Debt payments prioritised as Brits 'give up' on saving

11/03/2009

Cautious consumers are trying to pay down their mortgage, personal loan and credit card debts in the current downturn, a financial website indicated today.

According to Moneysupermarket.com, 21 per cent of UK adults are looking to use any cash left over each month to service their debts.

This same group also said that they have "given up" on saving.

Priorities among consumers appear to have shifted over recent months, with interest rate cuts from the Bank of England damaging returns from savings accounts.

The typical instant-access account now offers an annual interest rate of well under one per cent.

Kevin Mountford, head of banking at moneysupermarket.com, commented: "Gone for now are the days when numerous accounts were returning over seven per cent. Now, you are doing remarkably well to find an account paying four per cent."

Figures from charity Credit Action, released last week, showed that Brits' total personal debt stood at almost £1.5 trillion.

On average, each household owes just under £60,000, including mortgage debts.

Tags; Housing Debt and Bills, Young Family Finances, Credit Card Lifestyle,

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