People do say, in many walks of life, that your first step to realising you have a problem is admitting that you have the problem. Easy to say and it makes a lot of sense – but a lot of people in society do use forms of denial as a way of avoidance on many subjects.
Debt is no different. It is so easy to assume all is well and that you don't need debt advice. Avoidance of the requirement of debt advice often falls into 2 categories:
1. Cut spending but cannot make significant inroads into clearing the debt.
2. Completely ignore the debt and continue borrowing on new or existing credit limits.
Both are a clear sign you need help with debt management – however it is clear to see that point number 2 is the worst situation to be in.
Write down what you owe and to whom. Then write down how much you pay on the debts per month. If you think that you're paying too much on unsecured debt then you need to get debt management.
Another step that you should take is to stop borrowing. If you have more credit available on your credit cards – don't spend it – if you do you are spiralling towards more debt and higher monthly payments on this debt.
In times of low interest rates on savings you will save money also if you move any savings that you do have to clear existing debt – chances are you're earning none or very little interest on your current savings.
Friday 30 October 2009
Tuesday 20 October 2009
Issues With Borrowing Money And Debt Management
People have always been in debt. There will always be borrowing and many don't consider a mortgage to be debt – but of course it is. If your property was to half in value and you had a 100% mortgage then the bank would still want their money back – and rightly so. However, just because borrowing has become more difficult does this mean that people are no longer getting themselves into debt problems like they were a few years ago? I think not and here is why...
I have 2 credit cards. I used to use them a lot but now I don't. They used to have a large amount owing on each but I have managed to reduce the balances massively on them both now so there is very little outstanding. So, I'm in a good position with my credit cards – I owe hardly anything on them so therefore my debt is low and I'm not paying a significant amount of interest. I'm sure I'm not alone in this situation.
Here's my point though. I can borrow up to £7,500 on Credit Card 1 and £6,000 on Credit Card 2. I'm not going to – but say I was to suddenly use all this money and treat myself. I would then owe £13,500 and with a minimum payment of 3% a month I'd be paying £405 a month – with the majority being interest. Now let's say I now lose my job, let's be honest, many are at the moment. I'd be absolutely stuck and be seeking debt advice urgently – possibly even debt management.
I have 2 credit cards. I used to use them a lot but now I don't. They used to have a large amount owing on each but I have managed to reduce the balances massively on them both now so there is very little outstanding. So, I'm in a good position with my credit cards – I owe hardly anything on them so therefore my debt is low and I'm not paying a significant amount of interest. I'm sure I'm not alone in this situation.
Here's my point though. I can borrow up to £7,500 on Credit Card 1 and £6,000 on Credit Card 2. I'm not going to – but say I was to suddenly use all this money and treat myself. I would then owe £13,500 and with a minimum payment of 3% a month I'd be paying £405 a month – with the majority being interest. Now let's say I now lose my job, let's be honest, many are at the moment. I'd be absolutely stuck and be seeking debt advice urgently – possibly even debt management.
Monday 19 October 2009
Uks Unsustainable Debt Problem And The Growing Need For Debt Help
A report by the European Commission on the long-term prospects for Britain's public finances warns that unsustainable debts are a real risk to Britain. This implies that the nation will be unable to manage its debts and that only default or high inflation can relieve the burden.
The Commission's 2009 Sustainability Report says that Britain will suffer a "sustainability gap" of 12.4 per cent of GDP – meaning tax rises or spending cuts amounting to close to £200bn a year.
The Commission says the black hole in the British public finances is far higher than the EU average of 6.5 per cent. It implies that, as Britain's population ages and makes increasing demands on the NHS and state pensions, governments will have to make even more painful decisions on public services and taxation in the decades ahead than so far envisaged. The Chancellor, Alistair Darling, currently plans a tightening of 6.4 per cent of GDP by 2017. The Commission's time horizon stretches to the middle of the century.
The existing crisis in Britain's public finances will be exacerbated by long-term population and social trends such as a pattern of high borrowing followed by debt management, says the Commission: "To put public finances on a sustainable path, the United Kingdom should improve its structural primary balance in a durable manner by 12.4 per cent of GDP. In principle, this adjustment could take place via both an increase in revenues and cuts in expenditure. Alternatively, the social protection system would have to be reformed to decelerate the projected increase in age-related expenditure."
Ignominiously for ministers, Britain is placed in the same sin bin of fiscal profligacy as the Czech Republic, Cyprus, Ireland, Greece, Latvia, Lithuania and Romania. The Commission says that by next year four EU members – France, Hungary, Portugal and Britain – will have debts between 80 per cent and 100 per cent of GDP.
Since it is continuingly difficult for the public to get consolidation loans the only viable option for many is to seek debt consolidation.
The Commission's 2009 Sustainability Report says that Britain will suffer a "sustainability gap" of 12.4 per cent of GDP – meaning tax rises or spending cuts amounting to close to £200bn a year.
The Commission says the black hole in the British public finances is far higher than the EU average of 6.5 per cent. It implies that, as Britain's population ages and makes increasing demands on the NHS and state pensions, governments will have to make even more painful decisions on public services and taxation in the decades ahead than so far envisaged. The Chancellor, Alistair Darling, currently plans a tightening of 6.4 per cent of GDP by 2017. The Commission's time horizon stretches to the middle of the century.
The existing crisis in Britain's public finances will be exacerbated by long-term population and social trends such as a pattern of high borrowing followed by debt management, says the Commission: "To put public finances on a sustainable path, the United Kingdom should improve its structural primary balance in a durable manner by 12.4 per cent of GDP. In principle, this adjustment could take place via both an increase in revenues and cuts in expenditure. Alternatively, the social protection system would have to be reformed to decelerate the projected increase in age-related expenditure."
Ignominiously for ministers, Britain is placed in the same sin bin of fiscal profligacy as the Czech Republic, Cyprus, Ireland, Greece, Latvia, Lithuania and Romania. The Commission says that by next year four EU members – France, Hungary, Portugal and Britain – will have debts between 80 per cent and 100 per cent of GDP.
Since it is continuingly difficult for the public to get consolidation loans the only viable option for many is to seek debt consolidation.
Thursday 15 October 2009
Personal Debt Crisis Escalates. Debt Advice Companies Thrive
Approximately 70,000 people are desperately seeking help each month as they struggle to cope with debts of almost £1 million between them. New figures revealed illustrate an escalating personal debt crisis as the recession tightens its grip on struggling families throughout the region. The Citizens Advice Bureau said the number of people facing money problems has spiralled. A money advice specialist told the Standard: "We are dealing with an extremely high number of people in thousands of pounds worth of personal debt each month. Christine, who has worked at CAB for four years, says the majority of new clients are homeowners struggling to pay their mortgage. "The number of clients who are homeowners and seeking advice regarding debt problems is continuing to increase," Ms Sinclair said. "Many of them are struggling to pay their mortgage which could be the result of a job loss or perhaps a person can no longer get overtime at their work. debt help companies are one option they should consider." She said: "We anticipate that this situation will continue as the impact of the credit crunch takes effect and it could take several years for families to get back on track financially. "I would urge families to contact us early on with any financial problems they may have. We have an excellent team at hand to help people." CAB are currently helping 1,293 people locally overcome debts mounting to an incredible £17.7million. debt advice companies are noticing a boom in people seeking their help and a total of £1.7 million-worth of debt has been written off between April and September as dozens of people are forced to claim bankruptcy. Worrying Stuff.
Redundancy Fears Force People To Seek Debt Management
As the recession continues, a lack of job security and possible redundancy is forcing people in the UK to seek advice on debt management, debt consolidation and voluntary arrangements.
Research shows that legal help lines are receiving a fifth more calls than this time last year, many of the calls are relating to employment matters.
Private legal help can be very costly. Consumers are risking throwing themselves into further debt by consulting a private solicitor. This is not good, especially if finances are among the concerns.
Many people are seeking legal advice because of employment problems caused directly by the recession. The employment problems are far ranging, covering redundancies, a reduction in hours and pay, or changes in employment contracts.
We would recommend homeowners to include legal advice in their home insurance premiums to avoid the risk of having to spend even more should they find themselves in a difficult position.
More people who have property are now considering renting it out for extra income because of fears of redundancy, rising mortgage debt and the harsh economic conditions.
The average amount of money owed by every adult in the UK, including mortgages, is said to be around £30,000.
debt management can help you with your financial difficulties straight away. If you are having difficulties making your loan payments, paying your credit card bills or store cards, please contact our friendly team.
Research shows that legal help lines are receiving a fifth more calls than this time last year, many of the calls are relating to employment matters.
Private legal help can be very costly. Consumers are risking throwing themselves into further debt by consulting a private solicitor. This is not good, especially if finances are among the concerns.
Many people are seeking legal advice because of employment problems caused directly by the recession. The employment problems are far ranging, covering redundancies, a reduction in hours and pay, or changes in employment contracts.
We would recommend homeowners to include legal advice in their home insurance premiums to avoid the risk of having to spend even more should they find themselves in a difficult position.
More people who have property are now considering renting it out for extra income because of fears of redundancy, rising mortgage debt and the harsh economic conditions.
The average amount of money owed by every adult in the UK, including mortgages, is said to be around £30,000.
debt management can help you with your financial difficulties straight away. If you are having difficulties making your loan payments, paying your credit card bills or store cards, please contact our friendly team.
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