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Expat Investor : September 2008
STATISTICS AND ANALYSES One in 10 in the dark about debt levels Brits underestimate how long they will live A medley of statistics and analyses revealing much about our responses to saving, investing and spending our money. As greater longevity is increasingly becoming a fact of life, people are leaving themselves vulnerable to financial hardship at a time when they are most in need, according to research released by Life Trust Insurance plc. Nearly half the population of the UK said they were only expecting to live to the same age as their parents’ generation – with 49% of North Easterners, 45% of North Westerners, 44% of those living in the East Midlands, 51% of those living in the West Midlands, 50% of South Easterners, 48% of South Westerners, , 50% of those living in Yorkshire and The Humber, 48% of Scotland and 47% of Wales – while approximately one in ten questioned in each region were even expecting to have shorter life-spans. Life Trust is concerned that people are not aware that they are likely to live far longer than their parents' generation and should be preparing to finance this increased chance of living longer. A man aged 40 today has a higher than one in three (39.2%) chance of living to 90, and a 4% chance of living to 100, whilst a woman aged 40 today has a one in two (53.1%) chance of living to 90, and a one in 10 (11.2%) chance of living to 100. There are currently 42,900 people in UK aged 90 or above, and this figure is set to increase as people are living healthier lives into advanced ages. Interestingly, whilst people do not realise the possibility of themselves living longer than their parents, they do recognise that their children will live longer lives than they will. However, 18-24year olds grossly underestimate this, with only 25% of them thinking that their children will live longer, whilst 44% of 55 year olds thought this. Waiting for inheritance which may never come We’re in the dark about our finances, according to new research released by CreditExpert.co.uk. The survey reveals that despite 96% of us claiming to be familiar with our current finances, when questioned further it appears that many of us do not have a clear picture of our credit commitments. The research revealed that: ? only one in four (26%) of us can accurately state how much we have left to pay on our loans. ? one in five (20%) admit to only planning finances once every six months or less. ? one in 10 of us admit to having no idea about how much debt we are in. Jim Hodgkins, Managing Director for CreditExpert.co.uk, comments on the research findings, “It’s alarming to see that while almost the entire UK population think they are on top of their finances, many aren’t. “Keeping track of your commitments and planning for the future are always important and in addition to checking bank and credit card statements, you also need to regularly check that your credit report is accurate and up-to- date.” As well as being unaware of what is going on in our credit accounts, a significant proportion of us are also unclear about the APR (annual percentage rate) we are charged on credit cards, loans and overdrafts. Whilst most of us know our overdraft limit, the study revealed that over a third of the population are unsure what APR is. The lack of APR awareness is even more marked when it comes to credit cards, with 48% of the nation unable to recall the APR on the cards they hold. The research also reveals the British public are not confident when it comes to applying for loans. Forty-two per cent of adult Brits do not believe they could secure a loan of £10,000 and 66% think that we would be refused a loan of £30,000. Almost one in two Brits (45%) are putting their life on hold, saying that they are unable to afford to pay for big costs like mortgages and further education without the aid of inheritance according to new research from Engage Mutual. At a time when households are spending nearly one third of their disposable income on essentials, the chances of getting on the property ladder or paying for a child's education are becoming unaffordable dreams for many Britons. At the moment one in 10 British adults dismiss being able to own a property unless they inherit money (11%) and almost one in four say that they would be able to pay off their mortgage with the help of an inheritance (23%). With previous research from Engage Mutual showing that 54% of retirees are struggling to make ends meet, and 7,900 pensioners being declared bankrupt in 2007, many Britons may not receive the financial lifeline they are looking for from inheritance. This raises alarm bells over their financial expectations. Further findings 12% of Brits have written off being able to afford to retire unless they receive an inheritance. Eight percent of people over 55 are still waiting for inheritance in order to be able to afford to retire. Many people see inheritance as a way to make their dreams come true. One in 17 say that they will only be able to afford a career change if they receive an inheritance (6%) and almost one in five will only be able to afford to travel the world if they receive an inheritance (19%). Three per cent will not be able to afford their own wedding without an inheritance. Whilst just 8% consider themselves to be well enough off to afford what they need without an inheritance from family members, the Welsh are those most likely to say that they need an inheritance to cover costs (57%). Online Brokerage for Offshore Investors • Trade Forex, Futures, CFD’s and Shares offshore • European, North American & Asian Stock Exchanges • Backed by TD Waterhouse and Fortis www.internaxx.lu Tel: (+352) 2603 2003 Your International Online Broker in Luxembourg Internaxx Bank S.A., 46a avenue J.-F. Kennedy, L-2958 Luxembourg, R.C. B 78729. Fast Facts 77002 September 2008 ? EXPAT INVESTOR 5
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