Saturday, May 22, 2010

Savings after Subprime

We've cut back on the credit cards but we're still not saving

"The credit crunch sent our spending into reverse but one in four Britons still has no savings". "We have stopped using our houses as cash machines. During 2007 we were taking out around £12-£13bn every quarter in "mortgage equity withdrawal", some of it going into building extensions, but much of it frittered away on cars and holidays.Two years on, economists have come up with a new term – equity injection – to describe the fact that we're actually paying down our mortgages, to the tune of around £5-£6bn every quarter".

Posted by alan @ 09:58 PM (2160 views)
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3 thoughts on “Savings after Subprime

  • tenyearstogetmymoneyback says:

    The most interesting bit is right at the end

    “But perhaps the biggest change to our personal finances was that we stopped buying houses. In 2007 we £362bn to buy houses. By 2009 it fell to £143bn, and despite much talk of a property market pick up, the first quarter of 2010 saw £29.5bn of mortgages advanced, compared to £84bn in the first quarter of 2007.”

    I immediately thought of the cartoon where Wile E Coyote runs off a cliff. He had as much support as the housing market.

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  • The Masked Tulip says:

    Why save when you effectively get 0% interest?

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  • Of course if they increased the interest rates there might be some insentive to save. We have capital in the bank, but to be honest it is losing value where it is. Seems to me they are currently thieving from us to pay those who have run themselves into debt. Where is the fairness in that!

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