Ever wondered how much other people worry about their personal debt? Ever wondered if others worry more or less than you do? Is there a level of debt which should prompt you to press the panic button? Is worrying about debt normal? Do you ever think: ‘it’s just me – nobody else seems too concerned’! Or do you think: ‘I should be worried’.
Scottish Provident has just published a remarkable report which provides answers to some of these questions. The Financial Safety Net report is a consumer survey carried out by Opinium Research on behalf of Scottish Provident in August 2010 and is based on 2,044 online interviews.
Remarkably an average debt level of £15,837 is reported to be the threshold beyond which Britons consider themselves to be in serious financial difficulty. Younger people however in the 18-34 years old category have a slightly higher ‘worry’ threshold of £16,646 while the over 55s set the bar lower at £14,424. There are also some regional variations in the ‘worry’ threshold but the spread is relatively small.
If struck with a serious illness or disability a remarkably high 62% of working respondents said that they would turn to their family for support with 26% contacting their local Citizens Advice Bureau and just 4% contacting the Samaritans. In making a major decision about their own finances just 20% of respondents said that they would seek help from an independent financial adviser. The survey also revealed a surprisingly high level of working respondents who believe that their employer or the government would offer them all the financial assistance they would need if they should be hit by critical illness, disability or even death.
Interestingly the £15,837 ‘worry’ threshold is almost the same as the upper threshold for a Debt Relief Order (£15,000) and as the lower threshold for an Individual Voluntary Arrangement (also £15,000). Both of these solutions are for insolvent persons as indeed is bankruptcy. If you are already encountering difficulties in re-paying your debts, you may be insolvent. If you want to determine this one way or the other, do consider going to CCCS, CAB or to any reputable commercial provider of insolvency services in order to obtain professional advice.
Any reputable Insolvency Practitioner (IP) will determine if you are insolvent. If you are, you can explore and have explained to you the full range of possible solutions to your predicament. You can make up mind if you want to proceed further. You commit to nothing at this point and can walk away and ‘sort out’ your own finances.