According to Ian Boden-Smyth, spokesperson for the UK Insolvency Helpline, creating a budget can be the first step for those looking at reorganising their day-to-day finances after becoming unable to pay off credit cards and loans. In addition, seeking help from a professional advisory service was also mooted as an option in the road to handling debt, as they could help consumers create a manageable strategy in limiting their spending.



He said: "The first thing to do is budget. We always say: sit down, write down your income, take away your living costs and see if you've actually got any spare income. Always budget for your rent and housing and utility bills first. If you've got any money spare, that's obviously disposable income."

Mr Boden-Smyth added that although an increasing number of people running up serious debts are opting to choose an individual voluntary arrangement (IVA) or file for bankruptcy, there are "various different ways out" of debt problems. He noted that as a rising proportion of consumers are filing for IVAs, such a choice is "obviously a soft option to bankruptcy".

Meanwhile, the spokesperson claimed that evermore Britons are running up debts due to online gambling. Following the recent growth in internet-based betting, it was suggested that more people are funding a flutter by using credit and debit cards. "They can get into as much debt as they have limits on their credit cards and they can even apply for as many cards as they want these days," Mr Boden-Smyth commented.

He added that online betting is becoming an addiction for people in which they attempt to "win back" the money they owe. "Like any addiction, you think that you can get out of it one last time, but that is part of the problem," the representative purported, pointing out the level of those seeking help with gambling has undergone a "massive increase over the past two years".

However, those Britons looking to reduce the amount of money they owe on credit cards run up via gambling, or by any other means, may wish to consider getting a debt consolidation loan. Earlier this month, Adrian Kidd, spokesperson for Mint Financial Services, reported that by consolidating debts from a variety of sources into one single monthly repayment such consumers could be set to pay a much lower annual percentage rate than if they were to use a card.

The financial services firm reported that once special introductory offers on such products are completed, borrowers are set to pay an average of 17.9 per cent - about twice the amount charged on the typical loan. Mr Kidd added that opting for consolidation loans also allows consumers to protect their credit as long as they are able to make regular payments. However, to avoid the temptation of running themselves further into the red, he advised people to "cut their credit cards up" the minute that they are granted a loan.