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Brighter side of web - personal finance
- Keeping the right balance between Money and Leisure Trying to work less than the 8 hour day.
- Economics of Falling Stock Markets - Should we be concerned about falling stock markets? - Don't forget the stock market has correctly predicted 10 out of the last 2 recessions...
- Top 10 Reasons for studying Economics - Why it's a good idea to study Economics: When you are unemployed you will know why.
- 7 Tips for Avoiding a lifetime of debt at Pick the Brain
- Avoiding default on Mortgage debt What to do when faced with an increasing mortgage burden.
"Neither a lender nor borrower be."
- Hamlet (Act I, Scene III) - Polonius to his son Laertes
So said the bard, William Shakespeare. However, such advice seems rather quaint in modern society. In the UK alone personal debt of clients seen by the CCCS averages over £33,000 per person. [1]
It is perhaps ironic that increased levels of economic growth and prosperity have also led to increased levels of personal debt.
There are various reasons why debt has increased.
- Increased willingness of banks to lend money
- Higher expectations of personal living standards.
- Change in social trends and perceptions about debt.
Debt is not necessarily a bad thing. For example, without going into debt, very few people would be able to buy a house. Credit cards can be helpful if they are used in the right way. They give flexibility and can prevent going overdrawn at the bank. If you are careful you can get all the benefits of credit cards, without paying any of the high interest charges.
However, an increasing number of people find themselves in a situation of very high levels of unsecured personal debt.
Here is some Top 10 tips for Reducing and Eliminating Debt
If you credit card debt is very high, it may be worth considering a debt settlement plan. It is not to be undertaken lightly, however, it can be helpful for reducing very high levels of debt.
[1] UK debt twice european average at BBC
[2] UK debt frontline - £53,000 in debt How one woman suffered nervousbreakdown, but considers herself one of the lucky ones. BBC article
In the UK levels of credit card borrowing is reaching unprecedented levels. Some have suggested this is the consumer generation. I think in the past people wouldn't have considered borrowing so much unsecured debt. Perhaps it is just a feature of modern society with so many enticing goods to buy.
The most important thing is to try and avoid missing statements and having unauthorised overdrafts. Always maintain the minimum payments and always try to pay off the high interest bearing accounts first. If possible try to consolidate your debts in one place where you can get the lowest interest rates.
