Expert: Everyone is stretched to financial limits

Wednesday, May 26th 2010

Most consumers and businesses in the UK are facing money troubles, according to a professional.

Chris Tapp, director of the charity Credit Action, drew attention to the financial difficulty facing organisations, individuals and the government.

"Everyone is stretched to the limit financially," he said, adding Britons need to remember the importance of living within one's means and accepting that it may be necessary to spend less than in the past.

He explained that, once people have their finances in hand, they can become "more confident consumers".

Mr Tapp admitted that if consumers are not optimistic about prospects, the UK could go back into a recession.

Research by the Markit Economics Household Finance Index has shown that 26 per cent of households saw their financial situation deteriorate in May.

Close to half (43 per cent) believe that it will only become worse in the year to come and 57 per cent think they will suffer as a result of the government's planned cuts to balance the deficit.