Credit card debt ‘should be avoided’
Consumers have been advised to avoid taking on credit card debt in the current economic climate.
David Kuo, head of personal finance at fool.co.uk, noted that paying off what is owed is becoming increasingly important as redundancies rise.
He observed that people are falling back on credit cards due to difficulties in obtaining loans, but suggested that this could lead to bankruptcy if a situation arises where debt cannot be repaid.
“People need to be very aware that there is a problem with the economy at the moment, there is a problem with the system,” said Mr Kuo, urging people to “live below your means” in order to become debt free.
His comments come after Apacs figures revealed that spending on credit cards grew by two per cent to reach £126.2 billion in 2008.
According to the statistics, plastic cards accounted for two-thirds of all retail spending in the UK.
By Andy Mackay
