Brits may cut repayments in saving drive

Posted: 04 Feb 2009 08:38:44 GMT

Financial website fairinvestment.co.uk has found that as many as one in three Britons are currently considering cutting essential monthly payments as a result of the ongoing financial crisis.

With household finances stretched more than ever, 31 per cent of Brits are considering defaulting on mortgage payments or on payments on other loans.

Sharon Bratley, chartered financial planner at Fairinvestment.co.uk, said: "It is important that people prioritise their outgoings and try to reduce their debt as far as possible, so cutting back on non-essentials like saving contributions makes sense, especially as savings rates continue to fall.

"It is vital that if people have to cut back, they do so in a way that doesn't actually cost them anything more, for example, you should keep paying your mortgage and credit card bills to ensure that you don't have any further charges applied."

One long-term way to reduce monthly outgoings would be to downsize a property, and such a move may prove attractive as the threat of negative equity grows for homeowners who bought their house during the end of the housing boom.

Buying and selling a home online could prove quicker and cheaper than using a traditional estate agent, and could offer homeowners more control over the transaction they are making.



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