How tighter finances have taken their toll on British homes
Thursday, 16 February 2012
Tight finances have resulted in Brits facing difficult times when trying to cope with everyday costs. Consumers are drowning in a sea of high prices, soaring bills, pay freezes and even job losses - all of which have taken their toll on British homes.
A great number of Brits are concerned about accumulating debts - fearing that they may be unable to pay them back - but what effects have these concerns had on spending and lending?
Late repayments
Despite their concerns, 32% of Brits confessed they make late payments and 46% of this late-payers revealed they did so frequently. This suggests that the current economic climate is forcing households to risk large debts and late payment charges due to a lack of available funds.
Household bills
As a result of inflation, people are struggling to pay their domestic bills with 45% claiming it is a struggle to cope with all their costs in between paydays.
Everyday expenses have all risen over recent months, with energy bills in particular undergoing drastic price hikes.
Credit cards
Whilst credit cards previously provided Brits with a way to make purchases when they lacked the necessary cash, they are now being targeted for encouraging consumers to spend money they simply do not have.
Only one third of credit card holders are claimed to think rationally when reviewing the impact of spending on a credit card and most people only consciously evaluate their spending when the purchase is over £100.
The problem with this is that those small expenditures can soon mount up - leaving borrowers with a nasty shock at the end of the month. High credit card bills are a common problem for British households, stretching finances even further.
It is very difficult for individuals to remove themselves from this situation once they are in it. Recent reports have seen loans gain popularity as credit card numbers fall, suggesting this form of lending is meeting the requirements of modern borrowers more effectively.
Loans
Products such as quick cash loans are now popular ways for people to manage their finances and there has been a significant increase in the number of cash loans taken out by consumers.
The lengthy process of bank loans have been somewhat replaced by more modern formats, where smaller sums can be obtained and applications can be made and approved via the Internet.
Many Brits find they need a small amount of cash rather than a large sum and this is a requirement lenders now cater to. The convenient application process of short term loans means consumers can submit online applications from their home, making it more accessible.
Reduced spending
Tighter finances have prompted Brits to reduce their personal debts - something which lower spending can assist. The price of products and services and now routinely compared and consumers are always after the best deals on the market.
By comparing prices, Brits can make sure they don't spend any more than is absolutely necessary, meaning tighter finances have led to price competition and intensified budgeting.
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