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The average debt, apparently, is £8,400, but parents don't just owe money to companies – according to the survey, a full 25% have borrowed money from (or been given money by) their own parents in the last year. The survey also reported some other worrying findings. For example: that 1 in 4 parents found their household income wasn't enough to pay the monthly bills; that 1 in 10 are worried about the household's main breadwinner being made redundant in the next 6 months; and that 3.6% of parents with mortgages thought it was very likely or fairly likely that their home would be repossessed within the next year. Against a backdrop of record personal debt, parents are particularly worried about paying the heating bills (47%), paying the rent or mortgage (36%) and paying the food bills (31%). Mary MacLeod, Chief Executive of the Family and Parenting Institute: "Families up and down the country are finding it hard to balance their budgets. Many also have a heavy burden of debt. Parents say they feel under stress as they struggle to clothe and feed the children and find money for school trips yet need to cut back to manage within their income. This can put a big strain on relationships. Even more of a strain is the pervasive fear that they will be out of work or even lose their home." "With today's high cost of living, record levels of debt and worries about the nation's economic health," said a spokesperson for Debt Advisers Direct, "it's no surprise we’re hearing such gloomy answers to surveys like this. "There may, however, be debt solutions which could help some parents reduce their monthly expenditure. A debt consolidation loan, debt management plan or IVA (Individual Voluntary Arrangement), for example, could help them bring their expenditure back in line with their income." Even though debt consolidation, debt management and IVAs all address unsecured debts (unsecured loans, overdrafts, credit cards, etc.), they can nonetheless help people keep up with payments to their secured debts (mortgage, secured loans, etc.). With debt consolidation, for example, people basically pay off their existing unsecured debts by taking out a single new loan large enough to pay them all off in one go. This allows them to arrange to repay the new loan at a rate they can afford, freeing up the money they need for their secured debts and other essential expenses. With IVAs and professional debt management plans, the borrower asks debt experts to negotiate with their creditors, asking them to accept lower, affordable payments. IVAs and professional debt management plans are very different debt solutions, but they do have similarities: if the creditors accept the terms, the individual will agree to pay as much as they can (i.e. their entire disposable income) every month, and the creditors agree to accept that, even though it's less than the monthly payments they originally agreed on. “Debt management plans, debt consolidation loans and IVAs are very different, and suit people in different circumstances – so if someone’s facing debt problems, the first thing they should do is seek professional debt advice from an organisation that really understands the pros and cons of each.”
Article Source: http://www.bharatbhasha.net Article Url: http://www.bharatbhasha.net/finance-and-business.php/107668 Article Added on Saturday, November 29, 2008
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