice rather than having to pay, adding that this advice should be extended to those that have overspent on their savings as well as those that are struggling with debts such as credit cards, loans, and other types of debt. She expressed concern that many people were not getting access to debt advice for free, and for some people this could mean that they are not able to get the advice that they need and their debt problems could end up getting worse.
Personal debt levels have been rocketing since the onset of the global financial crisis, and many people have discovered that their finances are severely overstretched. This said, The Insolvency Service has said that the number of personal insolvencies has started to fall, although the number of pensioners that are becoming bankrupt has been rising according to the figures.
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reason,
past couple,
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Thursday, December 30th, 2010
According to recent reports many people are set to experience pay freezes next year, which means that more and more people will struggle to keep on top of their financial commitments, and many may fall into increasing debt because of the cost of living rising whilst pay is being frozen.
Last year also saw many workers having no pay increases, as companies tightened their belts and either reduced pay increases or froze them altogether. Many officials believe that next year is going to be equally as challenging, and many people will have to continue struggling along with no increase in their pay.
The concern that many people have is that whilst pay is being frozen or rising only marginally the cost of living is continuing to soar, with prices on things such as food and petrol rocketing. On top of this, January will see the VAT increase of 2.5 percent kick in, which means that consumers will be paying more for many of their purchases even though their salaries are not increasing.
For that are already struggling to repay their debts and keep up with their financial commitments the lack of salary increase coupled by the soaring cost of living and the hike in VAT could lead to real problems, and could leave many unable to make payments on debts and other financial commitments.
However, the British Chambers of Commerce said that things may not be as bleak as they seem, stating: “Despite a number of businesses suggesting that pay will be frozen, almost as many are suggesting wage rises in 2011. Equally, many businesses say they will deal with reductions in public spending by taking a hit on the bottom line, rather than by reducing staff numbers. This continues a trend we first saw during the recession: firms doing whatever they can to retain staff, even when conditions are more challenging.”
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Tuesday, December 28th, 2010
With the post-Christmas sales now in full swing many people have rushed out with their credit cards to buy all sorts of things that they don’t want and don’t need simply because the price is lowered at this time of year. This has fuelled concern amongst industry officials with regards to how much debt many people will end up in, having already spent a fortune on Christmas and now giving their credit cards a good bashing at the sales.
So, should you give in to the temptation of the sales or should you simply reflect upon the amount that you have spent over Christmas and try and tone down the purchases for a while? Well, the concern seems to be over people that are rushing to the sales to buy things that they do not actually need simply because the price is right, which in effect makes the purchase a waste of money, albeit a cheaper waste of money than it would have been if not in the sales.
The sales are great for people that are looking to make a purchase and can save some money on the cost as a result of the slashed prices that shops try and entice consumer with. So, for instance if you were planning to buy a new fridge freezer in the coming months buying in the sales could be ideal, as it will save you the additional VAT that will come into force at the start of January and will enable you to enjoy cut prices.
If on the other hand you have a perfectly good fridge freezer but you buy one simply because it is cheaper than it was before the sale then you may effectively be wasting money that you cannot really afford. It is important to think about the purchases that you make in the sales rather than snapping up anything with a reduced sticker on it, as this way you will be saving money on the things you need rather than wasting money on the things that you don’t.
If, for instance, you are going to a wedding in 2011 and you know you will need to get a new outfit, now could be the ideal time to get it so that you can get it at cut price. Another good idea, if you have the available funds, is to start thinking about birthdays and Christmas for 2011. The cost of many gifts is slashed right after Christmas as shops try and get rid of excess stock, so you could save money on everything from gift sets and jewellery to fragrances and more.
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Tuesday, December 28th, 2010
When sensible tips for debt consolidation are used it is possible to get out from under the financial stress. These tips can help to clear up the outstanding debts by budgeting properly, not taking on new debt and rather than having 10 bills each month it is consolidated into one. (more…)
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Debt-snowball method,
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debt,
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