If you have seen the way Night Nurse wields her credit card on pay day, it comes as no surprise that half of us here in Britain admit to making serious financial mistakes and 80% of us overspend regularly!
This infromation comes from a new survey that coincides with the first Credit Awareness Week.
Credit Awareness Week is organised by Credit Today magazine and supported by Experian and the Consumer Credit Counselling Service, aims to help us all with easy to understand, direct advice.
Spiralling debts and rising interest rates have led 1 in 20 of us to consider or take out an Individual Voluntary Arrangement (IVA) or become bankrupt. (That is quite a shocking figure i am sure you will agree)
The research, for CreditExpert.co.uk, shows the urgent need for practical financial education and advice; 24% of us admit that we find it hard to control our money and find financial matters even harder to understand!
As a result we make the following mistakes:
- Taking out expensive consolidation loans with lengthy pay-back periods
- Using spending as therapy; 26% of us do this when we are feeling low, 14% cheer ourselves up after a tough day at work and 5% overspend after an argument with a partner.
- Getting a new credit card to pay off debt on another card with 9% of us admitting to this!
- Missing repayments on credit and store cards, loans and mortgages; 10% of us have fallen into this trap.
"It is very worrying to see how many people admit to making basic financial mistakes and consider serious options such as an IVA or bankruptcy as a quick fix," says CreditExpert managing director Jim Hodgkins.
"This research seems to expose a serous lack of understanding of the long-term consequences of these actions and how they can affect your credit rating. People who are worried about money management should learn to understand their credit report. Evidence of missed repayments, court judgements, IVAs or bankruptcies stay on your credit report for years and seriously damage your credit rating; and your future ability to borrow."
You can see your free Experian credit report with a 30-day trial of CreditExpert.
Based on that, you can then begin to look at your finances and see what you need to do to begin to get them more organised!