Monday 14th May 2007 marked the start of Credit Awareness Week. The event, devised to help people understand the implications of credit, has discovered that almost 50% of UK consumers admit to making financial blunders and do not feel in control of their finances.

According to the findings, over 2/3rds of people are prone to overspending and have considered an IVA or even Bankruptcy as a matter of course. A large amount of people blame over stretched debt consolidation loans and “spree” spending as the primary cause of their financial distress.

The data also confirms that around 10% of people have entered into an IVA within the last 12 months, with a further 20% using additional forms of credit to manage their existing debts. 1 In 10 people admit to frequently defaulting on mortgage, loan or credit card repayments.

The general consensus taken from the findings, is that many people have little to no understanding as to how to manage credit, resulting in countless, simple financial mistakes which should have been easy to avoid. Worryingly, large amounts of people are turning to IVA’s as a quick fix to their problems without researching the long-term consequences.