Consumers urged to live within their means this Christmas

Having access to the best credit card deals is no good if consumers are living consistently beyond their means.

Credit Action has underlined the need for families to ensure they are living within their means during the festive period, to avoid a difficult new year.

The advice accompanies the money education charity's debt statistics for December, which show that average household debt, including mortgages, has reached £55,808.

There is nothing wrong with debt if consumers are capable of paying it back, but the Credit Action figures shows that debt is getting out of control for growing numbers of Brits.

The Consumer Advice Bureau is dealing with 8,910 new debt problems each working day, while a property is being repossessed an average of once every 14 minutes.

Even consumers in control of their finances should be aware of the potential for falling into debt. The data indicates that 1,611 people are being made redundant daily, some of whom could be saddled with thousands of pounds worth of outstanding loans.

Excluding mortgages, average household debt is £7,984, which is a lot to consider paying off without a job.

Credit Action chief executive Michelle Highman advised families to create a Christmas budget and avoid unnecessary expenditure "so you can enjoy the celebrations with a sense of financial security".

"Our figures suggest that, on average, the burden of consumer debt has eased up a little recently," she explained. "Whilst this is clearly good news, we all need to be careful as we start the run up to Christmas."

Despite charities calling for more households to create a monthly budget for themselves, recent research by the Institute of Financial Planning suggested that one in four Brits are still not setting themselves a clear budget.

The Consumer Credit Counselling Service is among those charities, recently claiming those who do not set themselves a clear budget are more likely to fall into unmanageable debts.

Moneyextra.com recommends you take independent financial advice before acting on any article

Back

2011-12-02 08:24:26 © Moneyextra.com