Families urged to seek out debt help and plan ahead in 2010

23/12/2009

Families should make getting their personal finances in order their number one New Year's resolution, it has been suggested.

Just this week, the latest 'income tracker' report from Asda revealed that, while families now have, on average £8 a week more discretionary income than at the same point in 2008, this is largely offset by an ongoing rise in the cost of living.

And, with this situation unlikely to improve over the next few months, experts have advised those households already struggling with money matters to either seek out debt advice or to take action to make sure they don't get into the red in 2010.

"We suspect that the second half of 2010 will see many families starting to feel the pinch," said Martin Bamford, chartered financial planner for Informed Choice.

"Families should be planning ahead, rather than living month to month. In the short-term, they should do what they can to pay off expensive unsecured debts, such as credit cards which are likely to be used over the Christmas period."

At the same time, the RAC has reported that the cost of travel over Christmas is set to be higher than in 2008, thanks to the steady rise in fuel prices seen over 2009.

Kevin Still, director of EuroDebt, commented: "The ONS indicated in their third quarter report that consumers are using more of their disposable income to clear debts where they have the means to do this.

"This does not reflect the challenges of those with reduced disposable income and high levels of unsecured debt, where interest rates are typically increasing thereby extending the repayment period of revolving credit like store cards and credit cards.

"EuroDebt feel that there remains a lull before the storm and that the full effects of the recession are likely to hit indebted consumers as we turn the corner and government measures to reduce their borrowing levels kick in."

Tags; Young Family Finances,

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