R3: RECORD NUMBER OF PEOPLE IN FINANCIAL DISTRESS.
The number of people experiencing financial distress has increased to the highest level recorded by R3’s Personal Debt Snapshot.
The latest research finds that eight million people are due to go into their overdraft this month, with two million believing that they will go into an unauthorised overdraft position.
The findings also show that six million people are currently behind with some of their bills and payments – a jump of 2 million over the last quarter.
It’s encouraging to see that R3, the Association of Business Recovery Professionals say in their report that 19% of the people surveyed have now set up a budget. This is good news as many consumers get into unmanageable debt simply through mismanagement of their finances whilst for others unemployment, relationship separation or even illness can be the trigger.
However I think the number of people in financial difficulty is actually much higher than that quoted by R3. Based upon industry and associated reports and my own knowledge of the current state of affairs my estimate would be nearer the 10 – 12 million mark.
People in debt come from all walks of life. My clients include a doctor, a vicar, an airline pilot, a belly dance, a number of actors and others working in television, police officers from 35 of the nation’s police forces as well and many others aged from 18 to 88.
Given the current financial situation and with many people not having enough savings to fall back on and get them through the next 6 months I can see many more consumers dropping into unauthorised overdrafts and maxing out on their credit cards. What is of real concern is that is at a time when interest rates are at an historic low, 28 months at 0.5% what will happen when the rates go up? Note that this is not an ‘if’, but a when?
Free Budget Wizard
If you are one of the 81% that have not set out a budget yet then why not look at our Budget Wizard.
The free budget form covers your income, expenses, assets, savings and debt, making it very hard for you to miss anything important so as to give you a complete understanding of all your finances.
Plus, we've made it very flexible and allow you to add as many houses, cars, assets, credit cards, etc... as you want. For your outgoings you'll find a list for everyday items such as gas, electricity, water, telephone and transport costs but you can still add your own just in case we missed something. It also has a built in debt predictor – ouch!
Need debt adive, then see our list of Helpful Organisations, these include the full contact details for the debt charities.
