Personal finance website Financity has warned UK borrowers not to be fooled by recent research out from IBM that the average UK adult is worth £82,400.
This research takes into account net wealth, including value of your home, savings and contribution schemes. The reason that so many people in the UK are 'well off' is in line with the fact that house prices are going stratospheric.
But FinanCity says that as attractive a statistic as this might sound, it's not really the true picture.
Arthur Kendall, managing director of personal finance concern at FinanCity, says: “Unless you plan to sell up and become a nomad in the Sahara or perma-camp on a beach in sunnier climes, this statistic isn't going to do you a whole lot of good. As long as you intend to keep a UK roof over your head, you will have to keep paying the prices.
“If you do continue to live there, and intend to leave your house as part of your estate, then your children will get slammed with inheritance tax anyway.”
Despite this statistic, the company says that people in the UK have a reputation as financial ostriches. With one of the biggest credit cultures on the planet, people have to start reigning in their finances and taking control themselves.
Pointers on how to do this:
A holistic take on your wealth is beneficial – people often only look at it in terms of what they have in the bank and how much they owe. To really get an eagle eye view of your finances, you have take all aspects of your financial health into account.
Sensible finances: people have to start looking towards provision they have made for old age and at aspects like income protection - people need to start thinking ahead in terms of their finances.
Seek proper advice: don't put your head in the sand and pretend that all is well – do research, find out the facts and learn to manage your finances in an intelligent way
FinanCity is a personal finance website that enables people to manage their finances in an effective way – the site also has modelling tools which people can use to make predictions on their financial future.