Brits ‘Are Concerned About Their Finances’
Britons are becoming increasingly concerned about the state of their finances, new research shows.
In Lloyds TSB Corporate Markets’ latest consumer barometer, people are becoming more worried about their job prospects. About a quarter (23 per cent) of those questioned state that they feel their job is less secure than it was at the same time in 2006. In comparison, 19 per cent believe their working position is safer than it was in December last year, resulting in a negative balance of minus four. This represents a fall from the minus one noted in November and is also the lowest reading recorded for six months. Meanwhile, some 39 per cent of Britons claim that, on the whole, the country’s employment situation has worsened over the past 12 months. Just 15 per cent report that the scenario has improved.
The consumer study indicates that 74 per cent of people believe that the cost of goods has risen over the last 12 months, with just three per cent deeming them to have fallen. Over four-fifths (81 per cent), meanwhile, state that during the coming year prices are due to increase. As a result of such rises, many may well find that their ability to manage various demands on their spending such as personal loans, utility bills, mortgages and groceries comes under pressure.
Findings from the financial services firm also showed that more than half (51 per cent) of consumers believe that interest rates will be higher by this time in 2008. Meanwhile, 18 per cent state that they will stay the same, while 26 per cent think they will be lower. The figures come despite the Bank of England’s monetary policy committee choosing to cut the base rate of interest earlier this month to 5.5 per cent, with such a move potentially seeing monthly mortgage and loan repayments lowered.
Trevor Williams, chief economist for Lloyds TSB Corporate Markets, said: “The slump in confidence over job security, coupled with the pressure of rising prices, does not bode well for the new year. This combination could dampen consumer spending and have a knock-on negative impact on the housing market. However, the fact that official labour market data remains strong offers some hope that job fears may be short-lived. Although our survey suggests that December’s interest rate cut has so far had little impact on sentiment, a further two cuts early next year - which we expect - may offer a welcome boost to confidence.”
For those consumers who believe that pressure on their spending is to deepen over the coming months, taking out a debt consolidation loan could be advisable. This type of loan may be suitable for rising numbers of Britons after recent figures by the Office for National Statistics indicated that food price rises at bakeries and dairies is running at 6.6 per cent - the fastest rate of growth since July 1993. In turn, it was suggested that extra costs will be passed on to people via higher grocery bills at the checkouts. In facing such increased pressure on their finances, consumers may well find that a consolidation loan can help to pay off numerous demands on their spending quickly.
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