Household budgets ‘facing strain’

Household budgets are being stretched to breaking point as consumers struggle to "keep a roof over their head".

Charity Citizens Advice h…

Household budgets are being stretched to breaking point as consumers struggle to "keep a roof over their head".

Charity Citizens Advice has admitted it is concerned about the current situation facing many people in the UK, as they are struggling to make ends meet thanks to a rise in household bills, coupled with below-inflation pay rises.

Indeed, recent figures from Shelter found that nearly ten per cent of Britons are concerned they won't be able to pay their rent or mortgage at the end of the month, highlighting just how severe money worries are for some. 

On top of this, 70 per cent of those with families are struggling or falling behind with their payments, compared to only 63 per cent of the overall population.

Citizens Advice chief executive Gillian Guy is apprehensive about the effect of "intense pressure" on many Britons, which is forcing them to borrow money they may struggle to pay back. 

"It is extremely worrying that the default option for far too many people is to turn to a payday lender to get them through the month. Payday loans may appear to be a quick fix but often turn into a long-term debt problem as people struggle to pay back the loan and high interest rates and charges further increase debts," she added.

Ms Guy revealed the number of people looking for help with rent arrears is up in every region of England, while since the start of the recession there has been a 20 per cent rise in people falling behind on their mortgage. 

She believes the situation is being compounded by the fact that many people are not aware of the repercussions of taking out payday loans. Research by the group has discovered 61 per cent of payday loans are given out without the proper checks and balances. 

This has led to concerns that lenders are not doing enough to assess some people's financial circumstances.

By James Francis

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