Don’t borrow your way out of debt, expert urges

Ill-informed decisions about which financial packages to take out and how to handle a debt management problem can often make a bad situation worse, Derek Oakley, from Debt Free Direct, suggests.

The personal finance expert also claims that there are instances of advertising actively encouraging people who are already facing serious debt management trouble to continue to borrow more money.

“What is an issue is people making ill-informed decisions involving money,” said Mr Oakley.

“The situation I’ve come across most frequently is the poor decision making: [consumers] thinking you can borrow your way out of a problem.”

According to a study from the accountancy firm KPGM concluded that the number of people entering into an Individual Voluntary Arrangement in the UK is increasing at a “breathtaking pace”.