With the credit crunch affecting more and more households in the UK, people are taking dangerous measures to keep up with their monthly bills. There has been a recent rise in the number of people taking out additional credit cards to help pay their monthly mortgage or utility bills. A debt management charity have released details of a survey stating that over half of the 8,000 participants have taken out a credit card to help pay for their monthly outgoings.
This is hardly unexpected due to the cost of fuel rising at a staggering rate of 27.7% which exceeded expert's expectations. The average household is left with just £270 a month to pay off any outstanding debts after their utility, transport, food, medical and mortgage costs has been taken from an average salary of £2,200.
The debt management charity stated that the average enquiry they receive from a homeowner owes over £40,000 in unsecured debts with the average renter owing a more manageable £27,000. This has seriously affected homeowners with the rate of inflation going from bad to worse.
A number of homeowners expecting to fall back on credit cards due to the increasing monthly bills will be in for a shock as lenders are becoming a lot more cautious as to who they lend money to.
An expert has said that “Small debts previously dealt with by juggling credit are now becoming unmanageable much faster.”
Other ways to reduce household debt is to simply stop living beyond your means; cancel direct debits, store cards and other unnecessary credit sources.
Credit cards can be a life saver for some if used properly; find a 0% credit card and make sure you keep up with payments. Be sure to research interest free credit card deals and ensure you keep an eye on the 0% interest period.
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