As a nation struggling to manage our finances, it is estimated that approximately 6.5million of us here in the UK are turning to the idea of consolidating our debts.

Figures from MoneyExpert.com show that over the last 3 years some 14% of Brits have taken the opportunity to consolidate their debts as a way to bring their borrowing and spending habits under some kind of control. Their research also shows that 1.29million people have consolidates debts of as much as £20,000 or more. This figure is the result of an accumulation of overdrafts, credit/store cards and loans.

The trend is that it is the younger age group who are taking the decision to transfer their debts to the one lender, with 23% of all 25-34 year olds taking part in the study having already taken steps to consolidate their debts.

Furthermore, figures show a sharp increase over the last 6months in the demand for secured loans. Those among us choosing this option more often than not secure the loan against our own homes. Since October 2007, applications for homeowner loans has increased by 85%.

Chief Executive of MoneyExpert.com, Sean Gardner is encouraged by so many people being proactive in trying to manage their finances. He hopes these people can see for themselves that, in many cases, there can be significant savings to be made by moving all your debts to the one place. He says,“With average standard credit card rates at 17.01 per cent compared to average unsecured loan rates of 8.44 per cent it is clear that borrowers can cut their monthly interest bill by moving.”

Mr.Gardner does add one word of warning though, and that is to view consolidation as a means to tackle debt problems and an attempt to get them under control. He strongly advises against repeating consolidation on any regular basis.

As with all financial advice/matters, one must always read the fine print and be aware, as Head of Personal Finance at Fool.co.uk tells us, that around half of all consolidation loans carry a penalty for early settlement.

A growing number of mortgage lenders are restricting home loans to customers outside certain geographic areas or are capping the maximum amounts homeowners can borrow at £350,000 as the credit squeeze intensifies.

Nationwide, one of the UK’s biggest lenders, has said that it will stop lending to first-time buyers who want to take out selfcertified mortgages where proof of income is not required. It is also stopping lending to all first-time buy-to-let landlords.

In addition Nationwide, which lends to these specialist segments through its two divisions Mortgage Works and UCB, is capping the maximum it will lend to any borrower taking out selfcertified mortgages to £350,000.

FT.com / Companies / Financial services - Borrowers face caps on loans

According to a recent report many Brits are juggling multiple credit cards and continuing to get themselves into debt despite the credit crunch and despite the financial woes that many households are facing due to higher energy, food, petrol, and mortgage costs.

Figures show that over three million Brits have five or more credit cards that they are spending on, and this could simply add to the already massive personal debt problem in the UK.

Although financial markets are in turmoil and credit conditions are tight due to the global credit crunch many Brits are continuing to spend way above their means.

A third of Brits are said to have applied for another credit card over the past year, and those that have been turned down due to difficult credit conditions will also have adversely affected their credit profiles.

There are already concerns over the amount of personal debt in the UK, with industry officials expecting an increase in the number of people that will become insolvent over the course of the year.

One industry official said that getting another credit card is fine if it is to reduce debt – for example getting a 0% balance transfer card to save money on interest on existing credit card balances – but he said that consumers that are simply accruing credit card debt could hit problems in the future.

He said: ‘It is entirely healthy if people are swapping debts from one card to another, taking advantage of 0% deals to ensure that they pay as little interest as possible. But anyone who is trying to juggle five or more credit cards and owes money on all of them is in real trouble.’

Why is the outlook suddenly more gloomy?

The sudden demise of Bear Stearns has revealed that the credit crunch crisis is deeper and more damaging than was previously thought. The emergency takeover of this US bank has caused UK banks to grow even more nervous than before. For the past six months they have been withdrawing mortgage deals. But now they are becoming even less willing to lend. Estate agents report that creditworthy potential homebuyers are being excluded from those loans still on offer. The latest worries have ruled out an early end to this troubling scenario.

Are all borrowers affected?

Securing a home loan is now much harder and more costly for all buyers - even those who have had no problems in the past. The supply of credit has dried up most quickly for first-time buyers, with lenders now channelling their funds into remortgages. So if you have substantial equity in your home, you might have better luck securing a good deal.

After years of good deals on home loans, David Miles, an economist at Morgan Stanley, says that lenders are charging according to what it costs them to borrow - not the base rate. Do not rely on any savings being passed on to you if the Bank of England cuts rates.

What about buy-to-let investors?

Loans for amateur investors are in short supply but more experienced landlords who have built up strong portfolios can more easily get loans to snap up a property. Their enthusiasm is bolstered by rising rents - up 9 per cent last year, according to Hometrack - as more potential buyers wait. Michael Coogan, the director-general of the CML, predicts that buy-to-let could outperform the owner-occupier market. Fionnuala Earley, of Nationwide, counsels against expecting a sell-out in the sector - more bad news for buyers hoping for bargains.

What will be the effect of all this?

Experts say that the biggest casualty will be the number of sales as uncertain homeowners stay put. Richard Donnell, of Hometrack, expects only 1 million transactions this year - a rate that would have people moving once every 25 years, rather than the typical seven years.

But there are disturbing signs that some owners may be soon forced to move: Citizens Advice says this week that the number of inquiries from householders struggling with their loans is up 35 per cent this year.

Will property prices slump?

Signs that prices are taking a hit are increasing: Nationwide says that prices have dropped four months in a row, Hometrack says five. The agents Hamptons International and John D.Wood report prices down 10 per cent in London. And there may be more pain ahead. David Miles, of Morgan Stanley, says that futures traders expect a 14 per cent fall in house prices over the next two years - or 20 per cent in real terms, once inflation has been accounted for.

But is the prime sector powering on?

Not any more. Just months ago expensive homes were confounding the rest of the market, but the latest figures from Savills show that prices dropped 1.5 per cent in the first quarter of this year. The worst hit are homes that most appeal to those in the City, those priced from about £1million to £2 million, which fell 2.7 per cent.

So bargains must be emerging?

Some homes are selling at knock-down prices in auction rooms, particularly unpopular new-build flats. And some owners who need to sell are prepared to take offers. But Rightmove is again reporting a rise in asking prices. All this means is that homes are lingering unsold on the market.

Can we hope for a quick recovery?

Agents had been hoping that this year’s early Easter would revive the property market - and there were some signs in recent Hometrack data of more interest from buyers. Hamptons International said that, after a difficult few months, applicant levels had improved. But observers who had been predicting a relatively quick resolution of the problems seem to be disappointed. David Salvi, of Hurford Salvi Carr, believes that it will be spring 2009 before the market recovers; Liam Bailey, the head of residential research at Knight Frank, believes we may be waiting until 2010 for the turnaround.

Are there any safe havens?

Agents are reporting a return to more traditional markets: houses without obvious flaws will hold their value best. Savills is selling The Priory, a five-bedroom, 18th-century country home, in Denham Village, Buckinghamshire, for £3.5 million (01494 731950). With access to good schools and in a conservation zone just half a mile from the M40 and two miles from the station and Tube, this kind of home has a good chance of holding its value.

Richard Donnell, of Hometrack, says that if he had a deposit of £200,000, he would buy a three-bed home in southeast London for about £350,000. By renovating it to create five bedsits, he could bring in £54,000 in rent - £30,000 more than the unconverted house.

Any other good news?

Developers are finding it tricky to get finance.This means that the number of new homes being built is falling - Hometrack says that the number is down 10per cent in 18 months. This will frustrate the Government’s plans for 3 million new homes by 2020, but a shortage of supply should provide some support for prices.

And Cantor Spreadfair, which reported in December that spreadbetters were predicting UK house prices would slide to an average £169,000 by 2010, now says that their clients are making much more bullish bets, proof that not all signs in the property market are gloomy.

WHAT THE AGENTS SAY

It’s like the shoot-out at the OK Corral as sellers struggle to understand that the days of bullish prices are behind them, and buyers remain determined to get a bargain

ROBERT GODFREY, BIDWELLS, NORTHAMPTON

It is no longer a case of one or two quarters of price falls with values bouncing back shortly after

LUCIAN COOK, DIRECTOR OF RESEARCH, SAVILLS

The jobs market in the City is the new driving force in the property market. We are six months into a downturn and into a spiral that will not be easy to get out of

DAVID SALVI, FOUNDER OF HURFORD SALVI CARR

The rental market will be affected by the events at Bear Stearns. Most American bankers come here for short-term contracts and rent. But there are buyers coming from the East. Every time you lose a couple of Americans there will be an Indian or a Russian to take their place

ED MEAD, DOUGLAS & GORDON, WEST LONDON

There are as many gainers as losers when house prices fall. The quick way that first-time buyers can be helped onto the market is if house prices fall.

DAVID MILES, ECONOMIST, MORGAN STANLEY

London will now underperform the UK this year. We are expecting a fall of 2 per cent across the UK and one of 3 per cent to 3.5 per cent in London

RICHARD SNOOK, ECONOMIST, CENTRE FOR ECONOMIC AND BUSINESS RESEARCH

Interviews by Judith Heywood, Lucy Alexander, Lorna Blackwood and Kasia Maciejowska What Bear Stearns and the credit crunch means for your property - Times Online

But has that “tomorrow”, and a grim day of reckoning, finally arrived?

Millions are already feeling the squeeze from soaring utility bills, higher taxes and only modest growth in take-home pay. Now, the financial screws on Britain’s households are being turned still tighter as the global credit crunch leads banks and other lenders to ratchet up their rates for remortgaging and for new loans.

Although most people will get by, millions will struggle and hundreds of thousands will suffer financial trauma. And for the unlucky and unwise who have overextended themselves in the good times, economists fear that things may be about to turn truly ugly.

Economists have given warning that the high levels of debt in the UK are actually magnifying the effects of the credit crunch.

Households in the UK owe a total of £1.4 trillion to banks and building societies. More than £225 billion has been piled on to credit cards and personal loans while the remainder has been spent on bricks and mortar, the Bank of England says. Even the start of the credit crunch last year was not enough to stem the credit binge. Credit card borrowing rose by 1.25 per cent last year, while mortgage borrowing rose 10.8 per cent, figures from Experian, the credit reference agency, show.

However, bigger debts mean that households become more sensitive to any change in interest rates. Even the slightest increase can eat up a significant chunk of their weekly income.

In 1998, when the bank base rate was as high as 7.5 per cent, the average household spent 9 per cent of its annual income on paying interest charges on its home loan, credit card, loans and overdraft. Today the base rate is only 5.25 per cent, but households are spending 10 per cent of their income on interest payments.

George Buckley, UK economist for Deutsche Bank, said: “The higher the debt levels, the more sensitive consumers are to changes in interest rates.”

The added difficulty is that while the bank rate has fallen in recent months, borrowers are being forced to pay higher rates for their home loans as lenders pass on the increased costs of borrowing money from other banks. The margin between the bank rate and “swap rates”, the rates banks charge each other, hit 1.2 percentage points last month, Usually this figure is around 0.23 percentage points.

Higher rates on new fixed-rate deals will force the 1.4 million people coming to the end of a fixed-rate deal this year to find an extra £100 a month on average, or £1,200 a year, simply to cover their repayments. In addition, they will have to find about £1,000 to cover the mortgage fee.

Although this will be an uncomfortable addition to the monthly bills, experts point out that many homeowners have built up a cushion of equity in their property which they can draw upon if the bills start to bite. The total equity held in property was £2.8trillion last year, compared with £1.2trillion of mortgage borrowing.

Those who who have had little time to build up equity in their property, or those who have remortgaged to release big slices of equity to fund their spending will be hardest hit. Lenders have withdrawn many deals offering more than 90 per cent of the value of a property, and only nine lenders still offer 100 per cent mortgage deals. As competition between lenders for these types of deals shrinks, the interest rates increase. The number of mortgages on offer has more than halved from about 13,000 in July last year to 6,100 today. As a result, borrowers will have to pay more to secure a new deal, or go onto their lenders’ more expensive standard variable rate.

Recent falls in house prices will only add to their woes. Spiralling house prices in the past decade resulted in many first-time buyers stretching their finances to the limit to buy a home. This, reasoned borrowers and lenders alike, would be fine as interest rates were low and house prices continued to climb, providing a pool of equity that they could use as a “Get out of Jail Free” card.

This worked for borrowers who bought two years ago. They have seen their house’s value soar by 20 per cent, giving them a reasonable cushion. However, people who bought a home with little or no deposit after September last year have limited wiggle room.

Tens of thousands of borrowers have already contacted debt charities for help this year. The number of people seeking help on mortgage arrears soared by more than a third in the first two months of the year, Citizens Advice said yesterday. About 144,000 borrowers were between three and six months in arrears with mortgage payments last year, figures from the Council of Mortgage Lenders show.

Another debt charity said that the number of people becoming insolvent is set to rise this year as Britons try to keep up with the spiralling cost of living. Vince Cable, the deputy leader of the Liberal Democrats, has given warning of a “very real possibility of mass bankruptcy and repossession across the country”.

More borrowers could be thrown into difficulties by the abrupt withdrawal of credit. Last month, Egg, the online bank, cancelled the credit cards of 161,000 customers with little warning. Those relying on juggling their debts between credit cards will face an uphill struggle as lenders become more picky about their customers. They may face the prospect of actually repaying the debt or accepting punitive interest rates on their borrowings.

A spike in insolvencies is bad news for the economy, but a potentially more damaging side-effect of the credit crunch is the slowdown in spending among consumers as they strive to meet their increased monthly repayments. The stalling housing market is likely to exacerbate this. Jonathan Loynes, UK economist for Capital Economics, said: “The housing market oils the wheels of consumer expenditure as homeowners buy goods for their new houses.”

Consumer spending accounts for two thirds of economic activity, and economists have sounded alarm that any slowdown in this area and the subsequent drop in demand could prompt redundancies. Mr Loynes said: “A cut-back in employment could then cause a further slowdown in spending. There is a real danger that these things feed back into themselves.”

Howard Archer, of Global Insight, said: “The longer the crisis goes on, the more people will be sucked into it.”

Debtor nation

— The average credit card holder has a balance of £1,856 on their cards, according to Uswitch, the price comparison website

— The average outstanding mortgage is £100,406; the average first-time buyer borrows £117,999 and spends 20 per cent of their income on mortgage interest payments

— Consumers in Northern Ireland increased their borrowing by nearly a quarter over the past 12 months, the biggest increase in the UK

— Borrowers in Aldershot, Dartford, and Ilford have reined in their spending most, according to Experian, the credit reference agency

— Nearly 25,000 people became insolvent between October and December last year, 16.4 per cent fewer than the same period in 2006. The major reason for that was a spat behind the scenes between lenders and companies offering Individual Voluntary Arrangements (IVAs) – schemes that allow debtors to pay off only a portion of their debts. Borrowers who take out an IVA must repay at least 35 per cent of their debt

— Lenders refused to accept many IVA applications, saying that IVA firms were offering payments that were too small and taking high fees for themselves. The dispute was resolved last month, so experts expect the number of IVAs to soar in the coming months

Credit crisis: the cracks are opening in UK’s debt mountain - Times Online
The buy today and worry tomorrow culture that has gripped the nation in recent years threatens to make UK households particularly sensitive to the global credit crisis

ALISTAIR DARLING has been accused of failing Scottish homeowners in his first Budget because he refused to increase the thresholds for stamp duty in line with property inflation.

Bank of Scotland estimates that more than half (52%) of home buyers in Scotland paid at least 1% stamp duty in 2006, and the typical stamp duty bill is £1449. But the figure is much higher in property hotspots. In the City of Edinburgh, for example, 72% of home sales were above the 1% stamp duty threshold, followed by East Renfrewshire (70%) and East Dunbartonshire (70%).

More Scottish homebuyers are also stung for the higher rates of stamp duty, with almost one in 10 Scottish home sales over the higher threshold in 2006.

If a property is worth less than £125,000, there is no stamp duty to pay. But on homes worth more than £125,000, buyers have to fork out 1% of the entire price. The duty rises to 3% of the total house price on properties worth more than £250,000, and to 4% on a house costing more than £500,000. So if you are buying at the very top end, you could be slapped with a bill of more than £20,000.

There are early signs of a slowdown in some parts of the Scottish property market, but prices still rose at an annual rate of 13.1%, according to the latest figures from the Bank of Scotland. The typical house price is now £144,897, although the average property in Inverurie, Edinburgh, Aberdeen and Helensburgh is more than £200,000, dragging more people into the stamp duty net.

Campaigners have long called on the government to raise the stamp duty thresholds to keep pace with property inflation. If the lowest threshold had gone up in line with UK house price inflation since its introduction in March 1993, it would now stand at £191,000. The higher stamp duty thresholds were introduced in July 1997, so they would now stand at £720,000 and £1.4 million.

But the government has so far resisted - and it resisted again in the Budget. A glance at the Treasury figures perhaps explains why. Total stamp duty revenue from UK residential property sales rose by 40% in 2006-07 to a record £6.4 billion. Over the past five years annual residential stamp duty revenue has more than doubled, with a 140% rise from £2.7bn in 2001-02. Estimates of residential stamp duty revenue for 2007-08, based on government projections in the pre-Budget report, are for a 14% rise to £7.3bn, followed by a 4% rise in 2008-09 to £7.6bn.

Ron Smith, chief executive of the Edinburgh Solicitors Property Centre (ESPC), said: “The decision to again freeze the lower threshold for stamp duty at £125,000 means a record number of buyers are likely to be liable for the tax again this year. This will come as a particular blow to first-time buyers, who are already finding it difficult to find an affordable way on to the property ladder, as the simple fact is that changes in stamp duty have not reflected house price inflation in recent years.”

The number of first-time buyers in Scotland dropped to a record low of 30,000 in 2007, the lowest annual number since records began in 1988. The average house price paid by a Scottish first-time buyer has also more than doubled since 2002 to £123,213, which is only just below the 1% stamp duty threshold.

David Carmichael, area director for the Scottish offices of Savills Private Finance, a mortgage broker, said: “The number of first-time buyers who come into our offices has dropped from about 40% five years ago to about 8% today. But the Budget was a disappointment. The chancellor has done nothing to help struggling home buyers get a foot on the property ladder.”

Darling tried to appease home buyers with measures to help key workers and an attempt to encourage lenders to develop mortgages fixed for 25 years or more. But they met with a cool reception.

Michael Coogan, director general of the Council of Mortgage Lenders, said: “The modest announcements relating to shared equity schemes for key worker first-time buyers, while potentially welcome, are unlikely to provide any short-term relief to affordability and entry costs for first-time buyers in the housing market.”

But what of long-term fixed rates? The government thinks long-term fixes would shield borrowers from the ups and downs of interest rates and bring stability to the mortgage market. But the big snag with the loans is the early repayment charge. Lenders typically slap you with a penalty if you want to redeem the loan early, and early often means in less than 10 years. Carmichael is not a fan: “How many people know what they will be doing 10 or 20 years from now, particularly young people? If the chancellor seriously thinks that long-term fixed rates will help struggling home buyers, he has got it badly wrong.”

The cost of borrowing £1,000 through a personal loan has risen by 4.5% since last March, as the credit crunch has forced lenders to increase interest rates, latest figures show.

The statistics from financial information provider Moneyfacts show the average APRs on unsecured loans of all sizes have risen since March 2007, even though the two recent cuts in the Bank of England base rate have brought it back down to the same level it stood at a year ago.

Those taking out the smallest loans have been hardest hit, with the average APR on a £1,000 loan increasing from 14.4% to 18.9%.

The average APR on a £2,000 loan has increased by 3.9% to 17.9%, while a £3,000 loan now attracts a rate of 15.5% - 3.8% higher than March last year.

Borrowers taking out larger loans are also paying more than those who did so last March, although the gap between rates isn’t as large.

On a £5,000 loan average rates have risen 2.1% to 10.1%, while on a £25,000 loan they are 1.2% higher at 8.1%.

“Anyone looking to take out a loan in 2008 is going to find themselves faced with having to shell out more by way of monthly repayments than they would have done over the last couple of years,” said Michelle Slade, a Moneyfacts analyst.

“The ongoing credit crisis has seen institutions concentrating on getting money in the door and becoming more expensive and selective when lending money out.”

Slade said the highest rate on a £1,000 loan had increased from 19.9% to a massive 27.9%, while some of the keenest rates have been withdrawn.

Last March, Northern Rock was offering a best-buy rate of 6.4% on £1,000 - this year it still offers the lowest rate, but it has increased it to 12.9%.

The outlook is worse for people with imperfect histories, Slade said.

“With 97% of loans offering typical or personal pricing, consumers with less than perfect credit scores may find themselves offered rates higher than those advertised, or declined completely,” she warned.

Secured loans have been an option for some borrowers, but they have also become less competitive as a result of the credit crunch, Moneyfacts said.

Eight lenders, including Alliance & Leicester and Picture Financial, have withdrawn entirely from the market in the past few months, while those that remained have cut limits and increased rates.

“In line with the mortgage market, the amount that the lenders are prepared to offer has been slashed. Loans of 125% loan-to-value (LTV) are no longer available and only a handful of lenders will consider 100% LTV loans,” said Slade.

“In March 2007 rates as low as 5.9% could be found. Now the best deal on the table is 6.4%.”

March 11 (Bloomberg) — U.K. banks raised the cost of borrowing for homebuyers with the smallest deposits to a seven- year high, declining to pass on two interest-rate cuts by the Bank of England.

The average rate offered by lenders on loans for 95 percent of the price of a property, fixed for 24 months, rose to 6.55 percent, the highest since September 2000, the central bank said today on its Web site. The cost fell for mortgages worth 75 percent of the value of a home.

Banks have been reassessing the credit risk of their loan books after reporting losses and writedowns totaling almost $190 billion stemming from the collapse of the U.S. subprime mortgage market. Today’s data suggest that lenders are making it harder for consumers buying their first property, who typically have smaller savings to invest, to afford a home.

“Banks are clearly now engaged in more active risk- pricing,” George Buckley, chief U.K. economist at Deutsche Bank AG in London, said in a note. “Riskier borrowers are failing to benefit from the fall in policy rate expectations.”

While the Bank of England cut the benchmark interest rate twice since December to 5.25 percent, banks have been reluctant to pass on the reductions in full. They have also curbed the number of loans on offer, with mortgage approvals in January staying close to the lowest in nine years.

The average rate on a mortgage for 75 percent of the price of a property, fixed for two years, fell to 5.76 percent in February from 5.97 percent the previous month, still less than the quarter-point cut in the benchmark on Feb. 7, the central bank’s data showed.

Separate data today show average first-time homebuyers had larger deposits and borrowed smaller loans in proportion to their incomes in January than in December, in another sign that banks are tightening lending standards.

First-time buyers took out mortgages at 88 percent of the property’s value and 3.32 times their salary, compared with 90 percent of the price at an income multiple of 3.38 percent the previous month, the Council for Mortgage Lenders said today.

Bloomberg.com: U.K. & Ireland

March 10 (Bloomberg) — Northern Rock Plc, nationalized by the U.K. government last month, will stop selling subprime mortgages in Britain.

The bank will stop selling the loans today, though applications submitted before will be processed, the Newcastle, England-based lender said in a statement today.

Northern Rock, bailed out by the Bank of England after it ran out of funds for new loans in September, began selling subprime and “near prime” home loans last year on behalf of Southern Pacific Mortgage Ltd., which was responsible for funding the loans and managing the repayments, it said.

Bloomberg.com: U.K. & Ireland
Northern Rock Pulls Out of Subprime Mortgage Market in U.K.

With personal loan debt almost four times higher than last year, even our combined January and February earnings are not enough to pay off the interest on our debt – without actually even reducing it, new figures reveal.

As a nation, we have worked the last 70 days solid to earn enough money just to service the interest on our credit card and loan debt, let alone re-paying the actual debt itself, according to new figures from Unbiased.co.uk.

The site has hailed today, Monday 10th March, as Debt Freedom Day. This is a stark increase from last year, when Debt Freedom Day was the 1st February 2007, meaning we only spent 31 days to service our debts.

The figures show that personal loan levels in the UK increased to £9.8 billion, from £2.6 billion last year. At the same time average interest rates on personal loans are now 0.5% higher, which means that Brits pay almost £1.5 billion in interest payments alone. Credit card debt in contrast has dropped slightly, decreasing from £55.6 billion to £54.9 billion.

Personal debt levels in general have increased by over 10% over the last year and average levels of interest payable on this debt has increased by over 6% - making the proportion of income needed to service this financial burden even greater.

“This year’s Debt Freedom Day is a real warning for UK consumers – as it marks the day we start paying off the actual debt levels rather than merely servicing the interest accrued,” said David Elms, Chief Executive of Unbiased.co.uk. “Compared to last year we spend almost two months longer this year to pay off the interest of our borrowings and this doesn’t event take into account mortgage costs.”

He added that although Debt Freedom Day is a hypothetical point in the financial calendar, people should still pay attention to it, as in the current economic climate is has never been more important to realise just how much it costs to service debts and to ensure there are adequate funds available to do so.

“Seeking independent financial advice can be the first step to taking control of your finances,” he added. “An independent financial adviser can assess your financial situation and help you identify where your monthly budgeting could be improved and help you embark on the path to saving.”