Ok, so I found out some interesting, some reassuring and a few distressing points of comparison. The headache I had analyzing the results reflects some sloppiness in test design … yes, I whacked it together on the fly … so BIG thank you, thank you, thank you to the 56 people who participated (And the 55 of you who didn’t use the comment box to snark!)
To keep things bite-sized I’m sharing the findings out across several blogs (stay tuned). The headline for today: those of us in debt, don’t do it by halves.
This chart compares your individual earnings with the amounts you told me you owe (excluding mortgages) to reveal what % of your income belongs to a creditor.
These numbers likely underestimate what you owe (and in some cases, probably substantially) seeing as I applied two assumptions to simplify the data
1) blanket assumption of 20% tax bracket (yes, a few of you pay less – but a big majority pay a lot more)
2) the debt question asked you to tick which amount you owed more than; in the analysis I very generously assumed “>12,000” was in fact 12,000 (when the next choice up was >20,000) and so forth.
Category A represents 44% of us …if we stress amount money, we don’t stress about the debt side of it since we don’t have any. The rest of us do.
Category C people owe over 100% of their after-tax income. This bracket covers a varied collection of situations. There’s the poor “highly anxious about debt” person whose partner owes more than £100,000 even though they themselves owe nothing – the personal loans hang over them both. There are people whose debt has kept their small businesses afloat or carried a partner through a period of redundancy. There are people paying off hefty student loans which for many is more an investment than the sort of debt explained by Imelda Marcos style tendencies, taking lots of expensive holidays or routinely living beyond our means.
Which brings me to the whole stack of people in category B … the “normal” gang; owing 65-70% of after-tax earnings on non-mortgaged debt seems a scary average. But maybe it isn’t. Most of us seem accustomed to being in debt. The majority of respondents weren’t worried about debt (if they had some). Only 15% replied they felt anxious and just 5% very anxious. Remarkable. And nothing to do with size of earnings … as we shall see in the next installment of Survey Says.