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Only a third of Britons bother to save regularly, according to a report from Bradford & Bingley.

The loan and savings provider found that whilst 36 per cent save money often, 20 per cent say they never put money away. One in ten would rather spend their hard earned cash on consumer items than put their money away for a rainy day.

Over a quarter of those asked said that they cannot save because they do not have spare household cash. Bradford & Bingley suggested that high consumer debt is eating away at UK household’s ability to put money aside.

“The spending culture has certainly replaced the savings culture in the nation’s consciousness,” said Steve Potter of Bradford & Bingley. “With so many attractive interest-free deals many people are being tempted to buy now and pay later.

“Just how much they will later pay, however, remains to be seen. What’s clear though, is that if consumers don’t start looking to the future and putting in place proper savings plans they’ll be facing many ‘cash strapped’ years.”

The survey also discovered that few ‘rate tarts’ exist amongst those who do save. Only 12 per cent said that they regularly look at the savings market, whilst three in five said that they trust their bank or building society to provide a competitive rate.

Shopping for ourselves accounted for 7.8 billion of credit card expenditure at the end of 2005, new figures from Morgan Stanley has revealed.

In the last quarter of 2005, UK consumers spent on average 166 on treats for themselves.

The survey of 2,000 UK adults showed twenty-somethings to be the most self-indulgent, spending on average 62 per cent of their credit card on personal shopping.

Women were revealed to be the most generous, spending more than men on family and children.

Under-twenties were the second biggest ‘me’ shoppers, indulging 57 per cent of their credit card spending on themselves.

Patrick Muir, MD for Morgan Stanley credit card said: “Despite reports of a quiet end to 2005 on the high street, our research shows that Britons still found time for the occasional self-indulgent purchase.

“Over the past few years we have observed a growing trend in using credit cards for making everyday purchases, but they also remain a popular way for people to treat themselves before pay day.”

Young people in Britain are increasingly choosing to remain in the family home well into their twenties and even thirties, according to a raft of new reports.

As the cost of living soars, many young adults are finding it easier to live with Mum and Dad than attempt to assert their independence by buying or renting a home.

A new study out by engage Mutual Assurance suggests that more than a quarter of young people (28 per cent) do not expect to be able to move out of home until beyond the age of 25, with the problem worst in London.

The poll of 2,000 people aged 25 and under discovered that many Britons are forced into an early childhood by problems with affordability, with just 11 per cent of respondents owning their own property.

A quarter of those quizzed (25 per cent) said that they did not expect to be able to afford to buy their first home until they are older than 30, while eight per cent predicted that they would never be able to purchase a property.

Karl Elliot, enagage 3GB spokesperson, commented: Money is often a key determinant in deciding when the time is right for young adults to move out of home, get married or buy their first property. With the younger generation finding it increasingly difficult to gain financial independence, our research has shown that supporting young grownups is placing an increasing strain on older family members.”

A growing number of graduates are choosing to move home in order to pay off some of the debts they accrued as students and, with a total debt mountain of 1.2 trillion in the UK, others are remaining at home in order to pay off credit cards and loans long after they have started working.

The number of people going to university has risen from just six per cent of young people in the 1970s to 40 per cent today and students now face higher costs for their education than ever before. Many students are now working during university and facing years of clearing debts at the end of the course.

A recent report by right wing think-tank Reform claimed that the number of young people in the UK in debt has risen rapidly and many are struggling to buy a home in the face of rocketing house prices that continue to outstrip wage inflation.

First-time property prices are an estimated eight times higher than average earnings for 22-to-29-year-olds, with around 47.5 per cent of 20-t-24-year-olds still living at home.

Although many young people are remaining at home well into their twenties, others are moving into their own homes, attracted by the space and freedom it affords. The average age of marriage is now around 27 and the age at which women have their first child has risen above 29, signalling that most people are settling down later than ever before.

Mortgage approvals are rising and the UK’s rental market is healthy, with more and more landlords entering the sector. Although household bills such as council tax, water and energy have risen sharply in recent years, many other items such as furniture and electrical goods are considerably cheaper, making the cost of setting up home more affordable.

An increasing number of parents are helping their children out financially even after they have flown the nest, with many prepared to fund property deposits, provide cash for bills and emergencies and help out with DIY.

A study by Halifax Home Insurance found that parents helping out with DIY at their children’s homes have added around 33 billion to the value of their properties during the past five years. Two thirds of the 18-to-35-year-olds polled said that asked their parents for help in doing up their home.

However, those counting on their parents’ continuing support should be mindful of a new trend, dubbed SKI-ing (spending the kids’ inheritance), which sees retired Brits and those whose children have left home enjoying their increased leisure time by spending cash on holidays, hobbies and adventures.

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After years of ignoring credit card bills or expert advice on planning for the future, millions of Brits are likely to face a nasty fall to Earth in the next few months as their past financial irresponsibilities come back to haunt them.

That is the warning being issued by Scottish Widows, whose recently-published 2008 Pensions Survey makes for worrying reading indeed for many Britons who thought that their ‘buy now, worry later’ lifestyle could carry on indefinitely.

Research carried out by the firm found that a significant number of people are now beginning to feel the pinch when it comes to their personal finances, with four in ten saying that they felt better off five years ago than they do now.

When it is taken into consideration that this figure was nearer to three in ten when the study was carried out this time last year, it becomes clear that people’s economic confidence levels are falling.

What’s more, of those questioned 32 per cent said that they are pessimistic about their short-term financial situations, with those with a number of years of work ahead of them generally more wary that those who are now approaching retirement.

Ian Naismith, head of pensions market development at Scottish Widows, commented: “We’ve been a position for the last few years where if you wanted to buy something you either got it on your credit card or store card or you went out and borrowed for it and it was easily done and you could put off the consequences for another day.

“I think now it is turning and with the credit crunch [making it] more difficult to borrow I think people are going to have to start thinking about tightening their belt and also think about saving more for the future.”

However, in spite of all the pessimism, even Mr Naismith acknowledged that “we’re not in a crisis yet”, and there is plenty that people can do to shield themselves from the worst effects of a recession which is becoming increasingly likely as each day passes.

When it comes to looking for the future, arguably the best thing many people can do is look backwards to their parents’ generation.

Just a small chat with anyone now retired would show that what they couldn’t afford they simply learned to live without easy credit just wasn’t an option.

Sure, it may be a relative sacrifice to do without impulse buys after so many years of the good life, but for many, there really is no other way, particularly as lenders are now getting tough on borrowers, and even following through with threats of repossessions on unpaid loans.

In way of consolation, most experts believe in the cyclical nature of global economics; so batten down the hatches now, as the storm will soon pass, ushering in another decade of financial plain sailing for those who haven’t gone overboard with their spending.

For all the reports of Britons being unable to jet off for some summer sun for the first time in ten years or be unable to take a step up the property ladder, a lot less has been reported about the less sensational, but even more serious, effects the current economic turmoil is having on UK households.

For while a week’s camping in Wales or a spring clean rather than a new conservatory won’t do anybody any harm, rising utilities bills are hitting consumers hard, worrying new research has found.

Of those households questioned in a recent poll by the Chelsea Building Society, 15 per cent said they had dipped into their savings in order to pay their gas or electricity bills, more than the proportion who have taken similar action to meet their council tax commitments.

What’s more, the rise in the cost of utilities is seriously impacting on people’s abilities to set money aside for the future, with average savings for men down by 24 per cent and for women down by eight per cent.

Commenting on the findings, Darren Stevens, Chelsea director of customer services, said: “It is a completely new phenomenon for savings to be used for everyday expenditure on this scale.

“We are concerned that many peoples finances are in real trouble due to the growing pressure of rising costs across so many essential items.”

Indeed, it’s hardly surprising that people are struggling to look to the future given the immediate pressures being placed upon their wallets by the country’s energy suppliers and the only forward planning many are doing is with dread regarding how high their bills will be once winter comes round again.

According to some observers, gas and electricity prices could go up by between 25 and 40 per cent this winter as suppliers pass on soaring wholesale costs to consumers and this is on the back of them putting their gas tariffs up by an average of 17 per cent and their electricity rates by an average of 16 per cent earlier this year.

As Peter Luff MP, chairman of the cross-party Business and Enterprise Committee warned: “We cannot avoid continuing rises in energy prices.

“If oil is hitting record levels, and theres also increasing competition for gas and coal supplies, then prices are going to go up.”

The only thing for consumers to do therefore is to equip themselves as well as they possibly can for the anticipated rises.

Not only does this mean keeping a tight rein on finances now and not get lulled into a false sense of security by bills which are inevitably low as the sun shines, but also that households need to shop around for the best deal before it’s too late.

Britons who use online dating sites are refusing to curb their spending when they meet a potential match for their first date despite the effects of the credit crunch, it has been claimed today (November 28th).

Leading UK online dating service provider FreeDating.co.uk conducted a study which found that just 12 per cent of its single male members were planning to cut back on date-related expenses due to the economic downturn.

In addition, the research found that the concept of the man taking care of the financial side of a first date is still in existence – although there was some disparity between the sexes and different generations.

According to the statistics, 64 per cent of men now believe that they should pick up the tab, while only 35 per cent of women expressed their desire to let their date foot the bill.

Perhaps surprisingly, this attitude appears to be even stronger among younger men, with 80 per cent of under-21s claiming that they should pay, while 47 per cent of women in the same category shared that view.

Dan Winchester from FreeDating.co.uk said: “This research shows that the traditionally-held view that the man should pay for a first date is alive and kicking – even more so amongst the younger generation.

“Furthermore, guys are not letting the credit crunch hold them back when it comes to splashing out on a first date.”

In terms of the geographical breakdown of the study, men from Liverpool were found to budget the most for that first meeting with a match from online dating sites (72 on average), with guys from Coventry and Birmingham close behind.

Males in Sheffield were found to be the tightest with their cash (42 on average), while men from Nottingham and Southampton also admitted to having a particularly firm grip on their purse strings.

Interestingly, respondents were also given the opportunity to discuss their stingiest encounters with a first date, with one woman claiming to have been bought two kids’ meals at McDonalds.

Among the other frugal dates were dinner at a free food outlet for the homeless and a badger watching excursion – a situation Mr Winchester believes underlines the need to splash out a bit more, at least on a first date.

“Whilst the majority of women are perfectly happy to pay their own way on a first date, men should be aware that most of their fellow suitors will be offering to pay,” he said.

“Our research also confirms that, unsurprisingly, many women find meanness with money an unattractive trait.”

He added that people who are on a tight budget should attempt to compensate by injecting as much imagination as possible when they decide to go dating for the first time with a potential match.

Britons have become increasingly adept at managing debt, with a whole generation growing up inured to the fear of finding themselves in the red. Recently cumulative debt in the UK topped 1 trillion, with the rates of borrowing continuing to spiral. As credit card lenders and persona loan providers adopt increasingly competitive marketing techniques and competition drives the available rates down, it has become easier and easier to secure capital. While scare stories abound on the consequences of unmediated borrowing, some say it is now time to revise our perception of debt including the upper limit for loans.

Currently the Consumer Credit Act of 1974 governs the market. Under these terms an upper limit of 25,00 is in place for any agreements between individuals and traders.

Yet as inflation continues to rise and the public become more “debt-savvy” there are those who think it is time to raise the upper limit. This week Mervyn King, governor of the Bank of England, admitted that existing rate of inflation had in fact been an eye-opener even for the experts.

“The MPC has been surprised by both the slowdown and the rate at which inflation has picked up,” he acknowledged.

With prices escalating, it seems 25,000 is not quite the lump sum it used to be.

Indeed, with the average student expected to have debts of 15,000 well into their thirties once the government’s loans for top-up fees kick in, the sum is likely to dwindle even further in real-terms. In this context the limit of 25,000 is effectively only generating an additional 10,000 for a graduate.

One other reason for reviewing the upper limit for loans has been the change in the social stigma attached to debt and its ubiquity. Young people and students in particular are now well-used to managing debt, with the rise of the so-called “rate tart” those who hop from one zero per cent interest rate to another indicative of this.

However, in many respects the fact that the UK is becoming more accustomed to debt is one reason why the upper limit for loans should not be changed. In such an environment, when people as young as 20 can find themselves in insurmountable debts, the prospect of the loans continuing to mount is arguably not the way forward. Not since the last recession has there been such a bottleneck of people in debt, with charities and the credit industry warning of a surge in people unable to foot the bill.

Figures this month released by the Department of Trade and Industry (DTI) show a marked rise in bankruptcies. Crucially those most at risk here are young people, as the Consumer Credit Counselling Service (CCCS) spokeswoman Frances Walker explained to the BBC.

“We are seeing lots of younger people coming to us for help,” she commented this month.

“They are often very heavily in debt as they have been able to borrow far more than in the past.
With no assets to fall back on the repayment of credit cards or personal loans can quickly escalate.”

For older debtors with families the burden can go beyond balancing the books to produce a sense of failure in the face of overwhelming debts. Earlier this year Richard Cullen killed himself after hiding the scale of his debts from his wife of 18 years after credit card repayments began to pinch.

Whatever the rules governing debts, it seems borrowers should tread carefully when looking to secure extra capital.

More and more Britons are taking on the daunting project that is building your own home. Soaring house prices, the lack of individuality in many modern buildings and the popularity of TV programmes such as Grand Designs have all driven the trend.

You can save money if you build yourself, but you must be prepared for a long and stressful process. You have to find and buy your plot, often beating established house builders and developers in the race, negotiate planning departments and find an architect you trust.

The size, shape and aspect of your plot should determine your design. Dont assume your plot will be flat, or square. Inner city plots are often sloping or triangular in shape. Dont let this put you off oddly-shaped plots can be the inspiration for good design.

You will need planning permission from your local planning department. Contrary to popular myth, planners are not the enemy and you need to get them on side as soon as possible in the process. They are committed to buildings that enhance the local area.

Your budget should influence your every design decision. You cannot have everything you want. A simple rule is that if you want to build cheap, build simple.

The next fundamental decision is who should design the house. The golden rule: it shouldnt be you.

The first option is to employ an architect with experience in one-off house building projects. They can come up with plans and supervise the build. They are usually paid a percentage of the build cost, between 5 and 12 per cent. Visit the RIBA website at http://www.architecture.com to find one in your area.

The second option is to use a designer who for one reason or another is not entitled to be called an architect, (a term protected by law) often because they havent got the appropriate qualifications. They can produce attractive plans based on your ideas. Some builders and structural engineers can do the same thing, and may well be cheaper than an architect.

The last option is to buy a package or frame house from a package company. Potton, the most popular timber frame supplier, has a set of standard plans that can be adjusted to suit your needs. In fact, they claim never to have built the same house twice. Many of these companies have talented in-house designers who are used to the needs of self-builders.

Expect to pay a fixed fee for a set of designs from between 1,000 to 3,000.

http://www.potton.co.uk
http://www.designandmaterials.uk.com
RIBA http://www.architecture.com

As online criminals think up increasingly elaborate means of stealing people’s hard-earned money, a growing number of consumers are opting to take action by using a credit, rather than a debit, card.

For though personal finance experts are currently advising Britons to get into the black during these tough economic times, many lenders are not only offering special deals such as zero per cent rates or low-interest cashback, but they are also offering greater protection for those consumers keen to do their shopping on the internet.

According to the latest figures on card spending patterns across the country released by UK payments association APACS, the proportion of people carrying out online transactions has now risen to 55 per cent, with those living in the north-west the most likely to have embraced the new technology.

Significantly, such a boom in online transactions is being largely driven by increased credit card usage, with lenders reporting that their customers now have a number of reasons to put charges on their plastic and pay them off at a later date.

Donald MacLeod, head of Sainsbury’s Credit Cards, explained: “We are seeing customers migrating their spending from debit to credit card.

“So from where we have traditionally seen a steady move away from credit card to debit card spend, we have seen that shift back.”

As well as the higher levels of protection against online fraud offered by credit cards, this trend is also being influenced by the growth in special offers being launched by lenders keen to attract new customers.

In turn, many struggling consumers are now looking to defer payments for everyday necessities and instead focus on paying back their mortgage or personal loans for the time being.

As Mr MacLeod added, many Britons are now thinking: “I will keep my savings where they are, I will keep my current account money in my current account and I will take advantage of deals that are available on credit.”

Reassuringly, it seems that Britons are becoming increasingly mature in their attitude to money, with many simply using credit cards as an expedient means of weathering the current financial storm.

Indeed, the recently-published ‘UK Plastic Cards 2008′ report from Datamonitor concluded that, in the long-run, debit cards will win out, with the credit card industry set to experience an annual market growth of just 5.9 per cent over the next four years considerably lower than the rate seen in the recent past.

A significant majority of UK consumers, therefore, now see the advantages offered by credit cards, while also realising the importance of living within one’s means surely an upside to the current economic crisis.

UK savers are putting away record levels of cash, according to a new study.

However, although Britons are saving higher sums than ever before, they are also borrowing an average of 48p for each pound saved.

The UK’s total savings pot soared in the second quarter of 2006 to more than 38.6 million, the highest level this century, IFA Promotion reports.

The independent financial advice agency estimates that consumers in Britain are continuing to take on more consumer debt, with 48p borrowed for every pound saved between April and June this year.

David Elms, IFA Promotion chief executive, said: “People are beginning to take heed of repeated calls to start saving but seem to be eliminating spending and borrowing behaviour from their budgetary considerations. The simple fact is that if we dont stop borrowing money, the positive effects of saving will be negated.”

Commenting on the IFAP Savings Brake, Mr Elms added that it was “very disappointing” following figures for the first quarter which suggested that just 16 pence was being borrowed for every pound saved and warned that consumers were threatening to negate the benefits of saving.

“This quarters results therefore only go to show that the economy is in a state of flux and that a sensible budgeting mantra is yet to be embedded in the British psyche,” he concluded.

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