Finance Choices
Brits not bothered by debts
The vast majority of Britons simply do not care that they are in debt, new figures show.
While some 2.5 million UK residents have more than £10,000 in unsecured debts, seven out of ten of these are not worried about this and one in four would borrow more, the latest research from market analysts Mintel reveals.
Overall, 21 million British adults - almost half the population - owe money on credit cards, overdrafts or personal loans, with most keeping this under control.
However, more than one person in eight owes more than £10,000 and one in 20 owes more than £20,000.
"While many people in debt may have the means to continue meeting their repayments, the high levels of debt and lack of worry does clearly represent a cause for concern," said Paul Davies, senior finance analyst at Mintel.
"Although the research certainly shows that an impending debt crisis is not inevitable, a large minority of households are extremely vulnerable to any deterioration in the prevailing economic conditions.
"While this may not currently be the most likely outcome, there is clearly the possibility that such a 'doomsday' scenario could yet unfold," he added.
There is some concern among UK residents about their level of debt, with one person in 20 "very worried", but 85 per cent of debtors think their financial situation is well under control.
The most common form of borrowing is on credit cards, with three people in ten having an outstanding balance on a card. Some six per cent of Britons also have an outstanding balance on a store card.
"The increasingly widespread availability of credit has meant that many consumers have found that they no longer have to save up in order to finance major purchases, but instead can simply fund their current spending plans through a variety of credit arrangements. In certain situations, credit has effectively replaced the need to save up for purchases," Mr Davies noted.
"This high incidence of credit card and store card debt partly reflects the ease with which consumers can borrow through these accounts.
"These products have acted to blur the distinction between spending and borrowing and have helped to create a 'spend now, pay later' culture. The credit card industry's promotion of zero per cent purchases and balance transfers for fixed time periods will also clearly have encouraged some consumers to borrow money via this route."
To find a cheap UK credit card, go to www.financechoices.co.uk/credit-card-best-buys.html
While some 2.5 million UK residents have more than £10,000 in unsecured debts, seven out of ten of these are not worried about this and one in four would borrow more, the latest research from market analysts Mintel reveals.
Overall, 21 million British adults - almost half the population - owe money on credit cards, overdrafts or personal loans, with most keeping this under control.
However, more than one person in eight owes more than £10,000 and one in 20 owes more than £20,000.
"While many people in debt may have the means to continue meeting their repayments, the high levels of debt and lack of worry does clearly represent a cause for concern," said Paul Davies, senior finance analyst at Mintel.
"Although the research certainly shows that an impending debt crisis is not inevitable, a large minority of households are extremely vulnerable to any deterioration in the prevailing economic conditions.
"While this may not currently be the most likely outcome, there is clearly the possibility that such a 'doomsday' scenario could yet unfold," he added.
There is some concern among UK residents about their level of debt, with one person in 20 "very worried", but 85 per cent of debtors think their financial situation is well under control.
The most common form of borrowing is on credit cards, with three people in ten having an outstanding balance on a card. Some six per cent of Britons also have an outstanding balance on a store card.
"The increasingly widespread availability of credit has meant that many consumers have found that they no longer have to save up in order to finance major purchases, but instead can simply fund their current spending plans through a variety of credit arrangements. In certain situations, credit has effectively replaced the need to save up for purchases," Mr Davies noted.
"This high incidence of credit card and store card debt partly reflects the ease with which consumers can borrow through these accounts.
"These products have acted to blur the distinction between spending and borrowing and have helped to create a 'spend now, pay later' culture. The credit card industry's promotion of zero per cent purchases and balance transfers for fixed time periods will also clearly have encouraged some consumers to borrow money via this route."
To find a cheap UK credit card, go to www.financechoices.co.uk/credit-card-best-buys.html
posted by Bruce Wayne at 10:46 AM
Brits not bothered by debts
8 Comments:
Yeah but...
Can't we just carry on spending and then go bankrupt if need be?
That way after a year I can start the debt merry-go-round again??
I can replace my out of date tat (repossessed crap) from China with brand new crap??
After all spending in the shops (at any cost) is what we all have to do as a nation if we are to keep this proud country alive!!
I honestly thought the % would be higher. how many of those 2.5 million adults are students? or graduates? And who's to say they are homeowners???? And "a quarter of borrowers have debts of less than £500"
I don't have any credit card debt, but do have a car loan. I do worry about personal finances and hope not to have to get into credit card debt again or any other debt too deep.
Was chatting to a few colleagues yesterday about easy credit and the risky ploy of "living for today". The stories I heard raised my eyebrows somewhat:
A chum of one of the guys I work with earns a fair old whack and so does his wife. They live in a particularly huge house somewhere in Norfolk and are both approaching retirement age. Despite bringing in two large salaries they still live well beyond their means and it's all down to credit and equity release. It's SKI-ing on a grand scale. Their justification is that when they pop their clogs they will use the house to pay off the debts and anything that is left over will go to their (already quite wealthy) offspring. The consensus was that this was okay: "Hey, it's their money. Nobody's getting hurt. Anyway the banks keep offering them the cash. Etc etc". Another piped up to say that his Dad's doing pretty much the same thing.
I'm of the opinion that "living for today" is alright so long as you die tomorrow. Personally I would rather live a life of relative comfort than spunk all my cash away just so I can live it up for a year (and to do it on credit is a hell of a risk - the goalposts can be moved far too easily). The thought of being a doddering octogenarian shuffling around a state-run $h!th0l? of a care home with a Celtic-band tattoo fading nicely into the wrinkles on my arm while near-psychotic interns randomly abuse me doesn't exactly appeal to me.
Or maybe I'm the only one.
Yes, I worry, but I know I have the cash to pay it off. I have never had real big debts, so when I borrowed 95thousand to buy 10 acres and an old farm house, I was worried all the time. I sold it (too soon) and now I wish I had it back cause I could double my money on it.
No, I don't worry about debt. I am solvent. I owe it all to the fact that I have never had a car payment, and live well within my means. My only money worry is how to maximize my savings through the most suitable investments.
Yes, I do worry about debt. For many years, I worked with cash. I saved money for purchases and did not have to borrow for anything. Unfortunate circumstances put me in a position where I had to use credit cards to cover expenses and now I carry debt. That does worry me and I am trying to make progress toward paying them off and once again being debt free. It is a long road, or at least feels like it.
Wow, that's surprising information. I'm wondering why Britons aren't worried about having so much debt?
Post a Comment
<< Home