A new survey by SuperSaverOil.com has found that almost half of British adults have relied on a form of credit in order to pay for unexpected living costs.
The most common cost for the 1,035 UK adults surveyed found that the most common unexpected cost was car repairs, causing many to rely on a credit card to finance the unbudgeted cost.
“It’s quite surprising to see how many Britons are having to rely on other sources of funds to pay for unexpected living costs.” said Mark Hackett, Project Manager at SuperSaverOil.com.
“While budgeting based on ongoing monthly expenditure is certainly better than nothing, it’s important to keep a pot of money aside – a rainy day fund – that is there to use should any significant unexpected costs crop up.
“Unfortunately, it’s quite common for cars to break down, need a new tyre, or for homes to experience a leak, and as annoying as it is, we should be prepared for this financially. Not only will it mean the situation is likely to cause less stress when it does arise, but it will make you feel more financially stable day to day, knowing you’re on top of everything,” he added.
The total number of those affected by car repairs was 72 percent, who had to borrow money from friends or family to cover the unexpected cost. This was followed by home repair costs, affecting 66 percent of British adults.
Research from Consumer Intelligence has also found Britain’s reliance on credit cards. According to research conducted earlier this year, 80 percent of the population has a credit card.
“The alarm bells have been ringing all year with the Bank of England warning that personal debt levels have been rising at the fastest rate since 2005.” said Ian Hughes, chief executive of Consumer Intelligence.
“It is a major concern when millions of people admit to being worried about how much they owe and so many are relying on credit cards to tide them over each month.
“Borrowing makes sense for many when interest rates are low but it is essential people have a plan to repay their debts not least to reduce the stress millions are facing.”