Monday 3rd of August 2009
Britons may not want to use their credit cards for recurring payments because it could land them in debt trouble, a newspaper has warned, which could require the assistance of a debt management plan.
Setting up payment methods in this way could turn out to be far from convenient, the Daily Mail reported, because some firms continue to take out money on a monthly basis even when the bill has been met.
This unexpected expenditure could push some households into the red. As such, it could be safer to meet financial commitments through a debt management plan, rather than relying on a credit card to make payments.
A debt management plan may highlight how it is better to pay for items with money in an account, rather than leaning on the crutch of a credit card.
The newspaper noted that while direct debits have "a guarantee that if things go wrong the bank will sort it out and the customer will not foot the bill, there is no such promise when it comes to recurring transactions".
With the latest Credit Action report revealing that the debt of the average person is £30,460, including mortgages, managing finances through a debt management plan - which can reduce the interest of money owed - could be better than topping up interest with credit cards.
By Rachel Powell
