Brits Dipping Into Unauthorised Overdrafts
Household money problems are spreading as latest research reveals eight million Brits are due to go overdrawn this month.
The study by R3 showed two million believe they will go into an unauthorised overdraft which could significantly make their financial situation worse.
A further six million people are also currently behind with some of their bills and payments, which is an increase of two million over the last quarter, highlighting how the increasing cost of living is affecting the nation’s ability to stay financially afloat.
“It is clear that many have found themselves in a position whereby they have to go into and often exceed their agreed overdraft in order to keep on top of their bills and debt repayments,” said Frances Coulson, R3 president.
“A sudden change in circumstances such as redundancy tends to trigger insolvency so it is always advisable to put some money aside as a buffer.”
With five million people also worried about being made redundant, a third of people actually now admit that they are saving less than they used to. This is an increase of eight percent on the previous quarter – equating to 15 million people.
A third of people even believe their financial situation will worsen over the next six months, making it even more important to have some savings put aside for these periods.
Coulson also added 19 percent of people are actually setting a budget – which he explains is good news as this is a key tool to allow those in financial difficulty to clearly compare their outgoings with their income and budget accordingly.
For those who may have to dip into their overdraft this month to meet monthly costs, a prepaid card could be a good tool to prevent you from overspending as it aids budgeting.