Overspending leads to bankruptcy

03 January 2007

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Accountants have predicted over 30,000 people will declare themselves bankrupt before April as a result of crippling debts from overspending at Christmas.

Grant Thortons accountants blamed the trend on the increase of borrowing, interest rates and utility bills.

"Last year, during the period straight after Christmas, when most bills started to hit the doormat, we witnessed the highest ever amount of people going into personal insolvency," said Mike Gerrard of Grant Thornton.

"We regularly see people, especially over Christmas and with the start of the sales, add to their problems in quite a substantial way.

Last year, insolvency raised by 55% and 2007 looks set to be even worse.

Sarah Miller, a spokeswoman at Citizens Advice, said: "We do see evidence of a Christmas debt hangover, and this month we expect to exceed the 140,000 debt problems that Citizens Advice bureaux dealt with in January 2006."

Adele Moore

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