The Average Brit Is 15 Days Away From "Financial Meltdown"
New research recently published indicates that, if they were to lose their job or be unable to work during the Christmas festive season, the average UK household is now a mere 15 days away from financial meltdown.
Despite the fact that the average UK homeowner is currently experiencing a 10 percent rise in their monthly mortgage repayments, following the recent rate rises announced by the Bank of England, and notwithstanding that utility bills have risen, on average, 5 percent in the last six months, Brits will nevertheless spend more over the forthcoming Christmas festive period than at any other time.
Commenting on the combined effect of higher mortgage repayments, additional utility bills, and increased spending on Christmas festivities, Nigel Brittle, of Combined Insurance, part of the Aon Corporation, said, “We’ve been tracking the cost of living in the UK for the past 12 months and have found that the number of days a person could survive financially without an income is getting smaller. Six months ago, it was 17 days to financial meltdown and today it’s just 15 days.”
Moreover, research carried out on a sample of 2,000 households in the UK recently published by YouGov shows the average Brit is currently having to spend £115 of their monthly salary on credit card repayments and a further £59 a month in personal loan repayments. Despite this, alarmingly a report published F&C indicates that 17 percent of UK parents and grandparents will nonetheless elect to finance their record Christmas spending on their credit cards and/or by applying for personal loans to ensure that their loved ones don’t miss out on the festive spirit.
All of this uncontrolled festive spending has lead a number of consumer watchdog groups to become concerned that Brits are now letting their debt “snowball”.
According to Chris Tapp, associate director at Credit Action, the record levels of festive spending this year comes despite the fact that one in eight UK households has not yet managed to repay the credit card and personal loan debt they created to pay for their Christmas 2006 spending.
To limit the debt problems UK households will no doubt create for themselves during the remainder of the year, Mr. Tapp urges consumers to have a financially sound holiday season if they wish to ensure that 2007 really is a Good New Year by realistically budgeting their new year spending.
And we should always remember that New Year discount sales are just around the corner – when we’ll no doubt want to have some money in our pockets to pick up some juicy bargains!
Alisdair Milton
12th December 2006
More Information:
-
Did you know that switching lenders can save you money? Just because you agreed to a loan in the past, doesn’t mean that you have to stick with it forever. Most people stick with the same lender for years and years.
-
If you have a debt consolidation loan what would happen if you can't pay? This article gives some scenarios and some practical advice.
-
If it seems advertisements for debt consolidation loans are everywhere, it is because consolidated loans are big business. The primary reason for people taking out personal loans over the next year will be for debt consolidation.
External Links:
