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The average UK family is now £7 a week worse off this November then the same time last year, according to research published by Asda.

After tax the average family income was £547. Once essential living costs, such as mortgage payments, have been deducted, the average disposable income was £135 per week, a drop of 5.1% in comparison to last year.

However, the good news is that the level of disposable income is set to increase due to the 2.5% VAT reduction which was announced by the Government. Even so we may not feel the benefit of having this extra cash in our pockets as, according to Asda, 70% would either save this additional money or use it to pay off debt.

Andy Bond, Asda chief executive, commented: “The mood of the nation is that cutting back on conspicuous spending, being more frugal and an increased savings mentality will be a priority for most families in 2009.”

A bleak 2009 could be on the horizon for many homeowners, as homeless charity Crisis predict that more will have to face the possibility of repossession.

The charity has warned that nearly 10% of homeowners are struggling to keep up with their mortgage or rent payments, and this figure is set for an increase if unemployment figures continue to rise. According to their research, a third said that facing repossession could be a possibility within as little as three months after losing their job.

Leslie Morphy, chief executive of Crisis said: “These figures are a stark warning for 2009… Many are struggling to keep their homes. The situation is only made worse by pressure on jobs, with unemployment levels set to reach two million by the end of the year.”

As the economic situation continues to take a tumble and costs of living becomes tighter, saving any proportion of income is out of the question for many UK households.

Research by Axa suggests that, since the start of 2008, over 20 million households are spending more money than they are saving. Only those who are earning a pre-tax sum of over £70,000 per year have been able to save more money than is spent, which begs the question: is saving only for the wealthy?

Those who are earning less than the above amount have had to face larger mortgages costs, higher utility bills and increases in essential items such as food and petrol prices. Axa representative, Steve Folkard commented: “If only the richest members of society are managing to cope with their spending then we really need to consider how to improve the day-to-day financial health of British households.”

The Credit Crunch Christmas of 2008 has inspired us to get creative as a way to cut spending, according to a poll by National Savings & Investments (NS&I). Nearly two-thirds us are planning to be more resourceful in a bid to make our money stretch further.

Four in ten plan to get creative by hand-making cards and gifts to help save ourselves from having a nasty Debt Hangover in the New Year. Don’t feel as though you are being cheap by shunning away from shop-bought cards, 71% feel that hand-made gifts and cards are “more thoughtful”.

Dax Harkins, senior savings strategist from NS&I commented: “Those celebrating the season need to ensure that they are planning and spending within their budget and should try not to overspend, dip into overdrafts or go into debt.”

Halifax have revealed new research which shows that, when it comes to saving at Christmas, women are financially savvier that their male counterparts.

30% of women polled said they started saving for Christmas earlier in the year, compared with just 15% of men. They are also much more prepared when it comes to spending this saved cash, as almost half of women have prepared a Christmas list about which presents they need to buy.

Overall, it seems that both sexes are shunning the idea of getting in debt over Christmas, as almost three-quarters (71%) said they would be using savings to fund the festive season instead. For those who find debt unavoidable at this expensive time of year, a third will be using their credit card and one in ten will be building store card debt.

Head of banking at Halifax, Mike Regnier, said: “It’s encouraging to see that more consumers are becoming prudent with their finances this year by choosing to use their savings… rather than opting for costly store cards which could see them paying out more in the long run.”

Brits are owed approximately £4.7 billion in ‘friendship debt’, according to online payment company PayPal. The main reason for this ‘friendship debt’ is due to lending for larger purchases, to help pay bills or other debts.

Last year friends and family were responsible for lending £16.8 billion, and over a quarter of people are  waiting for this debt to be paid back. This means that there is almost £5 billion worth of ‘friendship debt’ which is still outstanding.

Lending money could become a disaster for both your financial and personal life as almost a quarter of those who had lent money have had a argument about this debt at some point.

Mark Hodson, marketing director of Paypal, commented: “If you’re lending money to friends or family, it’s worth agreeing up front when you’d like to get the cash back. This can save a lot of hassle and embarrassment further down the line.”

We all know the cost of living is on the increase, but did you know that an average 18 year old will need exactly £1,745,739.82 to sustain a constant standard of living throughout their life!

Axa’s research , as part of their My Budget campaign, shows that the average annual expenditure per person is £28,455.4. Worryingly it seems that many of us will be left needing debt help at some stage of our lives, as we each exceed our salary by approximately £4,000 a year.

This research is designed to help people understand their financial needs and to get their debt management skills under control for the future. Steve Folkard, head of savings and pension policy at Axa, commented: “”According to Oscar Wilde a cynic knows the price of everything and the value of nothing. We say ‘know the price of everything and the value of planning’.”

Many of us maybe looking for a loan to help fund our Christmas spending, but there has been increasing concerns about the interest rates offered by so-called ‘quick fix’ payday loans.

A PayDay Loan is typically used as a financial emergency and to fill in an income gap between paydays, but some of these loans are being lent with almost a straggering 10,000% APR. This research, by uSwitch, found that a £750 loan from a pay day loan company could cost the consumer up to £1687.50, if payments are deferred for five months.

Louise Bond, personal finance manager at uSwitch.com comments:“These loans really are quick-fix solutions which only work for some people – for others they act as a fast track to a tangled web of debt.”

The number of those looking to take advantage of interest-free credit card offers is on the rise. The number of people making applications for credit cards with introductory deals has increased by almost 16% last month, compared with figures from 2007.

MoneyExpert.com believe that the increase in credit card applications is due to the number of people who still plan to spend big at Christmas and forget about their debt until next year – But be warned, you could be left with a very nasty debt hangover to start 2009 with!

Sean Gardner, director of the site, commented: “The spending habit hasn’t died yet and the price-cutting frenzy on the high street shows that there are plenty of bargains out there with big name stores offering massive reductions….The fear must be that people are having one last turn on the credit card merry-go-round before it comes grinding to a halt.”

The average Brit is always looking for ways to reduce car running costs, and new research from the AA reveals that we could save as much as £7.7 billion a year by driving more efficiently.

Simple tips to reduce car petrol consumption includes driving slower, turning off the air conditioning, shutting the windows and stop revving the car engine. The AA predict that these tips could save drivers as much as three miles per gallon.

It was recently reported that it would cost £3,800 to run your car in 2009. But the above tips could also helps brakes and tyres to last longer.

President of the AA, Edmund King, commented: “Despite fuel prices falling in recent weeks, the cost of filling a car with fuel is still very high… Motorists up and down the country have felt the pinch.”

At a time when we are all looking for the best ways to have a credit crunch Christmas and stick to a reasonable festive budget, it is no surprise that there has been a 133% increase in the amount of Internet searches for discount vouchers.

According to online intelligence service Hitwise UK, more of us are turning to the Internet to help make our money go further this festive season, and keep our debt management firmly in check. It seems that online discount vouchers are fast becoming an easy way to make savings when shopping online.

During the 12 weeks ending mid November, UK online shoppers searched for over 20,000 different variations on the term ‘voucher’, in order for us to avoid seeking debt help in the New Year due to unmanageable debt levels acquired over the festive season.

Missing payment to your credit card debts may not worry you, even if you have letters from your creditors which are demanding payment; the fear of repossession could be the furthest thing from your mind as the debt is not secured on your house – But Newcastle Building Society have released figures which show 28% of all its repossessions have been triggered by second charge lenders.

Many people think that as long as they make payment to their priority debts, such as mortgage or utility bills, that they are free of the risk of repossession. But according to an article by This Is Money, an incresing number of lenders are using little-know law to convert unsecured debts into a debt which is secured against your home. This means homeowners could potentially be facing repossession, even if they have not missed one payment to their mortgage, which is why it is important that you get expert debt advice if you are struggling with your credit card debt.

The Financial Services Authority have issued a warning to all mortgage lenders who are too quick to trigger the repossession process, and there is now Government repossession help in the form of a new £1 billion scheme which aims to give mortgage help to those who are struggling due to a temporary loss of income.

If you have taken out a debt consolidation loan then you should check whether or not it is secured against your home. A majority of debt consolidation loans secure the debt onto your home, but there are also unsecured debt consolidation loans. If you are unsure then check with your lender.

However it is not just a debt consolidation loan which means that your original credit card debt could lead to repossession. Your lender could apply to the courts for a charging order to placed on your home, which turns the debts into secured loans. This means that the debt is logged at the Land Registry against your property as a ’second charge’, meaning that if your home is repossessed then they are in the second in line to be paid after your mortgage lender. (more…)

There is going to be additional Government help with mortgage arrears, as plans for Government help with mortgage arrears are announced. The Government hope that their new plans will help families who are struggling to meet their mortgage commitments, are falling into mortgage arrears and could potentially face losing their home to repossession.

So far eight of the major High Street mortgage lenders have signed up to the £1 billion government scheme, which allows struggling homeowners who are sufferig from a temporarily lose ofincome to defer mortgage interest payments for up to two years.

The Government help with mortgage arrears will be available from early next year, and this move is mainly targeted at middle earners and will be available on mortgages worth up to about £400,000.

Worried about repossession? One Advice might be able to stop your repossession and could provide help with your mortgage arrears, call today and find out how or see our repossession FAQs.