The end of the festive period means the tightening of belts and reigning in of budgets for many people as the overspend during the Christmas period is felt by the majority of the British public. Research conducted by the Money Advice Trust has revealed that one in eight people will struggle with their finances this month.
Official statistics confirm this fear reporting that personal debt in Britain has increased, soaring to the highest level in six years in November. Consumer credit reached a high of £1.3 billion; significantly higher than the average monthly spend of £1 billion recorded the previous six months.
It is largely believed that the surge in consumer credit was a direct reaction to in store reductions as Black Friday took the UK public by storm causing havoc in many stores. Howard Archer argues that the heavily discounted deals led bargain shoppers into a false sense of security and is likely to:
“have contributed to the high borrowing levels. Relatively high consumer confidence means people have become more prepared to borrow in recent months.”
Consumer culture appears to have blurred the boundaries of sensible spending as many households are left struggling with outstanding debt, unable to make mortgage or rent payments. A study conducted by Aviva has revealed that household borrowing debt has more than doubled what it six months ago was increasing from £7,840 to £16,300 with the majority of this on credit cards. Overall 2015 looks set to be a bleak year for personal finances with many admitting they expect to struggle in the upcoming months.
However for those concerned about finances proactive steps can be taken to help keep personal debt at a manageable level:
1) Set a monthly budget: Take the time to work out you monthly income against your outgoings, remember to include annual expenditure such as car insurance or road tax.
2) Do not ignore bank statements: Opening your statements will give you a clear idea of how much money you owe and allow you to incorporate repayments into your monthly budgets, making sure you make a clear not of the repayment dates.
3) Don’t be afraid to seek advice: The earlier you seek advice the easier your debt problem will be to solve as well as reducing the stressed caused by pressing money troubles.
If you require legal advice regarding debt please don’t hesitate to contact Farleys Solicitors Personal Insolvency & Bankruptcy team on 0845 050 1958, or alternatively you can email us. We offer free initial advice on bankruptcy, IVA’s, Debt Management Plans and debt issues.
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