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Two-fifths of Brits on financial knife edge

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22/05/2008

Research by Callcredit has revealed that 40% of the UK’s working population could not survive for more than a month on their savings alone.

The credit reference agency’s findings show that this figure peaks to a staggering 53% among the 25-34 age group.

The impact of the credit crunch means that one in 10 people can no longer afford to save and have in fact started dipping into savings to meet their monthly outgoings, with the 18-24 age group most likely to have to resort to raiding their accounts to make ends meet.

The findings also reveal that one in 20 people are spending over 50% of their salary on unsecured debt repayments. While this remains a relatively low figure, it has more than doubled compared to a previous survey conducted in September 2007.

Owen Roberts, head of Callcredit Check, said: “These findings are a stark illustration of how the credit crunch is already affecting consumers. It’s clear that the rising cost of everyday living is having an immediate impact on our ability to save. Many of the UK’s workforce are at what could be described as a financial tipping point where just one unexpected unfortunate incident could have dire financial consequences.

“We all need to take an active role in dealing with our debts. The first step is to get a copy of your credit report for a clear view of everything you owe and then review your bank statement to see how much you’re paying out each month.

“If people are concerned about their debt levels they should talk to their lender before things become unmanageable or speak to an independent organisation such as the Consumer Credit Counselling Service to work out the best way forward.”

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