Parents facing debt problems due to childcare costs

A new survey has revealed that parents from some of the UK’s poorest families may be facing severe debt problems in order to afford rising childcare costs.

The survey, conducted by Save the Children and the Daycare Trust, involved questioning a total of 4,359 parents on childcare costs and general household finances.

The findings revealed that nearly a quarter of parents admitted that the cost of childcare has landed them with debt problems. Other results from the survey showed that 58 per cent of parents questioned had cut their spending on essentials such as heating, clothing and other bills. Meanwhile, four out of ten parents said that they spent nearly as much on childcare as they did on their rent or mortgage.

The survey focused on the differences in spending and debt problems between poorer families and those earning more than £30,000. Of those included in the survey, around 250 brought in an income of £12,000 or less a year. It was found that:

58 per cent of poorer families believed they were no better off working and paying for childcare, compared to 19 per cent on higher income families who shared this view.47 per cent had made cutbacks to the amount of after-school activities their children participated in, compared to 22 per cent of higher income households.61 per cent of low-income families admitted they were struggling to afford childcare. Just 37 per cent of higher earners also admitted this.

Kate Groucutt, from the Daycare Trust, said:

“Our research shows that childcare costs have risen every year for the last 10 years.

“This, combined with the recent cuts to the childcare element of working tax credits, means that the financial burden on parents is greater than ever.”

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Posted in: childcare,costs,facing,parents,problems

Millions facing financial difficulties

A recent charity report that has been released has suggested that millions of households across the UK are in financial difficulties due to debts, rising living costs, and wage freezes or cuts whilst millions more are in danger of falling into similar financial problems. The report comes from the Consumer Credit Counselling Service and paints a bleak picture of the state of millions of household finances.

According to the report more than three million households are now facing financial problems across the UK. Moreover a further one third are facing financial difficulties and are described as ‘financially vulnerable’ by the Consumer Credit Counselling Service.

The report shows that more than one million people are now struggling to repay their mortgage, and over 3 million are at least three months behind with a debt repayment or are facing action such as insolvency. A further three million are now struggling to make ends meet and could fall behind with repayments if there are any further rises in living costs or any cuts to their household income. Many people are said to be left with little to no disposable income once their essential costs such as mortgage or rent, bills, food, and car running costs have come out of their salaries and some do not even have enough to meet all of these essential payments any longer.

One debt industry official said: “With the recent increases in the cost of living and static or reducing family incomes it is not surprising that more and more people are suffering with financial difficulties. I expect this figure to continue to rise as more and more government cuts start to kick in and the unemployment rate starts to rise”

Tags: essential payments, United Kingdom, car running costs, insolvency, report, bills food

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Posted in: difficulties,facing,financial,millions

Quarter of Bridlington residents facing debt problems due to ‘fuel poverty’

According to a recent report, up to one in four households in Bridlington are facing debt management problems due to ‘fuel poverty’.

The East Riding Council committee commissioned a report which found that across the region, 18 per cent of households are suffering from fuel poverty, which is greater than the national average of 16 per cent. Fuel poverty is when a household has to pay out more than 10 per cent of its total income in order to cover fuel bills and to maintain a satisfactory level of heating.

The key areas which have the highest levels of fuel poverty (above 26 per cent) were highlighted in the report to the committee. Included in this list were all three Bridlington wards, prompting concern that the residents of these areas may soon be in urgent need of debt help.

Looking back at the figures for the East Riding region in 2008, it can be seen that fuel poverty rose by six per cent since 2006. The problem may even get worse, as energy costs look set to rise alongside increases in the everyday costs of living.

Councillor John Wilkinson, who is the chairman of the environment and regeneration overview and scrutiny sub-committee, said:

“It’s going to get worse as fuel costs rise and will affect a very vulnerable section of the community, which I think is mainly older people and young families that have got very little spare income.

“The council is concerned about this. We are doing all we can to assist vulnerable people involved.”

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Posted in: Bridlington,facing,poverty,problems,Quarter,residents

“Squeezed middle” facing perfect storm as share of national wealth declines

Low to middle income earners are facing a “cost of living crisis” that is reducing their living standards and preventing them from entering the housing market, according to new research from an independent think tank.

The Resolution Foundation, a research and policy organisation working to improve the lives of people on low-to-middle incomes, is to launch an enquiry into how wages and living standards for the “squeezed middle” have increased at a slower pace than the economy as a whole.

The Commission on Living Standards will investigate the pressures facing people on low to middle incomes and focus on economic trends that are changing their way of life. The foundation defines low to middle income earners as those too prosperous to draw on the benefits system but not wealthy enough to profit from private markets.

Low and middle earners are defined as those with incomes between £12,000 and £30,000 for a couple with no children and up to £48,000 for a couple with three children.

The foundation says that low to middle income earners’ wages have remained flat since 2003, long before the start of the financial crisis. The group’s share of national earnings is in long-term decline and the country’s tax and benefits system is doing little redress the balance the commission will say.

Speaking at its launch, leader of the Labour Party Ed Milliband said: “For many decades, the proceeds of growth and rising prosperity benefited the vast bulk of those working on middle incomes,

“However, over the last 20 to 30 years that once-safe assumption has broken down. While those at the top have done well, middle and low earners are no longer guaranteed the proceeds of growth. Our economy is increasingly unfair not just for those at the bottom but for many of those in the middle as well.

“The task for the future is to build a different sort of economy; a high-quality economy with quality jobs and a better quality of life. That means good jobs at good wages for middle and lower-income families. And a tax and benefit system that supports families with children, not one which is increasingly skewed against them, as we see under this government.”

The commission will look at evidence which suggests that someone at the lower end of the earnings scale will take 45 years to accumulate the deposit for a house if saving 5% of their income each year. It will also highlight the fact that some 41% of young low to middle income earners currently live in private rented accommodation compared to just 14% in 1988.

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Posted in: declines,facing,middle,national,perfect,share,Squeezed,storm,wealth

Anyone facing unemployment should seek debt advice as soon as possible

- Thursday, 17 February 2011

Anyone who has recently lost their job has been advised to seek debt help as soon as possible to help them avoid further debt problems.

That is the recommendation of Delroy Corinaldi, external affairs director of the Consumer Credit Counselling Service (CCCS), who also stated that joblessness can add to debt worries.

He said: "Anyone who has lost their job and is worried about making ends meet should seek help as soon as possible before being tipped into the black hole of debt which can be a real struggle to get out of."

These comments were made after the Office for National Statistics revealed that unemployment in the UK increased by 44,000 in the three months ending December 2010.

It was also revealed that around one in five young people aged between 16 and 24 were out of work in this period.

The CCCS found that a quarter of people seeking debt advice in 2010 were unemployed and 11 per cent were claiming Jobseekers Allowance.

Unemployment can lead to debt problems as families affected by it tend to experience a shortfall in their income compared to their outgoings, the charity claimed.
Wed, 23 Feb 2011
Brits concerned about their debt problems, which have been accrued through borrowing on a credit card, may want to consider using a zero per cent balance transfer card... Tue, 22 Feb 2011
Around 430,000 students will be given a manual about how to manage their money and avoid debt problems in the process.

Finance charity Credit Action intends to give its guide on student finance to young people planning to attend university in the 2011/2012 school year.

The average student is expected to graduate with debts amounting to more than £23,000 so the charity has created a guide to inform youngsters about the financial support available, how to budget and how to save money.

This could help would-be students learn how to stay in control of their money and help them avoid debt problems while at university.

Joanna Parsley, associate director of Credit Action, said: "Getting this information and guidance into students' hands before they begin university is key as it allows them to prepare financially, so their university experience can get off to a smooth start."..

Mon, 21 Feb 2011
Consumers living with debt problems may want to sign up for the broadband and phone package that Talk Talk is introducing... Fri, 18 Feb 2011
Couples that are going through financial difficulties and seeking debt advice need to be "open and honest" with one another...

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Posted in: Advice,Anyone,facing,possible,should,unemployment