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Gas and Electricity Prices

For those families who work their arses off in underpaid jobs it won’t really matter if you make their energy bills £3500 or £5000.
They still won’t have the disposable income to pay their bills.
They also probably won’t be driving around in new cars or taking any holidays.
Not that the poorest earners deserve holidays, I mean why don’t they just get a 2nd job & work 24/7?
 
Ponty said:
I wouldn’t rule out huge state intervention to prevent forced sales. After all, elections depend on the housing market.
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Not sure how that would work, except possibly 'loans' to pay monthly mortgages but with all the government funding about to drop from the sky, I doubt this would be a fiscal feasibility. It would certainly be unprecedented.

Because local council housing stock is so low, funds could be made available for councils to purchase those properties in peril and the incumbents simply become tenants, with possibly a repurchase option at some juncture The gov't would be 'investing', there'd be a (rental) return, nobody becomes homeless and it could help prevent a property crash. How's that for an (far-fetched) idea ?

Olaup said:
Selling my house & living on a canal boat for the rest of my days is so tempting right now,
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You'll simply 'lock' up your assets. :D

Joe Hutch said:
* I could sit and watch hard work for hours, in fact.
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I understand this was pioneered by a Spaniard a long time ago by the name of Manuel Labor.
 
Ponty said:
For the vast majority, it’s a case of priorities. That might mean fewer holidays, changing the car less frequently, fewer meals out, less spending on crap you don’t need etc. It’s annoying but perfectly doable for most.
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I am not sure I agree, certainly not the "vast majority" part, anyway.

I am certain that I'd be classed as a "high earner", mrs. farfromthesun also works, and we have two kids. I have not been abroad (excluding Ireland, to visit family) since I went to Sri Lanka in 2007, just prior to the kids arriving. We have one car on HP, taken out in 2020 which replaced a rotting 2006 Focus, from memory it's costing £142 per month - I didn't consider at any point that we might have a war in Europe, an energy crisis and rocketing inflation when I signed up to it. Who would?

We have phones, as do the kids. We have the standard (extortionate) internet and basic sky packages. We struggled for years, and only the last couple of years have things become more comfortable for us financially, prior that it was month to month and dipping into overdrafts. For people that earn less (be it a few grand a year, down to those on minimum wage), I have absolutely no idea how they're going to be able to cope.

So I take issue with the "holidays, cars, meals out" - should people just "exist"? Where is the enjoyment? The motivation? Something to look forward to?

It's a pretty easy argument to make when you've already got to the point in life where you own multiple properties and you're not as exposed to this crisis as those who are far worse off are.
 
Mike Reed said:
Not sure how that would work, except possibly 'loans' to pay monthly mortgages but with all the government funding about to drop from the sky, I doubt this would be a fiscal feasibility. It would certainly be unprecedented.

Because local council housing stock is so low, funds could be made available for councils to purchase those properties in peril and the incumbents simply become tenants, with possibly a repurchase option at some juncture The gov't would be 'investing', there'd be a (rental) return, nobody becomes homeless and it could help prevent a property crash. How's that for an (far-fetched) idea ?
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They’ll do anything to prevent forced sales and falling prices. ‘Encouraging’ banks to allow people to switch to interest only, payment holidays, forbearance etc. I disagree with bails outs, as they tend to make problems worse, but it wouldn’t surprise me. Quite like your suggestion, fraught with issues but like the principle.
 
Ponty said:
They’ll do anything to prevent forced sales and falling prices. ‘Encouraging’ banks to allow people to switch to interest only, payment holidays, forbearance etc. I disagree with bails outs, as they tend to make problems worse, but it wouldn’t surprise me. Quite like your suggestion, fraught with issues but like the principle.
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Interest only would be an easy way for people to get through these times.
However it seems like with interest only mortgages you still have to prove you can afford the full mortgage.
 
Quite a few mortgages seem to provide the option to switch to interest only in tough times. I know my sister did back in 2008. She then 'forgot' to switch back to normal repayments in a timely manner - resulting in the mortgage now taking several years longer to pay off. Without that hiccup she would be mortgage free by now and feeling 'safer'
 
The trouble is (and I'm as much like this as most people) that few bother to read the small print. Particularly the bits about 'the value of investments may decrease', and 'your capital may be at risk'. We switched to an interest-only mortgage because it seemed like a good idea at the time; the linked endowment policy would pay off the mortgage and provide us with a useful lump sum when it matured. Then we started getting the letters about how maybe it wouldn't.
 
farfromthesun said:
I am not sure I agree, certainly not the "vast majority" part, anyway.

I am certain that I'd be classed as a "high earner", mrs. farfromthesun also works, and we have two kids. I have not been abroad (excluding Ireland, to visit family) since I went to Sri Lanka in 2007, just prior to the kids arriving. We have one car on HP, taken out in 2020 which replaced a rotting 2006 Focus, from memory it's costing £142 per month - I didn't consider at any point that we might have a war in Europe, an energy crisis and rocketing inflation when I signed up to it. Who would?

We have phones, as do the kids. We have the standard (extortionate) internet and basic sky packages. We struggled for years, and only the last couple of years have things become more comfortable for us financially, prior that it was month to month and dipping into overdrafts. For people that earn less (be it a few grand a year, down to those on minimum wage), I have absolutely no idea how they're going to be able to cope.

So I take issue with the "holidays, cars, meals out" - should people just "exist"? Where is the enjoyment? The motivation? Something to look forward to?

It's a pretty easy argument to make when you've already got to the point in life where you own multiple properties and you're not as exposed to this crisis as those who are far worse off are.
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Sounds like you are prudent. Many aren’t. You’re a high earner, I’d suggest others with similar income will have multiple foreign holidays, new cars, meals out every week etc. You choose not to, presumably because you don’t want to be financially exposed and don’t see a credit card limit as a spending target.

Too many have no financial resilience and are not living within their means, rather living leveraged lifestyles which assume all will be be rosy forever. I’m waiting for the sob stories of ‘we can’t afford presents for the kids this Christmas’, with a picture of a family head to foot in designer clothes and 2 leased German cars on the drive of the ‘Executive home’. 10 bob millionaires everywhere. You’ll know they’re in the 5#1t when they put £20 of diesel in the X5. When their lines of credit run dry, the piper will still need paying. Their choice, their responsibility, their problem, their consequence, not other tax payers such as you and I. As Buffett says ‘only when the tide goes out do you discover who’s been swimming naked’. Help those who need help and have no options, absolutely 100%, but not those who choose to swim with sharks in speedos tied to a leg of lamb.
 
Ponty said:
Sounds like you are prudent. Many aren’t. You’re a high earner, I’d suggest others with similar income will have multiple foreign holidays, new cars, meals out every week etc. You choose not to, presumably because you don’t want to be financially exposed and don’t see a credit card limit as a spending target.
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I am not that prudent really!

Despite earning OK, "normal life" (mortgage, kids, running a car, bills, repairs around the home, etc) costs a bloody fortune and I can't really afford to do a great deal more. We have slowly built up some modest savings, but it wouldn't save us for long if things took a turn for the worse. I would agree that there are people that spend beyond their means, though I can't castigate them for it because in the UK we do not educate people on how to manage their finances. A few iffy decisions can lead to a burden lasting years and I am no doubt that naivety plays a part, as opposed to people willingly racking up crippling levels of debt.

I don't think the situation we are now is anything other than completely unique, impossible to plan for, and is going to cause serious damage up and down the country.

Instead of blaming the individuals, who are - if my own experience is anything to go by - largely blameless, we (the people of the UK) need help by way of windfall taxes, lowering of duty (fuel / vat), more accessible and cheaper public transport, pay rises and proper caps on energy bills (like France). This is all within the power of the Government. Instead of doing all of this they're having a vanity contest and eroding our human rights, whilst siphoning off vast sums of money to their friends and donors.

Imagine if they had the will to fix this with vast sums of money, like they did with Test and Trace.....
 
There does seem to be some very judgmental individuals on this thread.
I would counter irresponsible borrowing with irresponsible lending.
 
We advised our kids at an early age to save whenever possible but also enjoy life at the time. We started the ball rolling with Natwest Pigs, remember them, then when they got to school leaving age they had a nice little nest egg to have some financial backup & further fun, once life began seriously by working for a living they had a foothold on matters. Both of my daughters have been fortunate, they are both career minded, both realise that "live for the moment" is a wise motto but also that life can bite you on the arse sometimes. They are financially responsible & that is somewhat lacking in a lot of people, they want it now no matter what it costs, get the credit card out & go to the max, worry about late payments later on. We all need savings if possible for the inevitable rainy day, today however that rainy day is heading towards a mighty storm for a lot of people, I fear for the future I really do, I fear for the world, a tide of darkness seems to be heading this way.
 
farfromthesun said:
I am not that prudent really!

Despite earning OK, "normal life" (mortgage, kids, running a car, bills, repairs around the home, etc) costs a bloody fortune and I can't really afford to do a great deal more. We have slowly built up some modest savings, but it wouldn't save us for long if things took a turn for the worse. I would agree that there are people that spend beyond their means, though I can't castigate them for it because in the UK we do not educate people on how to manage their finances. A few iffy decisions can lead to a burden lasting years and I am no doubt that naivety plays a part, as opposed to people willingly racking up crippling levels of debt.

I don't think the situation we are now is anything other than completely unique, impossible to plan for, and is going to cause serious damage up and down the country.

Instead of blaming the individuals, who are - if my own experience is anything to go by - largely blameless, we (the people of the UK) need help by way of windfall taxes, lowering of duty (fuel / vat), more accessible and cheaper public transport, pay rises and proper caps on energy bills (like France). This is all within the power of the Government. Instead of doing all of this they're having a vanity contest and eroding our human rights, whilst siphoning off vast sums of money to their friends and donors.

Imagine if they had the will to fix this with vast sums of money, like they did with Test and Trace.....
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Life is starting to cost more although I’d disagree it’s impossible to plan for. IR’s have been at ‘emergency’ levels for well over a decade. That’s a lot of the reason for the problems we now face IMHO. Doesn’t take Eric Monkman to work out where the next direction is likely to be.

Windfall taxes won’t work. Energy businesses are cyclical and would only be right to subsidise them when global prices fall. I gave the example of my gas and electricity, it’s going to mean a net extra cost of £24 a month on the SVR come October. That level of increase shouldn’t break the bank for the vast majority of people. Folks have very short memories. Only 2 years ago, the govt was showering people with cash. Petrol was £1 a litre, heating oil was for nothing and oil companies were losing money. I don’t recall people saying it was too cheap and volunteering to pay more then. All seems like ancient history now, conveniently long forgotten.
 
I don't understand why the BBC, press and Internet warriors are spreading doom and gloom. This I see as cherry picking bits in isolation and then make a big thing out of them. One example mentioned on pfm are the big profits from oil companies but the commentators that spread the bad feelings ignore the fact that most of these businesses did not take any government handout money during covid lockdown and had to go into debt. The other fallacy spreading is that this profit is at the expense of us Brits so we say 'give it back!'. The profits are made on the global market where at the moment prices are high due demand after covid and the Russian war on Ukraine however other oil producers are now pulling more of the stuff out of the ground so the global price will start to drop.

The above is just an example of much misleading information that is being spread.

I don't see much discussion on high UK employment that will result in increased NIC and income tax receipts from the workers who will then spend that money with resulting VAT receipts. More money in the coffers to help those less well off through these difficult times.

True we are in for a rocky ride but my gut feel is that we won't experience things anywhere near as bad as us oldies saw in the '70s/80s although for the younger never-had-it-so-good generations it may come as a shock.

Things are not as bad as are being made out so we should look on the bright side as better times will return unless Putin and Xi fire a few nukes then for most of us it'll be game over. Even with just a handful of nukes you can forget global warming.

DV
 
Darth Vader said:
True we are in for a rocky ride but my gut feel is that we won't experience things anywhere near as bad as we oldies saw in the '70s/80s although for the younger never-had-it-so-good generations it may come as a shock.
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I agree, though it could surpass those times but in different ways as life was so much simpler then. Anyway, nothing wrong with a bit a doom 'n' gloom !
 
Darth Vader said:
I don't understand why the BBC, press and Internet warriors are spreading doom and gloom. This I see as cherry picking bits in isolation and then make a big thing out of them. One example mentioned on pfm are the big profits from oil companies but the commentators that spread the bad feelings ignore the fact that most of these businesses did not take any government handout money during covid lockdown and had to go into debt. The other fallacy spreading is that this profit is at the expense of us Brits so we say 'give it back!'. The profits are made on the global market where at the moment prices are high due demand after covid and the Russian war on Ukraine however other oil producers are now pulling more of the stuff out of the ground so the global price will start to drop.

The above is just an example of much misleading information that is being spread.

I don't see much discussion on high UK employment that will result in increased NIC and income tax receipts from the workers who will then spend that money with resulting VAT receipts. More money in the coffers to help those less well off through these difficult times.

True we are in for a rocky ride but my gut feel is that we won't experience things anywhere near as bad as us oldies saw in the '70s/80s although for the younger never-had-it-so-good generations it may come as a shock.

Things are not as bad as are being made out so we should look on the bright side as better times will return unless Putin and Xi fire a few nukes then for most of us it'll be game over. Even with just a handful of nukes you can forget global warming.

DV
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Oil is back below pre war levels per barrel, so we've had a few months of eye watering prices and they've made record profits, meanwhile price at the pump is barely down from its recent high.

Pardon me if I don't cry them a river.
 
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