Credit Card Debt
U.K. consumer credit continues to grow, despite household income reducing in real terms over the past two years. Households with unsecured loans owe £15,491 on average, excluding mortgages.
Credit cards are an extremely popular form of unsecured borrowing. They offer flexibility and convenience, along with consumer protection against fraud. The U.K. has one of the highest rates of credit card usage, with an average 2.4 cards per person.
A quarterly survey by R3 reveals that 47 percent of people are concerned about repaying their debts, with 53 percent of those worried about debt naming credit cards as the biggest source of anxiety.
If you have a credit card balance which cannot be cleared at the end of the month, you may be hit with spiraling interest costs. With the average interest rate for credit card lending currently 18.24 percent, it can take over 20 years to clear £2,500 balance from a credit card if you make only minimum monthly payments. Around two-thirds of credit card holders carry forward their balance each month, according to the BBA.
If you are struggling to clear your credit card balances, it is important to tackle the issue rather than hoping it will resolve itself.
- Examine Your Budget – The first step in dealing with debt is to draw up an affordable budget. List all your income and expenditure and get a clear picture of how much money is left or overspent at the end of each month.
- Understand the Cost of Debt – Go through each of your debts and identify the cost of borrowing. If you have credit cards, the interest rates charged on balances carried forward may be surprisingly high.
- Consider Credit Card Debt Consolidation – You can reduce your monthly payments and balance your budget by consolidating your credit card debt.
Contact Credit Card Debt Solutions today to discuss how you can benefit from credit card debt consolidation.
