The Eurozone crisis has been well reported and we’re all more than aware that throughout Europe the turmoil has been devastating for families and businesses alike. Although the crisis has been well reported and we hear about it regularly, many of us are left wondering how it will affect our finances and us. Here’s a quick guide to explain the basics of what exactly this means for you:
Investment is always a risky business and it really depends on what level of investment you’re looking at. For many of us our pensions are the only real experience we have of investment, but for those among us that trade in stocks and shares, the seas are particularly rough at the moment.
Shares have been particularly volatile as a result of the Eurozone crisis, and the value of investments will only become more difficult to predict if the crisis continues to escalate as it has been. Of course the value of investments can go up as easily as they can go down.
Mortgages are one of the largest commitments in anyone’s life, and the Eurozone crisis has changed the game for those already with a mortgage as well as those looking to get one. Put simply, the crisis has made the banks nervous and therefore, considerably more cautious about lending money.
Unfortunately, this means that if the crisis worsens first-time buyers are in for an even tougher time. If no one’s buying, then the majority of us will rent and that could mean a rise in rent prices. This also spells trouble for those with a bad credit history as lenders are much more cautious about whom they’re lending money to.
Protection in the UK
Of course savings are something that everyone has been concerned about as the Eurozone crisis has progressed. The big question is ‘are my savings safe?’ and luckily, the answer is yes. Savers in the UK are protected even if the bank, credit union or building society goes bust.
The same cannot be said, however, if you are saving money in accounts abroad. Although the UK government did step in to protect UK savers when the Icelandic banks collapsed, there is no obligation for the government to do this and there’s nothing to suggest that the same would happen again.
As we’re all aware the interest rates offered by banks have hit an all-time low since the Eurozone crisis hit and there’s no sign that that will change anytime soon. If the crisis continues, we may be in for a long wait before we start seeing any attractive interest rates coming our way.
The crisis has already affected us all in some way or another but it’s unclear whether it will continue to worsen or improve. Governments and specialists have tried to predict how it will progress but unfortunately, it’s almost impossible to do so. The best advice, therefore, is to spend your money wisely and keep up to date with the news to see how your finances will be affected.
This article was written by Jennifer Griffiths on behalf of Pounds to Pocket. If you’re struggling with your finances and your bad credit is holding you back, unsecured loans could be an effective solution.