To think apart from mortgage it is possible to live debt free!?

[Moneytalkone]

Just that really, AIBU to think that it is possible to live debt free, that debt isn’t a necessity in life! Apart from a mortgage I suppose if you want to own a house. Had a chat with a friend who claimed that debt is given these days, it’s almost an accepted/expected part of life? What do you think?

@NightsOfCabiria actually from personal experience it is the working classes that have less debt. I'm working class and have no debt, same as my whole family and most of the older generation are mortgage free now. Because we buy what we can afford and don't stretch ourselves with huge mortgages, private schooling and fancy cars like I've noticed a lot of middle class do in a "keeping up appearances" kind of way. Plus none of us went to university so no student debt either.

There aren’t many people like though outside the upper and middle classes..

Rubbish! My mother worked in a newsagents and dad was in the police. No financial help ever received. Left school before completing A levels as all financial support was going to cease at 18 so had to get a job.

Everything DH and I have is through our own hard work.

actually from personal experience it is the working classes that have less debt.

This is my experience as well.

Though UC - talking to family and friends - is throwing more people they know into it at least for a few years.

im on a very low income, own my own home from previously had mortgage, paid off at 52 yrs old via an £18000 unexpected windfall, and own a nice car, not posh but nice and 4 yrs old. I have no debt/ credit cards /HP/finance, I was brought up save for what you want and thats what I do. i look after everything i have. I live to my means if have enough end of month I can afford to go out ect if not no problem buy wine make food friends here if want to come. my mobile is a pay as you go which gives me all I need, internet/ facebook ect, if nearly out of credit mid month I stop using it till can afford to top up, costs me roughly £6 per month with free txts ect. im very short on savings, but just enough for say an emergency. I think we live in a society where we want everything NOW.

I think we live in a society where we want everything NOW

I agree. Few seem to save first for things they want and credit seems the go to for them rather than them waiting until they can afford the item. Likewise where people live, family size, number of work hours etc where people’s wants don’t match their budget.

Plenty live outside their means and make choices they can’t afford. Financial planning for many doesn’t seem to exist so debt or claims for benefits happens. It should be taught as a parenting basic how to live within a budget and to save.

It should be taught as a parenting basic how to live within a budget and to save.

Unfortunately, like healthy lifestyles, financial management can't be taught by the parents if the parents themselves weren't taught and havn't learned such life skills. It's self perpetuating unfortunately.

Is living within a budget something that needs to be taught? Obviously you can tell your children that they should live within a budget and save but the actual mechanics of that depend on earnings and outgoings. A lot is down to personality as well rather than what they have been taught.

I think its considered normal for most to have some sort of credit, like cards or loans of caf finance sort of thing, however I've got myself into trouble in the past (and still bloody paying it off from years ago!)
So now our intent is to keep away from any sort of credit as to not accrue debts in future as it is no way to live.

If this thread has done anything, it's made me pause for a fresh thought about how I would spend/save/allocate my resources if the sky fell in tomorrow.

Always being aware of your situation is never bad, so thanks to pp for some enlightening comments and food for thought.

Is living within a budget something that needs to be taught?
How do people learn about the basics of budgeting if it isn't?
The principles of making a budget are the same whatever you're incoming and outgoings so it doesn't really matter what your circumstances are. My sister is always getting into trouble with money and whenever I sit down with her to try to get to her affairs in order I'm always surprised that she has no real idea what her outgoing are. We always have to trawl through bank statements to find out what she is paying for , sometimes she's paying for stuff she'd forgotten she had like old phone contracts she doesn't use.
How many people really understand how interest rates work or the different types of credit cards available?

For those that say they are debt free
What about council tax and water rates.

Do you pay the whole year upfront.

Or pay over 10 months

What about council tax and water rates.

It's an accruing/proportional expense. If you move out half way, you only pay half for that year. Those paying both annually and monthly are paying in advance of the services they receive, so it can't be debt. For monthly, you've paid the full year by the end of January, so you're ahead, just as you are if you pay annually in advance.

We always have to trawl through bank statements to find out what she is paying for , sometimes she's paying for stuff she'd forgotten she had like old phone contracts she doesn't use.

But that's not even budgeting. It's even simpler than that. It's just common sense to stop dd/so's for things you don't need anymore. Do we really need to "teach" people not to keep paying for things they don't need?

I wouldn't count paying water rates or council tax monthly as being in debt. They don't charge interest and if you left the country halfway through the year, you wouldn't owe them any money.

I changed my council tax payments to the last working day of the month, payable over 12 months, because I wanted them to wait as long as possible for their money.

I changed my council tax payments to the last working day of the month, payable over 12 months, because I wanted them to wait as long as possible for their money.

you know that it's not a direct payment for the royal family to go on another jolly, your council tax pay for things like rubbish collections, roads, fire and police services...

Looking at the state of our roads, we do need a massive increase in council tax to solve that out

@Oliversmumsarmy I’m in Ireland where we have no council tax or water rates. We do have property tax (approximately €100 per year) but wouldn’t consider that debt.

You can't choose a day for it to come out in our county. It comes out on the 10th whatever!

It's possible because I do it.

I have a mortgage, and I have a credit card which I pay off every month.

I'm not well off (single mum working 30 hours a week) but I put every spare penny into savings to pay for unexpected expenses and don't buy anything I can't afford.

I have a separate car expenses account where I've worked out how much I spend a year on MOT / tax / insurance / breakdown and put a 12th of that away each month so the money's there when I need it.

How do people learn about the basics of budgeting if it isn't?
The principles of making a budget are the same whatever you're incoming and outgoings so it doesn't really matter what your circumstances are.

What are the basis of basics of budgeting apart from not spending more than you earn? And that is surely the principal. How easy it is to do depends in part on earnings in that people on very limited budgets have to be more careful not to spend too much.

We always have to trawl through bank statements to find out what she is paying for , sometimes she's paying for stuff she'd forgotten she had like old phone contracts she doesn't use.

As a previous poster stated, that's not budgeting. It's just common sense to cancel payment for things you don't use. I have never trawled through bank statements to work out what on spending. If I have spent more than I would like to in a particular month just spend less the next month on going out etc. I don't have a budget for things like food. I just shop sensibly and don't waste.

Yes if you have a steady income and are careful.

We have a One Account from the RBS -- essentially rolling the mortgage and the bank account up together so your mortgage becomes a large overdraft. The secondhand cars are owned. We have a cashback credit card which is cleared every month and a 0% deal on another credit card which we calculated would save us money compared to the mortgage. We have no other debt. That said, I would consider an interest-free loan or a car lease if I thought it would save me money overall, but would need to be happy that if things turned bad we could pay it off.

We made stupid mistakes when companies threw money at people 20+ years ago. We are still regrettably paying for it now.

I think it sometimes really boils down whether you are a spender or a saver to be honest. Even as a 14 yr old I worked in a bed and breakfast and babysat most weekends. I still have my credit union book and that summer I saved over £800...that was a lot of money then. I’m not tight or mean with my money but once I see my saving increase i hate to spend it as such. I do, don’t get me wrong, I have travelled and still do! I treat myself too, I don’t go without! But I don’t spend unnecessarily! we worked hard and abroad away from our families for 3 years purposely to save money to buy a house and be mortgage free!! My car is 12 years old!! We don’t have sky, I don’t have any subscriptions, I meal plan and portion plan etc etc. I don’t even have a credit card. I don’t need or want one.

shorty

We have friends who lost their homes when money was free.
It was being chucked about, but people were either too dim or too greedy, ending up in misery.
We could have had a great lifestyle if we accepted it, but stayed on the breadline to avoid debt and credit.

"Oliversmumsarmy Mon 13-Jan-20 10:46:29
For those that say they are debt free
What about council tax and water rates.
Do you pay the whole year upfront."

Actually I pay up front but those are some of my lowest expenses so they are neither here nor there. Electricity/gas I have to pay monthly as that is how the companies work but I certanly could afford instead to pay and half the year I seem to have quiet a big credit with them so I don't regard myself as having any debt, over draft, mortgage, credit card debt, anything and I am very lucky.