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Profligacy, the cause of the problem: not in Bulgaria

There are strong cultural and lifestyle differences between Britain and Bulgaria and nowhere is this more obvious than in the realm of money. The personal financial profligacy by Britons is starkly contrasted by their Bulgarian counterparts who exercise financial prudence and healthy money habits. Why are the Bulgarians better at thrift than the Brits?


Different cultural attitudes to money are at the root, which are highlighted even more in these financially challenging times. The Bulgarians are better placed to embrace long term frugality as a means to weather any financial or economic storm. In the UK, people are only embracing prudence as a short term solution, after years of ridiculous over-consumption and over-spending.

Those who have bought property in Bulgaria and visit the country regularly or live here, will already understand about the Bulgarian way of life. For those who are considering property, this is a short analysis of how the Bulgarians are a living example of a financially cautious people yet have a great quality of life.

Figures released show that more than 55% of Britons have changed their money habits during the recession, endeavouring not only to spend less but even save. Big holidays and unnecessary goods are gone. Bulgarians by contrast have always saved and rarely splash out on luxury items. It is the Bulgarian national attitude towards thriftiness which sets them in front as folk who are way ahead in being financially prudent.

The global financial crisis made little difference to the Bulgarians. Bulgaria was already a belt-tightening country where they grow their own fruit and veg, use local suppliers, walk rather than take the car, enjoy time with the family rather than down the pub... 

In Britain, whilst there has been a shift towards this way of life, it is mainly cited as being 'for the environment', rather than a true lifestyle change. Bulgarians do this as a matter of course and values, Britons more usually because it is attractive to be seen by others as putting the environment first rather than themselves: allowing them to feel morally superior to those who buy the imported veggies in the supermarket. It is only now that they are starting to perceive the other result of this kind of labour: saving money.

The Bulgarian mentality is ingrained with living in a simple manner and part of that is spending less. If you have spent any time in the country you will see that lack of big-spending and over-indulgence is conspicuous.

A main reason cited in the UK for emigrating overseas is to lead a more simple life and have a better quality of life. The Bulgarians have that, enjoying family, conversation and a good laugh, rather than spending lavishly on the latest trends. Don't get me wrong, they like the newest mobile phone as much as anyone but they never take credit to purchase.

Through centuries of skimping and scraping, and more recent memories of hard times, thriftiness is a natural part of the country's psyche. This leads them to a simple lifestyle but a higher quality of life, where their personal balance sheets are in good shape.

Family upbringing plays a huge part in this, with most Bulgarians feeling proud to be like their grandparents, who re-use nearly everything, make their own clothes, grow their own food, look after family and are kind to their neighbours.

Pessimism also has something to do with this financial prudency. Most Bulgarians are naturally pessimistic, preferring to save now because tomorrow may be worse. Compare this with the British attitude that things can only get better. There is an innate British belief that no matter how bad things are right now, everything will always get better.

The pessimistic attitude, and natural caution, of the Bulgarians creates good money habits and putting money aside for a rainy day. The ever-optimistic Brits and western Europeans, however, whilst making some changes in the crisis, believe that it is for the short-term.

Bulgarians also have the highest home ownership in the EU without mortgage and have very little in the way of any form of personal loans or credit cards. The Bulgarian banks have long exercised cautious lending, well before the crisis.

One wonders though what kind of price those in Britain will pay for such rampant personal financial profligacy with record personal debt and houses at five to seven times income. I should imagine there is more than one person who proffers up a prayer when tapping in their PIN number, hoping it will pay out some money and not swallow the card.  It should have been recognised years ago that 'prudence had left the building'.

It was interesting recently to talk with English friends (Sue and James) in the UK, who confirmed a completely different attitude towards money, which has just had to drastically alter. They are just your normal family in the UK. Huge mortgage, maxed out credit cards, kids wanting everything Nike and new computer games. They are both well educated and not at all stupid. But even though earning good money - 64,000 sterling a year - they are still left counting the shrapnel at the end of the month to see if they can afford a beer down the pub.

They recently totted up their debts and credit cards, which worked out to a hefty 120,000 pounds not including their mortgage! Now, they are also finding it hard to make even the minimum payment on their credit cards and are being hounded by the credit card companies. It was evident that they had to alter their spending habits. They knew the debt was down to their reckless spending. They cut back their budget and were trying to see if they could get by on 400 pounds a week, or some 1600 pounds a month, not including mortgage, electric, gas or council tax.

Sue recounted the horror of it, "It suddenly dawned on me that I had no idea how much anything cost. I couldn't have told you how much we paid for internet or food shopping. Now, I have to say what I've never said in my life before, 'I can't afford it'. It makes me want to weep. When I looked at the figures it was so clear that we'd been overspending by a grand or two a month for ages."




"The kids were spoiled, getting anything they wanted. We were too, thousands of pounds on clothes, some never even worn, endless trips to the beauty and hair salon, two thumping great cars. We never used a bus! Private dentists and doctors. The list was endless and so much of it unnecessary. But whilst we could get more money on credit cards, it didn't really matter. We also thought that with house prices going up, we'd made a huge profit on the house. Now, we've lost most of the gain on the house with the property prices crashing and anyway we'd have to sell to get whatever profit is in it, then where would we buy next?"

The family agreed that some big decisions had to be made. Reducing their broadband package, no new computer games, no new clothes, getting rid of Sky tv, selling one of the cars, and more...

"I was so depressed", Sue added. "Suddenly images of my mother and grandmother came to mind. Only three tele channels and a small pot of Nivea face cream for my birthday. Rampant spending has left us broke. I had never had to think about money before.  It came a complete surprise to me how much a 'latte' is - four pounds is insane and I'd think nothing of having three or four during the day. In our situation it seems a stupid waste of money. Now, it's coming up Christmas and I feel as if I've failed if we can't buy the kids what they want: it's making me panic. All my energy now is consumed by just trying to get through each day spending as little as possible".

James backed up Sue's thoughts, saying, "The kids are far from happy but at least the calls from the credit card companies have stopped. That's already taken a weight off my mind. I'm just shocked how easy it has been for us to keep on spending, spending, spending without thinking about it. I just can't believe how normal, intelligent people like us could think we can't live without spending 100 pounds on dinner out for just us two, or simply won't buy wine at less than 20 pounds a bottle because low cost means low quality in our heads - or on whatever things we want, without having the money to do so. Our whole culture seems geared towards us believing that having endless luxury items is essential and our 'right'. My father would turn in his grave".

Compare this tale of woe with a British family living in Bulgaria. Similarly to Sue and James, they are a couple with two children. They are debt free: no mortgage, they own their detached four bedroom-two bathroom home outright: two cars: no credit card debts and no loans.

With the low pound, this has meant their income is now worth 30% less than a couple of years ago. However, even though their money is less, they still have an excellent quality of life and have taken the Bulgarian habit of saving a little every month, which has now stacked up in less than a year to 6,000 pounds. The family are happy, all well clothed and well fed. The children both have mobile phones and a few computer games but actually prefer taking off outdoors with their friends to sitting at home on the computer. The parents pay for additional private tutorage for the boys for German language lessons. They eat out in a good restaurant once a week and have a family meal out every weekend. All this, despite the fact they are on a fixed income of 24,000 pounds a year.

The Brits are paying for their recent profligacy by lowering their living standards and trying to rebuild capital for the future. The Bulgarians, by contrast, have always had the knack of living within their means, so have remain largely unaffected by debts and the global crisis.

Many Britons have been forced to change their lifestyle and spending through the crisis. How long will it last? How long will they be happy to keep saying 'I can't afford it'. One gets the impression that one sniff that mortgage lending or personal lending is going to ease and life in the UK will be back to the normal binge-spending round. The culture means that they are more likely to start sufffering from 'frugal fatigue' and surrender their new-found thrift. The Brits may temporarily flirt with prudence but are really seduced by spending.

Many canny Brits and other EU citizens have already turned their backs on this way of life and instead paid attention to Bulgaria - where prudence and thrift are a natural way of life, thus avoiding the giddy highs and lows of Britain's rollercoast economy and culture - and buying into a better quality of life!