Inside Money: This account is overdue

Keep the money in your hands or pay the bills on time? Photo / Hawkes Bay Today

This study, according to its promoters Dun & Bradstreet, "highlights a significant gap in consumer knowledge about the importance of personal finance management, such as paying bills on time".

Dun & Bradstreet, a debt collection agency, surely has a great future if this statement is true, however, it could be gilding the survey a little.

Call me naive, if you want, but I believe just about all consumers understand this basic rule of capitalist society.

The headline-grabber from the Dun & Bradstreet survey was that a quarter of New Zealanders would pay bills late if cashflow was tight, with 20 per cent even willing to miss the dreaded mortgage payment at a pinch.

And really, who wouldn't in those circumstances?

I'm not sure what questions Taylor Nelson Sofres (the research firm who did the legwork for Dun & Bradstreet) asked their 1,000 consumers but some of them, in this instance, might have been leading ones.

Predicting future behaviour is always a fraught business but Dun & Bradstreet also supplies some historical data, which you'd expect is more concrete. And the history stacks up reasonably well against future projections, with about 20 per cent paying credit cards, phone bills etc late during the last 12 months.

However, the results are a bit contradictory with the Dun & Bradstreet release also saying 30 per cent of Kiwis paid their credit card bills at 30-plus days past due and, amazingly, 42 per cent waiting over a month past due date to pay council rates. Fact-check please.

Still, times have undoubtedly been tough; bills have been put on hold. Dun & Bradstreet tells us why:

"The primary reason cited for late payments was that individuals did not have enough money - 47 per cent of Kiwis stated this reason for not paying promptly, while 31 per cent said they simply forgot to pay."

But the really interesting thing in the Dun & Bradstreet survey was its first bar graph that showed it was both low and high-income earners who said they were more likely to pay bills late over the next 12 months than those grafters in the middle-income bracket.

Why are the rich just as tardy with bills as the poor? Are they too busy or is it just a clever cashflow management strategy?

David Chaplin