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Those with Christmas debt urged to seek financial help

The Momentum UK Team 03 January 2012

The Insolvency Service of England and Wales, the government regulator of the insolvency profession, has advised those struggling with Christmas debt - particularly young adults - to avoid delaying getting financial help.

The advice comes after the Insolvency Service revealed that young people aged between 25 - 34 are turning to Debt Relief Orders (DROs) more than any other age group.

The figures have been taken from an initial analysis of around 44,000 DROs which have been issued in England and Wales. The figures found that 25% of individuals with DRO's fall within this age group.

DROs, which were introduced in April 2009, are an alternative to filing for bankruptcy and are available under certain circumstances; to those who owe less than £15,000, do not own a home and have less than £300 in savings and assets. Unlike filing for bankruptcy, a DRO can be amended or cancelled if the individuals' financial situation improves.

Financial experts have warned however that DROs are not an easy alternative has they still affect an individual's credit rating.

Una Farrell, spokesperson for the Consumer Credit Counselling Service (CCCS), said the figures highlight that many young adults are struggling with their finances.

She said: 'Generation Y faces a future of higher debts and fewer assets than older generations. It is therefore crucial that they are aware of the free debt help that is available and don't exacerbate their situation by paying for debt advice if they find themselves struggling to keep up with their credit commitments."

With the support of various debt charities, the Insolvency Service has launched a dept awareness campaign to help and advise young people with a wide range of debt problems.

Momentum