UK Consumers Urged to Eliminate Personal Debt
UK consumers have been urged to rid themselves of personal debt and re-think their spending habits as Britain’s debt problem grows.
In light of recent reports of UK credit card spending rising sharply, debt help organisation, The Debt Counsellors, is strongly recommending that consumers make credit card debt elimination a priority.
Many consumers struggle to pay off debt from sources such as credit cards and loans, as the debt is constantly accruing interest.
Market indications are that credit card debt in the UK is worsening and experts are urging consumers to make eliminating their credit card debt a priority.
Figures from Moneyextra, a personal finance website, suggest consumer spending on credit cards has increased sharply in recent months.
The average balance transfer being sought by visitors to Moneyextra in July was £2,933 – a 10.6% rise on the previous month and the highest figure for six months.
The Bank of England has also recorded a rise in credit card debt: according to their figures, credit card lending went up by £0.2 billion in July, compared with a £0.1 billion rise the previous month.
The Debt Councillors are just one of many debt groups urging consumers to make eliminating credit debt a priority when it comes to deciding what and when are paid at the end of the month.
Recent reports have also warned of the financial dangers that lie ahead when consumers make only minimum payments to their credit card(s) each month. Some consumers could avoid a considerable amount of their credit card debt if they paid more than the minimum monthly payment, as less interest on the card debt would be accrued.
John Porter, a senior counsellor with the organisation, insists many people are letting their credit card debt rise to unmanageable levels, making them vulnerable to insolvency and bankruptcy.
Porter says: "There is a 'want now, pay later' culture in the UK and a lot of people overspend on their plastic and just pay the minimum amount every month. But this way interest keeps adding to the overall debt and they're back where they started, or worse off.
"Anyone who owes money on credit cards should think seriously about credit card debt elimination and get advice on the best ways of reducing and, ultimately, clearing the debt."
The UK seems to currently be in the grips of a ‘buy now, pay later’ culture as many use credit cards and personal loans as another source of income. This often leads to financial difficulties in the future as the household income struggles to cope with the demands debt repayments make on it.
Used responsibly, credit cards can often be extremely convenient as well as offering some amount of consumer protection. Credit cards offering loyalty bonus schemes mean that using a credit card instead of cash, for the weekly shopping for example, can earn points that can be redeemed in various ways, such as at high street stores or at the petrol pump. Spending only what you can afford on a credit card will often lead to stress free shopping as well as a few perks.
13th September 2006