Disposable income diminishes for those with debt

Following the last few years, which have proven to be extremely turbulent by way of finances, many people have struggled to make ends meet financially. However, a recent report has shown that many people are now in dire straits with their finances, as they have literally no disposable income left at all once they have paid off their various debts and financial commitments.

A number of issues have adversely affected the finances of those that are now left with nothing to spend or put aside for emergencies each month. Many people are struggling with debt because they have been forced to borrow so much money to make ends meet recently and repayments are taking up a large chunk of their cash. In addition to this, some have lost their jobs or had hours reduced, which has affected the amount of money coming in.

To top things off, the cost of living has continued to soar, with consumers having to pay a fortune for essentials such as food, petrol, and energy usage. Given that many people have not had a pay increase in several years this is also putting additional strain on finances. The research showed that 21 percent of people had no disposable income left at all after paying their bills and commitments each month. Another 26 percent said that their wages did not even cover what they had to pay out, leaving them in the red permanently.

One debt expert said: “If you are struggling at the end of the month, it is a natural reaction to try and borrow more to bridge the gap be this with an overdraft, credit card or pay day loan company. However, this generally just makes the situation worse. Better to get advice from an expert debt advisor and consider ways to reduce the amount you pay on your current debts with a debt management solution. This will help free up cash and get your finances back under control and protect key payments such as your mortgage or rent.”

Tags: reaction, Business Finance, situation, solution, nothing, rent

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