MSE News: Half of UK 'struggling to next payday', study says

JuicyJesus

gadgetmind wrote: »

Sadly, life will always be hard for those without any skills that an employer would value or without the drive to set up on their own.

I guess it's always easier to blame someone else or "the system".

Blaming someone else or "the system" is perfectly valid when someone else or "the system" is at fault, which it is in many cases.

I worked in loads of minimum wage jobs waiting on tables and washing dishes when I was at school and through university. I got on well with everyone I worked with, but their anti-education "what's the point in working hard" attitudes really shocked me and I vowed to never get into that mindset.

That mindset is bad. But you are tarring everyone with the same brush. And it is still not an argument against increasing minimum wage to a level one can live on.

jonesMUFCforever

Archi_Bald wrote: »

You must hang out in your local high street a bit more often on a weekday morning - - that's where you are more likely to meet a researcher / data gatherer.

Normally i would be in work LOL
No wonder these figures are a joke.

You-kip

Wywth wrote: »

You're not sure what money you have coming in each month? :eek:

If you are typical, it's no wonder so many people are struggling financially. How can anyone hope to manage their financial budget if they don't know what that budget actually is?

I'm not struggling you wally and know exactly where my money come from but pretty sure child tax credits go into my OH's account.

I don't need a financial budget plan app paper A4 spreadsheets etc to work out how much I pay out each month.

gadgetmind

JuicyJesus wrote: »

And it is still not an argument against increasing minimum wage to a level one can live on.

Many people do live on it.and they are far better off than unskilled workers were in decades past and massively better off than unskilled workers in other countries.

The arguments for *not* increasing minimum wage are numerous and strong. In additional to making UK industry less competitive it would also further reduce the incentive for people to work hard and study hard. If semi-skilled works pays the same as unskilled work, why should someone slave away over books if they won't benefit?

A friend of mine maintains that the world would be a better place if cleaners were paid the same as doctors. Perhaps so, but there would sure be a whole load fewer doctors!

jamesd

The Money Advice Service report which is the basis for this story is The Financial Capability of the UK (PDF).

The focus on low incomes in posts here is not entirely appropriate. As noted in the foreward:

"In these tough economic times this report identifies those that can, and do, manage their money, and also those that don’t. The 18 million UK adults who run out of money before payday are brought into focus. They are not all on lower than average incomes: around a third of those who earn over £30,000 say they find it tough to live within their means."

The summary also has some interesting things:

"16% of people unable to identify the available balance on a bank statement"
"almost 84% say they keep track of their money"
"one in five people would rather take £200 now than £400 in two months’ time"
"over half the population save something each month"

gadgetmind

jamesd wrote: »

"one in five people would rather take £200 now than £400 in two months’ time"

Madness!

I would *give* you £200 now in return for £400 in two months, and would bung you £2million for the same deal scaled up if you could pass due diligence.

jamesd

Perhaps more interesting is the inability to identify the available balance, because that offers the potential to be corrected if banks were to make targeted mailings based on account conduct.

Sorry, the most I can offer you is around 5% a year. I think I can make around 20% on money invested but that's before income tax... And you'd be competing with credit card companies, who seem keen to offer me 12 month money for 3% or less on existing customer deals. Or nothing if on a purchase card.

gadgetmind

jamesd wrote: »

Sorry, the most I can offer you is around 5% a year.

Exactly, so why would anyone turn down 100% in two months unless they either couldn't handle deferred gratification or were totally innumerate.

Of course, such people probably blame "the system" ...

ilovelondontown

You-kip wrote: »

Completely forgot about that.

I think you'll find the majority of this forum are getting benefits from the Gorvernemt and I mean those who work.

My husband and I don't get any benefits- no a single thing. Both in work.

We'd like a family but we can't afford one :wall:

jamesd

They may simply have an urgent need for the money and not have the resources at the time to be able to afford to wait.

From page 17: "While some of us have amassed some savings, only 58% of us could cover a £300 unexpected bill. The remaining 42% would have to think about how to pay for it." followed by "Over a quarter of unexpected expenses were to do with cars, either buying a new one or getting the old one fixed. Home improvements, moving home and the cost of replacing boilers or white goods accounted for a further third and health or family matters (new babies, weddings, vets’ bills, funeral costs or helping a family member) made up another 12%."

Then there's this from page 15: "When asked to identify whether inflation at 5% would have eroded the purchasing power of money in an account paying 3% interest over a third of people (35%) got this wrong. Startlingly, this rose to 43% of those aged under 35.".

Both you and I are unusual. One challenge for those making policy is to make policies that are practical and understandable for those who are not as capable and interested as each of us is today.

It's very clear that banks could play some role, given 16% of people, presumably their customers, being unable to understand a bank statement. Clearly also, many of their customers will be demonstrating routine financial mismanagement. A challenge for banks is to seek to help educate, rather than exploit with charges, such customers.