One in ten Brits have no idea how much debt they are in, while a further 20% admit to only planning their finances once every six months.
Research from credit reference agency CreditExpert found that, while 96% of Brits claim to be familiar with their current finances, only one in four (26%) can accurately state how much debt they have left to repay.
The research also found that almost half (48%) don’t know the APR on their credit cards, while 36% aren’t even sure what an APR is.
Ignorance isn’t bliss
"It's alarming to see that while almost the entire UK population think they are on top of their finances, many aren't,” says CreditExpert MD Jim Hodgkins.
“This could lead to disappointment when people are planning to get a loan or change existing credit arrangements. Keeping track of your commitments and planning for the future are always important.”
Unsurprisingly, it is the younger generation (18 - 34 year olds) that struggle most with their money. Nearly a quarter (23%) admit to being bad at managing their finances and almost one in five (18%) claim to have no savings, compared to 13% of all adults.
Essential you fix your finances
As you’ve no doubt read countless times in the media, the cost of living in the UK today is soaring.
Worryingly, the research from CreditExpert seems to indicate that many Brits have yet to change their financial behaviour to reflect this. If you don’t know how much you owe, or even if you don’t know your credit card APR, you may need to start keeping a tighter rein on your finances.
Remember that the cost of credit is increasing all the time, so any debt you do rack up will prove more expensive to clear than before.
Avoid interest like the plague
The good news is that simple changes to your finances can have a dramatic impact.
For example, if you currently have credit card debt that is earning interest, switch it to one of the various 0% balance transfer cards on the market today (Virgin credit card has the longest offer, at 15 months interest free).
Assuming you had £3,000 debt, this one simple move will have saved you more than £400 over the course of a year.
