Debt may get worse as consumers ‘think more about relationships than money’

Many consumers could find themselves in debt or suffering from financial problems as they do not spend enough time thinking about money matters.

This point was made by personal finance expert John Lawson and psychologist and relationships specialist Dr Janet Reibstein, who both noted people think far more about their loved ones than they do about their personal economic situation.

Mr Lawson said: "Our research shows that [consumers] spend just about half an hour a day thinking about money matters and yet two hours twenty minutes thinking about emotional commitments. Family, friends and loved ones are an important part of people's lives."

While it is not a bad thing to spend time dwelling on personal matters, people should devote more time and energy to finance, he added.

Dr Reibstein backed this up by noting people make a "distinction" between the two subjects.

She added: "You make decisions about how you want to live and finances either support them or don't."

Such a situation could mean many people are too focused on their family, friends and close personal relationships to mange their money in the way they should, something that could lead some into running up arrears and needing debt management help.

However, this week has provided evidence that some consumers have been more money conscious when approaching close personal matters, with a Santander survey showing the average person is spending £879 on gifts, treats and dates with their nearest and dearest this year, compared to £1,103 last year.

This change has included 22 per cent of people looking for cheaper ways to date, while spending 13 per cent less on anniversaries and Christmas and 11 per cent less on birthdays.

Overall, women have cut back more (23 per cent) than men (22 per cent), the survey showed.

Posted by Paul Thacker