Credit Crunch: The Personal Pain And Gain

Posted at 16:23pm on 24th September 2008
Related Posts: Ten Tips to Stay Free From Debt; Ten Tips To Get Rid of Debt

EFFECTS OF THE CREDIT CRUNCH

Watching the UK’s Channel 4 TV programme Dispatches on the human cost of the credit crunch was heartbreaking. First there was the man (Jamaican, I think) who’d worked all his life on the buses. Masking his emotion with a big, beaming smile, he told us that he had never imagined that retirement would be so frightening. He indicated his gas and electrical bills. They terrified him, he said.

Then there was the single mother, wanting to do what all mothers want – to give the best to her children. She was easy prey for the loan-sharks who convinced her that she could easily repay her loans and who, once she neared doing so, convinced her that it would be in her interest to take out another loan.

The divorced mother, who left her husband with nothing but the clothes she and her children were wearing at the time, was similarly exploited. The £400 she borrowed was quickly consumed by the cost of school uniform. Whilst the mother who worked for the now bankrupt airline Excel, found herself suddenly with no income, no money to feed herself and her children, and only a vague promise of a loan from Social Services.

REVERSE MORTGAGE MARKETING

All three women feared the loss of the property they had purchased, in order to create a home for their children. But the worst, the most despicable treatment, was meted out to a pensioner with Parkinson’s disease. Promised a lump-sum if she agreed to a reverse-mortgage of the home she’d bought when widowed, and lovingly improved, she found that the amount she had been spending on her mortgage more than quadrupled in rent to the loan company. When she was unable to meet the payments, her flat was repossessed. And when she asked for the arrears to be taken from the lump sum, she was told that it was not payable for TEN years after the agreement. A swindle, if you ask me.

It made me so angry. And tearful on behalf of ordinary, decent people. And it reminded me of my own plight when my children were young.

DIVORCE SETTLEMENT

We were left without an income when my children’s father departed to set up home elsewhere. Unable to heat the large Victorian, stone-built family home which had been awarded me as part of my divorce settlement (with the encumbrance of a mortgage) I used a calor gas heater in the hall in an attempt to fend off the damp. To no avail! The windows streamed with condensation and, in no time, the wallpaper was hanging from the walls of the dining room.

As soon as the girls’ schooling permitted, I put the house on the market, and had a purchaser lined up who agreed to the asking price. But this was the 1980’s when gazumping was the norm. My purchasers, knowing my vulnerable position, kept me hanging around for months. Then they dropped the price they had offered me by nearly ten per cent. With the vendors of the house I wanted to buy threatening to pull out of my agreement with them, I had no option but to accept the reduced offer.

A BETTER PERSPECTIVE ON LIFE

Nevertheless, my daughters and I look back on that time with mixed feelings, part horror and part gladness. We felt it taught us so much about what mattered, you see. Gone was the lavish lifestyle of fancy restaurants, ponies and racing dinghies. Instead, I learned how to make a chicken last five days (I know! That’s two days longer than the best before date, but we came to no harm). First roasted, then stir-fried, then made into a pie which did us two days, and finally simmered for stock and soup, we considered ourselves well fed. I learned, too, that the butcher’s trimmings from gammon joints and such like can be bought cheaply over the counter and were useful to supplement the meagre filling for the chicken pie.

Christmas found us making sweets for presents, sewing lavender bags (the flower heads harvested from the garden), and raiding the ‘bit bag’ for fabrics and trimmings to be made into any number of useful and decorative items. It was, my industrious girls declared, the best Christmas ever.

GENEROSITY KNOWS NO BOUNDS

We found, too, the truth of the axiom ‘it is more blessed to give than receive’. Having always, in the past, been the givers, we now had to accept with grace the generosity of others. And generous they were. Like the widow’s cruse of oil in the Bible story, we never ran dry of gifts of food and toiletries which appeared, anonymously for the most part, in the cupboard, on the doorstep, or delivered by the local grocer. Gifts of money arrived, as well. Sometimes from people we had never met. Friends of friends.

I had applied for help from what was, then, the DHS. But the list of questions about being in receipt of ‘gifts in kind’ made me have to think again. I couldn’t, in all honesty, say that I had received nothing. And to say that I had received something made me ineligible for financial help. I had phone calls from the Department, urging me to collect what I was ‘due’. But I wasn’t due it, I told them. And even when they sent someone out to see me, I stuck to my guns. To have done otherwise would have meant telling a lie.

ALL GAIN AND NO PAIN?

It will be harder for the participants of Channel 4’s programme than it was for me. I was brought up in an era when being frugal was commendable – whatever your means. Today’s mothers and children have been led to believe by government, banks and credit card companies that they can have it all, and have it all instantly; that it’s all gain and no pain. The pain, for them I fear, is just beginning. But I hope, I just hope, that they will look back one day, as I have done, and find something of value in the experience they’re about to go through. They have my very best wishes that in the days ahead there will be something good in their lives.

Related Posts: Ten Tips to Stay Free From Debt; Ten Tips to Get Rid of Debt

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