Families Likely to Struggle Most with Debt
New data suggests many British families will struggle to pay their debts in the coming months, as the next batch of cuts imposed by the Government take effect.
The Consumer Credit Counselling Service (CCCS) published their Statistical Yearbook for 2010, and showed families in debt were particularly vulnerable compared to other households in debt.
They explain the majority of these families are faced with rising costs and falling incomes, with some even having to contend with redundancy and unemployment.
The CCCS states that almost half of all those coming to them for advice on debt ascribe their problems to job loss, or reduced income.
“The picture is undoubtedly bleak and it seems likely that many more families, including better-off ones, will be increasingly prone to over-indebtedness in the months ahead,” commented Lord Stevenson, CCCS chairman.
“It is also not a uniform picture across the country: public sector cuts in terms of jobs, spending and benefits will weigh disproportionately on certain groups of people.”
The increase in the cost of everyday living expenses has meant those with children need an extra £650 a month to cover them.
The more children a family has, the more money they require to stay afloat, with families with more than three little ones £45 short each month on average.
Middle-earning families are also likely to be hit with higher rate tax thresholds and the lower eligibility for tax credits, which will come into effect in April.
Those who have a mortgage were shown to have higher debts than those who rent, with clients of the charity having on average £30,000 in unsecured debts on top of their mortgage.
If you are struggling to afford everyday living costs, or are concerned your budget will not stretch come April, a prepaid card could help you manage your money.