Debt up 7.3%

meester

amcluesent wrote: »

Crisis? What crisis? Gorrdunnn is making the right decisions for the long term!

FACT For recent graduates with multi £10k debt and now dwindling chances of anything but a mcjob and no chance of a home loan for years, declaring bankruptcy looks like a good option.

Hmm, well the student loan will still need to be repaid, bankrupt or not.

GDB2222

Yes, some debts survive bankruptcy, and student loan is one. Who said that the government is stupid?

clobber_2

It's all my fault! I've put loads of stuff on my cc recently, although I pay the balance in full every month so I'm not sure they count it.

Generali

Dithering_Dad wrote: »

I think the same thing. A more interesting survey would be how much debt is carried over to the following month on a credit card. There must be millions of business people who put their expenses (hotel bills, food, etc) on a credit card and pay it off at the end of the month when they receive their expenses payments.

I sometimes can have anything up to £3k on my credit card as expenses, especially when you have to stay in London hotels at +£100 per night for a month.

The BoE do net and gross lending figures. Net credit card lending has risen by 6.7% in the last year. Net consumer lending is up by about the same amount.

The gross figure for MEW yoy to March 2008 fell by 75%!

WTF?_2

Jumping_Bean wrote: »

I don't think when talking about consumer debt that very many people on average use it to their advantage. Except if the advantage is to buy stuff they wouldn't normally be able to afford. I also don't think that the huge amount of consumer credit rolling around in our economy has a beneficial effect. IMO it's just the economy borrowing from its own future and just like the individuals doing the borrowing, at some point it needs to be paid back or written off.

Indeed - and irrespective of how much of the credit in the survey was just people using their credit cards 'properly' (to get short term interest free credit or as a buffer for expenses) the fact is that the news is that the figures have increased significantly.

That implies either more people having to fall back on credit or an expanding economy (more business activity, more consumer activity). I know which one I think is more likely in light of the other figures out there.

Generali

!!!!!!? wrote: »

Indeed - and irrespective of how much of the credit in the survey was just people using their credit cards 'properly' (to get short term interest free credit or as a buffer for expenses) the fact is that the news is that the figures have increased significantly.

That implies either more people having to fall back on credit or an expanding economy (more business activity, more consumer activity). I know which one I think is more likely in light of the other figures out there.

Well if you look at the figures, the rate of increase of credit card debt has increased over the past couple of years (from 2-3% to 7% pa) but is well below the 15-25% rate of increase that was normal from the mid-90s up until 2005.

I guess the problem for some will come if they lose their job, lose some overtime or if they are unable to MEW to repay the capital on the credit card due to a drop in house prices or (in a small number of cases no doubt) house prices failing to continue rising.

dopester

How long will the pretence go on for?

http://www.reuters.com/article/reutersComService4/idUSLL981520080822
Page 2 of 3

"We have an ongoing process of writing down and raising fresh capital. That is going to be demanding for a very, very long time," said Marc Ostwald, strategist at Monument Securities in London. "The government are going to have to step into the breach. The consumers are borrowed to the hilt and the banking sector is no longer able to provide the consumer with credit. Unless they want to see a major collapse in the financial sector, the government will have to fund the difference and borrow a lot more."

The government should stay out of it. The bad debt needs to deflate and be liquidated. What does the consumer need more credit for? Always more and more and more and more debt, despite record debt levels, to keep the party going, and wreck the system at the expense of future generations.

thriftybabe

MyOpinion wrote: »

I always wonder how meaningful these figures are, it seems to me there are a lot of factors that can skew them. There will be a lot of people who can comfortably service million pound plus mortgages, similar story on credit cards how much does does tarting impact on these figures, I have quite a bit of credit card dept I could happily pay off but my money is working harder in a savings account and I'm not that much of a tart.

I am the same. I have money in the bank to cover any credit card debt that I have. I would not do it otherwise. I am sure there must be plenty of other money savers who are doing this!

lostinrates

Well, we are not in debt (I do have a student loan). but this month we have REALLY felt the pain and did not meet our savings target. This is not only the first month we haven't met our target but the first we have not exceeded it. A big chunk, ironically, was to the new financial advisor...lets hope he's worth it, but where as I was monitoring our expenses and the personal effectof inflation quite well I find that its all got out of hand.

For example, I was unfortunate enough to feel the wrath o the car behind's bumper and will ned to have some car expenditure now. We never claim on our insurance because of the no claims bonus (of massive implication particularly as DH learnt to drive only in recent years) so I've realised two things. 1. If we were paying large mortgage or even rent we would have been CCing this month and 2. we should downscale from flly comprehensive insurance now that the car is an old banger and the value in a nastier impact would be negligable.

I'm really not surprised debt is up. You can cut back all you like on the day to day stuff, but when unexpected things crop up if you've cut back and are paying the same (as is the case in the Lostinrates household) then a decision will always be wait and save or debt. For many debt is the obvious answer, sometimes wisely sometimes not.

Guy_Montag

For those asking "How much of this is tarting?"


Would you say it's easier to tart in the last few months, than last year?