Many people these days are struggling with a range of debts that they have accrued, and in the current financial climate coping with these debts has become more and more difficult for many people. However, many people that are worried about losing their jobs or about the ongoing challenges and difficulties in the financial markets may be trying to put money aside into savings even though they also have high interest debts.

Some industry officials have said that some people may find that they are far better off using their money to pay off higher interest debts rather than to put the cash into savings. However, whilst paying down debt is going to be more beneficial to consumers in a number of ways one official said that this would only be suitable for people that had at least some level of personal savings that they could use freely in the event of an emergency.

Many of those that are putting money into savings are getting little to no return on their cash because of the low interest rates that financial institutions are paying on savings accounts now, whereas if they used that same money to pay off high interest debts they could save a fortune in the amount of interest that they pay.

However, at the same time people do need to have some money put aside that they can use in the event that an emergency arises, otherwise if something unexpected occurs they may not be able to get their hands on the cash that they need to deal with it.

An industry official said: “As long as consumers have at least a little bit put aside in savings then any further excess cash may be best used by putting it towards savings in order to save money on interest.”