Unexpected spending ’sets Britons back billions’

New figures have indicated Britons paid out £48.7 billion in unexpected bills and charges over the last 12 months.

Research by Abbey revealed that in the past year 79 per cent of consumers were forced to pay for something they had not budgeted for - each time setting them back an average £1,375 - which could impact upon their ability to make repayments on personal loans, credit cards and other forms of borrowing.

Reza Attar-Zadeh, head of savings for Abbey, said: "You never know what life is going to throw at you.

"However, you can prepare for the unexpected through building up a ‘buffer savings fund’ to help deal with these shock events."

He suggested that building up "a fund of at least three months’ salary" could help consumers with any unexpected debt management difficulties.

Other areas which were reported to place pressure on consumers’ abilities to make loan repayments included parking tickets, surprise bills and travel expenses.

To meet these expenses some 37 per cent were reported to have used their credit cards, with a further seven per cent of respondents borrowing money off a friend or relative.

The study also indicated that those living in the south-east could be experiencing the worst debt management difficulties with 83 per cent of residents in the area forced to make unforeseen payments.

Meanwhile, consumers in Wales and the south-west were said to be able to handle their finances better - as only two-thirds dealt with unexpected expenses in the past year.

Home repairs were reported to account for the largest proportion of unexpected expenditure, costing a total of £19.2 billion - an average of £1,206 per adult.

Last week figures from National Savings & Investments indicated that a third of Britons are ‘financial fantasists’.

The study revealed that 33 per cent of consumers take out personal loans or count on higher wages in later life to cement their financial future.

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