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Private Debt Reaches All Time High...

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"If you remove all student DEBT, property DEBT *especially interest only, doesn't count*, motor car DEBT, holiday DEBT, clothing DEBT, and food DEBT then the economy is BOOMING."

 

Gonna git me a job at the #VileBBC

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I'm closely involved with operating a really big redundancy program at our company. As is usual with something like this hanging over them nobody does much work any more, instead hang around in small groups discussing rumours, alternatives, coping strategies, "what-if"s. It's absolutely mind-blowing to discover the amount of debt people have - it's one thing to read about household debt in the press and quite another when you actually hear people tell you about their massive mortgages and other debt. Very few people seem to think they could continue as they are if they don't get another equivalent job pronto. Trouble is it's not only our company that's laying off round here :( 

I feel like a very bad person but it's rather thrilling to hear over and again "Thing is though my house is worth £xxxxxx so if the worst came to the worst we could easily sell up and downsize for a bit." Some who think they are certain to get the chop are already starting to make plans. If everyone does that at once then maybe we will have our HPC.

Disclaimer: Just like them I too could potentially be made redundant but I am debt-free. It's only by a fluke that I myself am not in their exact position so I am trying to avoid even a trace of smugness. Some people are in really heartbreaking positions.

Edited by Funn3r
clarification

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3 minutes ago, Funn3r said:

I'm closely involved with operating a really big redundancy program at our company. As is usual with something like this hanging over them nobody does much work any more, instead hang around in small groups discussing rumours, alternatives, coping strategies, "what-if"s. It's absolutely mind-blowing to discover the amount of debt people have - it's one thing to read about household debt in the press and quite another when you actually hear people tell you about their massive mortgages and other debt. Very few people seem to think they could continue as they are if they don't get another equivalent job pronto. Trouble is it's not only our company that's laying off round here :( 

I feel like a very bad person but it's rather thrilling to hear over and again "Thing is though my house is worth £xxxxxx so if the worst came to the worst we could easily sell up and downsize for a bit." Some who think they are certain to get the chop are already starting to make plans. If everyone does that at once then maybe we will have our HPC.

Disclaimer: I am debt-free but it's only by a fluke that I am not also in their exact position so I am trying to avoid even a trace of smugness. Some people are in really heartbreaking positions.

Awful situation. The biggest thing you can do for people (aside from arguing everyone takes a pay cut to save as many jobs as possible), is to make sure the redundancy is fair and everyone sees that their redundancy is fair.

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19 minutes ago, Funn3r said:

I'm closely involved with operating a really big redundancy program at our company. As is usual with something like this hanging over them nobody does much work any more, instead hang around in small groups discussing rumours, alternatives, coping strategies, "what-if"s. It's absolutely mind-blowing to discover the amount of debt people have - it's one thing to read about household debt in the press and quite another when you actually hear people tell you about their massive mortgages and other debt. Very few people seem to think they could continue as they are if they don't get another equivalent job pronto. Trouble is it's not only our company that's laying off round here :( 

I feel like a very bad person but it's rather thrilling to hear over and again "Thing is though my house is worth £xxxxxx so if the worst came to the worst we could easily sell up and downsize for a bit." Some who think they are certain to get the chop are already starting to make plans. If everyone does that at once then maybe we will have our HPC.

Disclaimer: Just like them I too could potentially be made redundant but I am debt-free. It's only by a fluke that I myself am not in their exact position so I am trying to avoid even a trace of smugness. Some people are in really heartbreaking positions.

Paging @Venger... :P

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14 minutes ago, LiveinHope said:

Awful situation. The biggest thing you can do for people (aside from arguing everyone takes a pay cut to save as many jobs as possible), is to make sure the redundancy is fair and everyone sees that their redundancy is fair.

yeah, that and advise them to invest their redundancy into a few cheeky BTLs, that way they won't ever have to work again innit.

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36 minutes ago, Funn3r said:

I'm closely involved with operating a really big redundancy program at our company. As is usual with something like this hanging over them nobody does much work any more, instead hang around in small groups discussing rumours, alternatives, coping strategies, "what-if"s. It's absolutely mind-blowing to discover the amount of debt people have - it's one thing to read about household debt in the press and quite another when you actually hear people tell you about their massive mortgages and other debt. Very few people seem to think they could continue as they are if they don't get another equivalent job pronto. Trouble is it's not only our company that's laying off round here :( 

I feel like a very bad person but it's rather thrilling to hear over and again "Thing is though my house is worth £xxxxxx so if the worst came to the worst we could easily sell up and downsize for a bit." Some who think they are certain to get the chop are already starting to make plans. If everyone does that at once then maybe we will have our HPC.

Disclaimer: Just like them I too could potentially be made redundant but I am debt-free. It's only by a fluke that I myself am not in their exact position so I am trying to avoid even a trace of smugness. Some people are in really heartbreaking positions.

The South is starting to see/experience a similar thing the North went thru in the earl 80s.

Then., large number of industrial/manufacturing jobs went. Various reasons - inefficient, un productive, rise of Japan etc etc.

Now the South is seeing the financial service jobs getting reamed. Both by tech + the fact no one has any one cash left.

A small town I used to work has seen its last shut. 10 years ago there were 4, each with about 5-8 FT heads.

The  life insurers which you used to find in every medium  sized town in the South have all going -rightly so. There are towns/ region where the only work experience i sitting shuffling paper around. Theres no transferable skills.

 

Edited by spyguy

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12 minutes ago, thewig said:

yeah, that and advise them to invest their redundancy into a few cheeky BTLs, that way they won't ever have to work again innit.

Funnily enough, that was exactly the soothing advice i was given in the 90's upon my first redundancy. "Buy a cul-de-sac' I was told during the 'meetings', 'put 10% on each house'. If only I had......

Edited by LiveinHope

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32 minutes ago, Funn3r said:

I'm closely involved with operating a really big redundancy program at our company. As is usual with something like this hanging over them nobody does much work any more, instead hang around in small groups discussing rumours, alternatives, coping strategies, "what-if"s. It's absolutely mind-blowing to discover the amount of debt people have - it's one thing to read about household debt in the press and quite another when you actually hear people tell you about their massive mortgages and other debt. Very few people seem to think they could continue as they are if they don't get another equivalent job pronto. Trouble is it's not only our company that's laying off round here :( 

I feel like a very bad person but it's rather thrilling to hear over and again "Thing is though my house is worth £xxxxxx so if the worst came to the worst we could easily sell up and downsize for a bit." Some who think they are certain to get the chop are already starting to make plans. If everyone does that at once then maybe we will have our HPC.

Disclaimer: Just like them I too could potentially be made redundant but I am debt-free. It's only by a fluke that I myself am not in their exact position so I am trying to avoid even a trace of smugness. Some people are in really heartbreaking positions.

I know I keep banging on about this, but if you have no debt and a healthy wedge of savings, you're already winning at the game of life.

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What complete and utter effing billshit don't-spook-the-cattle propaganda - hide total catastrophe behind some half-written bit of slop about how things are a bit bad oh but not really.

I recall from quite a few years ago a figure of 18 grand. Anyone got any idea of what true total figure is now? How much each household owes. Ok, lazy, went and looked, here we go...

http://themoneycharity.org.uk/money-statistics/

"The average total debt per household – including mortgages – was £55,855 in October. The revised figure for September was £55,688."

Oh my word what a great site...

"Per adult in the UK that’s an average debt of £29,862 in September – around 113.6% of average earnings. This is slightly up from a revised £29,773 a month earlier."

"82% - Private debt as a percentage of 2015 UK GDP"

OK there's too many fantastic statistics here, you really must look at that page - and be awed!

Edit - did it really say that had to check, yes it did, 113.6% of average earnings owed per adult. Knew it was a lot but that is phenomenal.

Edited by North London Rent Girl

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4 minutes ago, LiveinHope said:

Funnily enough, that was exactly the soothing advice i was given in the 90's upon my first redundancy. "Buy a cul-de-sac' I was told during the 'meetings', 'put 10% on each house'. If only I had......

Really? I doubt that.

LL mortgages up until 2000ish we very rare and very expensive.

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I  wonder how car finance contributes to that debt figure.  

For example - I have personal contract hire on a £20k car and my car rental payments are expected to be £5k over 2 years. 

What is my contribution to that total debt figure:

- nothing?

- £5k?

- £20k?

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6 minutes ago, spyguy said:

Really? I doubt that.

LL mortgages up until 2000ish we very rare and very expensive.

Yep, you're right, it was end 1999 / start of 2000. Buy a cul-de-sac or invest in with profits bonds - did neither.

Edited by LiveinHope

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9 minutes ago, North London Rent Girl said:

What complete and utter effing billshit don't-spook-the-cattle propaganda - hide total catastrophe behind some half-written bit of slop about how things are a bit bad oh but not really.

I recall from quite a few years ago a figure of 18 grand. Anyone got any idea of what true total figure is now? How much each household owes. Ok, lazy, went and looked, here we go...

http://themoneycharity.org.uk/money-statistics/

"The average total debt per household – including mortgages – was £55,855 in October. The revised figure for September was £55,688."

Oh my word what a great site...

"Per adult in the UK that’s an average debt of £29,862 in September – around 113.6% of average earnings. This is slightly up from a revised £29,773 a month earlier."

"82% - Private debt as a percentage of 2015 UK GDP"

OK there's too many fantastic statistics here, you really must look at that page - and be awed!

Bascially you are fcked once your unsecured debt is more than gross salary.

People end up paying ~10% of the debt just to stand still, swallowing about 1.5 months take home.

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9 minutes ago, LiveinHope said:

Yep, you're right, it was end 1999 / start of 2000. Buy a cul-de-sac or invest in with profits bonds - did neither.

Just as well you did not take up the latter.

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An unsecured 13K debt is just a typical car PCP.

Many people who live beyond their means though rely on extending their mortgages, taking some of the money their houses have earned for them to spend on cruises, cars etc.. so this isn't reflected in these unsecured figures.

My wife has worked in different court depts. over the years and used to see this first hand when dealing with divorces. Even one of her colleagues, living in a nice detached house (unlike our rabbit hutch) facing divorce, found that she and her husband would have nothing left if they paid everything off, so got counselled instead. At the same time one of my colleagues (early 40s) played away, resulting into two divorces. He couldn't understand how his new partner only had 40K from her share of the other house.

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1 hour ago, Funn3r said:

I'm closely involved with operating a really big redundancy program at our company. As is usual with something like this hanging over them nobody does much work any more, instead hang around in small groups discussing rumours, alternatives, coping strategies, "what-if"s. It's absolutely mind-blowing to discover the amount of debt people have - it's one thing to read about household debt in the press and quite another when you actually hear people tell you about their massive mortgages and other debt. Very few people seem to think they could continue as they are if they don't get another equivalent job pronto. Trouble is it's not only our company that's laying off round here :( 

I feel like a very bad person but it's rather thrilling to hear over and again "Thing is though my house is worth £xxxxxx so if the worst came to the worst we could easily sell up and downsize for a bit." Some who think they are certain to get the chop are already starting to make plans. If everyone does that at once then maybe we will have our HPC.

Disclaimer: Just like them I too could potentially be made redundant but I am debt-free. It's only by a fluke that I myself am not in their exact position so I am trying to avoid even a trace of smugness. Some people are in really heartbreaking positions.

Almost no job is secure these days. When I first applied for a mortgage 41 years ago the rule was 2.5 x main salary + 1x secondary salary. These days it's 4-5 times joint salaries and both are working full time usually. Job security is now almost non existent and this level of debt (4-5 x income) would have been considered extreme 40 years ago but is now normal. Utterly insane and asking for trouble.

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4 minutes ago, crouch said:

Almost no job is secure these days. When I first applied for a mortgage 41 years ago the rule was 2.5 x main salary + 1x secondary salary. These days it's 4-5 times joint salaries and both are working full time usually. Job security is now almost non existent and this level of debt (4-5 x income) would have been considered extreme 40 years ago but is now normal. Utterly insane and asking for trouble.

Its actually a max of 4.5 household income AFTER any recurring expenses - ctax, utilities, car finance, school fees, child care.

With low wage growth and th fact that average FTB age (late 30s) is now way beyond average peeak earning (30).

 

 

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1 hour ago, Funn3r said:

I'm closely involved with operating a really big redundancy program at our company. As is usual with something like this hanging over them nobody does much work any more, instead hang around in small groups discussing rumours, alternatives, coping strategies, "what-if"s. It's absolutely mind-blowing to discover the amount of debt people have - it's one thing to read about household debt in the press and quite another when you actually hear people tell you about their massive mortgages and other debt. Very few people seem to think they could continue as they are if they don't get another equivalent job pronto. Trouble is it's not only our company that's laying off round here :( 

I feel like a very bad person but it's rather thrilling to hear over and again "Thing is though my house is worth £xxxxxx so if the worst came to the worst we could easily sell up and downsize for a bit." Some who think they are certain to get the chop are already starting to make plans. If everyone does that at once then maybe we will have our HPC.

Disclaimer: Just like them I too could potentially be made redundant but I am debt-free. It's only by a fluke that I myself am not in their exact position so I am trying to avoid even a trace of smugness. Some people are in really heartbreaking positions.

UK I presume? More evidence of our booming recovery? Very depressing news for all of those involved.

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Maajid Nawaz at LBC Radio is covering the personal debt issue on his call in today.  

He's talking about Israel at the moment and then he's moving on to "Are you in debt and how do you cope?"

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