Following the insolvency service insolvency statistic announcement this morning, Mark Sands, Head of Personal Insolvency at RSM Tenon said, ‘Today’s official announcement has proven that bankruptcies typically increase in the first quarter of the year, a trend which is apparent over the last three years. This can be attributed to the fact many individuals overspend during the Christmas period without any realisation of how it will affect them. However, the subsequent three quarters usually have for the past few years seen modest quarterly falls. Bankruptcies are still 27 per cent lower than this time last year whilst Individual Voluntary Arrangements and Debt Relief Orders both increased by 8 per cent and 16 per cent. Despite pay freezes and rising costs in our daily lives which we all have to endure at the moment, I still expect 2012 to see the lowest levels of personal insolvencies for the last seven years with approximately 100,000 people being bankrupt’.
Mark continued, ‘I think people are becoming more money savvy and are realising they must budget effectively in the current times. The rise of Debt Relief Orders also shows that people/families with low levels debts, i.e. under £15k are still struggling and facing financial ruin. DROs have increased by 39% in the last two years and are rapidly becoming as popular as bankruptcies as a debt solution’.
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