Tuesday, January 4, 2011
Category:
Consolidation
According to new research commissioned by Santander Credit Cards, the equivalent of more than 2.8 million credit card holders will be shifting £2.8 billion worth of debt onto new credit cards this year.
The findings are thought to indicate that Brits have been keeping a close eye on their finances during recent years. At the end of 2008, the average balance transfer made by ‘credit shifters’ reportedly stood at £2,290; however, this figure has now significantly reduced to £1,015. Irrespective of this decrease, it is believed that a considerable proportion of this debt may actually have been incurred some time ago. In fact, the research uncovered that the equivalent of 3.6 million Brits are still paying off debts from the Christmas before last – to the tune of £1.1 billion in total.
Director for Santander Cards, Ian Coles, commented: "Our research shows that millions of people are switched on to the benefits of transfer offers and are choosing to take a proactive approach to managing their money, which is great to see. The fact that the average amount being transferred has fallen considerably over the past couple of years would also suggest that consumers have reined in their spending and that credit cards are being increasingly well managed. January can be a particularly tough time financially, which is why we encourage consumers to keep a close eye on their finances and to shop around to ensure that they are receiving the best rates."
With regard to the age of ‘credit shifters’, the research revealed that 41 percent of 18 to 34 year olds with an outstanding credit card balance are intending to transfer this to a new card in 2011. At the other end of the scale, just 14 percent of those over the age of 55 are reportedly planning to take this approach.
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Homeowners with several outstanding credit card balances could consider taking out a
secured loan to consolidate them– in turn leaving them with a single secured loan repayment each month as opposed to juggling multiple credit card bills. One of many finance options available, a secured loan for consolidation could even leave borrowers with lower monthly outgoings, thereby freeing up useful money each month. However, if opting for a secured loan to consolidate debt, it should be remembered that consolidating your debt may increase the amount you pay back overall and extend the repayment periods of your debts.
