Big Elephant in the Room with Cost of Living Crisis

DjangoUnchained

have you tried to buy a new or nearly new car from a dealer recently? they are not keen on cash ( i dont mean folding stuff, i mean paying it all up front, bank transfer) they are really pushy about trying to get you to lease, loan or other interest bearing stuff.

RogerBareford

theoretica said:

RogerBareford said:

socks_uk said:

I think this is the only place I can mention this seeing as we are all looking forward to being debt free but...

Why is nobody talking about the Big Elephant in the Room which is people's personal debt?
Don't get me wrong, I understand that prices of energy, food and other bills are going up but all I seem to be hearing is how much 'disposable' income people have.
Now since my lightbulb moment of realising I needed to sort out my own debt, I have cut down on my spending and cut out non essential subscriptions,  and I made the final payment on my personal loan last Saturday leaving me with just 2 credit cards on 0%.
We are hearing of people earning £40,000 needing to use food banks but I wouldn't be surprised if they too have personal debt which is helping cause this cost of living crisis but nobody in the news is taking about it.  I'm hoping Martin Lewis will do one of his TV specials about it.

Am I wrong, or even just over thinking this?  Hopefully, if I keep going as I am, I should be debt free by my 60th birthday in 2 years time ( possibly before).

I think the big difference is that having personal debt is usually something that is built up over a period of time and to get out of debt the person involved needs to go through their finances and budget as required. So to get out of debt people can usually fix it themselves and the cause of the debt is usually something they also had control over such as overspending.

The "cost of living crisis" is different because people are having to pay more for essentials such as energy and food but have no control over the price they pay apart from cutting down.

So they are two very different things with different cause.

But i'm not sure what the benefit of reporting that some people have taken on high levels of debt as most people will just say something along the lines of "well nobody forced them to take on debt so that's their own fault".

It's the flexibility thing - as cost of living goes up, I put less into savings and when my car next needs replacing may buy a cheaper one.  If I had taken on debt to buy my last car I would no longer be able to make that change easily - I would have committed to paying £X00 a month towards the car and so be less able to weather changes outside my control.  That flexibility in budget is the thing that debt destroys. 

Yes that is true but it's nothing new that people go and look at a shiny new car and decide "it's only £X a month and i can afford that" even though they don't currently have any extra money they are saving and don't have any real budget they stick too.

The problem now is that it's difficult to make this a news story without it sounding like "well everyone knows taking on too much debt is bad so now you have to deal with that plus the cost of living so your in trouble and should have done a buget first". There have been lots of news stories over the last 20 years that i can think of some financial/price crisis or similar but none of them seem to have made people more cautious when it comes to making sure they have room in their budget and resisting taking on debt.

femalemonarchfemalecanine said:

I know a lot of people who live a fairly modest life, which they could afford, but because wages have not kept pace with inflation and they have cut back on everything unnecessary, but with massive hikes in rent and now in pretty much everything, it is coming to a choice between heating and eating or debt. 

Unfortunately we have a vicious government who see the public purse as something for them and their mates to dip into, not money they are supposed to apply to the benefit of all the citizens of the country. 

And there are still people who defend them😱 Stockholm Syndrome 

I'm not sure how your drawing this conclusion?

Looking back over the last few years at how much money has been paid out in Furlough by the goverment to help people during lockdown (which was capped at £2,500 a month so aimed at lower earners). Plus now the goverment are giving out £150 + £400 to every household by taxing the big oil companies and even higher amounts to people on benefits.

So considering they are "conservatives" they are pretty good at splashing out massive amounts of money to the poorest people in society. Even before Coronovirus they massively raised the tax threshold and it has doubled since they came into power so again the poorest are paying a lot less tax.

It's very easy to hate on the conservatives and blame them for everything but in reality massive global disruption such as Covid19 and the war in Ukrain is beyond their control and the free market results in massive price increases that they are actually doing something about. 

femalemonarchfemalecanine

RogerBareford said:

theoretica said:

RogerBareford said:

socks_uk said:

I think this is the only place I can mention this seeing as we are all looking forward to being debt free but...

Why is nobody talking about the Big Elephant in the Room which is people's personal debt?
Don't get me wrong, I understand that prices of energy, food and other bills are going up but all I seem to be hearing is how much 'disposable' income people have.
Now since my lightbulb moment of realising I needed to sort out my own debt, I have cut down on my spending and cut out non essential subscriptions,  and I made the final payment on my personal loan last Saturday leaving me with just 2 credit cards on 0%.
We are hearing of people earning £40,000 needing to use food banks but I wouldn't be surprised if they too have personal debt which is helping cause this cost of living crisis but nobody in the news is taking about it.  I'm hoping Martin Lewis will do one of his TV specials about it.

Am I wrong, or even just over thinking this?  Hopefully, if I keep going as I am, I should be debt free by my 60th birthday in 2 years time ( possibly before).

I think the big difference is that having personal debt is usually something that is built up over a period of time and to get out of debt the person involved needs to go through their finances and budget as required. So to get out of debt people can usually fix it themselves and the cause of the debt is usually something they also had control over such as overspending.

The "cost of living crisis" is different because people are having to pay more for essentials such as energy and food but have no control over the price they pay apart from cutting down.

So they are two very different things with different cause.

But i'm not sure what the benefit of reporting that some people have taken on high levels of debt as most people will just say something along the lines of "well nobody forced them to take on debt so that's their own fault".

It's the flexibility thing - as cost of living goes up, I put less into savings and when my car next needs replacing may buy a cheaper one.  If I had taken on debt to buy my last car I would no longer be able to make that change easily - I would have committed to paying £X00 a month towards the car and so be less able to weather changes outside my control.  That flexibility in budget is the thing that debt destroys. 

Yes that is true but it's nothing new that people go and look at a shiny new car and decide "it's only £X a month and i can afford that" even though they don't currently have any extra money they are saving and don't have any real budget they stick too.

The problem now is that it's difficult to make this a news story without it sounding like "well everyone knows taking on too much debt is bad so now you have to deal with that plus the cost of living so your in trouble and should have done a buget first". There have been lots of news stories over the last 20 years that i can think of some financial/price crisis or similar but none of them seem to have made people more cautious when it comes to making sure they have room in their budget and resisting taking on debt.

femalemonarchfemalecanine said:

I know a lot of people who live a fairly modest life, which they could afford, but because wages have not kept pace with inflation and they have cut back on everything unnecessary, but with massive hikes in rent and now in pretty much everything, it is coming to a choice between heating and eating or debt. 

Unfortunately we have a vicious government who see the public purse as something for them and their mates to dip into, not money they are supposed to apply to the benefit of all the citizens of the country. 

And there are still people who defend them😱 Stockholm Syndrome 

I'm not sure how your drawing this conclusion?

Looking back over the last few years at how much money has been paid out in Furlough by the goverment to help people during lockdown (which was capped at £2,500 a month so aimed at lower earners). Plus now the goverment are giving out £150 + £400 to every household by taxing the big oil companies and even higher amounts to people on benefits.

So considering they are "conservatives" they are pretty good at splashing out massive amounts of money to the poorest people in society. Even before Coronovirus they massively raised the tax threshold and it has doubled since they came into power so again the poorest are paying a lot less tax.

It's very easy to hate on the conservatives and blame them for everything but in reality massive global disruption such as Covid19 and the war in Ukrain is beyond their control and the free market results in massive price increases that they are actually doing something about. 

you only need to look at the PPE contracts, for example. But apparently we have to be kind to tories and can't call them out for what they do, so you can look it up for yourself if you want.

RogerBareford

femalemonarchfemalecanine said:

RogerBareford said:

theoretica said:

RogerBareford said:

socks_uk said:

I think this is the only place I can mention this seeing as we are all looking forward to being debt free but...

Why is nobody talking about the Big Elephant in the Room which is people's personal debt?
Don't get me wrong, I understand that prices of energy, food and other bills are going up but all I seem to be hearing is how much 'disposable' income people have.
Now since my lightbulb moment of realising I needed to sort out my own debt, I have cut down on my spending and cut out non essential subscriptions,  and I made the final payment on my personal loan last Saturday leaving me with just 2 credit cards on 0%.
We are hearing of people earning £40,000 needing to use food banks but I wouldn't be surprised if they too have personal debt which is helping cause this cost of living crisis but nobody in the news is taking about it.  I'm hoping Martin Lewis will do one of his TV specials about it.

Am I wrong, or even just over thinking this?  Hopefully, if I keep going as I am, I should be debt free by my 60th birthday in 2 years time ( possibly before).

I think the big difference is that having personal debt is usually something that is built up over a period of time and to get out of debt the person involved needs to go through their finances and budget as required. So to get out of debt people can usually fix it themselves and the cause of the debt is usually something they also had control over such as overspending.

The "cost of living crisis" is different because people are having to pay more for essentials such as energy and food but have no control over the price they pay apart from cutting down.

So they are two very different things with different cause.

But i'm not sure what the benefit of reporting that some people have taken on high levels of debt as most people will just say something along the lines of "well nobody forced them to take on debt so that's their own fault".

It's the flexibility thing - as cost of living goes up, I put less into savings and when my car next needs replacing may buy a cheaper one.  If I had taken on debt to buy my last car I would no longer be able to make that change easily - I would have committed to paying £X00 a month towards the car and so be less able to weather changes outside my control.  That flexibility in budget is the thing that debt destroys. 

Yes that is true but it's nothing new that people go and look at a shiny new car and decide "it's only £X a month and i can afford that" even though they don't currently have any extra money they are saving and don't have any real budget they stick too.

The problem now is that it's difficult to make this a news story without it sounding like "well everyone knows taking on too much debt is bad so now you have to deal with that plus the cost of living so your in trouble and should have done a buget first". There have been lots of news stories over the last 20 years that i can think of some financial/price crisis or similar but none of them seem to have made people more cautious when it comes to making sure they have room in their budget and resisting taking on debt.

femalemonarchfemalecanine said:

I know a lot of people who live a fairly modest life, which they could afford, but because wages have not kept pace with inflation and they have cut back on everything unnecessary, but with massive hikes in rent and now in pretty much everything, it is coming to a choice between heating and eating or debt. 

Unfortunately we have a vicious government who see the public purse as something for them and their mates to dip into, not money they are supposed to apply to the benefit of all the citizens of the country. 

And there are still people who defend them😱 Stockholm Syndrome 

I'm not sure how your drawing this conclusion?

Looking back over the last few years at how much money has been paid out in Furlough by the goverment to help people during lockdown (which was capped at £2,500 a month so aimed at lower earners). Plus now the goverment are giving out £150 + £400 to every household by taxing the big oil companies and even higher amounts to people on benefits.

So considering they are "conservatives" they are pretty good at splashing out massive amounts of money to the poorest people in society. Even before Coronovirus they massively raised the tax threshold and it has doubled since they came into power so again the poorest are paying a lot less tax.

It's very easy to hate on the conservatives and blame them for everything but in reality massive global disruption such as Covid19 and the war in Ukrain is beyond their control and the free market results in massive price increases that they are actually doing something about. 

you only need to look at the PPE contracts, for example. But apparently we have to be kind to tories and can't call them out for what they do, so you can look it up for yourself if you want.

But how does that make them "vicious" ?

I have read about that before now you've mentioned it and it does very much indicate that money has been wasted due to the lack of competition in choosing these companies. So yes that is a big negative of the goverment when it comes to budeting and something they should definetly be better at considering they are "conservatives".

I think we need to look at the goverment with a balanced view and in reality every goverment/party has done and will do good and bad and they should be held accountable for any actions they take. But calling them "vicious" and saying people who defend them have "Stockholm Syndrome" doesn't really add much to the discussion and just makes it sound like you hate the goverment no matter what they.

TripleH

My brother used to think 'I've paid off this debt, great now I can get this loan'

I'd like to have slapped him for that mentality but he did learn eventually.

He would constantly rib me for being a secret millionaire because 'I never spent money' without realising I didn't have the same material needs as him and because I hate paying interest.

He got into debt at university where a good chunk went down a urinal (I suspect). I hated hangovers so never drank a lot.