People find it difficult to make debt repayments for a number of reasons. Most often, the main cause of non-payment is usually down to some form of change in personal circumstances such as unemployment, divorce, illness or a new arrival in the family. In these circumstances, many people look towards borrowing more in order to pay off creditors or household bills. Unfortunately, taking on more debt to pay off existing commitments is often a recipe for disaster.
However, debt can have an effect on more than just a person’s financial affairs. In fact, debt is a major contributor towards stress, depression, anxiety, mental health problems, relationship breakdown and even suicide in some severe instances. A lack of financial awareness is often cited as a reason for people falling into debt. Although debt is a nationwide problem, and affects people of all ages and backgrounds, the financial cost of debt is not limited to an individual and in fact can impact greatly on society.
Many people believe the Government should do more to highlight the issue of financial awareness, targeting the loan companies and credit card issuers whose advertisements run constantly on televisions across the country. In many cases, consumers become seduced by the promise of lower payments and relief from their debt burden without realising that they could well end up spending more money in the long term as many loans advertised can have repayments run for periods up to 25 years. Read the rest of this entry »
