Shared Appreciation Mortgages – a new scam to me

I had never heard of these until reading a Sunday newspaper I usually don’t get, The Mail on Sunday. Their financial section had a piece on ’shared appreciation morgages’ that were marketed by the banks, barclays and HBoS in the late ninties.

They are horrific in their terms, allowing the banks to keep 75% of any increase in the value of a borrowers property. Legalised burglary at its finest.

They were mostly promoted to the elderly to give them an income from equity in their homes, and in many cases now, widows ands widowers are facing losing their homes as the banks move to repossess property after the death of their spouse.

See the full story and details of how one pensioner, Mr. Roy Muckle has been badly traumatised by his run in with HBoS.

As you know by know, I have little regard for the banking industry, who I believe considers all their customers as cows to be milked for their maximum profits regardless of the hardships endured.

Step out of the banking system, wise up to the facts, opt in for more information at www.wealthfreedomfighters.com

Personal Debt – Is excessive shopping due to peer pressure?

Personal debt is out of control in the UK and USA. It has become tolerated and even expected that we each have credit cards, loans and mortgages, and most of our wages now go to keeping up with these debts. and yet, we can’t seem to stop spending. Why?

Alongside the shrieking headlines about the global credit freeze are equally gloomy highlights about recession caused by lack of consumer confidence. ie. we’re not spending. So, is it our moral duty to carry on building debt to keep the economy alive?

Consider magazines, newspapers and tv; all carry advertisments extolling the virtues of the next ‘must have’ item. Most editorial in women’s magazines is about what you should be wearing now and next season and where to get it. Spend now to look fashionable.

An almost rabid encouragement for us all to spend, spend, spend seems to have become the default editorial for all publishers, who extol the virtues of the many products supplied by their advertisers.   

We all have fallen for this societal peer pressure, shopping is now longer a pursuit to be undertaken when you need something, now it is every weekend occurance, and for some an every day, habit.

I used to be just as guilty as the next person of excessive shopping. Being a spendthrift is portrayed as glamourous and exciting, whilst being frugal is seen as being sensible and dull. Again, why is spending vast amounts of money on fripperies you don’t have any need or real want for seen as having fun?

I remember those crazy shopping days, after all, I only really quit about a year ago. Every weekend was spent in some shopping centre or other, often coming home with bags and bags of goods every week.

The first purchase was the most important because that loosened me up to spend more. Until I made that first buy, I wasn’t able to relax, I would be thinking about what I needed, whether or not I could afford it, and that I shouldn’t really be shopping at all. After I first handed over my card for the first purchase of the day, it was as if a veil came down, and I went into a shopping trance. Now, there were no further worries about affordability, just if something was pretty enough to catch my eye, and get me to buy it.

There is no logic to such spending, you’re not buying anything useful or necessary, you are not even indulging yourself. It’s a self destructive act, and seems unstoppable.

When you meet friends for lunch, they’re all so excited about your purchases and yet you start feeling sick inside because you know you didn’t need or want these things. The only joy you get from them is your friends’ cooing and aahing over your taste and choices.

When I got my loot home, oftentimes they would stay encased in their shop bags, sitting on the bed in the spare room. And I would forget about them until the next time I would go in to stash another day’s haul.

Contrast that with our frugal friend who only buys what she needs when she needs it. She always has the money for what she wants when she needs it. She never has to worry about not being able to pay the rent because she blew £300 on 2 pairs of high heeled shoes she can’t walk in that month. She is not swayed by silly magazine headlines about this year’s hemlines or shirt style must haves. She is smart, presentable and able to contribute to every collection because she has money in her purse.

Our frugal friend can go on holiday to where she wants because she saves every month to be able to do so. She has a nice car that’s well maintened, and she never runs out of petrol. She has a comfortable home and probably doesn’t have 10 different linen sets for her bed, but two or three good ones that she really likes.

She never worries about the bills that land on her mat because she always knows what her account  contains, there are no surprises in her credit card accounting for items that she ‘forgot’ she had bought. She is totally in control of her finances and even has several savings and investment accounts.

So why has the spendthrift lifestyle become the most attractive one that we all seem to mindlessly pursue when it’s obvious our frugal friend has a much nicer, more relaxed and carefree existence? why do we laugh when we admit to being ‘hopeless with money’ and see it as a badge of honour to have a scary overdraft and several £thousands on various credit cards?

Would it be because we have been constantly sold on the ‘instant gratification’ culture? The ‘must have it now or it’s worthless to me’ generation are waking up to a mountain of debt they have no hope of ever repaying. Is anyone besides themselves to blame?

Human beings are weak unless they personally strive to exercise self discipline and self control, and in a culture where such attributes have no value, there is no impetus to develop them.

The marketing men employed by the banking and credit industries in the 1950s and 60s created the monster ‘must have it now’ culture, and it has grown and matured into the society we have today where no-one saves, everything can be bought at a price and we all strive to live like the Beckhams.

Simple values that were always core to the human experience of honesty, integrity and hard work seem to be worthless. Living a simple, frugal life seems now to be a desperate sign of poverty rather than a committed, honest choice to live within your means. When did debt and spending money you didn’t have become so admirable?

We need to start ignoring the insiduous messages of the marketing supremeos, we must find a way to block the call of advertising so it no longer influences us. A way to start is to switch off your tv. Then stop reading magazines and newspapers. They’re full of propaganda and advertising with very little real, unbiased news, so dropping them from your routine will only benefit you.

Start to think about what you are buying. Before every purchase ask yourself if you really need this item, will it add value to your life, it is completely necessary to take the money from your bank account to acquire it? Even when doing your grocery shopping, question every item you put into your trolley. Tesco is not making billions of profits because we all just buy what we need when we shop.

Become a conscious shopper, be aware of everything, primarily your needs, but also the blatant messages there to seduce you into buying unnecessary items. Be frugal, let’s make it fashionable to be responsible and careful with money.