Over-reliance on credit leading to debt problems?

Posted 15/06/2011

A dependency on credit could be leading many Brits into a spiral of debt that results in them having to declare insolvency.

This is according to Paul Crayston, media officer for the Money Advice Trust, who highlighted a widespread reliance on credit card loans and overdrafts as one reason why a growing amount of money is owed to credit providers in the UK.

Increased utility debts have also contributed, he said, as his group has reported a 181 per cent rise over the last four years in the number of callers who are reporting difficulties with meeting fuel payments.

This may be down to significant price hikes that outpace the rate of inflation, the expert suggested.

He stated these issues may have become more prevalent in recent times because “when something like that happens people are less protected nowadays than perhaps they were ten years ago”.

Mr Crayston noted a lack of savings to fall back on could be contributing to the increasing number of personal insolvencies.

If you are facing the prospect of insolvency and need some professional advice, please contact the team at Ashtons Legal.