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More than 4 million fear they`ll be made redundant Consumers took on more mortgage debt in July Debts called in by parents Teenagers `scared of debt` Rising household costs could pressure people in debt Pensions debt may impact workers` retirement funds Welsh young adults `at highest risk of debt problems` Over 50s can`t afford to enjoy retirement because of debts Budget: tackling the nation`s debt Short-term debt: `no need for price control` The cost of clearing debt Education debt Tackling the national debt Number of mortgage deals on offer exceeds 3,000 Almost 5 million take on debt to pay household bills OECD: household debt more than 120% of disposable income Petrol price falls help people in debt Amount of mortgage debt taken on at lowest level in ten years Northern Ireland sees significant IVA rise Overdraft debt `becoming more expensive`

Savers could suffer as base rate falls to 1%

05/02/2009

The Bank of England today cut its base rate to 1% – the lowest since the Bank was established in 1694 – in a further effort to tackle the economic downturn.

The base rate cut is likely to reduce the interest rates on some mortgages and loans, which the Bank of England hopes will help to raise levels of lending in the economy.

However, the news will not be received well by everyone. Some economists have speculated that further base rate cuts would be ineffective in encouraging higher volumes of lending from banks and other financial institutions.

The base rate cut also threatens savers, since it could take interest rates well below the rate of inflation, meaning they are technically ‘losing’ money.

A spokesperson for Debt Advisers Direct said: “The worst affected by the base rate cut are likely to be those who rely on interest from savings as a source of income. For them, there is a danger that they may have to get into debt in order to meet their commitments.

“We advise anyone who finds themselves struggling to repay debts to seek professional debt advice as soon as possible.”

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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation loans and IVAs (Individual Voluntary Arrangements).

More than 4 million fear they`ll be made redundant 16/12/2010 - According to R3`s quarterly personal debt tracker, more than 4 Consumers took on more mortgage debt in July 26/08/2010 - Consumers took on £2bn more mortgage debt than they repaid Debts called in by parents 26/08/2010 - According to research, `the bank of Mum and Dad` is Teenagers `scared of debt` 19/08/2010 - Nearly two thirds of teenagers are `scared` of debt, according