The Cash Chasm – the Latest Symptom of the Credit Crunch.

New research reveals that the UK could collectively save over £14bn between now and 2012 by adjusting personal finances to cope with the new market conditions. By taking a few simple measures to put their house in order, the average Brit could save up to £1236 a year.

The report, commissioned by credit card company Capital One, investigated the impact of spiralling prices on the man in the street, and the costs of different coping strategies.

In the report people were grouped by their financial reaction to the changing conditions, and calculated the gap between how the best and worst prepared Brits will fare over the next four years. This gap – over £1200 per year has been dubbed the Cash Chasm. Those who don’t adjust will forfeit £2532 per year, whereas those who behave sensibly will have to find the somewhat lower amount of £1296.

In this video independent financial analyst Cesarina Holm-Kander give her opinion on the Cash Chasm, and also has tips to make sure the credit crunch doesn’t bite so hard