08:34 22 May 2013
Money worries making you ill? Help is at hand
Almost one in six Brits are so worried about money and their financial futures that it's affecting their mental health, says new research from MoneySupermarket.
If money worries are causing you sleepless nights, you're clearly not alone. Our research found that 16million people find finances the most stressful aspect of their lives, while 15% say it's having a detrimental effect on their health.
The link between mental health and money is well established so, in an economy where the cost of living is rising while wages are stalling, the research is hardly surprising.
But there's loads of help out there for anyone feeling the strain, and MoneySupermarket has teamed up with mental health charity Mind to let people know they don't have to suffer alone.
Here's a quick look at the research along with some practical advice on what to do if you're feeling the strain and need help.
Anxiety and stress
Almost a fifth (18%) of those surveyed said their current financial situation was what caused them the most stress. A further 13% said their future financial situation was causing the most worry.
That means not far short of a third of us put anxieties about money of one sort or another at the top of our worry list.
What's worse is that a huge 72% thought their worries would only get worse this year, with 51% citing the rising cost of living as the main reason. One in 10 said the forthcoming changes to the benefits system were troubling them.
Young people appear to be feeling the strain most, with two-thirds of 18-34 year olds saying they're frequently or occasionally worried about money.
Clare Francis, editor-in-chief at MoneySupermarket, said: "While we have recently narrowly avoided a triple dip recession, the impact of the last five years has hit people's finances hard, and so it is not surprising that it is such a cause of anxiety and stress."
Get help today
The average household debt, including the mortgage, was £53,995 in March, according to national money education charity Credit Action. Excluding mortgages, the average debt was £5,980.
Trying to clear your debts can feel like an impossible task, but burying your head in the sand is the worst thing you can do. There's plenty of help out there and you don't have to pay a penny for it, so pick up the phone or log onto one of the following websites as soon as you can.
Mind also offers support for people facing mental health problems, whether they're caused by financial worries or anything else.
Paul Farmer, chief executive of Mind, said: "No one should have to face mental health problems alone and that's why we offer information and support to anyone who might be struggling with money matters."
You can find Mind online at www.mind.org.uk or call its advisors in confidence on 0300 123 3393. Calls are charged at local rates, but will cost more from a mobile phone.
The Citizens Advice Bureau (CAB) offers free, impartial and confidential advice on debt. Its staff receive specific training on mental health problems too, so you can talk to its advisors, in confidence, about your worries.
You can find the CAB online at www.adviceguide.org.uk or by making an appointment at your local branch, which you can search for online or in Yellow Pages.
StepChange, formerly the Consumer Credit Counselling Service, also offers free advice on problem debt, anonymously.
It works with the Mental Health Foundation and has carried out its own research into the link between debt and mental health. For example, it found 78% of those in debt say it's damaged their self-confidence.
You can find StepChange online at www.stepchange.org or you can call them for free, including from mobile phones, on 0800 138 1111.
Christians Against Poverty (CAP) specialises in helping people who are struggling emotionally with debt. CAP also does home visits and although its name implies a religious focus, the support is entirely non-religious.
You can find CAP online at www.capdebthelp.org or call its advisors for free on 0800 328 0006.
Read more in our Supanet Business and Money Channel
Borrowers seeking a medium-sized personal loan can now take advantage of rates as low as 5%. And, what's more, they have a whole half-decade over which to repay the debt.
We take a look at Derbyshire Building Society's new loan offering in closer detail and see how it stacks up against the wider market.
What's the deal?
Derbyshire Building Society is offering customers looking to borrow between £7,500 and £15,000 a joint market-leading APR (annual percentage rate) of 5%, down from the previous still-competitive 5.1%.
This rate applies to loans that are taken out over a period of one to five years, with repayments remaining the same for the fixed term of the loan.
You can apply online for the loan and will receive an instant decision on whether you have been accepted. There are no hidden fees so you won't face a charge for setting it up.
Who's it good for?
The new rate is great news for anyone looking for medium-sized borrowing - for example, to fund home improvements, buy a new car or pay for a summer wedding. In this case, this lender could well be your best bet, enabling you to budget with fixed repayments over the loan term.
To apply for Derbyshire's loan you will also need to be aged at least 18, a UK resident for the full term of the loan and have a minimum (combined) income of £700 per month.
Also, bear in mind that while the quoted 5% is joint top of the tables, you may find this isn't the rate you actually get. The APR that's advertised is 'representative' which means it only has to be offered to 51% of successful applicants. Yours could be higher.
You'll also need a squeaky clean credit history to be accepted for loans with a market-leading rate. To check if yours has any blemishes, you might want to get a copy of your report before applying. You can see what's available from the different credit reference agencies and their services by visiting MoneySupermarket's credit reporting channel.
If you find your score does need repairing, Melanie Wright's article gives you tips on how to start repairing your score.
What's the verdict?
If you need a medium-sized loan it could be worth getting your skates on and applying for this deal. Personal loan rates are currently at an all-time low, but it might not be that way forever.
But before applying, as well as checking your credit score, make sure you can afford the repayments. There are other loans available at great rates, although they are on shorter fixed-term timeframes.
For example, Sainsbury's Bank's new 5% loan rate is also available on amounts of between £7,500 and £15,000 but only over a repayment period of between one and three years.
However, the deal is also only available to Nectar cardholders who have had their cards swiped in-store or used them on the Sainsbury' website within the last six months.
Another option is the Clydesdale Bank Personal Loan, which is available over up to five years, although the rate is slightly higher at 5.1%.
If you need access to a smaller amount of cash, there are still cheaper ways to borrow than personal loans. For example, you could pick from one of the best buy credit cards offering a 0% introductory period on balance transfers or purchases - or both.
This way, you can avoid paying any interest on your borrowing at all. For purchases, one of the best bets is the Tesco Clubcard Credit Card for Purchases which gives you 16 months at 0% before its representative APR of 16.9% (variable) kicks in.
However, if you need a loan to pay off existing card debts, the Barclaycard Platinum Credit Card with Extended Balance Transfer offers the longest with 26 months interest-free borrowing, though it's subject to a 3.5% fee. You can pay a lower 2.4% fee with the Barclaycard Platinum Credit card with Balance Transfers, but this will only provide 25 months interest-free.
However, remember to clear your balance during any 0% time period to avoid being hit with representative APR of 18.9% (variable).
Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct. We're free, independent and compare all UK credit cards, as well as offering exclusive deals you can't get anywhere else.
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