The power of guilt

April 18th, 2010

It seems one of the most powerful tools to help stop you spending further into debt, is guilt. Free of charge and yet weighty in value, this powerful emotion appears to be helping consumers across the UK purge the urge to shop. According to research by, shopping is no longer an indulgent pleasure but an essential task which carries the burden of guilt with each unnecessary purchase. According to their statistics 59% admitted they no longer enjoyed shopping whilst 35% admitted they feel more guilty when let loose in the stores. 48% of those asked confirmed they felt guilty spending as they knew they could have saved the money instead, 32% admitted the money they were buying goods with could have been better used against bills waiting to be paid and 27% admitted the most obvious – whatever they were buying wasn’t really needed.

So how is it that despite the bills coming in and the chasing creditors knocking on the door, it’s seemingly not the red letters which are bringing a stop to the spending and rising debt – but the one thing which in essence, is a natural reaction to the devastation people are witnessing all around them? Fear of making your debt worse, or even going into debt in the first place, is creating the emotion of guilt – and with it, could actually be our saviour.

With guilt comes conscience; and with conscience comes the potential for (with time and effort) effective and sensible money management. Now if only we could put that in a bottle? 😉

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ClearDebt provide IVA and Debt Management Plans for individuals in England and Wales.

Wallace wasn’t the only one wearing the wrong trousers

April 5th, 2010

It seems the person “wearing the trousers” in the modern day house has changed from the olden days and now it’s the women who rule the roost when it comes to the running of the household bills and budgets. 

I personally find it fascinating that 50 years ago, it was the men who managed the finances of the home and gave their wives an allowance to live on – nowadays, the tables couldn’t have turned more.  According to research by Lovemoney, women are leading the way with self control and habit forming – keeping on top of their money worries, and less likely to create debt through a loan or credit card in comparison to their male counterparts. 

As we’ve gone through decades of female liberation, shoulder pads and power of Sex in the City (as I’m told by my daughter and Mrs Mond), the role of the female in both business and the home is forever evolving and strengthening.  So much so that it seems it’s the women who now have the balls needed to handle the crunch – and no longer the men. 



The wrath of Jack Frost leaves a flurry of debt

March 18th, 2010

The winter may be coming to an end, but as we settle into spring, it seems many people around the
UK are paying the price for keeping warm this winter.

What on earth was the right thing to do – freeze in your own home in order to save on the bills - or put the heating on and hope you could afford it?

It seems as Jack Frost made it clear he was here to stay, the majority of the UK opted for the latter and hoped for the best.  Unfortunately, it’s clear their best hopes went unanswered.

Figures now in from confirm around 5.5million people – 21% of the UK are now in debt to energy suppliers – primarily as a result of the long, cold months we are finally moving on from.  Confirmed as the coldest winter in 30 years – 41% of those who took part in the research confirmed their energy costs for this period had increased in comparison to the same period in 2008/09

With £728million now owed to energy companies, the question has to be asked, what are we doing to manage the debt arising in this area?  This debt is unlikely to be down to poor management of monthly costs but from unexpected costs – planned costs that spiralled out of control because the cold period lasted longer, and cost more, than three decades before!

As energy costs come under scrutiny for their rising trends, these issues have to be addressed before winter 2010 creeps upon us.

So – if you’re experiencing similar trouble, share your knowledge and thoughts here.

What can people do to save energy when the cold nights set back in?  Who are you finding to be the best energy companies and rates?  And who are the worst?  Have you had your house insulated – and if so, how much did you save in energy costs in comparison to previous years?

Student debt becomes a Catch 22 scenario

March 11th, 2010

Following on from my last blog, it seems student debt is the subject of the moment. 

Half way through the student year, figures are being released from the National Union of Students (NUS) confirming approximately 28,500 school leavers are still waiting to receive their student grants. 

It’s bad enough that we now live in a society where university is quickly becoming a class system – only those with the funds to go there, are the ones privileged to receive such a high class education.  But it now seems for those who have the desire but not the funds to go, a catch 22 scenario presents itself. 

Without the grants being distributed in the appropriate and timely fashion, how are we expecting the future leaders of this country to go to university? It seems, the answer is either, the bank of mum and dad…or more likely…debt. 

September 2009 saw 16% of student loan applications waiting to be processed.  I can only imagine with a six month delay on the distribution of grants this figure will have substantially increased?  What a way to start their adult life! 

Come on now – surely we can do better than this for our children? 

The cost of having children soars by 43%

March 7th, 2010

There used to be a time when people planning to have a baby did so without any thought to cost or affordability. But when speaking to a colleague who’s “baby” is now just over one, she told me, “the days of people telling you a baby doesn’t cost you anything, are long gone!” 

And it seems, she’s not the only to think this.  According to a new survey from
LV, the cost of bringing up a child from birth to age 21 is around £200,000.  This figure has risen by 43% over the last seven years – that’s an increase of £86,000! 

The current annual cost of bringing up a child works out at around £9,610/£800 a month/ £26 a day. 

When talking this over with my colleague, she explained – should both parents feel they are financially better off if they both return to work (as is the case in her situation), then even from an early age, they have to account for the cost of full time nursery.  And depending on where in the country this may be, this can range from £600 – £1000 a month.  On top of that are nappies, which, based on one pack a week, work out at around £40 a month, and then if the baby is still on formula, that’s another £40 a month.  In addition to that, there are of course new clothes and accessories, so in total, rounding it up, even for a young baby, monthly costs can be approx £1200 a month. 

Furthermore, if both parents are working, they have to consider that they may not qualify for the same amount of benefits other do, and so based on their net salaries (take home salary), they still have to cover normal expenditure as well, such as the mortgage/rent, food, utility bills, etc.  And of course….more than likely, presents for other friends who are also having a baby! 

So it’s certainly not a simple case of making a baby anymore – it seems, the modern day approach must be, to make a savings account first! 

If you’ve had experience in this field, why not share your story here and comment on how others could save money when struggling to make ends meet whilst making, housing and keeping a baby, or two, or three….including the grown up ones!

The blame game of student debt

February 28th, 2010

The blame of student debt has often been debated before – and normally, assumptions are made that the primary reason for this debt are student past times – the kind which lead to sore heads and unfocussed brains the day after the night before.  But last week, figures from the NUS confirmed that “the student” may actually be the scapegoat for a more shocking reason leading to all this debt – the lack of organisation from the government to distribute grants that are relied on. 

I’ve touched on this issue before, and unfortunately feel the need to do so again as the National Union of Students (NUS) confirm approximately 28,500 school leavers are still waiting for their student grants. 

It’s bad enough that we now live in a society where university is quickly becoming a class system.  Only those with the funds to go there are the ones privileged to receive such a high class education.  As many know, the golden ticket of a degree qualification often provides a fast track route through the working system, up to management where the higher salaries are gained. 

It now seems with this latest news the catch 22 cycle is getting worse.  Not only are general affordability issues stopping students going to college and university, but now the appalling lack of organisation and time planning in distributing the grants to those who are reliant on them, is forcing many students or their parents in to immediate debt. 

For some, their parents are sacrificing their own credit rating and well being, to ensure their children have the opportunities they want and need, in order to create the life they desire.  In other circumstances, where parents can’t even afford to offer this, it’s the students who are opting into debt, as they know without it, and with their grant still “on its way”, they have no choice if they still want to pursue their dreams and aspirations of further education.  The common analogy of the taxi “around the corner” rings a bell ;) 

The report from the NUS confirms this whole fiasco has been going on since September of last year – 6 months!!!  If this isn’t ridiculous, I don’t know what is. Maybe it is what is expected from the death throes of a Brown government running around like headless chickens – but it is affecting our students and their lives!  

When we’ve experienced the harsh times of the recession, debt and all the sadness, destruction and heartache this has brought to people’s lives, surely government would understand the necessity to get their act together and sort out these grants.  I am lost for words.  Before long there will be two types of students alone – those who are wealthy enough to afford university on their own, and those drowning in debt who have made the ultimate sacrifice in the ultimate hope that their higher level of education reaps the rewards it should promise to. 


The IVA REVIEW BOARD and their ilk!

February 22nd, 2010

The word of the day is surely “trust” 

Recently, my team have been commenting with news services regarding the need to ensure as an industry, we’re providing people with as many routes to free and accurate advice as possible.  The announcement earlier this year, stating the
UK is officially out of recession, seems to have created a wake up call for many people – creating the opportunity for people to feel safe in taking stock of their debt and making key decisions about their future. 

Why is it then, when such serious issues are at hand, organisations such as the IVA Review Board, rear their ugly head and pray on the worries of those already in an IVA and paying back their debt honestly? 

As many readers may know, over the last few weeks we have seen several articles in the press about the IVA Review Board, also claiming to be the Department for Personal Insolvency Review and Assessment.  The parent company of this brand, INTL Marketing, has already had its licence revoked (December 2009) but as they’re appealing this decision, their licence still stands.  And during this time, they’re certainly making the most of it – contacting as many people as they can, implying they might be in the wrong/inappropriate IVA and entitled to compensation. 

In light of the IVA Council drama, and the Dispatches programme in 2009 on Marlin, I would hope that the public are with their wits and understand, when receiving letters such as the one from the IVA Review Board,  It may also interest people that although the IVA Review Board claim they are not connected to the IVA Council, INTL Marketing were a consenting party with others in signing settlement terms with me and ClearDebt in the case against them. 

There has also been a spate of newcomers into this area and many readers may now be approached by the likes of Care Free Solutions or First Step Finance. Both these new entrants into this arena are on the Office of Fair Trading’s radar, so if any reader receives any communications from these organisations or anything similar please contact me (details below). 

As Chairman of the DRF and a known campaigner for ethics and “grace” within this industry – it saddens me to see activity like this, which could significantly damage someone’s recovery from debt, let alone their personal life. 

I have linked here to a copy of a letter which one of our clients received from the IVA Review Board and hope this helps people understand the true nature of this company.  Their opening line states they have been “tasked” to review your IVA – and certainly, I can assure my clients, they haven’t! 

If you receive a letter like this – please speak to your IP first before doing anything else. 

For more information on this subject, or if you have any concerns, you can also contact me direct at: 

Repossessions are never be a good thing

February 17th, 2010

The weekend has done me no good and unfortunately I’m still wreathing from the comments of John Healey last week. I’m sure I’m not the only one. 

The Council of Mortgage Lenders has, this week, confirmed 46,000 properties were repossessed last year – a 15% increase on the year before.  That works out at just under 400 repossessions a month which breaks down to 20 a day. That’s 20 livelihoods packed up into cardboard boxes because their debt had caught up with them too late in the day. 

So what does 2010 really hold for us?  Well, if it’s up to John Healey, we’ll probably be seeing even more increases! 

As people adapt to our status as officially out of the recession, I fear, even more bad luck is yet to come – particularly for those who still haven’t realised the weight of their debt.  Even if we’re lucky enough to experience a 5% decrease of repossessions this year, that still means 13 people every day will loose their homes.  And in many cases, we’re not talking individuals – we’re talking about families – we’re talking about children. 

So Mr Healey, still in favour of increasing repossessions and using them as a wake up call for people in debt, or have you had time to sober up your thoughts and think about how we can help people keep their homes, rather than rushing to boot them out?!

Love is in the air

February 13th, 2010

Or maybe not?   

It seems the recession has had quite an effect on Brits in love, leaving them so worried about finances, there’s no longer room for romance. 

The Priorities in Life Index confirms 52% of those questioned, confess they would like to make their partner their main concern, whilst 36% admit they’re turning their backs on love to focus on making ends meet. 

It’s never been a secret that arguments about finances are often cited as a reason for a break up.  But this year’s Valentine’s Day, seems to be one which is bringing a more sober approach than usual.   

Feeling the pound rather than the pinch is appearing to be the preferred option as partners turn off to large displays of affection.  The time may finally have arrived where flowers, chocolates and jewellery are replaced by more simple messages that can be said in person. 

So whilst Yorkshire Bank state they believe £5million will be spent on celebrating February 14 in style, I wonder if they’re really right. 

So, why not share your views on this subject?  Commercialised or not, is Valentine’s Day 2010 something you’re taking part in, or is this the year you’re choosing to opt out?

Dear Valentine…be mine

February 9th, 2010

This is what many people around Britain will be saying to their credit cards this February, as their plastic friends treats them to a gift or two in the recovery to the recession. 

According to Credit Action, even with the best of intentions, people are falling back in love with their credit cards and returning to plastic as a form of extra cash. 

Although people may have done well in curbing their spending during the recession, it seems many consider the news of “the end of the crunch” as an official “get out and spend” alert.  But surely we’ve learnt our lesson? Or maybe not. 

As there are now signs of milder days to come, the shops are filtering in their spring season products and temptation is looming.  After so much doom and gloom, who can resist the appeal of brighter days – and the wardrobe to match.  And if it isn’t clothes, maybe it’s some new bedding that you’ve been putting off buying, or a new set of crockery? 

But do we really need these things or have we just reached the end of disciplined spending? 

If you think you’re struggling to continue tightening the purse strings and have waivered to indulge in non-essential purchases; then share your thoughts here on why you think people are now turning back to credit cards to buffer a little home and self improvement?