Thursday, January 15, 2009
Category:
Personal Finance Tips
According to research conducted by MoneyExpert.com, 30 percent of British adults are anxious about their ability to manage their personal debt.
These worries have come about thanks to the onset of recession, which is heightening existing financial pressures.
In addition, the research also reveals that 27 percent of debtors have sunk further into the red during the course of the last three months. Approximately 4 percent (equivalent to almost 1.8 million people) have increased their debts by more than 20 percent throughout this period. 17 percent of people have been able to reduce their debt exposure, with 27 percent retaining a constant level of debt.
Sean Gardner, Director of MoneyExpert.com, said: "Household finances are feeling the strain across the board with people struggling to keep their heads above water.
"It is extremely worrying that so many people are concerned about managing their debts. Nothing's so stark as a reminder that many of us are struggling to repay the money we owe.
"The Bank of England has slashed interest rates and the Government has bailed out the banks but there are few signs that the cost of borrowing is falling. There may be light at the end of the tunnel but for too many of us it seems the light is a train coming down the tracks."
According to the research, the individuals that are most likely to have fears surrounding their ability to repay debts are those that have recently found themselves on the property ladder – those between the ages of 25 and 44. Approximately 37 percent of people in this age bracket admitted to feeling either ‘concerned’ or ‘very concerned’. In contrast, just 21 percent of people over the age of 55 described themselves as similarly worried.
Sean Gardner added: "With talk of record national debt it can seem that we're all in for the long haul, but there's no reason for those with personal debt not to take steps to tackle their own. Methods such as debt consolidation, or simply moving borrowing onto cheaper products can all be appropriate means of lessening the burden.
"The crucial thing, though, is to structure a repayment plan, and not simply bury your head in the sand."
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Homeowners that are struggling with multiple credit cards and/or personal loans may wish to consider consolidating their debts with a
secured loan. Repayabale over a term from 5 to 25 years, borrowers can usually repay over a term to suit them. When repaying borrowing over a longer term, it should be remembered that this may increase overall interest charges.
