Women and debt
Debt
Financially, what have the last 10 years done for us? Allowed us to get into a lot of debt it seems!
The 
recession hasn’t helped, but the rot had set in long before the credit crunch really started to bite. In June this year the average household debt was £8,650 excluding mortgage debt. Add to that the number of households who have some sort of unsecured loan and the figure rises to £18,021.
Total UK personal debt at the end of June 2010 stood at £1,457bn. This now means that individuals owe more than what the whole country produces in a year! Add in gloomy stats such as every 13.4 minutes a property is repossessed and every 51 seconds somebody will be declared insolvent or bankrupt and it’s pretty obvious that we’re in a mess along with the economy.
The frightening thing is that to an extent the overspending was falsely propping up the economy for a couple of years before we finally did slide down into recession. One of the measures used is consumer spending – and a good deal of that spending was with borrowed money, not “real” money.
We’re paying an average 15% of our net income to service the interest on our personal debt which has the knock on effect of meaning that huge numbers of people can’t afford to save. Unemployment has risen and currently, 1900 people are being made redundant every day.
So there we have it – whichever way we look at it the current situation is pretty grim.
Here’s the thing, though. It’s our own fault. We spent too much – all of us.
The financial situation in our house is currently mixed, at best. We’re both self employed, and we both have hangover debt from our first marriages (my first husband was VERY expensive). Cashflow is the perpetual problem and whilst I have had an exceptionally busy few months, the recession seems to have hit my husband’s industry hard this year and he’s had very little work over the past few months.
We’re not quite at the point where we’ll be sending my 10 year old up the chimneys yet, but the Knicker Drawer Fund has been pretty much empty of late. We both got hit hard financially by our divorces and we now have a “if we don’t have the money we don’t buy it” rule, and a plan to get rid of the remaining debt.
The thing about recessions is that they keep on coming around again. This will happen again in my working lifetime, possibly more than once. Everything is cyclical, and the current habit of blaming the banks, the lenders and the government for our personal debt is just shifting the responsibility onto somebody else.
Mind you, I did laugh this morning when I read a report from the House of Commons about how a government scheme set up in 2004 to help the millions of people in the UK who are drowning in debt has failed. It seems to me that the government can’t control their own spending and manage their own debt, so I’m not entirely sure why we think they’ll be able to help us with ours.
About Special GuestBirds on the Blog welcomes Guest Bloggers of all abilities, if you have something to say and you wish to share it with us - get in touch
View all posts by Special Guest →
9 Responses to Women and debt
All that jazz – All in A Day
Review of: Cousin Alice Jazz Music by Cousin Alice: Elaine Sturgess Reviewed by: Elaine Sturgess Rating: 5 On January 21, 2012 Last modified: January 30, 2012 Summary: What makes Alice so distinctive is her wonderfully smokey voice, a quality that furniture designer William Yeoward found so arresting at a concert she was performing for the [...]
Pingback: Tweets that mention Women and debt | Birds on the Blog -- Topsy.com
Some people must owe a lot because I have no debt at all except for my mortgage which is quite low. Anything I need I save up for.
I’m about to transfer my knickers to a bigger drawer so I can save more pennies in there – where they will probably earn more interest than they would in the bank.
However awful the recent recession has been, and however awful the present coalition government’s actions may be, the upshot is that a jug of iced water has been poured over our heads.
The spend-spend bonanza is well and truly over. Thanks for this post, Kate – and for making us think more sensibly!
Twitter: SuzeStMWrites
I like your comment about your expensive first husband, mine is too, sometimes it feels like I can’t afford the expense of another husband, and then I remember it’s Kev
In all fairness the current government shouldn’t take the blame for a scheme set up to manage debt in 2004, but if they had half a brain, it would be closed down real swiftly.
Pingback: Tweets that mention Women and debt | Birds on the Blog -- Topsy.com
Well, that was a misleading title.
Yes, it is time everyone smelt the coffee and got real with the debt they carry and what they expect others to carry for them. We, as a world, are leaving our grandchildren with a desparate future. State pensions as a safety net are not going to cope.
Apart from the house we are debt free, but everyday we are still paying the price of everyone else’s debt in terms of interest rates (why pay savers when they can get all the money they want from loans). Regulate the financial industries and be done.
Totally agree with your review of the current credit crunch. Although, we, as in the general public are not wholly culpable. The government and the banks really should shoulder most of the blame. In the late 90′s Brown basked in the reflected economic glory created through the smart bankers realising that they could make a lot more money, by curiously lending more? Everyone and their granny was then encouraged to borrow, to the point of actually receiving blank credit cards cheques through the post with suggestions on how you could spend it!!!
The selling of loans got so out of hand that in the US and UK that people who were out of work or on low income could buy house which cost more than 6 times the household income. Not only that these people were also encourage to “stretch the truth” in respect of their income. This created the perfect storm which hit our shores in 2009 and we are still caught up in the eye of it. Hopefully we have learned our lessons!
To be fair (and I can see from your online name that this is a field you know pretty well!), I know one man who got into multiple buy-to-let properties by using interest-free credit cards and ruthlessly moving them on to the next offer. However, someone needs to be very skilled to be able to manage that sort of thing. I know I couldn’t.
My policy always used to be to pay off my credit card bill in full every month, so interest rates were never relevant to me. But then, after my husband died, things got a bit out of hand and I ended up running my credit card bill up to its £8,500 maximum. I then changed it in to a loan, which I felt was the responsible thing to do because it had a much lower interest rate.
However, I should also have hidden my credit card, because it was run up well into 4 figures within 3 months.
And I’m still paying it off.
At least I’m not as bad as one woman I used to work with in the 1990s, who used to celebrate every time she got an increase in her credit card limit – she used to think of that as more money to spend!