Credit cards, loans, mortgages, what can be done to reduce the UK personal debt burden
These figures are worrying as they only cover levels of unsecured personal debts as opposed to being inclusive of large secured loans such as mortgages.
Another finding of the report was that the levels of "extreme" debt appear to be worsening; as the proportion of clients reported who owed more than £100,000 to creditors has now increased from 1.4 percent in 2004 to a current level of 2.7 percent.
This survey has been released at the same time as another by the Royal Bank of Scotland which indicates that one in five current account holders never open their bank statements, while a further 23 percent only occasionally check their statements for errors.
Under Financial Services Authority regulations, accredited members of the banking and financial services industry such as Barclayloan are now presenting unsecured and secured loan products in a more transparent manner, using quick glance summary boxes to show product information, rates and potential additional charges. If however a large section of the public is so disinterested by their own personal finances that they will not read their own bank statements, it seems that this type of action may not lead to the widespread improvements in the public's financial knowledge that the Financial Services Authority may have hoped for.
To get the most out of limited finances there are many small changes that can be made which won't hurt, such as:
- Shopping around online to get the best value credit cards, loans, and insurance through financial comparison sites like Moneynet.
- Running a trial budget, keeping a track on all spending, can help highlight areas where costs can be reduced
- Check any benefits and tax credits that may be getting claimed to see if there are any other additional benefits to which you may be entitled
- Check existing finance agreements, credit cards, utility bills, etc, to see if there is a better deal to be obtained since originally taking them out
- Seek qualified advice before finances start getting out of hand
- Reading financial contracts before agreeing to them and seeking independent advice wherever possible can save expensive problems occurring later on
Disclaimer:
All information contained in this article, is for general information purposes only and should not be construed as advice under the Financial Services Act 1986.
You are strongly advised to take appropriate professional and legal advice before entering into any binding contracts.This article is free for republishing
Source: http://www.articlealley.com/article_68636_19.html
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