Abacus Daily Debt News

Seven deadly debt sins revealed

The seven deadly sins of debt have been laid out to help people avoid falling into arrears and recover financial stability.

According to Felicity King-Evans of moneysupermarket.com, the first is mistaking luxuries for necessities, with many used to living excessively.

She noted that consolidating debts, which can be done successfully, will fail if cutting up credit cards and closing overdrafts is not done.

And seeking short-term solutions, such as payday loans, was recognised as useful but not something that should be relied upon.

Drifting into debt through not tracking disposable income means that it is "impossible" to plan larger purchases and keep out of overdrafts, Ms King-Evans writes.

Furthermore, debt denial - which is a growing concern according to David Rodgers of the Debt Advice Foundation who observed that many are unwilling to share worries with their family - is "particularly dangerous", with people underestimating how much they owe.

The sixth sin relates to keeping up appearances. In 2008, 15 million adults in the UK had a total of £35 million worth of debt to demonstrate levels of wealth that may not have existed.

Lastly, spending money before it is in the bank was also highlighted as a sin.