Why ARE people in so much debt?

Hello - this is my first post after 'lurking' for a while, and I hope it doesn't come across as churlish or insensitive, but I'd really like to know why this country is drowning in so much debt! Obviously if a family's main breadwinner loses their job, or becomes ill etc. it's understandable that folks will have to tighten their belts as it were, but we seem to all want the newest, biggest, most fashionable, most hyped 'things' on the never-never! I've always hated the thought of owing money to anyone, and if I have to wait another year to renovate my kitchen, then so be it - I'll WAIT until I've saved the cash to do it! I drive an ancient car that cost me £750 (cash) 4 years ago, all my bills are paid through direct debit, we don't really use any credit cards (through choice) and my ONLY debt is my £45,000 mortgage. Me and Hubby are both in fairly low-paid jobs, but we actually LIKE it that way - a stress-free simple life in a place we love, and to Hell with keeping up with the Jones's! We buy all our clothes from charity shops and furnished the house throughout by attending auctions etc. All our appliances are refurbished second-hand machines, and we don't give a fig if the washing machine doesn't match the freezer - they're not works of art for Heaven's sake!! Don't give in to rampant consumerism and DON'T even try to keep up with the mythical Jones's - Drag 'em down to your level!!! Sorry if this has been a bit of a rant, and I must learn how to indent paragraphs - total Luddite!
"I'm ready for my close-up Mr. DeMille...."


  • nearlyrich
    nearlyrich Posts: 13,698
    First Anniversary Combo Breaker Hung up my suit! Mortgage-free Glee!
    Hi Norma welcome to the boards, I don't think you came across as insensitive or churlish. There is a lot to be said for living within your means and in my case having been through lean times and being brought up with necessities not luxuries I know where you are coming from. It is very easy to go from having a well paid job and managable debts to losing everything through ill health, unemployment, relationship breakdown when the managable debts become anything but managable.

    Its easy to believe all the media hype that values people for what they have and what car they drive, the labels on their clothes, but some of us know that happiness is not having what you like but liking what you have.
    Free impartial debt advice from: National Debtline or Stepchange[/CENTER]
  • Pooky
    Pooky Posts: 7,023
    Combo Breaker First Post
    I appreciate that your opinion of debt is personal but not everyone is lucky enough to be in your situation.

    My washing machine doesnt match my fridge - I dont have designer clothes, neither do my kids, we have a computer that hubby needs for work and dont subscribe to anything that we don't need, but what I do have is debt.

    Everyone's situation is different and can't all be blamed on "keeping up with the jones's"

    I made the choice to stay at home with my children through their childhood and as such have had to pay the cost. My ex husband didn't earn alot, we managed to buy a clapped out old house and had to start renovating as and when we could. We had rented previous to that and wanted more security. Everything was fine, the house was a mess, but the kids were loved and happy and there was food on the table. Then the marriage broke up and the house needed to be finished to be sold. I took the responsibility of this as the ex wouldn't and he forced the sale of the house for debts he'd accrued after the split. The whole thing went against me and although my share of the profits from the sale was £22k, I was £43k in debt from new roof, bill's he'd not paid before he left, mortgage payments that I just couldn't afford on benefits and so on and so forth. That was 5 years ago and I've made big inroads into paying off what I owe. I met a new man - we married - he had a substantial debt from a partner that had defrauded him, the debt was never recovered and he was left liable. In the past 5 years we've had no holidays, we've made do with a car that was just reliable enough to get us from A to B and have had to pay over the odd's for renting privately as no council houses are available. He works hard, we pay what we can and we don't buy what we can't afford. Several times we've sat and complained about the injustice of circumstances that have befallen us - but we just get on with it. I certinally didn't want to loaded with debt as my kids were growing up but I didn't actually get a choice.

    Circumstances are a very strange thing and should never be dismissed so lighthandedly as "rampant consumerism"

    I do understand your opinion wasn't meant to offend anyone - as mine isn't.
    "Start every day off with a smile and get it over with" - W. C. Field.
  • mrcow
    mrcow Posts: 15,170
    First Post First Anniversary Combo Breaker
    but we seem to all want the newest, biggest, most fashionable, most hyped 'things' on the never-never!

    That's perhaps part of the problem, but how about the credit companies who are constantly plugging us with "easy" credit at levels which are simply beyond our realistic means.

    A friend at work applied for a car loan with Purple Loans. She got accepted for the loan and the salesperson was trying to convince her to take out £2k more than she originally wanted. When she queried what she was to do with the extra £2k (as she really didn't need it), the reply she got was, "Why don't you take it all out in cash and roll around on your bed in it?"

    Seriously?? They should be ashamed of themselves.
    "One day I realised that when you are lying in your grave, it's no good saying, "I was too shy, too frightened."
    Because by then you've blown your chances. That's it."
  • Norma_Desmond
    Norma_Desmond Posts: 4,417 Forumite
    Hi Pooky (and everyone else!); of course your circumstances are through no fault of your own - my ONLY bugbear is people who spend, spend, spend and then moan about the resulting trouble they're in. And surely when it comes to pushy credit/loan offers, well, in the wise words of a Liverpudlian friend of mine - just tell them to 'do one'!!
    "I'm ready for my close-up Mr. DeMille...."
  • bonnie_2
    bonnie_2 Posts: 1,463 Forumite
    i wish i had had your attitude 10 years ago wounldnt have got into 35,000 debt, but i am living like that now after all it is only stuff. i have 10,000 left of debt to pay which will take another 2 yrs and i am never going to have credit again
  • dougk_2
    dougk_2 Posts: 1,403 Forumite
    I think there are several kinds of debt. Some can be avoided - some cannot.
    Sometimes debt comes from a series of unavoidable bad luck or circumstances beyond your control.

    There are however some people who do not learn, do not care and spend, spend, spend and maybe this is sometimes related to their upbringing or lack of respect for the value (and power) of money.

    I guess it is worse for younger people who feel "forced" to go to university and then having to have student loans to survive. I don't think the government helps in this area.

    Credit is far to easy to come by (certainly unsecured credit) and drastic action needs to address this, but people forget banks and loan companies don't care about you they care about making money - they are a business!

    I was brought up to believe with the exception of a house you never borrow. Hence the route I took to get a degree - Worked from leaving school to earn money and then studied evenings/weekends.... yes it was hard work but no debt and I never got bored!

    I think the main thing is that sites like this show alternatives and ways to make debt easier to manage, how to cope and get out of it and hopefully, how not to get into it in the first place.
  • margaretclare
    margaretclare Posts: 10,789 Forumite
    Pooky, I sympathise. You illustrate another way that some people are in debt - it's through a previous relationship that went sour and not only did you have all the emotional fall-out, you were left with considerable financial commitments through no fault of your own. You're in a new relationship and sadly, your new partner also had the same thing happen to him!! This, sadly, is not at all uncommon. There are people out there who are quite happy to walk away and leave the other person with the responsibilities on their back.

    So really, we are lucky if we're in a happy relationship, one that doesn't land us in the deep sh*t financially, one in which we can afford a reasonable standard of living, one in which we can talk, discuss and share all decisions and know that the other person shares the burden and won't walk away and leave us in it.

    It doesn't matter if your fridge-freezer doesn't match your washing-machine. Mine does, but it has taken a lifetime to achieve - it never happened while I was still bringing up kids, doing a full-time job and with a disabled husband. Now happily in a second marriage and retired, we're 'comfortable' - not rich but a long way from being poor. And we're lucky!

    Best wishes

    [FONT=Times New Roman, serif]Æ[/FONT]r ic wisdom funde, [FONT=Times New Roman, serif]æ[/FONT]r wear[FONT=Times New Roman, serif]ð[/FONT] ic eald.
    Before I found wisdom, I became old.
  • Norma_Desmond
    Norma_Desmond Posts: 4,417 Forumite
    It's great that this site exists - I only came across it by accident through a link on a property renovation site of all things! It's heartbreaking to see so many people drowning in debt, but wonderful that well informed, friendly people are so willing to help others out!
    "I'm ready for my close-up Mr. DeMille...."
  • Jumanji_2
    Jumanji_2 Posts: 108 Forumite
    I fell into the trap of believing the creditors when they said "Repayment will be easy and take almost no time to do". Even when explaining the situation they thought it would be fine.

    I don't deny being impatient or "trying to keep up with the Jones", but I plead naievity. I've never had someone explain the interest rate, and how by the time you've paid for the £50 item it has actually cost you £75 or worse.

    Unfortunately, just like I've had to learn to pay the rent, and the bills myself with no one to talk me through it, I've had to learn the hard way how to deal with creditors. We've had some bad luck, I also admit to spending on things I can't remember.

    But we're trying our best to get out of a hole (I'm dreading people commenting on the fact that we're going bankrupt and having a go at us).

    HOWEVER when we are bankrupt, and have no credit, believe me we will be living like you do. When we move I know we're going to have to get washing machine, fridge freezer and cooker from Friday Ad, and no they're not going to match.

    It does make me angry/wonder when I see the adverts on TV where people are in financial trouble, and these creditors are saying "Come to us, we will fix all of your problems!". I only wish that the National Debtline and CCCS could advertise as well. So many people out there aren't aware of the help available and think loans are the only way out.

    But I do agree that even though we will be living on less money, I think we will be so much better off!! I can't wait to have the life that you do now! :)

    By the way... Welcome! :)
  • Norma_Desmond
    Norma_Desmond Posts: 4,417 Forumite
    Hello Jumanji - and the very best of luck to you! It's a hell of a cliche, but the best things in life ARE free (or very cheap!) The only thing is tho' that if you genuinely do enjoy the simple things, be prepared for a bit of 'stick' now and again - my in-laws are the sort of people who bought their 11 year old daughter a PS2 as a 'stocking filler' (!!!) last Christmas and let me know in no uncertain terms how disappointed they were with me when my gift to her was to plant a tree in her name!
    "I'm ready for my close-up Mr. DeMille...."
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