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Facing up to festive debts

By CreditMan Tuesday, January 20, 2015

The latest figures* from The Money Advice Trust reveal that one in eight Britons face a struggle to make ends meet after over-spending in the festive period. As post-Christmas credit card and utility bills are set to arrive in the next few days, credit reference agency, Equifax, is urging a New Year check on credit information to help consumers get their finances back on track in 2015.

“According to the recent Money Advice Trust research, 12% of people are expecting their finances to slip dramatically this January”, explained Laura Barrett, Equifax Consumer Affairs. “Christmas is a time for increased spending for many – with the early part of the New Year often when cost-cutting becomes priority to get budgets back on track. Taking the opportunity to review your credit information can be valuable when planning your finances for the year ahead.”

Laura Barrett is also urging consumers tempted by 0% balance transfer deals as a means of tackling existing debt to carefully consider whether they will actually be able afford to pay back what they’re borrowing and they understand the terms of the deal being offered.

“There are a number of 0% deals currently on the market which can provide a useful way to cut costs on existing debt. But consumers should ensure they understand the terms, including details of any balance transfer fees, so that they are not simply exacerbating their debt problems. They should budget to pay this credit off before the end of the 0% deal period and close old accounts to avoid the temptation to spend more than they can afford to repay. Equally, if they do plan to use the card for new purchases it’s important to know whether the interest-free period applies to these too.”

As well as getting a copy of their credit report from Equifax, consumers concerned about their finances can also make use of the interactive free Equifax Budget Planner.

“By providing a quick and easy table for consumers to input all their household income and outgoings, the Equifax Budget Planner gives people a ready-made tool for getting their finances in order to start the New Year on a positive note”, continued Laura Barrett.

The Equifax Budget Planner is divided into categories including all forms of income from full time salary and any benefits to part-time jobs. Outgoings are divided into sections, including household expenses, utilities, health, transport and entertainment, helping consumers think about every aspect of their spending. Importantly, outgoings also includes a section for debt payments, such as loans and credit cards. Once everything is filled in, the planner creates an expenses total, which is subtracted from income to create a ‘Net Income’.

The Equifax Budget Planner can be accessed for free from the Equifax website - http://www.equifax.co.uk/newsroom/index.html.

The Equifax Credit Report is accessible for 30 days free simply by logging onto www.equifax.co.uk/Products/credit/credit-report. If customers do not cancel before the end of the 30 Day Free Trial, the service will continue at £9.95 per month, giving them unlimited online access to their credit information and weekly alerts on any changes to their credit file. It also includes an online dispute facility to help them correct any errors on their credit file simply and quickly.
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Source: http://www.moneyadvicetrust.org/media/news/Pages/Warning-as-Britons-put-Christmas-on-credit.aspx
Source: http://www.thisismoney.co.uk/money/cardsloans/article-2895312/Six-million-Britons-face-Christmas-financial-hangover-new-personal-debt-soars-highest-level-nearly-seven-years.html