Thursday 17th of September 2009
Individual voluntary arrangement (IVA) advice could help Britons plan for the future, after a large number of people admit they would not be able to draw on cash to help them through a crisis, a newspaper reports.
The Financial Times says that a poll by the Institute of Financial Planning shows that 55 per cent of people claim they have enough cash to cover the cost of a long-term illness or a job loss.
However, households which have no spare cash to see them through tricky periods may want to shore up their long-term financial standing now, by clearing current unsecured debts with an IVA.
Many households could soon find themselves debt free by undertaking an IVA, meaning they can start afresh and no longer need to rely on large amounts of credit to cover the cost of what they require.
"Good empirical research has repeatedly demonstrated that the majority of the population does not have a cash reserve to pay essential outgoings for three months, let alone manage to do so during a long-term illness," Clive Waller, co-founder of the Income Protection Task Force, tells the publication.
Having enough cash to cover a drop in household income could be wise, after the Office for National Statistics revealed that the employment rate of the UK has fallen to 72.5 per cent.
By Mark Waterman
- House price rise 'may not indicate recovery'
- Equity release 'needs to be increased'
- Need for IVA help could increase as expert predicts reduction in lending
- Government announces 'breathing space' for those needing IVA help
- Lack of subprime lending creating need for IVA help, expert suggests
- IVAs 'are a good idea for those in debt'
