'normal' amounts of debt in this day and age

OneLife_OneShot

David I love your post!

peter3hg

David555 wrote: »

if I can do it there's no reason why anyone else can't

...

Granted I am living rent free with a friend so that helps, I give him £100 a month towards bills. But in return I have just one income pretty much to feed 2 mouths.

Sorry for my rant! If I can save somebody a quid even then it's worthwhile

While your advice in general is worthwhile it's a bit delusional to say that anyway can save like you have when you have £500+ less accommodation expenses each month than the average.

Fireflyaway

As well as the ' normal' amount of debt, it would be really interesting to know the most common reason for being in debt.
Not all debt is because of greed or reckless spending, but I think today's young people are more unlikely to wait for something if they can have it on credit though. Young folks also mostly can't expect to move out of home and live the same lifestyle their parents do. It takes time and sacrifice if you want to do it debt free.
Regardless of income I now see the importance of an emergency fund in case of a job loss. Its also true that the more expenditure you have, the easier you will get in debt if the income does stop. Rewind 10 years I could have covered the house payments if my husband lost his job but I couldn't now. We are not being extravagant, its just expensive where we live but we need to be here for work. Debt can happen to anyone.

EssexHebridean

dktreesea wrote: »

A household with an income of £25k after tax, household, mind you, has no reason to get into debt. Even with rent of £250 a week and council tax of £30 a week, what's left is plenty to live on and save a bit.


How much do they waste of takeaways, going to the pub, throwing away out of date food? it's not just the £100 plus items that throw people into debt; it's the pennies they waste every day.


The problem is that those with that kind of household income want the lifestyles of those with a £70k after tax household income. People don't want to live within their means because it accentuates how much of a failure they are at earning an income compared to those with much higher incomes.

You're generalising for a start - and that's dangerous.

Assuming that your rent & council tax figures are a good representation, by the time you add in £50 - 80 a month commuting costs, the relevant figures for upkeep and maintenance of a car (let's assume just the one car), gas & electric of what, £50 a month for an average terraced house with no kids in it? Water rates, telephone & internet (not unreasonable) will probably total another £50 a month? Is that fair? Then there's things like basic replacement of clothes, nothing flash, just a pack of M&S undies a couple of times a year, maybe new work clothes here and there, and casual stuff from Primark. Haircuts too - no need of Toni & Guy but even a decent local place will now charge £29 up for a ladies cut & dry. there's more stuff in there that I've not included which we have a right to take for granted for a reasonable standard of living.

Now can you let me know how much that household has left for food?

And when you've done that, perhaps you'd like to consider where we go from there if that household had a child added into the mix with the associated costs of that?

It's still not right for that household to get into debt, but I trust you can see from there that it's not *quite* as simple as your post makes it sound?

EssexHebridean

peter3hg wrote: »

While your advice in general is worthwhile it's a bit delusional to say that anyway can save like you have when you have £500+ less accommodation expenses each month than the average.

And apparently managed a wedding in Thailand with NO travel or accommodation costs! :rotfl:

OneLife_OneShot

My love of the post was more about savings up and not getting into debt for things you might not necessarily need. I'd love to know how to get a wedding that cheap mind!

Bumblebear

OneLife_OneShot wrote: »

I'd love to know how to get a wedding that cheap mind!

I got married in the UK last year, I think we paid around £90 for the legal bit at the registry office. We had the medium sized room as our families wanted to come (the audacity!), but personally I would have been quite happy with the two of us, and two witnesses, in the registrar's "office". That would have saved £30 I think. If you just wore something out of your wardrobe and got a portion of chips each afterwards, and were in walking distance of the registry office, just the one copy of the wedding certificate, I reckon you could do it for £100. However, you might have two very annoyed families on your hands!

dktreesea

Fireflyaway wrote: »

As well as the ' normal' amount of debt, it would be really interesting to know the most common reason for being in debt.
Not all debt is because of greed or reckless spending, but I think today's young people are more unlikely to wait for something if they can have it on credit though. Young folks also mostly can't expect to move out of home and live the same lifestyle their parents do. It takes time and sacrifice if you want to do it debt free.
Regardless of income I now see the importance of an emergency fund in case of a job loss. Its also true that the more expenditure you have, the easier you will get in debt if the income does stop. Rewind 10 years I could have covered the house payments if my husband lost his job but I couldn't now. We are not being extravagant, its just expensive where we live but we need to be here for work. Debt can happen to anyone.

People who save up for a house and live within their means may have a more positive outlook on life going forward - they expect to keep their jobs, expect that in the longer term they will always be able to earn enough to pay off the mortgage. And hopefully their life will match their positive expectations.


A lot of young people aren't in relatively secure employment. They live for today and spend accordingly, even if it's on the never-never. Some of them have university degrees but work in low end jobs because that's all they can get. Or doing unregulated work like a private cab driver. Or they are doing contract work because they can't get a permanent job.

worriedDan

I think that people who are in debt tend to either keep it a secret, or underestimate it. I might tell people that we have come credit card debt, but I probably wouldn't reveal the true horrific extent of our debts!!

Since starting my own debt free journey, I have become very perceptive of other peoples debts/spending. I think that unsecured debt is rife and that many people ( myself included up until recently) consider it to just be the norm to have debt. Of course, not everyone will be in massive debt, but I expect that a lot of people are. A good friend of mine works in HR and part of their role is to carry out random credit checks on the staff ( part of T&C's when taking job). He is regularly gobsmacked by the debt levels that he sees ( he doesn't know about mine so thank god I don't work there!!). He has told me that lots of seemingly affluent professionals have horrendous levels of debt, in some cases beyond 100K. Interestingly he reckons that the majority of heavily indebted employees are the ones who earn the highest salaries - something that I can totally relate to!

PoorGuyNextDoor

I earn 60k a year. Debt has just hit £40,996. Made up of £6k on credit cards the rest in loans. Its fallen fast from near £50k at Christmas time. Iv got my house to show for it although thats not what the money was spent on. Seems such a waste paying it all back now but im determinded to get it done.

I think it is the norm. Im 25 and it seems most people my age dont like to talk about debt. Id reckon most have finance on their cars. I struggle to think of anyone my age that drives an old banger of a motor yet i know of older very wealth people that do. Debt just spirals out of control. It needs to be a subject in schools before people are old enough to borrow so they are going into it with their eyes open knowing how one small loan can be the start of it and you end up six figure in the red.

Being 25 id like to think iv learnt this money lesson early enough so i can get debt free in the next 2-3 years then learn from my mistakes.