en-us http://backend.userland.com/rss Your Friends @ Myvesta.org.uk (stever@myvesta.org) myvestaukblog_archive.html stever@myvesta.org 112433464968856978 If you are at all interested in the factors that led people to overspend then I suggest that you spend some time curled up with the Financial Services Authority paper by The Henley Centre titled “Towards Understanding Consumers’ Needs”.

The paper revels that more of the spending in the UK is targeted towards lifestyle and fun purchases rather than needs. It is forecast that by 2010; nearly 75 per cent of spending will be on the lifestyle and fun items.

Time and time again study’s like this one have shown that an increase in income and disposable wealth do not increase our satisfaction with life or our happiness. This work shares that very same message again.

I love the fact that the paper presents the underlying issues why people get into financial trouble and even shows you Maslow’s Hierarchy of Needs, a key force in consumer debt. Maslow’s work is a critical tool in understanding the underlying motives that get people into financial trouble.

A key point in the paper seems right on target. It states that rather than life becoming less financially uncertain, it will become more so because as life becomes more complicated, the risks increase as well. The nasty shift from things that used to be labelled as nice to have items is rapidly shifting to must have items, especially in the travel/leisure categories. More mandatory discretionary items simple means more debt for many.

If you enjoy research like this, you will be very interested in the polarity of findings. The work presents points of view of people from hedonists to calculating planners. This work is very enlightening and worth investing the time in reading all 114 pages.