Don't botch your finances with DIY money management

AXA urges consumers to seek professional financial advice as the UK population turns to alternative sources in the wake of the current economic crisis.

The UK credit crunch appears to have made people increasingly aware of the importance of controlling their finances with four out of five (80%) of the population now more likely to actively to manage their money.

However in the fallout of the current economic crisis people are moving away from the traditional sources of financial advice and turning instead to the Internet and family and friends for those all important financial decisions. 72% of the population would prefer not to seek professional advice - despite three-fifths (61%) having done so previously - choosing instead to manage their finances on their own (58%).

In a recent survey, AXA found that in the desire for greater self-control in financial management over half of the population (58%) would use the Internet for financial advice, while a further 52% would use friends and family members. In contrast, just one third would consult a Financial Advisor and only 31% would visit their banks or building societies. The most significant factors in making people take more control of their money are the worsening financial conditions (42%) and job losses (43%).

The research also showed that almost 40% of the UK population are currently worried about their finances, most notably paying off immediate debt (20%) and income stability (18%), while one in six (16%) has significant financial problems that they need to address.

These figures, combined with the sharp number of home repossessions announced last week, the rapid rise in unemployment and the 3.8m people struggling to cope with mounting credit card bills means that now, more than ever, is the time for people to get professional advice on how best to manage their finances, be that via a Financial Advisor or, if they have debt worries, via the Citizens Advice Bureaux or one of the many debt charity groups, such as Credit Action.

Steve Folkard, Head of Pensions and Savings Policy for AXA said: "Understandably people are confused and concerned about their finances at the moment. Advice from the Internet or from friends and family may be a good place to start, but we believe that professional financial advice and qualified guidance is essential for ensuring the right decisions are made. AXA has carried out extensive research, including its AXA Avenue programme, which shows conclusively that professional advice will leave you in a better position than going it alone.

"The financial decisions we make now, be that on investments, borrowing or cutting our monthly budgets could have a significant impact on our current and future financial stability. And with the economy in turmoil, a bit of quick fix financial DIY is likely to be as effective as putting a sticking plaster over that hole in the water pipe."

AXA has an online budgeting tool to get people started with their financial planning which is available at axa.co.uk/mybudgetday.