According to Chris Tapp, director of Credit Action, the series of base rate rises actioned by the Bank of England since August last year has caused many people's finances to come under more pressure as a result of the subsequent increase in interest rates attached to borrowing products such as personal loans and credit cards. He added that such fiscal difficulties have also been exacerbated "a bit" on the part of financial services providers who are attempting to recoup some of the money lost via bad debt by becoming stricter with lending criteria.

In turn, Mr Tapp reported that with the festive season rapidly approaching, unless consumers begin to take steps to rein in their expenditure now they could find themselves coming under increasing monetary difficulties by the time the new year approaches. This led the director of the financial charity to urge people to draw up a budget, thus allowing them to identify how much money they are bringing in each month and where it is being spent. As a result, people should be able to spot areas where they can reduce their expenditure.

The Credit Action director claimed that as personal loans and other forms of credit become increasingly difficult to access and charge higher rates of interest, more consumers are going to develop problems managing their money. He asserted that as the economy is due to slow down next year a number of Britons are set to face "harder times ahead" and in turn will have to take steps to cut back on their spending.

Mr Tapp said: "We are at a point now where borrowing is much more expensive than it was a few years ago. People need to think very carefully about how they are going to afford Christmas and how they are going to pay for things in the next couple of months. What we are urging people to do is to think now, at the start of November, work out how much they can afford to spend on Christmas and try and stick to that budget."

In addition, the Credit Action director asserted that many Britons develop difficulties in getting their finances back on track in the subsequent months after the festive period. He pointed to statistics from the firm revealing that about one out of five people are still making repayments on their borrowing - whether this is through a cheap personal loan, store card or otherwise - some six months after the festive season is over. And with a tenth of respondents yet to complete such credit payments by the time the following Christmas arrives, such problems could well be causing consumers to not meet other areas of financial demand, for example utility bills, overdrafts, mortgages and transport costs.

For those consumers who are concerned that their financial situation will become unmanageable in the coming months, applying for a debt consolidation loan may well be a useful stepping stone on the road to getting spending back under control. Although the option involves taking out credit again, such a loan could see consumers reduce money owed to creditors into a single low-rate monthly repayment. Taking out a debt consolidation loan could be particularly advisable for those people who are deep in the red. Earlier this year, a study by Callcredit revealed that about three out of four people do not think it is their fault they are struggling with money. Owen Roberts, head of Callcredit Consumer, reported people need to take more "responsibility" for their financial situation and that those experiencing problems should check their credit report for any discrepancies.