The big debt debate

National_Debtline

thecassman86 wrote: »

I agree, the National Debtline figures are really interesting for those of us in debt, but as a national average, it's massively skewed as it's only for people who ran a debtline!

That's very true. Our figures are unlikely to be indicative of the general norm

blisteringblue

The US seem to do it the correct way. They record a DTI figure (Debt to Income ratio). It's a much better way to see exactly how "in debt" you are.

We've 60K of debt but it is less than our annual household income, hence the DMP is only 4 years and not the 10+ years you could probably expect for a debt so large.

Yes our lifestyle is going to have to change remarkably during this time, but in my eyes we've done the crime (oops signature contradiction time ) so now we do the time.

thecassman86

blisteringblue wrote: »

The US seem to do it the correct way. They record a DTI figure (Debt to Income ratio). It's a much better way to see exactly how "in debt" you are.

Yes, i think that's much better too (If only they were so careful with mortgage applications! ) ... Having a % or a ratio makes it immediately obvious what somebodies debt situation is regardless of their income etc.

Trishiapp

redpete wrote: »

The stories on here are from people stuggling with debt - so a rather skewed sample. Even the National Debtline figures (again from people struggling with debt) show that £30k is unusual.

Good point redpete.


Just seen the National Debtline figures. This of course is fantastic news, but I do wonder what's changed? Was it the recession and it's effects? Or just the general societal attitude to debt?

Trishiapp

thecassman86 wrote: »

Haha, yes, definitely.

I always wonder if she doesn't do it with a bit of irony... I mean, the faces and stares she does when someone else is talking are almost funny.

It's those eyes!

Growurown

Trishiapp wrote: »

but I do wonder what's changed? Was it the recession and it's effects? Or just the general societal attitude to debt?

In our case it was the recession. We were managing after a fashion but the recession came along and some of our creditors put up the minimum payments on credit cards, which pushed us into a position where we couldn't afford to buy the necessities any more. We are currently on a debt management plan with Step Change and have paid back £30,0000 with another £20,000 to go and hope to be debt free late next year.

worriedwilf

From reading posts on here it seems that most of the higher debt burdens affect higher earning people. I wonder if these people are less willing to call debt helplines as they feel that they earn enough to service their debt??


I know that this is the case with me. We earn about 64k a year between us so on the surface, there is really no excuse for our debts!! I would feel embarrassed calling a helpline in case the thought I was simply irresponsible etc.


I also agree that it is all relative. I know people who live on benefits and owe 10k. In my opinion that is a far worse position than mine as I can get out of my debt in 2 years ( ish)!!

matttye

worriedwilf wrote: »

From reading posts on here it seems that most of the higher debt burdens affect higher earning people. I wonder if these people are less willing to call debt helplines as they feel that they earn enough to service their debt??


I know that this is the case with me. We earn about 64k a year between us so on the surface, there is really no excuse for our debts!! I would feel embarrassed calling a helpline in case the thought I was simply irresponsible etc.


I also agree that it is all relative. I know people who live on benefits and owe 10k. In my opinion that is a far worse position than mine as I can get out of my debt in 2 years ( ish)!!

10k, 30k, 60k, it's all the same really. It's just a case of some have more expensive tastes or take longer to reach their 'lightbulb moment.'

It seems to me the vast majority of debt comes from people wanting stuff immediately rather than saving up for it. If everyone could just wait, they would pay a lot less for it and revel in the fact that it's theirs and fully paid off when they actually get it. It's great knowing that you can pretty much do what you want with your wages each month as well (after bills etc.)

I don't mean my above post to come across as judgemental by the way, I've been in debt myself and this post applies entirely to my situation.

FBaby

I owed over 30K at my worst. Is my highest level of debt really so unusual?

I don't know if it is unusual, but I have to say that I can't comprehend anyone owing that much not thinking that something is very wrong. I have in different stage of earning throughout my life, earning as little as £600 a month to earning much over average, yet I would say that I never find it more acceptable to be more in debts when I earnt more. On one hand it is probably less risky, but on the other, it is less understandable why I would have allowed it in the first place.

My highest debt ever was £1,500 on one credit card, working full-time and even then I started to have sleepless nights and immediately made it a task to reduce it back to zero. Except for extreme situation, losing one's job, not being able to move out quickly etc..., I really cannot comprehend how anyone could allow themselves to amount such a level of debts. It's not a patronising comment, I really don't understand how anyone could let it accrue and not do something about it much earlier.

dubs57

Because you panic and start borrowing more money to pay it all off. Which obviously doesn't work.