'Immediate budgeting needed' to ensure debts are paid

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Consumers who are struggling to make payments on their credit cards should take immediate steps to confront their financial situation, it has been claimed.

Tom Howard, a spokesperson for Consumer Credit Counselling Service CCCS, said this is particularly the case where they are failing to meet minimum obligations, borrowing cash from cards and using once card to pay off another.

He warned that people can risk entering into serious financial difficulty if they are not proactive in reorganising their personal finances.

Mr Howard proposed the first step should be to make a strict and truthful budget that will help identify areas currently subject to overspending.

"You also need to contact your lender as a matter of course, and should also seriously consider contacting a free and independent advice agency such as CCCS or Citizens Advice, who can help you solve your situation and won't charge you a penny to do so," he added.

A report from the International Monetary Fund published in April estimated that around seven per cent of consumer debt in the UK will be written off as individuals are left unable to pay them off.

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2009-07-29 12:14:35 © Moneyextra.com

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