The Average Age Of A Person Opting For Debt Management To Help Them Get On Top Of Their Financial Difficulties Was 43 Years Old

Category: Finance, Credit.

People using debt management plans are taking an average of one month longer to repay their debt, according to the latest debt monitor from debt management specialist Chiltern. The debt monitor reveals that the average person on a debt management plan is confronted by repayments to eight different creditors- a number that could be reduced to one through a process of debt consolidation.

According to the company, the average time taken by a person on an informal debt management plan to pay off any existing debt is 12 years and two months, with debt consolidation loans often used to attempt to make debts more manageable. Chiltern s Joanne Gill said: "The impact of a tightening credit market and interest rate rises is creating a greater interest in debt management programmes, but too many consumers are still struggling with their debts and not fully aware of the options open to them when they can no longer afford to pay their unsecured creditors. " Ms Gill added that" the vast majority of interest and charges are stopped through debt management, allowing the indebted to make some inroads into repaying their debt, which could be in the form of loans, credit cards or other types of finance" . With monthly living costs of 1, those involved in, 078 pounds debt management plans have on average 229 pounds of disposable income each month. "[A debt management plan] also provides debtors with the peace of mind that they can afford to keep up their mortgage payments and household bills as these debts take priority over their unsecured debt repayments, " Ms Gill said. According to the Chiltern debt monitor, the average debt of someone seeking such a solution stands at 26, with the typical, 537 pounds gross income of the same group standing at 23, 416 pounds. Chiltern s research found that when it came to debt consolidation through a debt management plan, 58 per cent of those involved with the process were female, compared to 42 per cent male. Around a quarter( 26 per cent) of all contractual payments were found to be affordable for the debtor, leaving some 74 per cent unaffordable in this manner.

The average age of a person opting for debt management to help them get on top of their financial difficulties was 43 years old. A number of the characteristics highlighted by Chiltern are symptomatic of what it terms" debt stress" . In July this year, a senior consultant for Macbeth Currie, said that bankruptcy, Duncan Philp now had less of a stigma attached to it, whether at a business or personal level. Giveaway signs of this condition include having four or more creditors requiring regular payments, a quarter or more of income being used to pay unsecured debts, only making minimum repayments on credit or store cards, using credit to pay for food or other necessities, or having a history of debt consolidation and further credit spending. He suggested it was a" modern phenomenon" that people are no longer as concerned by as they once were and that they are" perfectly happy" to go through the process of bankruptcy.

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