Under current legislation, bankrupts in Ireland are placed under various restrictions for at least 12 years, at which point they can apply to be released. However, some bankruptcies currently last much longer than this, because there is no actual time limit.

But the new Civil Law (Miscellaneous Provisions) Bill will mean bankrupts are automatically released after 12 years, and can apply to be released after five.

The Irish Times states that there are 300 people who currently exceed 12 years in bankruptcy, all of whom will be released once the new law comes into force.

An expert at the IVA Forum said: “In Ireland, bankruptcy is far more restrictive than it is in the UK, but this new Bill could enable people to apply for release much sooner – which will be welcome news for many of those Irish residents who are currently wondering if bankruptcy is the best way forward for them.”

In its latest payments survey, the BRC recorded a 12.9% fall in the proportion of transactions made using credit cards during 2010, compared with the previous year. Over the same period, the proportion of transactions involving debit cards went up by 15.8%.

British Retail Consortium Director General, Stephen Robertson, said: “Hard-pressed customers are switching to cash and debit cards for the reassurance that they can’t spend what they haven’t got. At the same time, use of credit cards has dropped sharply. Cash remains king – used for more than half of all retail payments.”

An expert at the IVA Forum said: “As simple as it may sound, one of the best ways to stay out of debt is to avoid it altogether – and that may be the attitude of many of those steering clear of credit cards last year.

“Credit cards can serve a useful purpose, but they should only be used if you’re completely sure you can afford to repay what you borrow. For those with any doubts about how they’ll repay their balance, credit cards are probably best avoided.”

First of all, there’s the retail sales index from the Confederation of British Industries (CBI), which has fallen to the lowest level in a year as consumers cut back on their spending.

Many people are spending less simply because they have less to spend – after all, the most recent inflation figures show that CPI (Consumer Prices Index) inflation stood at 4.5% in May. Against a backdrop of widespread pay freezes and job insecurity, this clearly means many consumers’ finances are being stretched.

At the same time, there’s also a focus on reducing debt. In May, the British Bankers’ Association told us that unsecured credit had actually shrunk by 1.2% over the course of the year. Many people are focusing on repaying their debts and trying to avoid borrowing any more.

And in April, the Finance & Leasing Association (FLA), whose members account for around 30% of all unsecured lending in the UK (according to 2010′s figures), told us that they’d lent out 4% less over the past year than they had in the previous year.

A spokesperson at the IVA Forum commented: “Cutting back on non-essential spending can be an excellent way of coping with financial worries without turning to borrowing. It’s troubling to hear of the impact it can have on the country’s overall economy, but people clearly need to put their own finances first.”

Under the right circumstances, this kind of debt can work out exactly as people expect: they borrow the money and pay it back as arranged, along with the interest. The annual interest rates can be very high, but these loans aren’t designed to be repaid over the course of a year, so many people consider the cost to be reasonable. The Daily Mail provides a look at some figures.

Borrowing £200 for a fortnight, for example, would cost someone around £23. Even though that’s an APR (Annual Percentage Rate) of 4,214%, what matters to the borrower is the actual cost – £23. As the paper points out, this can be cheaper than using an unauthorised overdraft.

The problems can begin when someone doesn’t repay the money on time. With one lender, for example, a debt of £100 would cost a borrower £87 if they didn’t repay anything for two months or longer.

A spokesperson for the IVA Forum commented: “If someone has to turn to payday loans on a regular basis, it could well be a sign that they have underlying financial issues that need addressing. Anyone in that situation should take a good look at their finances and try to identify what they could do to improve them. Talking to a debt adviser could really help them here.”

The number of insolvencies (including bankruptcies, IVAs and DROs) in this group increased by 43 basis points to 9.59% of all personal insolvencies in the first quarter of the year, the research found.

But Experian’s figures showed that many other married, middle-aged and middle-class members of society are also struggling.

In terms of location, Windsor in Berkshire showed the steepest rise in personal insolvencies – a 50% increase on a year earlier. Richmond in London saw the sharpest fall (39%).

And the research found that people in the ‘claimant cultures’ group – who are ‘largely welfare dependent’ – remain most at risk of becoming insolvent.

Simon Waller, head of collections for Experian UK and Ireland, said: “Despite the number of personal insolvencies dropping year on year, there are some noticeable differences across demographics and areas of the country.”

The survey found that debt levels increased as consumers struggled to make ends meet, while savings fell.

36% of those questioned for the survey said their financial circumstances had deteriorated, compared with only 6% reporting an improvement.

Tim Moore, senior economist at Markit, said: “It may be summertime but the living is far from easy. The decline in the index pours cold water on the tentative signs of improvement seen in the previous month. The grim figures show household finances deteriorating at the fastest pace since early 2009, with people eroding their savings and taking on more debt to finance strong rises in living costs, as income from employment continued to fall in June.”

Last week, figures from the Office for National Statistics (ONS) showed a 1.4% drop in both the value and volume of retail sales – another indication of the pressures currently faced by consumers.

And the ONS also recently said that inflation stood at 4.5% for the second consecutive month in May.

The company said that many people have put off home maintenance and renovation projects in order to make savings. More worryingly, 8% of people said they would consider not renewing their buildings insurance and another 8% would consider not renewing home contents insurance.

Phil Paterson-Fox, head of home services at Gocompare.com, commented: “In the current economic environment it is a good idea to review your finances and cut back on unnecessary spending – but it is important that in order to save money now, you don’t make false economies. For most of us, our home is our most valuable asset, so when making cutbacks you need to ensure that it is adequately protected.”

An expert at the IVA Forum said: “It’s very important that people are careful about what kind of cutbacks they make.

“Going without home insurance, for example, could have serious financial consequences if anything happens to their home or their belongings. It’s better to try to cut back on non-essential spending – and people may be surprised at how much they could save just by cutting back on things they don’t really need.”

Well over half (60%) of those with life insurance surveyed said they hadn’t updated the level of their cover following a significant change in their personal circumstances.

In other words, the level of cover they currently have might no longer be appropriate for their new circumstances.

David Cook, of Sainsbury’s Life Insurance, commented: “Many people invest in life insurance when they buy their first home as they want peace of mind that they’re covered should anything happen and they’re unable to pay the mortgage. However, clearly people are overlooking the need to update their level of cover once their personal circumstances have changed.”

An expert at the IVA Forum said: “Someone with three children and a mortgage will have very different financial commitments to someone with one child and no mortgage – so stories like this one serve as a real reminder of the importance of reviewing your finances regularly to see if you need to make any changes.”

But the rate of debt repayments fell during this time. In the first quarter of 2011 borrowers repaid a combined £1.8 billion of debt, compared with £2.4 billion in the previous quarter.

This meant people repaid 7p of debt for every pound saved in the first three months of the year.

An expert at the IVA Forum said: “An increase in savings is a good sign, as it suggests that people are taking their financial security very seriously. The drop in debt repayments is less positive, although it could suggest that some people are starting to feel less worried about the debts they’re carrying.

“A good savings pot can really help people deal with unexpected expenses or drops in their income. In that respect, some people may be happy to focus on savings while repaying their debts as normal, even though ‘overpaying’ on debt might reduce the amount of interest they pay overall.”

The Scottish Government’s website, www.scotland.gov.uk, provides some details, informing us that Finance Secretary John Swinney has ‘asked for an urgent meeting with Scottish Power to hear why they think their price increases are justified’.

He has also ‘urged energy regulator Ofgem to accelerate action to protect vulnerable customers and make the energy market more transparent’.

Scottish Power has announced it will raise its electricity prices by an average of 10% and gas prices by 19% – and Mr Swinney pointed out that around 800,000 households “in energy-rich Scotland” are already living in fuel poverty, meaning they’re spending more than 10% of their income on energy.

“Energy price rises are a big topic,” said a spokesperson at the IVA Forum, “partly because these bills take up such a large chunk of the average household’s finances, and partly because there’s little people can do to avoid them. We may be able to reduce our bills by shopping around, but this can only achieve so much when different energy suppliers all raise their prices.”