Over half of the UK population have taken action to clear debts, a new survey has discovered.
The research, from Lloyds TSB, found that 55 per cent of people have made steps towards becoming debt free over the past six months.
Around one in three (32 per cent) have increased repayments and 19 per cent have focussed on repaying debts with higher interest rates such as store cards.
In addition, 34 per cent said they have been forced to alter their spending habits as a result of the credit crunch.
However, the figures show that despite the positive action towards debt repayments, 37 per cent are currently neglecting their savings. One in five people have less than £500 stashed away, the report revealed.
“Economic conditions are set to become more challenging and a healthy savings balance could prove to be a financial lifeline for some families,” commented spokesman Ian Larkin.
Meanwhile, HSBC has announced that it is to maintain its standard variable mortgage rate at 6.25 per cent.
By Jamie Price