Brits 'looking to reduce debts and increase savings'
With the economic downturn continuing to rumble on, one financial expert has revealed how Britons are taking an increasingly sensible approach to their overall money management.
According to Motley Fool director David Kuo, consumers "have been scared into being responsible" due to constant reports about the possibility of rising unemployment rates.
Indeed, he points towards the possibility that as many as one out of ten Britons who can work will be out of a job by the end of this year.
Consequently, consumers are concentrating on doing one of the following - if not both - ways of improving their financial standing.
One of these, Mr Kuo highlights, is making moves to repay as much debt possible, which could include that accrued on credit cards.
By doing so, he states that should consumers eventually find themselves to be out of work then the burden of what they owe "is not as great".
Such moves to pay down debt comes as the Motley Fool director states that borrowers are taking advantage of the base rate standing at an all-time record low of 0.5 per cent.
He goes on to claim people will begin to spend money more once they see signs of unemployment rates easing, although those who are looking to fund major purchases straightaway may want to consider making use of a credit card that offers 0% purchases.
In addition, he states that people are concentrating on placing an increasing amount of money into savings accounts.
Britons looking to compare savings accounts to ensure they receive an attractive rate of return may be interested to hear the Motley Fool's advice that people should look to set aside between six and nine months worth of expenditure to see them through in case they lose their job.
Taking the time to increase the amount placed into savings accounts and reduce debts, Mr Kuo asserts, "can be no bad thing for the UK because the only way that the UK can dig itself outside of this hole is to get consumer debt down to a more sensible level".
His comments follow statements by Hargreaves Lansdown pensions analyst Laith Khalaf that the recession will hopefully remind people of the need to have a significant sum of money tucked away into a savings account.
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