1.6m families in 'extreme' debt

Working2Retire

"The falling value of people's earnings since 2007 has left 3.2 million households in "problem debt," spending at least a quarter of their earnings on repayments, while 1.6m of these in the most "extreme" type of debt are losing at least 40% to repayments, a report published today has warned."

Isn't this just a matter of perspective, 40% of £100 leaves you with £60 to live on but 40% of 10,000 leave you with £6,000.

The 1.6 figure is distorted without having a base figure for calculation.

missbiggles1

SailorSam wrote: »

Did people ever get into debt before the discovery of the credit card, when it was the norm that you saved up to buy whatever you wanted.

Have you forgotten hire purchase, buying stuff "on tick", catalogues and the talleyman?

Smodlet

missbiggles1 wrote: »

Have you forgotten hire purchase, buying stuff "on tick", catalogues and the talleyman?

Those have been mentioned several times in this thread already...

Whilst I agree that a great deal could be done in schools, imho the root of the problem is parents who have never learned to say "no" to either themselves or to their children.

nkkingston

When and where did you go to school? We didn't have Home Ec. We had Food Tech, which was designed to get you a job at unilever designing packaging or finding new ways to make yoghurt fat free, Textiles, which taught us how to program an automatic sewing machine, and Resistant Materials, where I made a clock and stool that I still have, but as evidence by another thread can't change the washer in a tap!

I wish proper Home Economics was reinstated, with focus on the economics. Not just budgeting, but things like what a rental agreement ought to look like, who to complain to if a tradesman scams you, your legal rights as an employee... A friend who teaches bought a house recently, and when he let slip to his A Level maths class they derailed the whole lesson (end of term, so not a proper one anyway!) to ask about not only the house buying process, but things like how you set up bills and how you find a plumber. Kids want to know!

drums

I work with young people and totally agree, they want to know! And facts about the grown up stuff are always really good - good on your pal for allowing them to have a chat about all that in his end of term lesson in my book!

However I don't think the onus should be on schools to do any of this stuff as standard, as other posters have suggested. I'm still in touch with my school friends (a long time now!) and we all have varying tolerances and fears about debt and credit and we had exactly the same lessons. I hate the panic that debt causes some people and wish there was a magic cure, but I can't see that education is the answer here. I think this is just down to individuals to choose and manage, and would much rather schools did concentrate on teaching the stuff that will help young people navigate a competitive job market, and maybe it's down to society to stop pandering to folk who just want to make money out of us. And we have to be tougher and say no!

Sanctioned_Parts_List

nkkingston wrote: »

When and where did you go to school? We didn't have Home Ec. We had Food Tech, which was designed to get you a job at unilever designing packaging or finding new ways to make yoghurt fat free, Textiles, which taught us how to program an automatic sewing machine, and Resistant Materials, where I made a clock and stool that I still have, but as evidence by another thread can't change the washer in a tap!

1990s Hertfordshire, and you've accurately described the GCSE options, but before the GCSE course started in year 10, the teachers tried to retain as much useful stuff from the bad old days as they could. Whether that was due to the syllabus of the time, or due to the cantankerous old beast in charge of the "technology" department refusing to acknowledge the 20th century, I have no idea.

But in starting to reply to another post, I spotted the citizenship course, introduced long after I'd finished school. Quote:

Pupils should be taught about:


<snip - dozens of bullets>

• income and expenditure, credit and debt, insurance, savings and pensions, financial products and services, and how public money is raised and spent.

Marvellous! Clearly it's working well...

drums

"Marvellous! Clearly it's working well..."

This is exactly what worries me! All teachers can do is give the facts, and if we think that that is sufficient to rid people of their propensity towards unmanageable debt, I feel that we are ignoring personal choice and responsibilities. I got into debt because I wanted to go on every night out, every holiday and every opening of an envelope; an earlier poster said his thing was sports cars. That's not the problem of the education system. If the state could do anything I think it should be stronger in regulating expensive lending and manage the welfare budget a bit better so that fewer people are in genuine poverty. Other than that I feel my financial situation is down to me, whether I'm in the black or the red!

Sanctioned_Parts_List

Well, when I said "lots of bullets", I meant... loads of them. How long is given over to citizenship classes? Half an hour, twice a week maybe? So personal finance will be one lesson in how many?

Thing is, schools have 5 lesson hours per day, into which to fit all the maths, sciences, English, arts, humanities, languages, sport and technology subjects at which we want our charges to become proficient. That's 5 lesson hours per day for 39 weeks of the year, since we still haven't realised that Britain is no longer an agrarian nation and doesn't need children to help bring in the harvest anymore. There's no flex in the system for more subjects and coverage for others, such as this citizenship wheeze, is patchy at best.

Perhaps time to raise the spectre of longer school days and shorter holidays all over again. Let the strikes commence!

merrydance

My friend was over from Italy last week and over a coffee I mentioned credit card debt. She said in Italy you have to pay off the balance every month, you could not carry the debt forward. Perhaps that should be brought into practice in this country.

Muttipops

Hi, I was thinking about the to and fro of should we educate children about money management in school and I am afraid the subject that popped into my mind was sex education. Now that is not left to parents to deal with , unless of course they choose to do so, and we don't just teach children the mechanics, they are taught way much more, so why teach children about numbers but not about money and money handling?
It is the attitude to I want it, I can borrow to get it, so I can have it now! I suppose it is society as a whole that works this way now and the relentless ways we are encouraged to spend and borrow; it is not just guess work on the part of businesses, it is very carefully marketed and planned to get us to spend.
My nephew is part way through an apprenticeship and he spends I think £250 on a lease car per month. He is 20!! Why the heck does he need a brand new VW Golf? Image! I just look at him and see gullible fool; I am wondering if his friends and collegues see "cool" or what?
A bit of a rambling few pennies worth from me there.
Ooo, final thought, I also realise that much of debt is now about the essentials and not about fun money, but there we enter a whole minefield of politics and austerity and it takes a braver and more informed person than me to tackle that subject.