Archive for June, 2009

Student debt repayment to take an average of 12 years

June 17, 2009

Recent research carried out by YouGov and Call Credit Check has revealed that it will take an average of 12 years for students to repay their debts after finishing university. This time span was arrived at after careful analysis calculating the average amount borrowed, average starting salaries and the minimum monthly repayments.

 Average student debt, not including credit cards and bank loans, is £15,700. This is the amount borrowed from local authorities in order to cover living expenses and fees while at university and is interest free, only rising at the rate of inflation. The average starting salary for a graduate is £22,300, with this salary the monthly repayments would start at £54. Assuming an average wage increase of 4.6 per cent annually with the repayments rising accordingly, it would take just over 12 years to repay a debt of £15,700.

 Entering into such a tough jobs market and unstable financial climate has taken its toll on young people, with many struggling to find work and 64 per cent saying that they worry about their finances more than they did last year. Despite admitting to worrying about their finances, 44 per cent of 18 – 24 year olds are not saving any money at all, while almost ten per cent are crippled by debt, spending over 50 per cent of their salary on various unsecured debts.

 Owen Roberts, head of Call Credit Check said: “Managing your finances as a student or a new graduate can be a tough. As a graduate in particular, trying to balance what may be a relatively low income with high debt levels, rent and other costs of living can prove very tricky. Crucially, it is at this time of life you may start to see the impact of your credit history, as lenders will use it to decide whether to lend to you and at what rate. While each lender has different criteria, the key to working up a good credit score is showing a consistent ability to service your debt levels, so paying phone bills, rent, credit cards, student loans etc on time is important if you are looking to secure the most competitive deals.”  

 With so many young people affected by debts and struggling financially, it is really important to have an effective and interesting money education program in place which will help young people manage their finances more appropriately. Growing up it is essential for children to be aware of money and informed throughout their lives so that as adults they are not entering the financial world feeling confused or unsure. Especially in light of the current recession, demand for some kind of money education in Britain’s schools and universities is growing.

 At Debt Doctors Foundation UK, we provide that education every step of the way. Holding workshops in primary schools we deliver simple messages about money to children as young as 4, gradually moving onto more complex message for the older children. Throughout high school we educate older children who may be starting their first job and handling slightly larger sums of money. In the final years of high school we hold specialised events for those who may be planning to leave school and take their first salaried job and those who are planning to go on to university where they will be navigating student bank accounts, loans and debt. We also hold events at universities, guiding students through budgeting and helping people to leave university with minimum debt.


Money worries keeping a third awake at night

June 9, 2009

One in three Britons admit they are losing sleep over the recession. As money worries mount up, thousands are finding it harder to nod off at least once a week. Two-thirds are having problems at least once a month, with one in six turning to alcohol to help them sleep, a survey reveals. Others are using the TV to help them drift off, with 44 per cent saying they had recently moved their sets into the bedroom. Half of those questioned said they were regularly using their laptop more in bed to finish off work. And while 31 per cent are reading more in bed, a similar number are playing computer games. So it seems these activities could explain why one in five of those polled are having less sex. ‘Unsurprisingly, money and work worries are cited as the leading antagonist to sleep,’ said Caterina Gerlotto of Harris Interactive, which carried out the survey on people aged 16 to 64. ‘The economic crisis appears to be taking its toll on us when we do eventually make the decision to turn off the lights.’ Source:

Research reveals desperate need for money education

June 2, 2009

 Research by education and entrepreneurship charity Young Enterprise has revealed how little Britain’s teenagers understand about money and finance.

 The charity conducted a poll on 1,000 British 12 – 19 year olds about matters such as pricing of popular groceries and financial products and found that knowledge in these areas was seriously lacking.

 The poll, carried out a the beginning of May this year, found that 6 out of ten teenagers found loans, credit cards and mortgages ‘confusing’. Even more worrying, many were clueless as to the price of common groceries such as bread. When asked to estimate the cost of a loaf of bread, the average answer was £4.31. In reality a loaf of bread costs between 70 pence and £1.50.

 The research demonstrates a staggering ignorance when it comes to money matters and does not bode well for the future budgeting potential of the next generation. The complete lack of understanding in this area needs to be addressed with the introduction of money education into our schools. Currently there are a small number of charities such as PFEG, Debt Doctors Foundation UK and MyBnk which hold events in schools around the country where money awareness is promoted. However, the reach of these charities falls far short of the need, despite the massive popularity of the programmes with teachers, parents and students.

 For more schools to be covered by the programmes which these charities offer, there is a desperate need for public donations. Just a small injection of cash could greatly extend the coverage which these charities have and change the future economic prospects of a generation.