With news that UK families are typically £7,900 in debt, we're here to help with all your money worries.
Think a debt management company might be the answer to your prayers? Well think again. And if you need a way to save money during half term, help is on hand! We've got a guide to bargain days out with the kids and don't worry about any tricky exclusions - they're all available this week.
UK IN DEBT
Last week a report by Price Waterhouse Cooper revealed UK families are typically £7,900 in debt from personal loans, overdrafts and credit cards. The average household has been making repayments on these debts for three years. UK households are among the most indebted in the world.
WHAT ARE DEBT MANAGEMENT COMPANIES?
Debt management companies negotiate with creditors on your behalf and will arrange repayments.
CAN YOU AFFORD A DEBT MANAGEMENT PLAN?
You can only enter into a debt management plan if you have some money left over every month once all your essential expenses have been paid - this is because the companies charge a fee for their services. It's a good idea to draw up a budget, including your monthly income and all your essential monthly household expenses. For example, your mortgage, rent, utility bills, Council Tax and hire-purchase payments. If you have a very small amount left over after all these have been paid - or nothing at all - you should consider other ways to manage your debts.
POOR VALUE FOR MONEY
We believe they offer poor value for money. Fee-charging debt management firms generally target people who are in serious financial trouble. The firms sell themselves as a last resort rescue option. Creditors don't have to enter into a debt management plan and may still contact you asking for immediate repayment and mortgages and other 'secured' debts are not covered by a debt management plan. Which have worked out the fees these firms charge typically equate to around 17% of a customer's monthly repayments. Several companies are also charging initial fees, equivalent to around two months' worth of repayments.
ALTERNATIVES TO DEBT MANAGEMENT COMPANIES
There are several impartial and independent debt advice organisations run by charities that provide the same assistance free of charge. Two of the main ones are the Consumer Credit Counselling Service (CCCS) and National Debtline. We feel that debt advice charities provide a more comprehensive and impartial service - and one that's free of charge. In recent years, fee-charging debt management companies have argued that they're able to deal with consumer debt problems more quickly than these free services. They maintain that the CCCS and others are swamped with requests, and therefore have long waiting times. But when we spoke to the CCCS and National Debtline, we found no evidence to support this.
DEBT MANAGERS STANDARDS ASSOCIATION (DEMSA) SAY:
We support the free debt advice sector and recognise the valuable resource it provides to consumers in financial difficulty. We also believe consumers should make informed choices and some prefer to use a fee-payable service that better suits their needs or provides greater accessibility. Consumers choosing to use a fee-payable service need to be confident they are dealing with a reputable provider, who acts in their best interests and provides a quality service and accountability. All DEMSA members have demonstrated their adherence to the high standards set out within DEMSA's Code, which has been approved by the Office of Fair Trading. We would therefore urge anybody seeking fee-payable services to look out for the DEMSA/OFT approved logo or to visit DEMSA's website, where they will find a list of reputable providers.
School holidays can be stressful for parents - you want to take the children out but think it's too expensive. People often believe that money-off vouchers are not available during half term but this isn't true.
Drayton Manor - 2 for 1 on admissions
Waterworld - buy one ticket get one half price
Knowsley Safari Park - Half price tickets for half term
London Dungeons - 20% off admissions
Wookey Hole - kids go free