Credit Card Debt – A Real Problem For The UK

Written By: Tobias McTavish on June 3, 2010 No Comment

Over the past decade or so the levels of personal credit card debt has reached an alarming high. With more and more people in the UK owning credit cards it is clear to see that this is an issue. One of the main problems with the level of debt on credit cards is that it is showing no signs of reducing. This is mainly due to the recession that has hit the UK and left many people without jobs. But why was spending on credit cards allowed to get so out of hand in the first place?

Financial experts and economists tend to point the finger towards credit card companies who offered levels of credit that were too high. In more healthy financial times people were given credit cards with very high spend limits. However, when the recession hit and people lost their jobs paying back their credit cards was the last thing on their minds.

As recession began to take hold and affect consumers many people found that they were out of work. This then led to them not being able to keep up with the repayments on their credit cards. In fact most people with credit cards would even admit that these bills were low priority after housing and utilities.

In addition to this more people were now using their credit cards for everyday essentials. They were no longer used for luxury or expensive items. People were and many still are using their credit cards as a means of getting by. By making the minimum repayment on these cards they were kept active, until they reached their credit limit.

Once the credit limit was reached many people would simply apply for another credit card or shift the balance to another. Yet again this is another short term method of staying in the black that is not sustainable. Instead more focus should have been put on clearing debt on credit cards and not creating more.

Over time as personal debt on credit cards has grown so has the number of people who are filing for bankruptcy. They believe that they can simply have their debts wiped out by doing this. However, the bankruptcy affects will be felt for several years after it has been filed, so it should not be seen as the easy option.

Today there are consumer credit counselling and debt advisory services in the UK that are helping people who have a high level of debt. They provide practical advice and assistance that can be a real benefit to anyone experiencing difficulties. Most of these services are totally free and can be used by anyone in the UK. So if you are feeling the strain of debt this is something to think about.

Credit card debt in the UK today is a very serious matter. It is on the rise and is showing no signs of reducing anytime soon. However, with the right help and advice people can work through their debts, but it can take time. To avoid these kinds of problems the best thing to do is to try to avoid credit cards if at all possible.

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