December 2007 Archive
Posted on December 31st, 2007 in Debt.
Financial concerns can cause "stress and unhappiness" to Britons, particularly following the heavy cost of Christmas, an expert has warned.
James Caldwell, director of Fair Investment Company, suggested debtors create a budget and stick to it in order to bring their finances under control.
He commented that while many Britons are concerned about their tightening belts following Christmas excesses, millions will be worrying about their finances.
"Most money-saving is down to common sense. The less you spend, the further you can stretch your finances," Mr Caldwell continued.
Those struggling to stretch their household income should look at switching credit card provider to take advantage of the best deals or hunting down a more competitive energy supplier, he added.
Last month, Joanne Gills from debt management firm Chiltern warned that six million UK adults are struggling to manage their finances and one million claim they are "seriously overstretched".
She suggested debtors consider an informal debt management plan.
Other options open to those in problem debt include individual voluntary arrangements (IVAs) and consolidation loans.
Posted on December 28th, 2007 in Debt.
The recent increases in credit card rates are likely to continue in 2008, according to price comparison site Moneyfacts.
At the beginning of November the firm revealed that there had been a total of 125 increases in credit card rates and fees during the preceding two months.
Samantha Owens, head of personal finance at Moneyfacts, said an increase in rates were the only way credit card providers can make back the money after offering good deals and rates for a long period of time.
People who transfer their credit card balances after Christmas also need to be aware of the transfer balance fee, she added.
The firm reported in November that ten credit cards had increased the cost of transferring balances.
"[Customers should] keep an eye on their credit cards, make sure they check their statements and the little leaflets that are in there, to make sure that the interest rate isn’t going up," advised Ms Owens.
Posted on December 28th, 2007 in IVA.
A record number of people will be declared bankrupt or insolvent over the course of next year, according to accountancy firm KPMG.
UK payments association Apacs estimated that Brits will spend a record £53 billion this Christmas. This, along with tighter lending rules, has meant many borrowers will find it hard to manage financially next year, claimed KPMG.
Mark Sands, personal insolvency director for the firm, said: "Those in difficulty will find that their options are becoming limited – formal insolvency will for many be the only way out."
According to the research, over 130,000 borrowers are likely to enter into individual voluntary arrangements (IVAs) during 2008, compared to 110,000 the previous year.
Channel 4 News reports that £1.3 billion worth of debt was written off by creditors this year, as a result of people using IVAs.
This figure is lower than during 2006, where £1.4 billion of debt was cancelled out.
Posted on December 27th, 2007 in Debt.
January is the perfect time to sort out debt and manage personal finance, it has been claimed.
Debt counselling service Thomas Charles has announced that although Christmas can be a difficult time financially, it is "psychologically the right time".
James Falla, director of the firm, recommended that people in debt should budget and plan their outgoings in advance by using a spreadsheet.
"Start by putting some money away," he added. "It sounds very simple but in fact the amount of people that don’t do that is quite considerable."
Mr Falla advised people struggling with their finances to always save money at the beginning of the month rather than the end.
Research for Thomas Charles by YouGov found that 15 per cent of Britons are in debt of over £10,000, with men owing more than their female counterparts.
It also revealed that one-quarter of Britons will avoid spending on their credit cards this Christmas.
Posted on December 27th, 2007 in IVA.
Tempting discounts in the post-Christmas sales could have a negative impact on the economic situation of individuals and the country itself, a survey suggests.
While the City’s sentiments about 2008 are less than hopeful, consumer confidence in the economy and their own financial situation is still fairly strong, a Guardian/ICM poll found.
The Guardian suggested that a sales purchasing "frenzy" with little regard to possible downturns in the country’s economy, especially in the sub-prime sector, could pose serious problems.
Some 55 per cent of respondents said they were confident about both the wider economy and their own finances, only four per cent fewer than in the more stable economic environment of August 2006, the newspaper said.
It hypothesised that the effect of the credit crunch and interest rates had not yet impacted upon incomes sufficiently for it to be taken seriously.
Director of Thomas Charles debt counselling service James Falla suggested that people struggling with paying off credit cards and other debts could find a individual voluntary agreement a good option.
