Could high energy bills be more financialy draining than credit cards?

Tuesday, February 20, 2007

Could high energy bills be more financialy draining than credit cards?

Recent reports have shown that most people living within London are thinking that they will have to declare themselves bankrupt or get an IVA within this next year. However the Citizen’s Advice Bureau claim that it is high energy bills and child maintenance costs which are causing so many people to be in such a terrible financial position.

Energy bills reached their highest in December of 2006 and it is only now that companies are starting to bring those bills down. However child maintenance costs still remain high and many parents struggle to afford the best for their children. The Citizen Advice Bureau in London said that since January 2006, the number of people who went to seek advice due to unaffordable gas and electricity bills went up by 34%. In comparison to just 3% of people who went to seek advice about loans and credit card debt, it certainly shows that credit card debt is not many people’s main concern these days.

With prices going back down now people should start to find that their bills become more payable. However, for the people already in financial hardship it is hard to get out of their problems even with these significant price cuts. From early 2006 until January 2007, it is thought that household utility bills went from £775 a year to £1,000. That is a huge rise which many people simply cannot afford. Due to the fact that wages stay the same, people just cannot manage with these ridiculously high prices.

So once again only time will tell if these price cuts have come too late, or whether they will provide a godsend to many households in debt. No doubt the news that utility bills have overtaken credit card debts in keeping people in financial hardship will come as a huge shock to some people, but for the Citizens Advice Bureau it is only too familiar.

Source

http://www.thriftyscot.co.uk/Finance-News/022007/could-high-energy-bills-be-more-financialy-draining-than-credit-cards.html