- The growing and respected website Netmums has reported that more and more single parent families are turning to payday lenders and other means of credit and loans to support them whilst struggling with rising household costs and bills.
Netmums surveyed around 2000 members this month and questioned mainly what impact the current economic climate was having on these families. Some of the findings seem quite harsh but evidence really how tough it is out there for normal everyday people who are just trying to get by.
- The survey said that 20% of mothers are going without meals to make sure the children can eat.
- One in twenty are taking out payday loans, 1% are turning to loan sharks to keep things going.
- 25% are living on credit cards.
- 50% of families are selling or pawning items.
- Two thirds have less disposable income this year when compared to last due to reduced household income.
- 16% are being treated for stress issues directly relating to personal financial problems.
Over half of all people surveyed stated that if they were to suffer another change in circumstance such as further reduced income from benefit changes or increasing child care costs, they will fall into a position of hardship. A number felt suicidal due to due to the pressures and stress of debt problems and the lack of ability to see things getting any better.
Whilst borrowing from friends and family is sometimes but not always possible, it is not a long-term solution to the problems faced. What is most worrying and shocking is that people who would normally be living modest and frugal lives but getting by are now living on the edge financially.
- Netmums did get a response to the survey from the Department of Work and Pensions who said;
“Our welfare reforms will have a dynamic impact on some of the poorest families and will lift over one million people out of poverty. We continue to support low-income families and put £6.5 billion a year into financial support for lone parents, but we know that debt remains a real driver of poverty.
“This is why we need credit unions to be supported and strengthened to ensure that illegal loan sharks can’t plague the homes of vulnerable people and offer a real alternative to doorstep and payday lenders. We are working on the best ways to help credit unions expand and modernise so that more families can have access to affordable credit.”
As a debt help and advice service we speak with many people every day in the same position.
We must stress that it is human nature to continue to search for more credit as a way out of debt, however, we must also stress that when an individual is given advice that another loan is not the best option, they should take this advice and consider it. Most consumers think that if they put the phone down and call another company they will eventually get the further credit or loan.
The reason why people are falling into the arms of these high rate lenders is because advice once sort has not been taken or more importantly acted upon if refused a loan.
The problem of not having a disposable income leads to further financial management issues that require the individual to make arrears repayment arrangements with utility or credit providers.
- The consumer will usually increase the “loan shark” supply base as they tend not always to act on the best advice!
- Most people do take the advice given and those that do tend to see some sort of organisation in the situation even though it is not one they wish to be in.
For further debt advice UK regarding personal debt issues and the problems and stress associated with being in the clutches of doorstep and payday lenders, call our debt helpline free from a land line today in absolute confidence using 0800 018 6868.
Lines are open 24hrs / 7 days.