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ClearDebt confirms suburbia debt even worse than expected.

by Marketing on June 9th, 2009

Leading UK debt resolution company, ClearDebt claim figures released earlier last week by Confused.com are actually more worrying than they look.

Confused.com report underestimates suburbia debt
High income groups become recession’s biggest victim
Northerners are more sensible with their money

Confused.com states that residents in Kingston, Surrey, have raked up the highest level of UK debt, owing 169% of their annual income. Confused.com failed to note this is based on gross and not net (after tax) incomes. When working out the net equivalent, ClearDebt believe this would be much closer to 202% which is even more alarming.

When take home pay is calculated instead, the debt to income ratio rises significantly.

Andrew Smith, Marketing Director of ClearDebt explains,
“Confused.com’s valuable research highlighting the geographical and income based differences in debt and income. What their report doesn’t show is the realistic level of debt these people have, based on the money in their pockets, rather than the figure on their payslip.”

This new worrying statistic means that it is time for even higher income groups to accept they are overspending their way into unmanageable debt. IVAs and Debt Management Plans may no longer be debt solutions predominantly associated with the lower income groups, says UK debt experts, ClearDebt.

Concurring with the logic behind the Confused.com report , ClearDebt states it not only highlights people are living beyond their means, but that those living in southern suburbia could suffer the most in the current recession if they don’t face up to their debt immediately.

Shaming them with sensibility are the Northerners. Mancunians featured in the report are found to just owe an average of 51% of their salary. However, in net terms, this equates to 72% of their salary – which is a hefty increase on Confused.com’s implied spending.

Andrew Smith of ClearDebt commented that these statistics prove what ClearDebt expected would result from the recession:
“Until the credit crunch hit, those in debt were usually people in lower income groups. However, now, the biggest change is that we see income groups, who are used to spending, to keep up with the Jones’s, falling into debt because of an unplanned life change such as redundancy, bonus-shortfall or even pregnancy, which they cannot afford to bank roll without the aid of plastic.”

Smith believes that the suburban residents Confused.com is highlighting, are going to face their biggest struggle yet as they come to terms with debt. What he questions even more though, is whether they have the discipline to do something they are not currently used to or even know how – to budget.

With residents in Camberley owing an average of £2,000 each on credit cards, ClearDebt believe they should be taking example from the much stricter spenders in the North of England. Residents in Dumfries are sensibly watching their pennies and owe less than, on average, £750 each.

As the recession continues, ClearDebt warn the number of high income consumers falling into debt could substantially increase with the rise of redundancies.

Ends.
For advice on debt solutions, consumers can call ClearDebt on FREEPHONE 0800 0192 095
For further Information contact: Jacqueline Cohen on 07976 739 125, jacqueline.cohen@cleardebt.co.uk / Andrew Smith at Andrew.smith@cleardebt.co.uk

Tags: confused, kingston, surburbia, surrey
Posted in Press Releases | No Comments »

The true cost of summer

by David Mond on June 6th, 2009

As the sun blasts down, we thank out lucky stars that we have one more day of British sunshine, and can enjoy our short summer a little longer.

But whilst many relax and indulge in the lighthearted atmosphere of summer, diligence must be at hand as giving in to a family day out in the sun, can end up costing hundreds of pounds!

The summer months do encourage more activity in the great outdoors and with this activity comes more spending. Rather than being cooped up inside, we seek outdoor adventure – though at what cost?

A survey from National Savings & Investments shows although we might save on energy bills at home during the warmer months of the year, we certainly make up for it in other ways!

The report confirms two-thirds of those taking in this research admitted to spending higher amounts of money on weekend breaks and trips abroad, while 43% say that good weather makes them feel more relaxed about their outgoings.

As we’re in the midst of the first summer of the recession, these are all key issues which need to be addressed, no matter how sunny our mood is. On just a family day out alone, you could spend into the hundred’s covering the cost of attraction tickets, refreshments and lunch – which are usually twice the price of anywhere else, and then normally, a meal out on the way home, or a take away and DVD once back. Not so relaxing after all? ;) And that’s only in the UK. If on holiday abroad, you’ll also have to take into account the Euro exchange, ATM FX charges, tips for restaurant services, food and drink generally, entertainment, family gifts and treats and of course day trips out!

Savings strategist Dax Harkins warns, “Everyone loves to see the sunshine, but people should try not to be so dazzled that they forget their finances.”

With national parks, home BBQs and coast line beaches, this summer is one we can go back to basics on and create new memories on a more cost effective budget….now where did I put that picnic basket?!

Share ideas here for the top ways to spend a summer’s day without going overboard!

Tags: budgeting, cost effective summer, debt, summer, summer expense
Posted in Debt Management, Managing Your Money, Personal Debt | No Comments »

Going down with the ship

by David Mond on June 4th, 2009

It seems the Titanic is not the only sinking ship which will go down in history. As more and more MPs are discovered fudging their expenses, I ask, how bad can it get? Well apparently, much worse! What a difference 24 hours makes.

Jacqui Smith, David Chaytor, Patricia Hewitt, Beverly Hughes and now Hazel Blears have resigned. Ian Gibson, Tom Watson and Carol Flint…are expected to go soon. Alastair Darling is…well..,still here…just. As the house of cards come tumbling down, it seems the golden rule of Parliament is as they say in the X Files, “trust no one”.

An email by Former Home Secretary, Charles Clarke, urging Mr Brown to resign, has now been leaked to the media. Claiming he has the backing of a further 70 MPs supporting this call (http://tinyurl.com/p6m5vj), you have to wonder is the curtain finally falling down on this show, and if so, who will the new cast be?

Well, based on the media reports so far, Mr Brown isn’t planning on giving up just yet and opinion elsewhere on this subject is very much split. Yesterday’s editorial in the Guardian commented that as everyone is jumping ship, the Labour Party should “cut him loose”. They went on to say Gordon Brown has: “no vision, no plan, no argument for the future and no support. Labour has a year left before an election; its current leader would waste it. It is time to cut him loose.”

Despite being backed by Leader of the Commons, Harriet Harman, and Northern Ireland Secretary Shaun Woodward who described Gordon Brown as the “man wants to get Britain through these difficult times.” Liberal Democrat, Nick Clegg believes Brown has no control, and that the government has become exhausted, claiming the general consensus does appear to be that Brown should go. The question then is, is this a case of a quick re-shuffle and change of leader, or is it a whole bag of crock and should the Captain go down with the ship?

And if Labour does go out, who will go in? As much as I disagree with how they’ve run things in the recession and key blunders they’ve continued to make, statistics of what will come after the storm, may be just as worrying.

A ComsRes report highlighted in this week’s Independent a dramatic drop in support for the Conservatives as the public have turned their backs on all three main parties. http://www.independent.co.uk/news/uk/politics/cameron-pays-the-price-of-expenses-scandal-1694507.html

If a General Election was held now, Labour would win 22 per cent of the votes and the Liberal Democrats 18 per cent, the poll found. That would leave Mr Cameron 46 seats short of an overall majority. Despite initially coming off well in the expenses scandal, later revelations of Tory spending has now also taken their toll on the trust and popularity they had previously gained. The new poll also puts the Greens on 8 per cent, Ukip on 7 per cent, the BNP 3 per cent, the Scottish National Party 2 per cent, Plaid Cymru 1 per cent and other smaller parties or independents 9 per cent.

With so much disappointment, frustration and anger towards the behavior of MPs and their mis-used management of our money,

Tags: election, expenses scandal
Posted in Government policy on debt | No Comments »

British Pride – you just can’t beat it

by David Mond on May 27th, 2009

British Pride is something you can’t package – it’s just there. And it’s something people take very seriously. In many cases, brands have built loyal customer bases on this very, special quality: British Beef, British Pies, British Ale, British Pride.

So I’m shocked to hear that the heads at Santander plan to put to bed our be-loved home brands of Abbey, Bradford and Bingley and Alliance and Leicester, and replace them with the Santender logo, name and policies. They may have saved some of our banks but at the end of the day, they’re an unknown player to the man at home, and the big question is – if going down this road and dumping the original branding of these long standing banks and building societies – will their customer base walk away with it?

It’s common knowledge that as a nation, we Brits find comfort in traditional brands – it’s familiar and homely. Particularly in times of need, such as the recession, we are more often than not, drawn to brands which embrace these connotations as they offer reassurance and familiarity in such uncertain times. Successes of this nature, can easily be seen with brands such as Warbutons, Morrisons and Ariel who wouldn’t have enjoyed such successful advertising campaigns when reminding us how of far we have come with them.

So is it that Santender fail to notice the relationship between British people and British brands, or that they choose to ignore it because they think their own brand is far more superior?

According to the news report on the BBC, http://news.bbc.co.uk/1/hi/business/8069648.stm
Santendar believe confidence will increase with this “make over” due to their strength and reliability as a bank…which in fairness, did come to our rescue. However, banking analyst Leigh Goodwin says this is definitely a risk and, in his view, a mistake. “Abbey has good value as a trusted brand in the mortgage and savings arena, staff will be upset and there will be a potential loss of customers.” And personally, I couldn’t agree more.

Brands such as Abbey, Alliance and Leicester and Bradford and Bingley are considered the down to earth, stable banks – (even if they weren’t physically in the recent crisis)…in our minds they are. They are British; they’re a part of us and because of that we trust them, support them and believe in them. They are the “people’s bank”. And so, in such a time of financial confusion, do Santender really feel it apt to sooth their own ego by stamping out these names in place of a large, corporate establishment?

Maybe they should take a closer look at their investment and the people they are now servicing? With a little dusting off, Susan Boyle has shined upon the world which watches her. With a little nurturing, who’s to say, the same would not be seen, and supported, of Santender’s latest adopted brands? http://www.youtube.com/watch?v=9lp0IWv8QZY

Tags: Abbey National, Alliance and Leicester, Bradford and Bingley, British banks, British Brands, Santander
Posted in Bankruptcy, Creditor Behaviour, Debt Management, Debt and Young People, Managing Your Money, Personal Debt | No Comments »

When did writing off your debt become acceptable?

by David Mond on May 11th, 2009

Our approach to the recession, so far, has been denial – hoping and praying the problem would go away all on it’s own. Unfortunately, not. So now, we are months into the situation and finally accepting it’s here to stay – at least for a while. Despite this, what is now being questioned, is not our level of acceptance to it, but our approach and the responsibility we are willing to accept towards our own debt.

Over 100,000 debtors plan to take advantage of a loophole in credit card agreements from the 1974 CCA Act. Aiming to have their slates wiped clean, without having to pay back a penny. Working with claims companies who believe they can manipulate the Act which was originally worded to stop lenders exploiting as they put it, “unsophisticated borrowers”, it seems now, the tables are about to turn. A case already won last year, via this very logic, found one couple winning the right to wipe away £65,000 of debt…and now, everyone wants a slice of the cake.

Marc Gander of the Consumer Action Group explained to the BBC http://news.bbc.co.uk/1/hi/business/8037983.stm that if your agreement is under the 1974 CCA Act, you can “write to the lender under the CCA and ask for a “true copy” of the loan agreement, if they are unable to supply it in the required time, then it becomes an unenforceable agreement.”

For people so far in debt, they see no way out, many consider this the quick fix they’ve been looking for. If you’re one of these people, I’m sorry to say, you’re wrong.
My father always told me, in life, nothing is worth its’ value if you haven’t earned it. Freedom from debt, applies the same way.

Acknowledging and facing up to your debt takes great courage and shows a certain level of respect for yourself and those you owe money too. Working hard over a period of years to pay off the debt, and re-educate yourself in what I call intelligent money management, is not an easy task but one which offers rewards money can’t buy. This whole process isn’t a punishment, but in essence, for some, a rite of passage which enables them to evolve a better and wiser person than before; more equipped to create a financially stable future for themselves and those they care about in the future.

With so much demand for unenforceable cases to be considered, the High Courts have put the breaks on, and instead decided to, at their own pace, run a few test cases before giving this “loophole” enough string to hang the lenders heads on. With this in mind, I raise the debate that, with so many people hoping to get their debts written off through unenforceable claims, where exactly have our morals have gone? Does accountability count for nothing or did some debtors never intend to pay the money back anyway?

I’ve always made it very clear that I understand the weight of stress and strain anyone in debt may feel; but to try and wash it all away as if it never happened, is something I feel needs to be questioned. It’s a question of ethics, conscience and personal responsibility – accountability for your actions; respect for those you bought off, and those who in turn, trusted you to pay what was and still is, due.

If you loan someone money, and they don’t pay you back, wouldn’t you feel they were acting dis-honourably? Even if they said they had found a loophole in your agreement – wouldn’t you feel cheated if they refused to pay you back? Particularly if it was money lent in good will? Of course you would – and rightly so! Why then, I ask, do we feel it’s acceptable to do the same to companies who have loaned us money or credit on the understanding? Are we no longer good for our word? Is that the value people place on their own name worth nothing if it means getting something for free?

I know for most, this is not the case, but for some, it sadly is. Help me champion this message and set an example of how debt can be conquered in a much more honourable, deserving and honest way.

Tags: credit card agreements, debt worries, PPI, unenforceable, writing off debt
Posted in Bankruptcy, Debt Management, Debt and Young People, IVA, Managing Your Money, Personal Debt | No Comments »

Online and dangerous: a licence to shop!

by David Mond on May 6th, 2009

Social media and e-commerce has opened up the world of opportunity even further. Now you can tweet away on twitter, poke around on Facebook and become the ultimate voyeur on You Tube!

Long gone are the days you can only go shopping on the high street, and checking your bank balance (or overdraft) is no longer restricted to the opening times of your local branch!

So as many are wooed and wowed by the progress of the internet – others, including myself, question whether this is the pandora’s box to those who can’t resist a good bargain.
Shopping online enables people to ensure they’ve got the best buy price and then…with such a great offer within their grasp, put in their details and before you know it, the product has been dispatched and is already on it’s way to them.

Unfortunately, apart from advising great restraint and discipline, there is nothing more I can do to encourage people not to buy everything they see on the internet; but advising you to know your rights when buying online is something I can advise on, and something I strongly advocate you being aware of.

The generation spearheading the power of the internet as a social networking and retail frame are those who, according to statistics just released, don’t know the rules of the game. The Department of Business has recently found that most 16-24 year olds don’t know their consumer rights when making purchases online or in the shops. Because of this, they lack the confidence to fight their corner when things go wrong, and financially, this could leave them low on cash because they lack both the knowledge and confidence to get their money back.

The research further confirms that 58% of the 16-24 year olds asked, look to the internet as a resource of information and guidance rather than official bodies and 70% say they are eager to equip themselves with a higher level of understanding on such matters.

If this is a generation who prefer to communicate virally rather than face to face, then shouldn’t we be taking responsibility to learn their language and speak to them in a way they understand? I fear without doing this, it could easily lead to a collection of incorrect purchases which are not returned or refunded and from this we could be looking at another generation of debtors… all because they lack the knowledge and confidence to speak out loud, and because we fail to teach them in a forum they can relate to.

By utilising tools such as you tube, twitter, etc to speak to this target group, we can communicate the facts of budgeting, money management, and consumer rights to a generation who desperately need to know these things. Is it not our duty to make sure what we create and how we communicate with them is exciting, and something they want to talk about?

T mobile’s, latest viral marketing campaign attracted 11 million viewers! The success has led to their follow up ad: http://news.sky.com/skynews/Home/Showbiz-News/Trafalgar-Square-Flash-Mob-Ad-Campaign-Singer-Pink-Joins-London-Crowd/Article/200905115272950?lid=ARTICLE_15272950_TrafalgarSquareFlashMobAdCampaign:SingerPinkJoinsLondonCrowd&lpos=searchresults

I ask, if they can do it, and connect so effectively with the younger generation, why can’t we?

Tags: consumer rights, debt, money worries, online purchases
Posted in Bankruptcy, Debt Management, Debt and Young People, IVA, Managing Your Money, Personal Debt | No Comments »