DMP, IVA or Consolidation Loan?

People worried about a recession are turning to independent financial advisers to ask how they should manage their money, it has been claimed.

In findings which may be a positive step forward for debt management, investments and savings, personal protection and retirement planning are all popular topics which Britons want to know more about, Unbiased.co.uk reports.

Chief executive of the website David Elms, states: "It is also reassuring that with increased interest in personal protection, consumers are seeking the gold standard of advice in order to decide on whether such products are appropriate to them."

This may persuade Britons not to take drastic debt management action - such as cutting back on insurance - without the advice of an expert, who may suggest an IVA should the mountain of debt be fairly high.

In related news, esure warns that those going on a winter holiday should not avoid buying travel insurance in order to save that little bit extra.

Rather than cutting back on products that may be deemed essential, people struggling financially may be wise to research IVAs, which could guarantee those in debt legal protection from companies they owe to.

While debt management is to be commended, an industry leader has warned people that they should be careful about what outgoings they are cutting back on, it is reported.

Insurance is a particular area that people often reduce or stop spending on, says Graeme Trudgill, the technical and corporate affairs executive of the British Insurance Brokers' Association (BIBA).

And while some insurance services such as car cover are required by law, cutting back on others is false economy, he claims, which may persuade some people to seek professional help and consider an IVA to manage their finances.

Commenting on the temptation to cut home insurance, Mr Trudgill says: "We would recommend that you retain contents insurance; contents insurance isn't expensive, it is very competitively priced."

But money can be saved on insurance policies, such as cover for mobile phones, which are often included under house insurance, while a warranty for electrical goods may not be necessary because they come with a one-year guarantee, he continues.

For those unsure about which outgoings can be trimmed back, help in the form of an IVA may be the solution, where the interest on a debt may be frozen while a person sorts out their money troubles.

More people are buying supermarket brand value goods, it is claimed, which could be seen as a wise move by those struggling with debt management and looking for ways to cut costs.

Such goods account for half of the grocery market, according to Richard Dodd, a spokesman for the British Retail Consortium.

"Customers want to be convinced that they are getting value for their spending. They're certainly shopping around in a big way and searching out the best deals," Mr Dodd continues, although another way to ensure people are keeping track of their outgoings may be an IVA, an official debt repayment plan.

And although premium ranges can still offer value for money, retailers are offering discounts and promotions in order for brands to appeal to shoppers, he adds, which could be useful for those worried about money and organising finances through an IVA.

Inflation for fresh food has increased by 10.7 per cent since the same time last year, according to the British Retail Consortium and Nielson Shop Price Index of September 2008.

Not only could interest be reduced or frozen on an IVA, but it may also provide legal protection from companies owed.

Young adults are most at risk from a recession through a combination of an out of touch financial industry and government regulations, a report claims.

In news which could be important for young adults deciding where to turn for debt management help, people are capable of looking after their finances but find it difficult living in "broke Britain", says Lucy Parsons, senior economics researcher at Reform and author of the report.

"We are potentially more capable of managing our money than previous generations, but we have been let down by the financial establishment and government," she continues.

The report, released in conjunction with the Chartered Insurance Institute, found that the mean debt among 18 to 34 year olds is £6,000, although an IVA could be one way for this age group to solve their debt problems.

Meanwhile, half of the age group turn to family and friends for financial advice, the report reveals.

IVAs may be considered a wise option for those struggling with debt management, as they may feel this route does not have the stigma attached which bankruptcy may have.

Futhermore, an IVA is an official debt repayment plan that could see the reduction of interest on money owed.

The financial instability the UK is experiencing has led to over a third of people being worried about losing their jobs, a survey has discovered and although it may never occur, people may want to prepare for such a scenario by organising their debt management.

And two in five of those people worried about job security, questioned by Bupa, say that their levels of stress have increased at work, although having finances in order through an IVA could be one less thing to worry about.

"For employers, the onus will be on spotting the signs of employee stress early, such as uncharacteristic short temperedness or an inability to concentrate and plan work," says Dr Rebecca Small, assistant medical director for Bupa UK Health Insurance, although stress could be reduced by an IVA, which may freeze or reduce interest on debt owed.

Links between stress and poor health include hay fever, indigestion and asthma, according to the Stress Management Society.

An IVA could take some stress off a person as it could lead to a reduction in the total amount owed to companies.

Britons are taking debt management in to their own hands by cutting back on pensions and insurance, a study has found, although it could be wise for people struggling financially to seek debt help rather than suffer alone.

While 42 per cent of those surveyed admit that they have cancelled insurance policies or pension contributions to save money, uSwitch.com claims that overall, up to 19 million people could have reduced their financial security in order to save that little bit extra.

"The potential impact on you or your family finances if you get it wrong could be huge and long lasting, so it's important to go into it with your eyes wide open," Ashton Berkhauer, an insurance expert at uSwitch.com says about those who are deciding what to cut back on, although an IVA could be a more sensible option for some.

Rather than cutting back pensions and insurance, which includes life cover, people should shop around for cheaper deals, rather than compromise the protection of their family, he adds.

For those considering managing their budget with no expert advice, an IVA could be a debt management solution, as interest may be frozen or reduced.

The deadline for when charities and organisations can apply for a share of the £2.33 million fund to help vulnerable people reduce their debt is November 12th, a report says.

Social enterprises, co-operatives and mutuals can also apply for a share, according to HM Revenue and Customs (HMRC), which may interest those of you wondering what debt management help is out there.

"Our aim is to ensure also that people are made aware of how they can reduce their debts and pay the right tax," says head of HMRC's third sector team Derek Tilstone, adding that people need to be aware of how they can reduce debt, which for some may be an IVA.

Funding available for 2009-10 is £1.05 million, with another £1.28 million available for 2010-11, according to HMRC.

While the current economic climate may be worrying for some, an IVA could be one solution to consider.

An IVA could provide a person with legal protection from the companies owed, which may give some the peace of mind that they could pay back their debt without the worry of organisations contacting them.

People whose car is essential to them will have to cut back in other areas in order to pay for the running costs, it is claimed, which may be useful information for those finding debt management difficult.

Buying what is needed in the supermarket, rather than what is wanted, is another way consumers are becoming more disciplined in how they spend their money, a spokesman for the AA says.

"I think what we are seeing is people adopting a more efficient and money saving way of using their cars, for instance using the smaller car at weekends and combining trips," he says, adding that a car becomes indispensable for people when it is the only way they can get to work to earn money to pay for necessities.

Furthermore, the credit crunch has even seen people cutting back on the essentials in a bid to make debt management even more efficient, he states.

But if debt management does become too tricky, an individual voluntary arrangement could be one way to solve debt issues, which is a legally binding agreement, set up by a licensed professional, who is called an insolvency practitioner.