Inflation and debts 'cause household budget squeeze'

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Inflation and debts 'cause household budget squeeze'

Tue 26th Feb 2008

National money education charity Credit Action has warned people to seek help if they find they are using their credit card "as a necessity" and are struggling to pay the balance off each month.

Chris Tapp, director of the charity, said that there had been a "little bit of a jump in the rate of people borrowing" just before Christmas and that this could "squeeze people's budgets month by month".

He added that utility and food costs are rising and said that as "inflation kicks in, people find that more of their take-home salary is taken up paying for day-to-day expenses".

This in turn forces them to use their credit cards more than they usually would, which Mr Tapp describes as "a very worrying scenario to find yourself in".

He advised people to always pay their mortgage off before any other form of credit, but cautioned against using credit cards to pay the mortgage bills as "you can't do that forever".

According to Debt Help UK, Brits have five times more credit cards than the average European.

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