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Debt Collection News Roundup – January, 2018

Here at Access Credit Management we like to make sure we bring our readers interesting and relevant news about our industry so once a month we’ll be publishing a News Roundup.  This should keep you up to speed with all the important goings on within the sector so that you have a resource that keeps you fully informed of all the latest news.  It would be interesting to know what you, the readers, think of the stories that feature here. 

 

If you have any stories you think we should be covering or if you’d like to comment on this or any of our other articles, please do so on our Facebook page or tweet to us on Twitter.

First comes the news that the phrase “Blue Monday” was trending on Twitter on the day – the third Monday in January.  The term was coined in 2004 by psychologist Cliff Arnal and is familiar to debt advisors as they see a rise in the number of people asking for help and advice in the wake of the Christmas holidays.  With the festive season pressuring people to spend money that they cannot afford, people often go into debt to pay for the presents and food to celebrate the holiday.  Blue Monday has been labelled “the most depressing day of the year”.

The Institute for Fiscal Studies (IFS) analysed official figures to ascertain the extent of unmanageable debt in the UK and discovered that a quarter of very low income households have high debt repayments or are behind on bills or repayments.  Unsecured borrowing, such as credit cards, overdrafts and loans, have been rising by almost 10% per year here in the UK and the Joseph Rowntree Foundation (which commissioned the report) claims that the government needs to look into the financial pressures that lead to families taking on debt in order to fund day to day living expenses. However, more than 60% of unsecured debt is held by households with above average incomes, more than half of which could easily pay off the debts.  However, debt problems tend to be more common in low income households whilst young adults in their twenties are more likely to be struggling with debt problems than older people.

Despite this fact, a shock report from ITV reveals that according to Prudential’s Class of 2018 Report, which considers the financial plans of those hoping to retire in the coming year, those who do retire in 2018 are likely to have debt that’s nearly 40% higher than those who retired in 2017!  Moreover, pensioners who retire with debt expect to spend around 3.5 years paying off their debt with average repayments of £285 per month (up from £230 per month paid by those who retired in 2017).

It’s not all doom and gloom, however, as a BBC programme, Inside Out, features Kirton Primary School in Lincoln in its debt special.  Believing that it’s never too early to learn about money, pupils as young as five are running their own bank and shop using a currency called “Kirts”.  The children are awarded Kirts for their achievements (which includes getting full marks on tests, representing the school at events and for full attendance), in order to instil a work ethic and a responsible attitude.  The shop and bank are both managed by pupils in their break-time and they’re paid in Kirts for doing this.