An increasing number of people in Britain may be in need of debt management help as the UK has one of the highest levels of personal debt in the world…
An increasing number of people in Britain may be in need of debt management help as the UK has one of the highest levels of personal debt in the world, it has been claimed.
The Guardian noted debt has become an accepted part of modern life – with people in the nation owing a combined total of £1,460 billion in private debt in April this year.
According to the newspaper, many individuals currently owe money on loans, credit cards and overdrafts.
It observed borrowing cash can often be beneficial, such as with student and business loans, as well as mortgages, but warned there is a “tipping point” at which the option can become detrimental.
Debts can become uncontrollable because of irresponsible lending and the publication stated this is often down to loan and credit companies charging too-high interest rates.
Some firms are calculating annual interest rates at over 2,500 per cent, the source claimed.
This is despite the Bank of England base rate coming in at just 0.5 per cent.
Such borrowing rates can repeatedly take customers into endless cycles of debt and, ultimately, poverty.
Moreover, financial troubles are associated with a number of resultant negative implications.
The information outlet stated: “High debt repayments are linked to rent, council tax and utility arrears, constraints on job-seeking behaviour, poor diets, cold homes and mental and physical health problems.”
A recent report from Confused.com found money matters to be one of the most baffling aspects of modern life among the British public.
The research showed 71.9 per cent of Brits suffer confusion over how best to handle their cash, while 83.9 per cent claimed they do not understand pension schemes and 80 per cent are unsure of the process involved in selling a house.
By Amy White