Debt advice in 2008

16 January 2009

The Government’s focus on – and extra funding for – debt advice seems to have come at a good time. According to the Department for Business, Enterprise and Regulatory Reform, over 100,000 people were helped by Government-funded face-to-face debt advice services in 2008.

Meanwhile, calls to the Government-funded debt advice telephone service increased by 40% throughout the year, and demand for the business-specific debt advice service doubled between autumn 2007 and autumn 2008.

Government-funded debt advice services are not, of course, the only providers of free debt advice. Debt Advisers Direct, as part of the Think Money Group, have been helping people with financial difficulties since 1993. In fact, we were one of the first companies to offer free debt advice to people in the UK.

According to Consumer Affairs Minister Gareth Thomas: “It is imperative that when people are struggling with debt, they seek assistance as soon as possible. There are a wide range of organisations who provide expert advice and can really make a difference when it comes to resolving debt problems. We have made a firm commitment to support these services so they can continue to help those most in need.”

Debt advice in 2009

As we enter 2009, the UK (along with the rest of the world) is facing an economic crisis of daunting proportions. With unemployment rising and long-standing companies going out of business, UK citizens are collectively carrying around £1.5 trillion of debt – around 85% of it secured against dwellings and the rest unsecured.

In other words, we can expect even more people to need debt advice in 2009. According to KPMG, 2009 is ‘likely to see personal insolvencies reach record levels, with more than 150,000 people entering into an Individual Voluntary Arrangement (IVA), being declared bankrupt or entering into a Debt Relief Order’.

“For some people,” said a debt expert for Debt Advisers Direct, “insolvency may well be the best way forward, but many others may be able to avoid it. If they seek debt advice in time, they may well be able to tackle their debt problems before insolvency becomes the only option.”

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