So what have we learnt from the recession?

Really2

Follow the crowd but only to look at what they are doing, don't act like the crowd.

Also a recession can be a great time of opportunity.

What ever any advises you to do on the internet, do the opposite:)

ess0two

Afriend wrote: »

You don't need to spend cash to enjoy yourself esso. In fact, some of the most enjoyable activities are free.

Your right but it helps,i enjoy motorcycle riding,£20 of petrol and 20 mins later, i'm scratching in Wales,priceless.

Pssst

Nothing will be learned. The same mistakes will be made over again given time.

I personally have learned to live more for today,to take on more debt and not worry too much about it as long as it is manageable. My new mantra shall be ..if i can afford the repayments, i can have it.

Afriend_2

ess0two wrote: »

Your right but it helps,i enjoy motorcycle riding,£20 of petrol and 20 mins later, i'm scratching in Wales,priceless.

So true esso. I enjoy drinking beer with friends around a fire. However as the UK government have concreted over everything or it's farmland. Meaning the barbecue takes place in the garden rather than the prefered woodland retreat or summer cottage i.e. unless i'm visiting friends abroad.

purch

Actually what we should have learnt, we probably won't have.

We should have learnt that you can't just magic up wealth, alchemy has never worked and financial alchemy has been shown to be just an empty promise.

We need to learn this lesson, sooner rather than later.

This recession was just a warning shot across our bow.

This recession was caused by a few guys thinking they could create wealth by pressing a few buttons on a computer keyboard.

The next recession will be caused by the producing nations, those that produce real wealth deciding they don't need us, the consuming nations anymore.

Then the fun will start !!!!

Rochdale_Pioneers

It feels like some lessons have been learned - credit is less available and less cheap.

For example, my wife's car was paid for 3 years ago using a Super Balance Transfer off a 3.9% for life card. Total borrowed £6,500. We both applied for the target card as a precaution against credit limits, and both received thousands more than we needed.

3 years later, and Hyundai offer a too good to miss trade in for a bigger one (new car at near cost price - 22% off list! - plus a generous trade in of the old car). Really struggling to find a balance transfer card to source the cash needed (£4,800) as they're only offering credit limits of a few grand. If it doesn't come off it'll be a pity, but it is a clear sign that lenders are learning - aside from the transfer fee the card company wouldn't make a penny from us....

Cleaver

Graham_Devon wrote: »

A really quick example here, as I believe families are going to pay the price here....

2 parents, 2 kids. 1 parent out at work, the other looks after a 12 month old and a 4 year old. Other parent brings in 32k net a year.

(These are really rough examples of figures!!)

So, 24k gross a year, plus 10quid a week tax credits = £24,500

I'm going to go with rent simply because the variables of a mortgage are too large...

Rent - £600 per month for a 3 bed home, £7200 a year.
Council Tax - £1200 a year
Gas / Electric - £1000 a year
Phone, TV, 1 mobile - £500 a year

We have £14,600 left.

Going to use a Vauxhall Zafira 06 plate as an example as it's just something I heard advertised, and is a family type car. So 1 car, at £131 a month = £1572
Insurance - £350
Fuel (at £50 a month) - £500
Servicing, tax, MOT etc etc, approx - £400

£11788 left.

Food / cleaning etc etc, supermarket shop, £200 a month, £2400 a year

£9388 left

I'm going to stop here, as this list could go on and on, and I don't think I need to go too into depth for the point to become clear.

I'm not being argumentative Graham, but I have no idea what point you're making my friend. I'm genuinely confused. You're listing the income and expenditure of a family, right? I was quite in to reading it, but I have no real idea what point you're making?

mewbie_2

ess0two wrote: »

Your right but it helps,i enjoy motorcycle riding,£20 of petrol and 20 mins later, i'm scratching in Wales,priceless.

£20 of petrol in 20 minutes - !!!!!! is that you are riding? Some sort of jet rocket?

fc123

Graham_Devon wrote: »

It's not so much bad practice. But an example I am annoyed at is that the government promised us all this reform on the back of bailing out banks, yet nothing has happened.

We have a government telling, and now possibly looking at creating negative interest rates to force lending.

But this isn't so much what I was getting at. My point was, we seem to be as a nation, cheering on this recovery, however, the stimulus, i.e. scrappage scheme, BOE rates, QE, has had possibly the biggest part in this recovery. It's not in the slightest bit natural.

Which is why I asked, where is the money going to come from when the taps are turned off?

A really quick example here, as I believe families are going to pay the price here....

2 parents, 2 kids. 1 parent out at work, the other looks after a 12 month old and a 4 year old. Other parent brings in 32k net a year.

(These are really rough examples of figures!!)

So, 24k gross a year, plus 10quid a week tax credits = £24,500

I'm going to go with rent simply because the variables of a mortgage are too large...

Rent - £600 per month for a 3 bed home, £7200 a year.
Council Tax - £1200 a year
Gas / Electric - £1000 a year
Phone, TV, 1 mobile - £500 a year

We have £14,600 left.

Going to use a Vauxhall Zafira 06 plate as an example as it's just something I heard advertised, and is a family type car. So 1 car, at £131 a month = £1572
Insurance - £350
Fuel (at £50 a month) - £500
Servicing, tax, MOT etc etc, approx - £400

£11788 left.

Food / cleaning etc etc, supermarket shop, £200 a month, £2400 a year

£9388 left

I'm going to stop here, as this list could go on and on, and I don't think I need to go too into depth for the point to become clear.

So, lets say thats your average family, pretty decent wage, pretty low costs. How much are they going to have left over at the end of the year?

Is this money they have left going to support the economy as we see the pace of recovery now? Are they going to be able to save deposits of 20% for a home of their own? How long will it take them?

Theres 30 million families in the UK, half the population, all at different stages, I realise some will both be working, etc, but for all those who have both working, you halso have those where both can't work, so I just gone in the middle really.

Sorry for the long post, hope I got whats going on in my mind across. If anyone actually read all that blurb, congrats!

:hello: Hi Graham.....could I just say the above is a a touch flawed and idealistic?

We, and many of our friends, couples and singles bought our first places from 1990....the majority in 93/94.
None of us earnt massive salaries but, likewise, we weren't on low ones (equiv to min wage) either.
Not one couple bought a small house on a single salary......and this is in one of the cheapest areas of SE London. 2 salaries and a lot of 'going without' were required to service the mortages we all took on.

Singles I knew could only afford flats..and not wizzy, exec type ones .


To go back to one breadwinner and one at home with the kids and affording a decent size house, you need to go back to the 70's...and those prices and wages ratios.

And we didn't have any tax credits then either.

This Utopian dream of plenty of affordable space in fab areas on one average salary just isn't going to happen anytime soon...just IMHO of course.

fc123

Cleaver wrote: »

I'm not being argumentative Graham, but I have no idea what point you're making my friend. I'm genuinely confused. You're listing the income and expenditure of a family, right? I was quite in to reading it, but I have no real idea what point you're making?

I figured he was trying to say Mr and Mrs Average should be able to afford a decent semi in an average area on the average wage.