Other reasons for the huge increase in personal debt in the UK, particularly in the days before the Credit Crunch, would have to include the amounts of easily available credit which may have enticed some to live beyond their means.
For many the solution to the problem, the way out, has been to borrow more, which has ultimately left them in an impossible situation.
Sadly the scenario, listed below, from money expert Martin Lewis at moneysavingexpert.com is typical of more and more people in the United Kingdom who, in their desperation to keep their heads above water have not realised, that to quote Mr Lewis they may be in “debt crisis.”
- “You spend more than you earn
- You borrow to fill the gap
- More of your income goes to repaying your debts
- You keep borrowing more to maintain your lifestyle
- The end result is all your income goes towards repaying debt
- You’ve got nothing left”
For all those who recognise this situation, there’s good news, there is help and there is a way out although it may not be a quick fix.
The first step is to seek advice from the right people. Do not go to a bank or broker, get the advice from one of the free independent sources of help in the UK that support people through the process of getting their lives back again.
The Citizens Advice Bureau (CAB) offers a range of personal debt advice; they will also help with information on what benefits, that might have been overlooked, are available. Yes the CAB is staffed mainly by volunteers, but they are trained and they do have access to professional debt counsellors, accountants and lawyers.
The Consumer Credit Counselling (CCCS) service is a non-profit UK organisation. UK citizens searching on-line should be aware there is an American organisation with the same name.
The CCCS was created: “Following a recommendation of a national group of insolvency lawyers and accountants which had been examining the effects of the huge influx of unregulated debt counsellors…”
CCCS invites people to fill out an on-line, in depth questionnaire, which is then examined by their debt counsellors. This is followed by a telephone appointment, which can last up to an hour, during which an analysis is made of each individual case and is then followed by appropriate advice. If for example bankruptcy, Individual Voluntary Arrangement (IVA) or a Trust Deed is the way forward they will suggest suitable professional accountants to further advise.
If an instant answer, on a particularly pressing matter is needed they also have a telephone advice service, which is free, and allows callers a certain degree of anonymity.
Because Scottish law, in some debt matters, differs from the rest of the UK, there is specific advice geared towards Scottish residents.
The examples, mentioned by this writer, of help available from the Citizens Advice Bureau and CCCS are just the tip of the iceberg. They offer practical help and advice for all situations.