Shades of Grey

I’v never been particularly good with money. Six months after I opened my bank account on starting my job/student role, I applied for a Barclaycard and was maxed out within a couple of months. Then, when money was a little tight, another Barclaycard arrived, with a duplicate credit limit but a different account number. The reason for this was that I had originally applied after three months but the Bank deferred it then sent it in on my behalf.

Now I was sorely tempted to play the cards off against each other but common sense prevailed. For the next couple of years, I got on by, clearing the credit card whenever I got a tax refund. (Because I alternated between a student and an employee, the nature of “Pay As You Earn” was quite pleasant whenever I went back to College).

I was fortunate enough to make lots of money abroad for a couple of years, returning with a £10k nest egg in 1983. I put £6k towards a £30k house (a 20% equity) and used the other £4k to furnish it.

In the mid 80s, I took on a much bigger mortgage on a nicer house near Camberley but whilst my salary had increased, my job satisfaction had plummeted. I eventually downsized to a smaller flat in Bracknell when i downsized my career to work in the Stage Lighting sector. I was still overstretched though and made too much use of my overdraft facility to tide me over. Eventually the bank caught up with me and we had to do some joint financial planning. I cleared my debts by selling the flat when I moved up to Nottingham with the job but still lived slightly beyond my means and a few years later my savings were gone and I found myself going to an Ocean Finance type company for a consolidating loan.

By contrast, Karen is very careful with money and I now live by her approach, having savings to tide us over hiccups and not buying things if we can’t afford it. Our Credit Cards are paid off every month, we drive older cars and the only debt we have is the mortgage which is less than half the value of the house. (Well, it is this week, property prices are falling somewhat).

However, I know that if I wasn’t careful and was on my own again, I could easily slip into overspending, in the same way that I am probably only one cigarette away from starting smoking again, or one chip supper away from getting fat. (I’m already fat, I know!)

So, I learned my lesson, it cost me a lot of money over the years but I put myself back on track by tough choices along the way. I don’t blame anyone else for poor decisions I made because I voluntarily entered into all of the arrangements with a certain level of self-denial of my circumstances at times that “it’ll be reet”.

The most stressful time of all was when the Company went into administrative receivership when I was fairly skint anyway, the worry that the salary bill might not be met that month. (As it happens, we came out the other side, but that is another story).

Now, contrast my circumstances with the current cash crisis. Should the Government have paid off my bills because the UK stage lighting economy would have crumbled? Of course not.

Now, contrast my circumstances with how the Government “runs” the economy. I’ve previously described PFI deals as like having a credit card, get what you want today and pay back the minimum payment every month for the rest of your life.

Britain owes ridiculous amounts of money- in off-book PFI projects, in unfunded public pension plans where the hole in the bottom is now bigger than the taps running into it, by the ridiculous number of make-work non-jobs and make-work compliance jobs in all sectors from the biggest quango of all, the Europhant in the room.

Three things worth a read and further thought. Firstly, Jeremy Jacobs picks up on EuroMatts Financial Situation analysis. Secondly, the UK Libertaian Party hits the ground running with proposals for monetary reform. Finally, Watt Tyler adds to his series on fiscal policy, sharing the proceeds of stagnation.