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A Nation of Spenders?
“There’s no gain without pain” Benjamin Franklin
Is it my imagination – am I just getting old perhaps – or do the “spenders” now outnumber the “savers”?
Until last year, it seemed to be so easy to live on credit. I remember the early days of credit cards – your bank sent you one even if you did not ask for it! I suppose there were other ways of living on tick before that. And equally expensive! It never struck me as a good idea to pay high rates of interest if I could avoid it. But I am not a “spender”.
Mortgages are different – interest rates are lower – and if you don’t buy a house, you still have to find the rent. But it definitely was different in those days. You had to beg for a mortgage, and the repayments nearly killed you. However, inflation came to the rescue and the pain only lasted a few years. Until recently, lenders were falling over backwards to lend to you – the repayments might be slightly more affordable than when I first bought a house, but they go on and on.
What kind of example are we setting to our children? They can easily start working life with a massive debt from a student loan. The interest rate might be reasonable, and it might make them appreciate the value of their education – but does it make debt appear more acceptable?
The credit crunch has come a wake-up call to some. It had simply become too easy to borrow – and lenders were not weighing up the risks. Now mortgages are harder to get and more expensive. This hurts those who are coming to the end of a fixed rate term particularly hard.
Of course, it does sometimes make sense to spend now and pay later. You might need a car to get to work. Your partner might be between jobs, perhaps to look after young children. But it can be the start of a slippery slope. Do ask yourself whether your finances are on the slide! We are not trained to give debt counselling, but the Friendly Society can put you in contact with professional help if you need it.
How much better to have a “nest egg” or a “rainy day fund”! Saving painlessly, through salary deduction, is one way to get started. Many of our members start a new 5 year savings plan each year. Once the first plan matures, there is then a pay-out every year – to pay towards a holiday, or for all the Christmas expenses. For that first 5 years, the premiums build up until 5 separate contracts are in force. For a spender who wants to turn over a new leaf, it’s as painless as we can make it!
For further information please call Metphone 28192, telephone 01689 891454 or visit
