Both Borrowing And Savings ‘On The Up’
Britons are borrowing an increasing amount of money, according to a recently released set of figures.
As part of its Savings Brake study, data from Unbiased indicates that the level of cash taken out via consumer credit reached 76.7 billion pounds in 2007. With this number up from 2006 by more than 11 billion pounds, the amount borrowed was revealed to be the highest noted for about three years. Furthermore it was indicated that levels of debt hit a peak during the final three months of the year where 21,378 million pounds was borrowed. This figure was the highest amount seen since the final quarter of 2001.
Vehicles through which money may have been borrowed during this time could include personal loans, credit and store cards and overdrafts.
Research from the finance publication also indicated that for every pound that consumers saved during the course of 2007, some 52 pence was borrowed. Unbiased points out that this figure is a “notable” rise from 49 pence per pound borrowed in 2006. The figures do not take into account mortgage debt. Overall, it was claimed that savings levels increased by some 12 billion pounds over the course of last year to account for 145 billion pounds.
From saving an increasing amount of money, it is possible that consumers are able to take steps to meet various demands on their finances in later life. Such areas could include the cost of property repairs, personal loan repayments and utility bills.
David Elms, chief executive of Unbiased, stated: “2007 has been a turbulent year with regards to finances. Not only did we see three base rate rises last year, but we also witnessed the beginning of the so-called credit crunch. Consumers no doubt will worry about the impact of the financial markets and the economy on their wallets and it is great to see that savings levels have increased compared to 2006. However, our figures also show that consumer borrowing is now at a worryingly high level and it remains doubtful whether we will see a significant improvement in the Savings Brake ratio in 2008.”
He went on to report that it is now more important than ever for Britons to be active in the handling of their finances and make sure they are both saving and borrowing money at a level which they are comfortable with.
For those looking to supplement their finances as the rest of the year progresses taking out a cheap loan could prove to be of assistance. By applying for this type of loan, consumers may find that they are able to fund a home improvement project, go on holiday, treat a loved one or make a major purchase - such as a house or car. In addition getting a loan may be of use to those looking to save more money.
By using it as a means of debt consolidation, borrowers may be able to merge numerous financial constraints into a single low-cost repayment. This may leave them with more disposable income at the end of each month, money which could then be invested into savings schemes.
A cheap UK loan might also help people looking to reduce debts. Recent research by Sainsbury’s Finance shows that in the six months up to July an estimated 4.3 million people are to transfer credit card debts, switching a total of 6.68 billion pounds.
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