I touched on this a while back but seeing as the quote from Bankruptcy.org.uk was interesting I thought I’d share it.
In recent months, the job market in the UK has picked up. Although unemployment may still be close to 2.5 million, any signs of improvement will be encouraging for anyone looking to get back to work or into employment for the first time. Ever since the downturn began in 2007, the unemployment rate rocketed upwards, but a slow decline may hint at better times ahead.
Joblessness can bring a multitude of problems with it, the main ones being of a financial nature. Without the necessary income to fund even the basics like food, electricity and rent, there are few options open when it comes to plugging any shortfall in funds. Going without is not an option, so to tide them over, they may consider taking out a loan.
Poor most at risk
People in either low-paid or part-time employment, as well as those out of work are more likely to find themselves in debt. Whether through taking out a loan, falling behind on payments for energy bills or struggling to keep up with the cost of a mortgage, getting into debt is more likely when working with a lower-than-average income.
Getting into debt can be surprisingly easy, but getting out of it is usually difficult, especially if the total amount due for repayments amounts to more than is affordable. As personal debt has become a major problem in the UK, services such as the government’s Money Advice Service have sprung up to help people work out how to get their finances back into the black.
Homeowners less likely
Those who live in rented accommodation are likely to have greater difficulty with debt, but what about those who have at least partial ownership of their own homes? According to a spokesperson from Bankruptcy.org.uk, the problems they face are a little less stark:
“According to our latest findings, although surprising, people who are on the property ladder are less likely to get into serious financial difficulties. This is due to the fact that it tends to be the people in the lowest tax bracket who spend more than they actually earn, and these people naturally find it difficult to get on the property ladder”, they said.
