Fall in unemployment masks underlying rise in those facing loss of income warns Atlantic

This week's unemployment figures revealed how record numbers of people are facing a loss in income because they can't find a fall-time job.

Loss of income is the number one factor in people taking out Debt Management Plans (DMPs) according to debt solution specialist and DEMSA* member, Atlantic Financial Management. While the headline ONS figures look positive, these could belie an underlying picture of growing debt problems in the UK. The ONS figures also showed unemployment benefit claimants rose by 19,600 from April to May 2011 and is now at 1.49 million.

"Unmanageable debts can affect confidence and in turn make finding a job even more difficult."

"Although we have seen the biggest quarterly drop in unemployment since August 2000, this masks the reality that so many have faced a loss in income over this period which is reflected by the number of employees and self employed people working part time because they can't find a full time job." says Kevin Still, Director of Atlantic. "This has increased by 46,000 on the quarter to reach 1.21 million which is the highest figure since comparable records began"

"We know that nearly 50% of the people entering a Debt Management Plan do so due to the loss of income, primarily through reduced working hours or becoming self-employed, often not through choice."

"It's vital for those in debt due to loss of income – or any other factor - start taking action."

"With the cost of living rising so steeply the financial burden placed on those who have had to take part time work or have lost their job will be huge. Unmanageable debts can affect confidence and in turn make finding a job even more difficult. As The Governor of the Bank of England has said, "Millions of people are now bearing costs of the financial crisis" and only now reaching the middle of "seven lean years", it's vital for those in debt due to loss of income – or any other factor - start taking action as clearly things aren’t going to get any easier any time soon."

A Debt Management Plan (DMP) from a debt solutions provider such as Atlantic can prove invaluable when unsecured debts become unmanageable. A new schedule of payments can often be negotiated with all the creditors and will ensure rent, mortgage, energy, critical insurances and council tax bills get paid before other unsecured debts.

Priority debts, such as mortgage, secured loans, rent, council tax, priority insurances and utility bills must be paid first...

Atlantic Financial Management offers a range of debt solutions including Debt Management Plans (DMPs), IVAs, Protected Trust Deeds (Scotland) and Bankruptcy advice and its expert legal support team prioritises dealing with any court actions an individual or household may be facing. It also offers a number of money saving tools including energy switching and a prepaid current account.

One of Atlantic's trained and understanding Debt Advisors will confidentially discuss an individual's financial circumstances over the phone and provide initial debt advice without obligation. Once they know more about the current financial situation, the best debt solution for their circumstances will be recommended.

Atlantic is licensed to use the Common Financial Statement...

If a Debt Management Plan is chosen, Atlantic will then complete a statement-of-affairs, from which it can work out which payments are prioritised and which can be negotiated. Priority debts, such as mortgage, secured loans, rent, council tax, priority insurances and utility bills must be paid first and Atlantic makes allowances for these in the client’s monthly budget and statement of affairs.

Atlantic's business model is based upon very early contact with creditors to advise them of their appointment and to commence the debt repayment negotiation process at the earliest point possible. Atlantic is licensed to use the Common Financial Statement, which is widely accepted by creditors and their collecting agents. Part of the Atlantic model is to look at benefit entitlements and ways of optimising income.

* DEMSA – Debt Management Standards Association

To find out more about Atlantic Financial Management contact us or call 0845 0 30 30 30