The overdraft generation: With more of us than ever in the red, LIZ JONES comes clean about her own debt mountain

By
Liz Jones Last updated at 9:30 AM on 01st March 2010

When the word ‘overdraft‘ appeared in my email inbox on Friday, my
heart leapt into my mouth - something it tends to do if anything
vaguely financially-orientated makes it through the sand and into my
consciousness. It turned out to be an email from my editor,
drawing my attention to a new survey that revealed one in ten people in
the UK is always in the red, with more than 38 per cent dipping into
the red at least once. Would I like to write about my overdraft? Hmm,
would I? 
While I have written openly about many shameful, previously hidden
aspects of my life (lack of sex, facial hair, grey roots, plastic
surgery, OCD), writing about my money worries in a national newspaper
has been the most difficult, exposing thing I’ve ever done.
Overdraft: Liz Jones’s weakness for shopping has landed her in huge debt

Since publishing on these pages a piece about how I got into debt (look it up here),
everyone I come into contact with, including builders, carpenters and
oil delivery men, now demand their money up front. Hotel receptionists,
shop assistants, even car park attendants regard me with suspicion. My
gardener has gone grey. But even if you don’t, as I have,
broadcast your bankruptcy, those one in ten of us who live in the red
and on our nerves exist in a twilight world where every move, every
thought, is ruled by how close you are to that magic number: your
agreed limit. Your relationship with your overdraft (is the
cash machine cross?) becomes the most important in your life. It is
allconsuming, a dirty, hungry weight around your neck that saps your
strength. It’s like a really bad husband. Or a nasty, painful boil.

First of all, just how much of a financial hole am I in? I tell you
the following in the hope your own money worries will seem delightfully
trivial, a mere blackhead. But please don’t feel sufficiently buoyed to
go out and celebrate with a £9 glass of bubbly (nibbles extra).
Well,
I have a £15,000 overdraft limit at NatWest and a £8,000 limit at
Santander. I also owe £19,000, £10,000, £1,000 and £12,000 (please
don’t make me add them all up) on various credit cards, a £50,000 bank
loan and a mortgage so huge I can’t bring myself to write it down. I
haven’t looked at my new tax bill, but became quite scared when my
agent phoned me last week to say: ‘Liz, you do know the Inland Revenue
can make you bankrupt in a day?’ 
I have had my overdraft at NatWest since 1989 and have not been in the
black since. The other day, I discovered I had £2,596 to go before I
hit my limit but instead of thinking ‘Oh dear, I’m nearly £13,000 in
the red’, I thought: ‘Hoorah! I can go to Sweaty Betty and buy a £100
pair of Stella McCartney trainers!’Madness, I know. But I have become so used to being in debt I see the
overdraft facility as my money. In the interests of research for this
article, I phoned NatWest to ask how much interest it charges,
something I’ve never thought to do before, preferring not to know.
I have become so used to being in debt I see the
overdraft facility as my money
‘It’s 12.73 per cent,’ came the reply. Is that a month or a year?
(Oh, that I had been taught economics at my high achieving grammar
school rather than Latin and hockey.) ‘A year.’ If I go over my
overdraft, it goes up to 20.50 per cent. So to ‘enjoy’ my overdraft of
£15,000, I pay about £1,178 a year (this is on top of the £500 interest
a month I pay on my credit card bills, and the yearly £800 on my
Santander overdraft). If I write a cheque that takes me
over my overdraft (please keep up), the bank charges me £35 to honour
it. Rather unhelpfully, NatWest not long ago stopped its practice of
writing to customers to tell them an item had bounced. It didn’t even
bother writing to tell them it was no longer writing to tell them. Now,
I find that even when I ring up to ask if a cheque has cleared the bank
can no longer tell me ‘because the system has been changed’. Last
time I rang up to check, I was told, not very helpfully, to ‘ring the
person you are trying to pay and ask them’. Those one in ten of us who
live in the red not only pay our banks through the nose, we get deeper
into debt in other ways, too: we are forced onto the scrapheap of
higher rates on credit cards, mortgages, you name it. Credit card companies and loan sharks prey on our desperation. I was recently caught out applying online for a loan and being made to pay an up-front fee of £69. It’s something the rich never, ever have to do. Even though I paid the fee, I still didn’t get the loan. You can see how this spiral only takes you downwards. The worst thing is that when you enter this awful world of borrowing from Peter to try to pay Paul (or Prada, or Pringle), it all becomes hairily scary. That heart-in-my-mouth moment I mentioned earlier happens several times a day: the more you owe, the more you are hounded. In the past seven days, ever since I applied online for yet another credit card, I have had 23 emails urging me to ‘choose your Visa card’, ‘£5,000 is waiting for you’, ‘your approval is running out’ and ‘all you need to decide now is what colour you want your credit card to be’.
Plan of action: Liz has vowed to cut up her credit cards
Also in the past seven days, I have had 50 missed calls from various financial institutions either offering me money at ruinous rates, or demanding their minimum payment. The statistic of one in ten people living on their overdraft does not tell you the personal anguish this brings. I wake up in the middle of the night without fail, unable to get back to sleep, doing sums in my head, unable to see a way out (I can only guess at the sheer terror a parent must feel, or someone who has lost their job). At Christmas, researching an article about loneliness, I rang the Samaritans. ‘Is spending the festive season alone the number one reason most people ring you up?’ I asked stupidly. It turned out that money worries outstrip every other problem you can think of. Higher than divorce. Higher even than cancer. I suppose I could burn all my unopened bank statements to keep me warm for the rest of the winter, but to bastardise the NatWest slogan: ‘There must be another way.’ So I’ve decided on a plan of action:To open all bills and statements. I know it’s scary, but facing up to debt and prioritising is paramount. To get to know my bank manager. It is his or her job to help you. I’ve been hiding from my accountant for months but when I was, finally, forced to contact him he merely said: ‘Why didn’t you tell me what was going on? I could have helped you!’ Cut up my credit cards. I haven’t done this yet as I use them to buy food. Just keep one, with a very low limit of say £500, for all those times when only a credit card will do. Otherwise, go shopping with cash. Write a list of your outgoings, and excise anything non-essential. Don’t use shopping as therapy to cheer yourself up. (I do appreciate the irony of that statement, given the name of my regular column: Fashion Therapy. Perhaps it should be changed to: Fashion She Really Needs And Has Thought Long And Hard About And Saved Up For.) The reason women are twice as likely as men to get into debt is that we have been brainwashed by a super-powerful, clever and devious gaggle of industries (fashion, beauty, advertising, glossy magazine publishers) into thinking we are worthless and, therefore, need to buy stuff to transform ourselves. We don’t. Join a library. Don’t be ashamed of being in debt. I have found admitting that I’ve got money problems to be quite liberating. It has made me stop using money as a way to get people to like me, and I’ve found out who my true friends really are. Give yourself a cooling-off period before buying anything. Learn to cook. I can’t tell you how much money I have wasted on bad restaurant meals. I am now working my way through Delia Smith’s Complete How To Cook. Remember, everyone wants your custom. Devote a day switching to a cheaper phone/internet/utilities provider. Learn how to use Skype, instant message, and so on. Technology can be your friend; if you are technophobic, go on an evening class. Learn to save. I am going to put 10 per cent of my money into the highest earning account I can find: contact an independent financial adviser, whose job it is to point you and your hard-earned money in the right direction (visit www.aifa.net and click on the box that says Find An IFA). Above all, stop being passive. Take control. Life is too short to be scared.  

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Workaholic Britons put in 900 million hours for free

By
Mail On Sunday Reporter
Last updated at 12:39 AM on 24th January 2010

Many Britons are working unpaid hours
Britons spend more than 900million hours every year doing unpaid work, according to a new survey. A poll of 3,000 people found 12 per cent said they worked a minimum of five hours unpaid per week. Almost half (45 per cent) said they took work from the office home at weekends. The OnePoll survey, carried out on behalf of furniture specialist Sharps, also found that 58 per cent of people worked through their lunch break at least once a week and the same percentage said they regularly worked overtime without additional pay. More than a third said they felt their boss did not notice the extra time they put in and one in three found it hard to switch off outside work and to resist checking emails and taking phone calls. Just over half of the men polled said they took work home at weekends, compared with 42 per cent of women. Men are also 10 per cent more likely to check emails and take phone calls even when they are on holiday, averaging six hours of work while they are away, the survey found. Almost a third (28 per cent) of those polled also said they had taken on additional home-based jobs to earn more money during the recession.

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Holiday giants named among worst offenders for poor service

By
Sarah Gordon
Last updated at 4:44 PM on 05th January 2010

You might think that by booking your holiday with one of the big tour operators, you can ensure a great trip.But that is not always the case according to a new survey of holidaymakers which ranks some of the biggest companies as providing the worst customer service.Tour giants Cosmos, Thomas Cook and First Choice were at the bottom of a customer satisfaction table compiled from more than 4,500 Which? members’ holiday experiences.
Disappointing: Many of the big tour operators are failing to make customers’ holidays great
The average ‘customer score’ awarded to the companies in the survey was 77 per cent. But Cosmos took last place with a score of just 57 per cent, with Thomas Cook getting 58 per cent and First Choice and Crystal - part of the Tui holiday empire - scoring 63 per cent.Only 44 per cent of Cosmos customers described the company as
efficient, while Thomas Cook received a lower rating than any other
tour operator for its holiday reps.Thomas Cook UK and Ireland chief executive Ian Derbyshire said: “The
Which? Holiday report is in total contrast to the high levels of
service that our customers tell us about and that we pride ourselves on.”From our own surveys, which number more than 100 times more people
than the Which? survey, our customer satisfaction scores have increased
year on year, with 94 per cent of our holidaymakers rating us as either
excellent or good for their holiday last summer.”

The top company for customer service was a much smaller company, set up 40 years ago by an Anglo-French couple.French specialist VFB Holidays, which received a customer score of 94 per cent, has long been a pioneer in its field promising holidays which show ‘the real France’. Customers also gave it five stars for its customer service, accommodation, overall organisation and claimed the tour operator was ‘efficient’ and ‘dependable’.Other niche holiday companies also topped the survey for customer service. Trailfinders, which offers tailormade travel worldwide, was given a customer score of 89 per cent with adventure travel company Explore, taking third place with 88 per cent.
On top: Customers awarded French specialist VFB Holidays 100 per cent for holiday organisation
The overall customer score took into account customer satisfaction and how likely people were to recommend the tour operator to a friend. Companies were also rated on the organisation of their holiday, any journeys involved, the accommodation, tour reps, customer service and overall value for money.In total, 92 per cent were satisfied with their tour operator’s organisation of their holiday, with VFB getting a 100 per cent score in this category.Rochelle Turner, head of research for Which? Holiday, said: “It’s great to see the small operators doing so well. They have the advantage of being able to offer a more personalised service - something valued by many.”However, larger tour operators still have an important role to play in offering affordable holidays to families. The vast number of holidaymakers that these companies deal with each year means it may often be harder to provide the attention to detail their smaller rivals can offer.”Although the larger tour operators performed well in terms of the accommodation they offer, they really need to up their game across the board and give their customers what they expect in terms of quality of service and value for money.”

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National postal strike ‘would deliver £1.5billion blow to struggling economy’

By
Sean Poulter
Last updated at 12:56 AM on 13th October 2009

A national postal strike would cost the economy 1.5billion in terms of lost orders, extra administration and higher delivery costs, a survey claims.
At the same time, it would have a massive impact on the troubled Royal Mail, which would lose tens of millions of pounds in income as its business customers switch to rivals.
Consumers who rely on the post to pay utility bills and manage their credit card bills also face enormous disruption and a risk of penalty charges.
Royal Mail would lose millions of pounds in business because of the strike, according to a new survey
And charities face huge difficulties because of the impact on festive mailshots and the sale of Christmas cards.
The last national strike in 2007 led to a backlog of more than
100million letters and generated losses for businesses in London alone
of some 300million.

Research by the online shopping portal Kelkoo puts the cost of
another strike in the run-up to Christmas at 1.5billion. It believes
online retailers would lose some 220million, with another 50million
lost by bricks and mortar stores. Kelkoo said online firms face lost orders and a big increase in the cost of ensuring deliveries are made.For example, delivery prices for some firms would rise from 1.90 per package with Royal Mail to around 4.80 with Parcel Force - a 153 per cent mark-up.
Retailers such as Amazon are dealing with other postal carriers to avoid disruption to deliveries

Kelkoo UK managing director, Bruce Fair, said: ‘The timing of the strike beggars belief. In one fell swoop it threatens to bring the postal network to a standstill, spoil the beginnings of the retail sector’s financial recovery, increase prices for cash-strapped consumers and cause a huge mail backlog.’
Three in four businesses are actively considering dropping Royal Mail as their postal services provider, according to a survey of 250 firms by the British Chambers of Commerce. Its economic policy adviser, Steve Hughes, said: ‘The results of
this survey are quite explicit. Businesses are very upset by what’s
happening and they’re worried about how it will affect their services.
All they want is consistency. That means the Royal Mail providing a service they can rely on and at the moment they can’t do that.’
The trade secretary, Lord Mandelson, has made clear that the Government has no intention of trying to head off the strike.
This inaction has been condemned by union leaders and business chiefs, including the internet retail trade body, the IMRG.
Its operations director, David Smith, described the lack of Government action as ‘dangerous’.He said: ‘We have a very fragile economy at the moment and a
strike is the very last thing we need. For a lot of small online
retailers, which rely on Christmas for the majority of their sales, it
is very difficult to find alternative delivery services.’If consumers start thinking it is too risky to make orders online, that will be very serious.’
He said: ‘The Government is trying to stimulate confidence in the broader market and get consumers shopping again. The last thing we want is barriers to that. It is very dangerous to do nothing.’
Business Minister Pat McFadden said the strikes were ‘counterproductive’ - not in the interests of either Royal Mail or its workers.
‘We have put in money for Royal Mail to bring in new machines and automate. That is what needs to be done, not strikes,’ he told GMTV.

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Europe eclipse North America as world’s richest region new survey finds

Published: 7:53AM BST 15 Sep 2009

North America, which the survey defines as the US and Canada, had $29.3 trillion
in assets under management, compared with $32.7 trillion in Europe last
year, according to the survey by Boston Consulting Group.

The survey also found that the US is still the wealthiest country at $27.1
trillion and, at 4 million, enjoys the highest total of millionaires. Japan
ranked second behind the US, with wealth of $13.5 trillion and over 1
million millionaire households.

On a global basis, global wealth fell for the first time since the survey was
started in 2001, as assets under management slipped almost 12pc to $92.4
trillion. The financial crisis that first erupted in the summer of 2007 sent
the Standard & Poor’s 500 Index down 38pc last year - its sharpest annual
drop since 1937.

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Firms still looking to hire migrants even as unemployment hits 14-year high of 2.4million

By
Sam Fleming
Last updated at 11:53 AM on 12th August 2009

Companies are planning to hire more migrant workers even as Britain’s
jobless toll rises by almost 3,000 a day, a new survey shows.Figures today reveal unemployment has increased by a further 220,000 to a 14-year high of 2.435million.The number of people claiming jobseeker’s allowance increased by 24,900
in July to 1.58 million - its worst level for more than 12 years, according to the Office for National Statistics (ONS).This marks the 17th month in a row where the so-called claimant count has increased in the UK.There was further grim news from The Bank of England, which forecast today that the economy would shrink by around 5.5% at the lowest point this year before beginning its recovery.The Bank’s inflation report said the recession “appeared deeper than previously estimated” but pointed to “encouraging signs” that its unprecedented monetary stimulus was taking effect.
Displaying good skills: Companies are planning to hire migrant workers despite the increasing numbers of Britons out of workDespite the jobless rise, nearly one firm in 12 aims to take on immigrants because they
cannot find suitably qualified Britons, according to the report by the
Chartered Institute of Personnel and Development (CIPD) and accountants
KPMG.The survey shows that 8 per cent of employers intend to recruit migrant workers in the third quarter of 2009.Some bosses said this is because they find migrants more ‘hardworking and reliable’, while others said they tend to be better qualified.This comes after official figures showed the number of non-UK nationals in employment increased in the first quarter of 2009 while the number of UK nationals fell.

The survey undermines controversial claims by Gordon Brown that he wants ‘British jobs for British workers’.The CIPD said Labour was failing to ensure that large sections of the British-born population have the right skills to compete in the jobs market. Gerwyn Davies, public policy adviser at the CIPD, said: ‘The best way to provide “British jobs for British workers” is to make Brits better equipped to compete in the jobs market rather than raise barriers to skilled migrants.’Most are recruited and retained by employers because they provide skills or attitudes to work in short supply among the homegrown workforce.’Economist Howard Archer, of IHS Global Insight, said the jobless pain will be particularly acute for young UK school and university leavers. He forecasts unemployment will peak at 3.2 million next year.
‘Even if the economy does return to growth in the third quarter, activity is still unlikely to be strong enough for some considerable time to come to prevent further net job losses,’ he said.Lord Mandelson admitted that unemployment levels were “unacceptable”  but the Business Secretary insisted that even more people would be out of work if the Tories had been in power during the recession.The peer said: “One thing I and the Government know is that any such level of unemployment is unacceptable.”The question is, what is the Government doing about it, and what would be the level of unemployment if the Government had not intervened in the economy in the way in which we have?”Meanwhile, the Department for Work and Pensions has started an inquiry into why there is a large gap between the unemployment rate, which stands at 7.6 per cent, and the proportion of the population claiming Jobseeker’s Allowance, which is 4.8 per cent.There was speculation that this is partly because some of those being laid off are well-paid City workers, while others might not have claimed benefits if they were hoping to get another job quickly.

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Pound soars after manufacturing sector grows for first time in a year

By Edmund Conway, Economics Editor

Published: 6:46PM BST 03 Aug 2009

Sterling rose by 3½ cents against the dollar to $1.6928 after new survey
data showed that manufacturing industry is growing again for the first time
in more than a year. The Purchasing Manager’s Index (PMI) for the sector,
produced by Markit, rose from an upwardly-revised 47.4 points to 50.8 points
in July. It is the first time it has surpassed the 50-level, which separates
expansion from contraction, since March 2008.

The increase, which was far beyond what economists had anticipated, pushed
sterling higher, along with gilt yields, since the PMI has often been a
reliable signal for official measures of economic growth.

The Bank will decide on Thursday whether to extend its QE programme to beyond
£125bn, based on whether it judges it has pumped enough stimulus into the
economy.

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Car scrappage scheme ‘unpopular’

By Brian Milligan
Business reporter, BBC News

There is growing evidence that the government’s forthcoming scheme to scrap hundreds of thousands of old cars is not that popular with motorists.

A new survey suggests most people who have studied the scrappage scheme have decided not to take advantage of it.

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US job prospects hit 27-year low

US companies’ plans for hiring staff are at their weakest since the recession of 1982, a new survey says.

The Manpower employment survey found that more US employers plan to get rid of staff than those that plan to hire staff in the second quarter of 2009. Read more

Employers plan ‘more’ staff cuts

Employers are planning to make deeper and broader cuts in staff numbers, a new survey suggests.

It found 46% of the organisations surveyed are planning to cut staffing levels in the next few months. Read more

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