Pay off debts now, says expert

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Pay off debts now, says expert

Mon 26th Apr 2010

People who have significant debts should take this opportunity to pay them off, since interest rates are likely to increase in the future, according to a sector commentator.

Director of the Motley Fool David Kuo highlighted how rates have already begun to creep up in the Far East, Australia and India, so if people are paying more interest on their debts than they are receiving on their savings, then they should put their money into getting rid of those debts first.

He stated: "It is only a question of time before the Bank of England starts to increase interest rates on this side also so if you have debts, now would be a good time to pay them off."

In his view, this is the most sensible choice to make during the current economic climate.

These remarks follow the announcement by the Office for National Statistics that the consumer price index rose to 3.4 per cent and the retail price index reached 4.4 per cent in March of this year.

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