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Are You Dicing with Debt? Don't lose out.

Dicing with Debt poster

Written by : published Tuesday 29th January 2013

Did you see the Channel 4 Dicing with Debt? The 10 part series which you can catch-up online here. A game show hosted by Paul Tonkinson. Where dice-duelling students get the chance to pay off a year's debt. One lucky winner walks away with nothing, the other with considerably less.

This guest article from Melissa Hathaway talks about debt and money and if TV is helping of making the problem worse.

Managing Debt - Why Do We Get into Debt?

So many of us either have some form of debt, or have in the past. If we haven't had any debts, we may at some stage in the future.

A debt can be anything from paying off a credit card, catalogue bill or a mortgage.

We may borrow money from the bank with intent to pay it back in manageable payments each month. Or we may be left with fewer options than to borrow. Students who are encouraged to take out loans to pay course fees and accommodation have to get into debt in order to better themselves in the future.

Other groups of people may have to borrow money or apply for credit cards just so they can afford to get by. High cost of living, having children and lower incomes put pressure on to provide or pay for everyday things.

Then, young adults who like to have expensive objects, socialise and have to pay the rent may also lose sight of their outgoings.

Temptation to Spend

Of course, we all have different personalities, needs and ways of living. The temptation to buy luxury items can be thrust in our faces in the form of advertisement and media.

New cars come out constantly, making our 'basic' vehicles modest in comparison. Glamorous adverts for designer clothing and fragrances or top of the range home improvements pressure us to upgrade.

Then with the power of media, we feel the need to overspend at every opportunity. Christmas is a time of buying costly gifts for friends, family, colleagues and neighbours. Valentines day puts the pressure on to give to your loved one, and all summer long you are tempted by commercials to go abroad on an all inclusive with all the family.

We all deal with commercialism in our own way, and weakening to one or two areas can have its impact on even the strongest of character.

Even having hobbies can mean spending money where it should be prioritised elsewhere. Sporting events, attending classes or spending money to make money can potentially put a dent in our bank balance.

If we are able to put money aside without living beyond our means, then the need for a pay day loan is low. But if more is going out than is going in, money is going to have to come from somewhere.

Understanding Your Debt

Borrowing money is never straight forward. Unless it is from a good friend or a family member, borrowing money usually costs more in the long run. Interest on loans, credit cards, and 'buy now pay later' purchases can vary. Some will give you 0% interest for the first 12 months or so. If you are able to pay back what you have borrowed in that time, you won't be paying back extra to the lender.

If you shop around, you could come across better deals. Certain banks will offer lower interest rates, with 0% up to a certain amount (for an over draft for example), or for the first few months. Some credit cards will also give you 0% for a balance transfer, as long as you are paying off your balance in full and on time.

Can Anyone Get a Loan?

So, you need some money and you want to borrow some from your bank. What will they look at? They will look at what you earn and what goes into your accounts. They can also see what comes out and if you are going to afford to pay off a loan.

Most companies will carry out a credit check before lending you money or allowing you to make a purchase and pay later or monthly.

If you are in the habit of missing payments, running up catalogue bills, making late payments, share an account with someone with a bad credit score or are bankrupt, chances are you will find it hard to get a loan from a reputable company.

Dicing with Debt

What About Money Lenders?

Payday money lenders appear to be on the increase. They advertise on the television, radio and magazines. The modern day loan sharks offer those who have spent up before their next pay cheque a quick fix so they can get by.

They make it easy for anyone to walk into the loan shop on the high street, or ring up and ask for money. The media almost make it sound acceptable.

Some claim to check your credit score and your ability to pay back the loan, and some state that a credit check is not necessary.

So, What is the Problem With Payday Loans?

The interest rates are high. Companies such as Wonga and Quick Quid have annual interest rates of up to 4,000 percent a year.

Some loan companies also offer a 'logbook loan' which is a loan secured a valuable item. If you own a car or vehicle, you could be putting it at risk if you don't pay back the loan.

How Are We Educated Against Payday Loans?

As well as high interest and the option of logbook loans, payday loan companies are also reported to put pressure on borrowers to pay back what they owe.

Programs such as 'Watchdog' on BBC 1, and discussion television shows such as 'The Wright Stuff' on channel 5 and 'This Morning' on ITV shed light on these loan companies.

Raising the issue of those who are in need of extra cash, applying for loans and what to do if they cannot repay the loan allows the public to become educated on these latest schemes.

People are now exposed to daytime magazine shows early in the morning, during the afternoon and after work. Discussions and interviews with the general public affected allow viewers to understand the minor details of stepping into these loan shops. Money experts can also give professional advice about avoiding debt or what to do if it happens. They also offer further advice on the internet as well as on the television, giving links to debt counsellors and the Citizen Advice Bureaux.

About the author thetvking

thetvking

Hi my name is  Chris Ramsden, I am the creator of TheTVKing. I don't write that often but every now and again I dust off the keyboard. I tweet as @TheTVKing

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