How to Tackle and Minimise Debt in the Current Climate

It's almost impossible to have a discussion about the UK economy without also considering Brexit, as the tense negotiations between the EU and the Conservative government continue at length.

Of course, the nature of the deal that the UK are able to achieve is intrinsically linked to their future economic performance, regardless of the polarised opinions that exist on both sides of the divide. So, while Shrewsbury MP Daniel Kawczynski is one of the many Tory MP's calling for the UK to walk away without a deal if the EU do not meet their demands, it's almost impossible to determine the precise impact on individual households across the UK.

In this post, we'll look at the rising level of debt within the UK economy, and ask how households can take proactive steps towards mitigating the impact of Brexit.

The UK's Debt Issue in Numbers

There's a plethora of data surrounding the UK's current debt levels, with the very latest figures suggesting that around a quarter of the nation's poorest households are struggling to repay existing loans or simply behind with their bills.

These numbers, which were released by the Institute for Fiscal Studies (IFS), confirmed that unsecured or “problem debt” remained a huge issue for the least well-off in society, with an estimated one in six households of the poorest 10% in arrears across a multitude of accounts and repayments.

Beyond this, a further 10% of households were spending more than a quarter of their earned income on servicing debts, while the gap between inflation and real wages placed an even greater squeeze on citizen's finances.

How to Mitigate the Impact of the Economic Climate and Successfully Manage your Debt

While the numbers that frame the issue are relatively easy to understand, however, the solution is less evident. After all, Brexit negotiations will continue to create uncertainty and hamper economic growth in the UK, while some experts have predicted that the UK could go for up to two decades without any form of real wage growth.

This places the responsibility for tackling and managing debt firmly in the hands of individuals,but fortunately there are some steps that can be taken to mitigate the issue. Firstly, it's crucial that households face up to the true reality of their debt and determine the gap between their incomings and projected outgoings, rather than attempting to avoid any form of contact with their creditors.

Once you understand the extent and the nature of the problem, you can quickly identify the most effective solution. For those with a number of small debts, for example, the issue may revolve around management and individuals can overcome this by investing in the type of consolidation loan featured here.

In contrast, those dealing with single or large debts may need to come to customised agreements with individual creditors, as they take the proactive step of opening lines of communication and seeking mutually-beneficial plans of action.


Pete White Pete White

Love Shrewsbury editor and chief developer at The Web Orchard, find out more on

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