More Couples Facing Financial Difficulties
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By :
Ranju Kumar
Submitted
2008-11-21 14:57:01 |
An increasing number of couples are experiencing difficulties managing their finances, new figures reveal.
In research carried out by the Manchester Business School for accountancy company Haines Watts IVA, 13,000 couples across. England and Wales were reported to have filed for insolvency over the course of last year - an increase of some 165 per cent from findings recorded two years. However, the study suggested that current levels are set to triple by 2010 as more consumers become unable to make repayments on loans, credit cards and other forms of debt. As a result, the research firm suggested that a total of 50,000 co-habitees could find themselves with unmanageable levels of debt by 2010.
Dr Sydney Howell from Manchester Business School said: "Some of these couples, especially those in their early 30s, are facing a future with no pension, no savings and huge debt. Rising house prices and interest rates, ever-increasing living costs and wages that have not kept up with inflation have all produced crippling debts and left more and more people turning either to bankruptcy or insolvency as their only way out."
Meanwhile, research from the business school also revealed that the amount of debt run up by those couples filing for insolvency has doubled since 2004. Two years ago the amount of money owed by those applying for bankruptcy or taking out an individual voluntary arrangement was said to be Pounds 21,000. However, this figure is now said to account for Pounds 42,000 as of last year.
Commenting on the figures, Gill Wrigley, insolvency practitioner for Haines Watts, suggested that an increasing number of young couples are now incurring debt management difficulties. She suggested that consumers under the age of 30 are particularly "vulnerable" as they are going through a "transitional life-stage". Ms Wrigley pointed out that while borrowers in this age bracket are beginning to start a family and buy their first home, they are "also spending a high proportion of their income on social activities". Debt author professor Muir Hunter added: "The worry is that people are spending all this money on credit cards without building up any solid assets."
Earlier this year, research carried out by the Daily Record indicated that in the months following their marriage newlywed couples are developing problems handling their finances. The report indicated that the proportion of recently married consumers visiting debt management counsellors has doubled during the last 12 months, with their big day said to be the main reason for their monetary difficulties.
Overall, the average wedding was reported to cost Pounds 18,000, with about a fifth of all nuptials funded via personal loans and other avenues of borrowing. Debt Advisor representative Bev Budsworth told the publication that a rising number of couples are seeing their new lives together "blighted" by debt.
Meanwhile, statistics from Credit Action have revealed that some 330 people apply for insolvency or bankruptcy every day. The charity also pointed to research by stockbrokers Brewin Dolphin Securities which indicated that just under half (45 per cent) of couples planning to get married - about 117,000 - do not have any financial plans in place to fund their wedding. |
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