Wednesday, October 17, 2018
Geld und andere Leidenschaften, 2005
Überschuldung in Deutschland von 1988-1999
Marktverhalten, Verschuldung und Überschuldung privater Haushalte in den neuen Bundesländern, 1997
Überschuldungssituation und Schuldnerberatung in der Bundesrepublik Deutschland, 1992

Financial Capability and Overindebtedness

Since 1990 we have been intensively dealing with consumer attitudes, credit taking and overindebtedness. We are not only interested in the description of differentiated consumption patterns but also how and where they arise. By our results we have built a theory of credit taking and overindebtedness.

We understand credit taking as any form of indebtedness which is economically and legally laid down by law and expects a role-concurring behavior from creditors and debtors.

Credit taking is constitutive for our economic system. There would be no economic growth without credit-related investments. This applies for the production of goods as well as for their demand and consumption. For example young families use credits to finance their consumption. About 4 million new credits are taken each year, as a consequence credit taking has become an accepted and common behavior. The number of credits (~2.5-3%) of credits which can not be paid back by the borrowers show however risks. Unemployment, separation, strokes of fate among low income but also economic inability can quickly lead to overindebtedness.

Overindebtedness is the case when the income is no longer sufficient to fulfil the current financial obligations after the necessary costs for living has been deducted. On the psychological level the destabilization starts with shame, self-reproaches, nervousness and sleeplessness and ends with suicide. On the social level there is a range from mutual accusations of guilt, separation to violence and often health crises.

The number of overindebted households has been continuously increased since 1988. We assume that about 3.5 million households are overindebted in Germany in 2007.

Since 1988 we have documented and commented on these coherencies and developments in four expertises as well numerous essays and lectures on national and international level:

Financial Education
Prevention of debts
Responsible lending
Implementation of credit scoring methods
Definitions of credit taking and overindebtedness
Causes for overindebtedness
Access to financial services
Results of debt counselling

As a founding member of the European Consumer Debt Network and as a member of FIN-USE we introduce our scientific and practice-related findings continuously into the public and political discussion.

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