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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`

Deeper into debt: middle-class poverty

02/03/2010

The recession has also affected a lot of people with comfortable lifestyles, an article in The Independent reminds us.

The article is largely based on the experiences of Andrew Newbury, a Manchester-based family solicitor who handles divorces. Mr Newbury explains that `a growing number` of people with a comfortable lifestyle (detached home, two cars, nice holidays, etc.) have actually taken on a fair bit of debt to fund it.

If it comes to divorce, in Mr Newbury`s experience, it`s often a case of sharing out the debts, rather than the assets (as you might expect). "Unbeknown to the wife," he explains, "the lifestyle is built on credit cards. I`ve always seen a slight element of it but I`m seeing a lot more now. It`s becoming worryingly common."

Like any other groups, the `seemingly wealthy` might face financial worries and debt problems for all kinds of reasons - but the effects are often all too familiar.

"A lot of them are struggling," says independent financial adviser Garry Spencer of Wilbury Financial Management. "They got as big a mortgage as they could get, and now they are fire-fighting. A lot are having pay cuts. They are cutting their pension, the life cover and cashing in the ISA. Some of their kids are being taken out of private school. Many are borrowing again, and they are missing payments on their credit cards. That affects their future credit card rating. Poverty is a spiral, and you get deeper and deeper into debt."

"Stories like this are a reminder that anyone can run into debt problems," said a spokesperson for Debt Advisers Direct.

"What`s more, they`re a reminder about the risk of taking on debts - just because your payments are affordable today doesn`t mean they`ll be affordable tomorrow. That`s one reason why it`s so important to keep borrowing to a minimum and bear in mind that your finances could always take a turn for the worse, especially at a time like this.

"As they say: `Hope for the best and prepare for the worst`."

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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