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Make sure you’re prepared for interest rate rises in 2015

2nd December 2014 Print

Recent research has revealed that up to 47% of households in the UK would find it hard to cover a substantial rise in interest rates.

In response to these scary statistics, the Money Advice Service (MAS), has put together an infographic detailing exactly how much an increase in base interest rates would affect our household budgets, and tips on how homeowners can cover this cost.

The average UK mortgage is £180,000. With just a 1% rise in interest rates, homeowners can expect their monthly mortgage payment to increase by over £90.

To counterbalance this increase in outgoings, MAS ha s put together a list of cost saving ideas to help you manage your budget more effectively. These ideas include…

Saving on your water bills by taking shorter showers and fixing leaking taps

Saving on your energy bills by switching to energy saving light bulbs and turning appliances off at the wall

Joining a car club to save up to £3,000 a year on travel costs

Nick Hill, a money expert from the Money Advice Service said: “The smallest increase in mortgage repayments can make a significant impact on a family budget – especially for those people who are already financially stretched.  So it’s a good idea to review your personal finances, start looking at where you can cut back, and plan ahead now.”

Prepare For Interest Rate Rises - An infographic by the team at Money Advice Service

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