A new savings initiative unveiled as part of the Budget recently could help some British families avoid increasing their debt management problems, it has been suggested.
Under the terms of the so-called savings gateway, the government will make contributions the accounts of qualifying low income families, who might otherwise have resorted to borrowing to fund their expenses.
The Association of Credit Unions has welcomed the introduction of the scheme and aimed to highlight the urgency of the issue by pointing out that around 43 per cent of the lowest income families have no savings set aside at all.
Mark Lyonette, the association’s chief executive, commented: “To help people become more confident in managing their finances and to reduce reliance on credit, it is vital that those on low incomes are able to save and build up their personal assets.”
The latest figures from the Credit Action charity have suggested that the typical UK household pays out around £3,775 annually to service the interest on their debt management burden.