Unfortunately, this good news for retailers doesn’t extend to consumer debt as it has left many people kicking off the new year with even higher levels of personal debt.
According to Grant Thornton’s personal insolvency practice, an estimated 30,000 people in the UK will become bankrupt by April with a third of those bankruptcies being caused by Christmas borrowing.
An incredible 29% of people borrowed money over Christmas with nearly one in five of us putting bills on credit cards and one in 10 borrowing on overdrafts.
These figures don’t bode well for the coming year and predictions already indicate that 2007 could see even more personal debt than last year, when the number of insolvencies reached 110,000.
Other factors that make this prediction all the more plausible are the rises in interest rates, utility bills and unemployment since Christmas 2005. Collectively, these factors set the scene for another year dominated by record-breaking debt and all that comes with it.
This will cause the alarm bells to ring for all of you who know the financial ramifications that a critical illness can have on people who, already steeped in debt, are faced with the prospect of losing their income as a result of their diagnosis. Such financial ramifications could become all too common if people continue to not face up to their responsibility when it comes to predicting their health.
A study by Cancer Research shows that a quarter of all Britons think contracting cancer is down to fate so they see no reason to change their lifestyles to cut the risks.
This is astonishing and makes you wonder whether people have similar attitudes to other critical illnesses, despite the extensive media coverage that is given over to the ways people can cut the risks of certain illnesses by changing their lifestyles.
From a protection viewpoint, this points to a year of explaining to clients the reasons why protection is pivotal to their financial planning. Your clients don’t come to you to be lectured on the state of their health but they do rely on you to advise them on what protection they need.
We’re not going to change people’s attitude to debt and misconceptions about the causes and incidence of disease overnight, but what we can do is take the time to explain the financial repercussions of ignoring reality. It takes patience, confidence and knowledge, but the rewards speak for themselves.