Updated: 29th May 2008
Families struggling to make ends meet by using credit cards to pay for groceries are finding that the credit squeeze means they cannot afford to live outside their means. According to personal insolvency experts from Begbies Traynor, Britains commonly used credit cards during the credit boom to cover food bills whilst using their income to fund a more lavish lifestyle than their income would warrant.
Joanne Wright, Partner from the Manchester office of Begbies Traynor, says: “The tap of easy credit has been turned off for most people, as credit card companies are refusing to extend existing customers’ limits or tightening the application process. People who previously used credit to meet everyday expenses are finding that they now have to live within their means.”
World food prices are currently rising due to population growth, climate change, poor climate in the major cereal producing nations and the conversion of food into biofuels. The UK operates under a deficit unlike France or the USA and importing world foods such as rice means that the cost is passed on to the consumer, so at time when money is growing scarcer, more is now needed to meet the increasing costs of staples foods.
Joanne says: “Whilst there may be a tough few months ahead, the situation does not necessarily spell disaster. Rather, the need is to recognise early that these are challenging times and plan accordingly.
“If the figures start to look worrying, then seek advice sooner rather than later. As in other aspects of life, third party input can often help to review the situation dispassionately and identify solutions before the situation goes critical.”
Begbies Traynor is part of Begbies Traynor Group plc which is an AIM listed specialist professional services organisation, providing independent professional advice and solutions to businesses, financial institutions, the accountancy and other professions and individuals in areas of finance, recovery, investigation and risk management, specialist financial advice and commercial finance.
A Licensed Insolvency Practitioner with an MBA degree, Paul joined the Manchester office of Begbies Traynor in 2009. Prior to joining, Paul was working at Dawson White, the IVA provider for an OFT approved debt management company. Paul also spent 11 years at Baker Tilly with two secondments with Motor Retail lenders, including Ford Financial. He has extensive experience of all insolvency procedures and also has a background in property based on his RICS accredited BSc Land Management degree.