Despite the threat of getting into masses of debt that takes years to escape, a large number of people are still spending now and paying for it later, says personal finance information website, Fool.co.uk.
Four out of ten borrowers said they took out loans in order to consolidate existing debts they already had, while another four out of ten borrowed money for a big purchase. On average it takes 38 months to repay these loans, which average £7,000.
Not everyone borrows money for essentials, the survey of 2,471 readers revealed; one in eight borrowed to pay for expensive weddings, and a similar number got the loan in order to become holiday-home owners.
David Kuo, Head of Personal Finance at Fool.co.uk, says: “It is always a good idea to consider alternatives before taking out a loan. If you have some savings, then dipping into your nest egg is likely to cost less than borrowing money, even if it is a low-cost loan.
“Additionally, delaying your purchase and putting away some spare cash is bound to work out cheaper in the long-run. Borrowing money may seem like a convenient way to plug a hole in your spending plans. But a hole in your budget may be a sign of deeper problems that can often be solved, not by increasing net borrowing but by cutting gross spending.”
Three out of seven borrowers said that in hindsight they will still take out another loan, but six out of ten are determined not to borrow any more money in this way.
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