As debt worries mount consumers forsake financial institutions

People in debt are forsaking traditional financial institutions as the credit crunch takes hold.

Research from MGM Advantage found that one in five people with serious debts have decided to keep their money around the home, rather than put it in a bank.

What''s more, one in twenty Britons said they would be avoiding financial institutions at the moment and plan to wait to decide where the best place for them to put their money is.

A separate survey from Scottish Widows indicated that men were far less likely than women to get into debt in the future.

The research found that 20 per cent of men described themselves as ''tight'' or ''careful'' with money, compared to 15 per cent of women who complained they were always short of money and at risk of getting into debt.

Mike Hoban, the customer and brand marketing director of Scottish Widows, explained that saving now could prevent debt and the need for an IVA in the future should something unexpected occur.

"There''s no point in saving money now if they end up simply splashing it all at once in a few years time. Putting a little aside each month and planning carefully for the future will stop them running into a financial crisis in later years," he added.