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However, more and more over 60s are now taking out equity release plans to unlock money from their homes so they can enjoy a `better quality of life in retirement`.

Figures show that 13% of over 55s are retiring in debt, and 40% of this age group have used equity release as a way to repay these - leaving them `better off in real terms` and free to enjoy their retirement.

Executive Chairman of the Saga Group, Andrew Goodsell, said: "This study dispels the concept that equity release is the last resort for those who have nowhere else to turn. We have found that people are increasingly likely to use equity release to clear debts, enabling them a better quality of life in retirement."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3217/over-50s-cant-afford-to-enjoy-retirement-because-of-debts.htm Thu, 1 Jul 2010 16:22:58 GMT
The deficit of £155bn basically means we`re spending a lot more as a country than we`re earning. Mr Osborne has said the measures designed to tackle that record deficit will be based on fairness, and wealthier people will pay more.

We don`t know the details of the Budget yet, but we know there will be tax rises and cutbacks in spending.

But there will be some good news as well as bad news - for example, around 900,000 low earners will no longer have to pay tax, as the threshold for paying tax will rise £1,000, up to £7,475. This will also mean a tax cut for millions of basic-rate taxpayers.

Many people disagree with the thinking behind the Budget, however, from unions to employer groups. Labour have warned that the poorest people will be hit, and that it`s too early for such severe measures, which could even drive the country back into recession.

Deputy Prime Minister Nick Clegg has e-mailed Liberal Democrat members on Monday evening, telling them that the deficit was a "fiscal bombshell" and had to be dealt with.

"Without action on the deficit, we will carry on racking up unaffordable debts our children will have to pay off," he said.

"We will carry on spending more money on debt interest than we do on our schools. And we will undermine the economic growth needed to create jobs and opportunities for all of us."

A spokesperson for Debt Advisers Direct commented: "Whatever the Budget brings, it`ll mean a lot of people have to make their money go further. This can be particularly hard for people with debts, who have to find the money for their debt payments every month as well as paying for things like their mortgage / rent, food, transport and other living costs.

"Anyone who`s struggling to keep up with their debts should look for some professional debt advice. It could really help them get - or keep - their finances under control."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3215/budget-tackling-the-nations-debt.htm Tue, 22 Jun 2010 11:35:13 GMT
In July 2009, the OFT began looking into a few forms of short-term debt - not just payday loans, but also home credit, rent-to-buy and pawnbroking.

Its decision? That although borrowing money like this was expensive, it still met a need for people who didn`t have any access to other forms of credit.

As the OFT`s press release says: `Products supplied in these markets are typically used by people on low incomes who cannot access mainstream credit and who borrow small sums for short periods.`

Furthermore, the Government should address the issue itself if it thinks it`s necessary, the OFT said, pointing out that `More radical approaches which are beyond the OFT`s remit would be required if the Government or others wanted to tackle the wider social, economic and financial context in which high-cost credit markets exist.`

The OFT did consider the need for price controls, but decided that this wouldn`t solve any problems - and could actually cause new problems.

After all, it said, the problems in the high-cost debt sector `stem from both limited supply options and consumers` lack of ability to drive competition`.

And imposing price controls would be difficult and could just make things worse, as suppliers might try to recover the money they lost by introducing / increasing charges for people whose debt repayments were late, or who defaulted on their debts.

The review did make a few significant findings:

• Many people who access high-cost debt don`t know about the options open to them - and advice is limited.
• They normally focus on how quickly and easily they can borrow money, and on the affordability of the repayments - not on how much it`ll cost in total, compared with other forms of debt.
• Few `significant` new lenders have appeared in these markets recently.
• There`s very little price competition in some high-cost credit markets.
• Some of the `incumbent suppliers` seem to be making serious profits.

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The press release estimates that 63% of balance transfer card users have fallen into the `payment hierarchy trap` by using their balance transfer card to make a purchase.

Due to the way many credit card companies handle their customers` payments, clearing the debt on even a small purchase can end up costing them much more than they expected.

Why? A card might charge 0% interest on the balance that was transferred to it, but that doesn`t mean the debt from a purchase will be interest-free. The interest on `purchase` debts can easily be around 18%. This is particularly important when the customer`s payments won`t go towards that debt until the entire `balance transfer` debt has been paid off - so it could well be sitting there (accruing interest) for many months or even years.

As moneysupermarket.com calculates: `Making a purchase of just £50 on a card with an existing balance transfer of £2,500 could cost up to £106 in interest over 12 months, due to the higher APR rate for purchase transactions.`

Not all credit cards work like this. Some already use a `positive payment hierarchy` (where payments clear the highest-interest debt first) - and some will start doing so before the end of the year, when all credit card providers will start treating debts in this way.

"Debt is a complicated subject," said a spokesperson for Debt Adviser Direct, "and it`s easy for people to end up paying more than they`d expected just because they didn`t know how the interest on the debt would be calculated. It`s well worth talking to a debt expert and asking their advice - the better someone understands their debts, the easier it should be to stay on top of them."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3210/The-cost-of-clearing-debt.htm Thu, 10 Jun 2010 15:46:29 GMT
In total, according to the bank, almost 4,400 personal loans - `with an average value of around £8,500` - were taken out for these specific reasons.

It is estimated that 1,100 loans (£12.25m of debt) were taken out to cover the cost of school fees, while 1,900 loans (£13.56m of debt) were taken out to help with university and college fees, and a further 1,400 loans (£11.26m of debt) were taken out to pay for `other education`.

Steven Baillie, Head of Loans at Sainsbury`s Finance, commented: "Parents and anyone paying for education, such as professional qualifications, need to make sure they are shopping around for the best loan rate available and not simply turning to their current account provider."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3208/Education-debt.htm Wed, 9 Jun 2010 15:44:14 GMT
Already at £770bn, the national debt is still growing, thanks to the £156bn budget deficit (basically, this means that as a country, we`re spending more than we earn).

Mr Cameron has warned of the changes that need to be made to reduce the deficit, pointing out that if the debt were allowed to reach £1.4t, the country would be paying £70bn in interest every year, as The Telegraph reports.

"Today we spend more on debt interest than we do on running schools in England," he said. "But £70 billion means spending more on debt interest than we currently do on running schools in England plus climate change plus transport. Interest payments of £70 billion mean that for every single pound you pay in tax, 10 pence would be spent on interest."

There are worries, however, that cutting back on spending too quickly could also endanger the country`s fragile economic growth. There are also worries about how it will affect people`s everyday lives.

The Times - which refers to the debt as `the country`s mortgage` and calls the deficit its `overdraft` - reports that Chancellor George Osborne `will call on the public today to identify services that should be cut as he begins a "once-in-a-generation" drive to rein in government expenditure`. People will `be urged to attend meetings and respond with ideas online`.

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3207/Tackling-the-national-debt.htm Tue, 8 Jun 2010 15:41:47 GMT
As it stands, there are currently 3,100 different mortgage deals available - 42% more than when the market fell to its low point in July 2009.

However, the amount of choice on offer to consumers looking to take on secured debt in this manner is still a lot lower than it was before the credit crunch began - with 28,413 different mortgages on offer in mid-2007.

Mortgage manager at Moneysupermarket.com, Hannah-Mercedes Skenfield, said: "The financial crisis really hit the mortgage market hard, with the number of products falling by a massive 92%.

"After a period of uncertainty in the market, in 2010 we have started to see confidence return, and although we are still a long way off the highs of 2007, it is encouraging for consumers that banks and building societies are starting to return to the market."

In April, according to the Bank of England, the total outstanding amount of secured debt (like mortgages) rose by £490bn, as people borrowed more than they repaid.

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3204/number-of-mortgage-deals-on-offer-exceeds-3000.htm Mon, 7 Jun 2010 15:25:37 GMT
The figures revealed that a further 2.5 million consumers withdraw cash using their credit cards, which could lead to combined charges of up to £90m a year.

A spokesperson for Debt Advisers Direct said: "We would advise anyone using their credit card to pay for expenses such as household bills to be very cautious.

"The fact that people are regularly taking on debt on their cards to cover the cost of their bills suggests that either they aren`t setting enough money aside at the start of the month, or they simply don`t have enough money coming in to pay their bills.

"We would advise anyone who feels they have to take on debt in this manner to seek debt advice as soon as they can. The sooner they take action, the sooner a solution can be found."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3201/Almost-5-million-take-on-debt-to-pay-household-bills.htm Fri, 4 Jun 2010 15:55:25 GMT
This wasn`t just in Britain, though; household debt had passed this level in Canada, the US and Japan too.

The latest edition of the OECD`s Factbook is said to take a `special look at the causes and consequences of the crisis`.

A spokesperson for Debt Advisers Direct commented: "The OECD`s findings indicate just how serious things were as household debt increased in the run-up to the economic crisis.

"The UK may be out of recession now, but the problems certainly aren`t over, and many people are still struggling with their debts.

"We would advise anyone finding their debts difficult to manage to speak to a professional debt adviser without delay."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3200/OECD-household-debt-more-than-120pc-of-disposable-income.htm Fri, 28 May 2010 16:20:47 GMT
Asda, for example, has cut prices twice in one week, as moneyhighstreet.com reported this morning. A litre of unleaded now costs 113.9p, while diesel costs 116.9p per litre.

The Express, meanwhile, tells us that Morrisons `fired the opening shots in another fuel price war yesterday by knocking 2p off a litre of petrol and diesel`, meaning that prices (at its 293 forecourts) have now dropped by 5p in one week.

Other supermarkets `are expected to follow`.

The moneyhighstreet.com article also refers to the latest Asda Income Tracker, which calculates that the average UK family`s weekly disposable income has fallen by £8 over the last year, while transport costs had risen by 11% in the 12 months leading up to April.

And the AA reports that petrol prices rose a massive 26.8% over that time.

A spokesperson for Debt Advisers Direct commented that: "These cuts will come as a relief to motorists, who saw prices reach a record high as recently as two weeks ago, when the average price topped 121p per litre.

"With RPI inflation at 5.3%, people everywhere are struggling with rapidly rising prices, pushing many into debt - and making it a lot harder for others to stay on top of the debt they`re already carrying.

"Depending on their lifestyle, people may be able to cut back on their spending in all kinds of ways - but when it comes to petrol, there`s very little most people can do to cut back on their usage. So any increase - or decrease - in petrol prices will have quite an effect on the vast majority of households."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3198/Petrol-price-falls-help-people-in-debt.htm Thu, 27 May 2010 16:17:39 GMT
The CML had said it had expected `a slight seasonal decline during the month due to Easter falling in April this year.`

Director of easyroommate.co.uk, Jonathan Moore, said: "This is not just another blip in the recovery - there is still a very real mortgage drought. And it`s not getting better.

"To reignite any progress in the housing market, lenders need to meet the growing demand from wannabe first-time buyers with affordable mortgages. Would-be first-timers are being forced to stay in rented accommodation or live with parents for longer than ever to scrape together enough cash for deposits."

A spokesperson for Debt Advisers Direct commented: "Mortgage availability is significantly lower these days, but that doesn`t mean that there aren`t any attractive products available. We would advise anyone thinking of taking on a mortgage debt to shop around and speak to a mortgage adviser to make sure they get the best deal for their needs."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3195/Amount-of-mortgage-debt-taken-on-at-lowest-level-in-ten-years.htm Mon, 24 May 2010 16:5:58 GMT
There were 238 IVAs in the first three months of the year, compared with 192 in the previous quarter. The total was also 65.3% higher than the 144 IVAs issued in the first quarter of 2009.

Meanwhile, bankruptcies fell to 316 in Q1 2010, from 382 in the last quarter of 2009.

An expert at Debt Advisers Direct said: "The statistics show that debt is still very much a problem for people in Northern Ireland. They also reflect the fact that it can take a while for economic problems to `filter through` to insolvencies.

"This suggests we are likely to continue seeing high levels of insolvency in the coming months, and as such it`s more important than ever that people seek debt help at the first sign of problems."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3177/northern-ireland-sees-significant-iva-rise.htm Tue, 18 May 2010 14:51:14 GMT
Overdraft rates have been on an upward trend since 2004, and this month the average rate stands at 14.22%. The last time it was higher than this was in 2000 - in May that year, the average overdraft rate stood at 14.78%.

Moneyfacts` research found that even though the base rate has remained unchanged for the last 14 months, bank account providers have continued to raise overdraft rates by as much as 3.4%.

An expert at Debt Advisers Direct commented: "Overdrafts can be a very convenient way of borrowing in the short term, but because of the interest rate they`re often not so appropriate for people thinking of repaying the debt over a longer period of time.

"As such, people should think carefully about their borrowing. If they intend on repaying the debt in the next few months, an overdraft may be a sensible option, but for more expensive purchases that will take longer to repay, a personal loan might be more appropriate."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3179/overdraft-debt-becoming-more-expensive.htm Tue, 18 May 2010 15:8:20 GMT
At St Leo`s College, children volunteer to act as tellers (with the help of an official from the local credit union), accepting money from their classmates. The emphasis is strictly on saving: the girls aren`t allowed to run up overdrafts or other forms of debt.

An article in the Irish Independent - entitled "Cure Ireland`s debt disease - teach our children to save" - takes a look at the initiative.

"The importance of providing financial education to young people can not be overstated," said Marion O`Toole, Youth Officer with Carlow Credit Union.

"The school credit union plays a crucial role in helping young people to manage their money and to develop a healthy attitude towards their finances. Given the levels of personal debt in Ireland, it is crucial that we assist and advise young people about this early on."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3186/school-focuses-on-curing-irelands-debt-disease.htm Tue, 18 May 2010 15:34:27 GMT
So says `business information and market analysis company` Datamonitor, in a recent press release.

To be precise, it predicts that gross lending (the total amount lent out) in the consumer credit market will drop from £27bn to £24bn this year, but will climb back to £25.8bn next year.

As a recent Datamonitor survey has shown, people are saving and paying off debt. Last year, they saved £19bn more in the third quarter of the year than they had in the third quarter of the year before. They put more of their disposable income (8.6% of it) into savings than they had in any other three-month period since 1998.

Commenting on the impact of the recession, Roderick Logan, financial services analyst at Datamonitor, said: "The recession caught many consumers by surprise, so they are now working hard to move away from depending on credit, rein in their spending and save. We would expect consumers to save after a recession, but not at this unprecedented level. Therefore with consumers concentrating on saving, the consumer credit market will face significant hurdles."

He pointed out that people are moving on from the recession with "a different attitude to borrowing". 32% of consumers, according to the company`s research, are concerned about their credit card debt.

As Mr Logan suggested, people may be more concerned about credit card debt than other debts because they use their card every day and are therefore more aware of how much debt they`re carrying on it. A loan, on the other hand, is very different - the money has already been borrowed, so people are less concerned about spending it.

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3192/debt:-lending-to-fall-this-year.htm Tue, 18 May 2010 16:21:4 GMT
During the `peak consolidation rush` last January, the average 0% balance transfer period on offer was 14.6 months, meaning many people who transferred their credit card debts at the start of last year have now started paying interest on their credit card debt once more - or are just about to start doing so.

So, the comparison site warns, it`s time to consider moving the debt to another 0% deal.

According to its calculations, paying 16.9% interest on a £2,000 credit card debt would mean credit card holders `would see their interest increase by £1,456 over the lifetime of the loan, and their debt sentence extend to 19 years and 9 months` - assuming there`s a minimum payment of 2.5% and a balance transfer fee of 3%.

The site does warn, however, that people who`ve switched their debts on multiple occasions may find their options more limited than they expected - and that most of the best deals on offer today are for existing banking customers only.

Kevin Mountford, head of banking at moneysupermarket.com, said: "An interest-free balance transfer card can be a great option for consumers with existing debt who need flexibility. We would always advise consumers that they really need to make some headway in paying off the balance, but for those who have failed to clear their debt in time for the end of their zero per cent period, they should look to swap their debt to another deal before reverting to the cards` typical APR."

A spokesperson for Debt Advisers Direct commented: "For many people with credit card debt, a card transfer can make a lot of sense, giving them an interest-free period in which they can really focus on reducing their debt, without watching a sizeable portion of each payment `disappear` on interest. Anyone who feels they`re not making enough progress on their debt should talk to a debt adviser, who can help them explore their options and find out if there`s a different approach that could help."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3172/debt-consolidation-time-to-check.htm Thu, 6 May 2010 14:2:49 GMT
It found that over the last ten years, typical cash ISA savers who also hold a mortgage would have been better off by around £3,306 had they placed their maximum cash ISA allowance into a mortgage offset account instead.

Richard Tolchard, senior mortgage product manager at first direct, commented: "For people without a mortgage, or possibly nearing the end of their mortgage, cash ISAs are often the most efficient way to save cash.

"However, for savers who hold a mortgage, this analysis show that cash savings work harder offsetting against a mortgage than they do within a tax-efficient ISA."

An expert at Debt Advisers Direct said this highlights the importance of choosing carefully when it comes to saving money.

"Savings can offer a lot of protection against debt, so it makes sense for savers to look around and find the best place to put their money. As we can see from this research, making the right decision can make a big difference, which means more security in the future."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3166/Offset-mortgages-could-give-more-protection-against-debt-than-ISAs.htm Wed, 5 May 2010 13:54:33 GMT
So says the Bank of England, which released its `Lending to Individuals: March 2010` figures this morning at 9:30.

In December, it seems, total debt grew by £1.7bn; in January, it grew by £1.9bn; and in February, by £2.4bn.

So March`s figure might surprise a few people: throughout the month, consumers only borrowed £0.6bn more than they repaid. It`s still a lot of money, but nowhere near the average over the previous six months - £1.6bn.

In terms of unsecured debt, the `net growth` (amount borrowed minus amount repaid) was £0.3bn in March - smaller than the totals in the previous two months, but still higher than the average over the last six months (just £0.1). Credit card lending increased by £0.2bn, but `other loans and advances` grew by just £0.1bn.

The big change came in debt that`s secured on property - like mortgages and remortgages. Here, the net growth dropped to just £0.3bn, the lowest figure we`ve seen since July last year, when people actually repaid more secured debt than they took on.

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3170/Growth-of-debt-slows-down-in-March.htm Tue, 4 May 2010 14:0:3 GMT
The Scottish Widows Priorities of Life index found that although the UK is no longer in recession, many people are still feeling financially insecure because they don`t have enough time to focus on their financial futures.

36% of respondents said they aren`t prioritising their financial security enough, even though just under a quarter (24%) said they are `more afraid of neglecting their financial security than anything else in their life`.

A spokesperson for Debt Advisers Direct commented: "Making contributions to a savings account in preparation for the future can be an excellent way to protect against debt.

"However, some people aren`t in a position to save - possibly because of the debts they are carrying. We would advise anyone in this situation to contact a professional debt adviser."

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3164/Fifth-of-Brits-admit-their-debt-worries-them.htm Fri, 30 Apr 2010 16:15:44 GMT
Throughout March, a total of 34,905 mortgages were approved (by the major banks) for people buying a new property - 20% higher than the figure recorded last March.

The figures also revealed a further fall in net mortgage lending to £2.4bn - the lowest level since July last year, and down from the `recent six-month average of £2.9bn`.

The BBA said the `subdued` net mortgage lending figure was due to homeowners using any spare money they had to pay down their mortgage debt.

Meanwhile, the amount of unsecured debt repaid outstripped the amount of debt taken on for the 12th consecutive month - with consumers paying off £63m more debt than they took on in March.

Despite debt repayments outstripping new spending, the amount of debt taken on through credit cards increased by £148m, while the amount of debt taken on through loans and overdrafts fell by £211m.

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).]]> http://www.debtadvisersdirect.co.uk/Debt-Advice-News/3161/mortgage-approvals-rise-unsecured-debt-falls.htm Wed, 28 Apr 2010 17:20:53 GMT