April 14, 2010
Brits Return To Secured And Unsecured Borrowing
New figures have revealed that Brits are returning to their borrowing ways – at the end of last year, the UK population was borrowing 62p for every pound that they saved from both their homes and their credit cards.
According to the research by Unbiased.co.uk, by the end of 2008, the public were conscious of their debt levels and working hard to repay what they owed, with £1.68 being repaid for every pound they saved. But these virtuous repayment habits of 2008 failed to continue, with the borrowed amount creeping higher by the start of 2009 and increasing throughout the year.
Overall in 2009, Brits borrowed a staggering £28.2bn worth of non-mortgage debt with only £71.6bn being saved. People are once again turning to short-term solutions to help them get through the month. The rest of the borrowing came from safer equity release, but this is still proof that people are not listening to professional financial advice when it comes to saving and borrowing.
Karen Barrett, chief executive of Unbiased.co.uk says: “While we may be officially out of recession, these latest figures highlight that consumers are back behaving as they did before the onset of the credit crunch, even though the economy is still not back to full strength. This trend of lower savings levels highlight a real concern for the public’s future financial well-being, especially as these falls in savings levels haven’t resulted in the public paying off an increasing amount of their debts.
“While many believe we are over the worst, there is still a lot of consumer confusion out there right now, and it is vital people seek professional advice from a financial adviser to enable them to strike the best balance between borrowing, saving and other aspects of their finances throughout these difficult times.”
SOURCE: Unbiased.co.uk, 01/04/10
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