Millions have saving of less than £100
Discussion
Funnily enough before i read this thread today I said to my colleague earlier that it seems like every frigger at work has a second property or a buy to let. I honestly don't know how some of them do it because most of them are middle earners for London 50/60/70k and have big mortgages living in z2 and 3.
Because I believe I am of Jewish /northern / Scottish heritage I could theoretically get involved in buy to let. I only owe 90 grand on our house worth 500k ish (that is purely by luck I should add buying and selling at right time and my wife got a reasonable redundancy package 3 years ago from the city)
BUT. s
t can and does happen. My wife and I are 31. In 2013 we were doing very well, earning 100k odd between us,and life was very nice. But she ended up getting made redundant from her city job. Got a good pay off, retrained and is now a teacher. She now only earns 30k odd but she likes it. But obviously we are 20k or so down in income from where we were 4 or 5 years ago. We weathered the storm and came out the other side in good shape.
But don't think it can't happen to you . It can.
Because I believe I am of Jewish /northern / Scottish heritage I could theoretically get involved in buy to let. I only owe 90 grand on our house worth 500k ish (that is purely by luck I should add buying and selling at right time and my wife got a reasonable redundancy package 3 years ago from the city)
BUT. s
t can and does happen. My wife and I are 31. In 2013 we were doing very well, earning 100k odd between us,and life was very nice. But she ended up getting made redundant from her city job. Got a good pay off, retrained and is now a teacher. She now only earns 30k odd but she likes it. But obviously we are 20k or so down in income from where we were 4 or 5 years ago. We weathered the storm and came out the other side in good shape. But don't think it can't happen to you . It can.
z4RRSchris said:
TheLordJohn said:
z4RRSchris said:
i am lucky to earn 6 figs - rented house
Where's the logic? I dont have £500k and it would take me about 50 years to save that.
You could do it in 9 years the hard way. But surely you know how to make money make money with that kind of earning power.
Post your p60 or your just another lying forum fantasist
SystemParanoia said:
50 != 9
You could do it in 9 years the hard way. But surely you know how to make money make money with that kind of earning power.
Post your p60 or your just another lying forum fantasist
You and your achievement filter have quite the unhealthy fixation with the financial position of others.You could do it in 9 years the hard way. But surely you know how to make money make money with that kind of earning power.
Post your p60 or your just another lying forum fantasist
Imagine asking, without hint of humour, to see a stranger's P60 in real life as proof of their earnings level.
SystemParanoia said:
50 != 9
You could do it in 9 years the hard way. But surely you know how to make money make money with that kind of earning power.
Post your p60 or your just another lying forum fantasist
i feel no need to post my p60 thanks. i also feel no need to own a house. You could do it in 9 years the hard way. But surely you know how to make money make money with that kind of earning power.
Post your p60 or your just another lying forum fantasist
nor do i feel the need to try and save 50 grand a year to buy a house.
SystemParanoia said:
z4RRSchris said:
TheLordJohn said:
z4RRSchris said:
i am lucky to earn 6 figs - rented house
Where's the logic? I dont have £500k and it would take me about 50 years to save that.
You could do it in 9 years the hard way. But surely you know how to make money make money with that kind of earning power.
Post your p60 or your just another lying forum fantasist
you obviously have no idea what is like paying to live in London. Saving £50k a year on £100k isnt possible for most.
princeperch said:
BUT. st can and does happen. My wife and I are 31. In 2013 we were doing very well, earning 100k odd between us,and life was very nice. But she ended up getting made redundant from her city job. Got a good pay off, retrained and is now a teacher. She now only earns 30k odd but she likes it. But obviously we are 20k or so down in income from where we were 4 or 5 years ago. We weathered the storm and came out the other side in good shape.
But don't think it can't happen to you . It can.
some storm........t can and does happen. My wife and I are 31. In 2013 we were doing very well, earning 100k odd between us,and life was very nice. But she ended up getting made redundant from her city job. Got a good pay off, retrained and is now a teacher. She now only earns 30k odd but she likes it. But obviously we are 20k or so down in income from where we were 4 or 5 years ago. We weathered the storm and came out the other side in good shape. But don't think it can't happen to you . It can.
anonymous said:
[redacted]
Ain't that the truthMind, in a reworked world where kids are saddled with debt by the time they've finished the education they need just to think about servicing it, and where business favours peopke who cant afford the stuff they sell to those who can ie cash buyers of everything from sofas to cars are snubbed in favour of the finance dependant, is it any surprise.
This statistic doesn't surprise me at all... and it isn't just the stereotypical "feckless benefits scrounger" that doesn't have any savings these days. The economic reality is pretty stty for many. There are loads of people in the 25 - 35 age bracket that work full time but are still stuck living with their parents or in house shares.
Even for those that do have a couple of grand in savings I'm guessing it is more than offset by their mortgage, overdraft, credit cards, car finance, etc.... all of which are at much higher interest rate than any savings account.
I do think one of the keys to financial happiness is to have low expectations and needs though. It is surprising how often expenses seem to rise in line with salary - people who earn more simply *must* have a nicer car, bigger house, the latest iphone, flashy TV, piss up holidays abroad twice a year and so on. So they end up just as broke at the end of every month as everyone else.
tty for many. There are loads of people in the 25 - 35 age bracket that work full time but are still stuck living with their parents or in house shares. Even for those that do have a couple of grand in savings I'm guessing it is more than offset by their mortgage, overdraft, credit cards, car finance, etc.... all of which are at much higher interest rate than any savings account.
I do think one of the keys to financial happiness is to have low expectations and needs though. It is surprising how often expenses seem to rise in line with salary - people who earn more simply *must* have a nicer car, bigger house, the latest iphone, flashy TV, piss up holidays abroad twice a year and so on. So they end up just as broke at the end of every month as everyone else.
turbobloke said:
Kermit power said:
How does anyone who works manage to have no savings these days?
MAS "For some on low incomes, saving is a real challenge as they may simply lack the income needed to save at all."Quite possibly because they may simply lack the gumption to live within their means, not at the limit of them.
What chances those 16 million living on the edge lack a very decent smartphone, don't have a large telly, never buy and wear bling, but do maintain fags and booze habits, buy expensive
If it's the person's choice to live on the limit and the limit walks through their door one day, it's OK because others will pick up the tab. Another reason why the edge isn't a scary place for many edgers.
Those who choose to step away from the edge aren't entering pissing contents, it's a matter of different margins for different income levels and different essential outgoings for different folks.
My son-in-law is a professional carer for those unable to look after themselves. He is well qualified for his post and has a non related degree. He is a supervisor.
He hasn't had a pay rise in the 6 years he's known my daughter. He has no chance of buying or renting a house near where he lives so fares are a factor as well as high rents. He doesn't drive a car, smoke or drink. His hobbies are easy enough to service without money apart from smart phone technology. However, his fees are little higher than mine and these are paid for by his relatives, as is the hardware.
He has savings that he brought to the relationship but these haven't been added to. He has no spare money. He would have to break into his savings if he wasn't married.
His position will soon disappear, although he'd still have the same responsibilities as no one else has the qualifications and as they'll have to pay for it themselves, with no extra money at the end of it, they won't. He'll be on a no worsening clause and given that there won't be any pay rises for years, his pay level is safe, but the col rises and he'll have to jack it all in and go for a different job. Oddly enough, he'll be better off, probably considerably so, and then he'll be able to save.
Those he is looking after will then have no one qualified for the emergencies and they'll have to depend on the ambulance service. They do currently when he or the other supervisor isn't there.
It's a very pleasant thought, wish really, that people can move away from the edge, and it is likely my son-in-law will, but not by cutting back as there's little meat. He will do it by stopping doing a job that is highly skilled but poorly paid. No one cares about those at the bottom on the pile, I mean apart from those helping them.
Move away from the edge? Ha! He'd have been quite happy to continue in a post that he loves and does well if only the pay was sufficient to enable him to save a little. Even not pay enough for that. He feels he will be abandoning his charges but he can't afford to subsidise the unit.
And he is one of those better off in his department. There are two levels below him who work full time. There are part timers below that, some of whom are paid minimum wage. This whilst caring for some people who can be extremely difficult.
Some people have no idea what it is like for the lower paid.
Still, when your taxes increase to fund the ambulances and health care that these people will require, feel reassured that all the ones who did a much better job and at lower cost are now safely earning enough to have savings.
I was poorly paid in the 70s. I did without a landline, a TV, car, holidays and such. I was given food parcels by my parents. I didn't drink or smoke, and didn't go out of an evening. I did have savings but had to eat into them just to keep my head above water. I probably lacked gumption to cut back on, let's see, well that's difficult to say. Clothes possibly, but then the local charity shop might have gone out of business.
I have an idea of what it was like to have no chance of savings.
crankedup said:
5th wealthiest Country, and yet! Wealth distribution seems not to be working so well.
This ^^^I'm not looking for some massive dose of redistributive tax, but we do need to recognise and try to tackle the problem that the return on assets has been outstripping earnings by an enormous margin. The policy response to shield heavily indebted individuals and companies by keeping rates at or close to zero for most of the last decade has had some serious unwanted consequences.
The only excuse for ZIRP and QE is that you're creating the space to allow people to de-leverage without the entire economy going down the plug hole. The USA fixed its banks, but their mortgage mkt is terrifying. The UK has done an OK job on its banks, but its mtg mkt is terrifying. Broadly speaking the EU has failed to address its bank's problems, but its general public were never as highly geared as those in the UK and USA.
At some point when you see asset price inflation going through the roof (30 year old 911 anyone?) and no return on savings accounts, you've got to ask yourself if the wealth divide it is creating between the young (who aren't buried under debt because they came to the party too late to borrow) and the wealthy is an acceptable price to pay for propping up those who borrowed far too much money in the late 90s and early 2000s? Eventually you've got to allow the zombies to really die so that interest rates and asset prices can become subject to normal rules of supply and demand and come back into an equilibrium with the rest of the economy.
But will anyone vote for that? The zombies are legion ... and half of them don't even know they're zombies. Here's ATG's helpful "Am I a zombie?" test. (No dead chickens or juju dolls required.) If your mortgage rate went up to 7%, would you be in real difficulty?
Because 7% isn't that much historically. Usually growth and inflation oscillate a bit over something like 4 or 5 year periods. On average you might expect inflation to be 2%, the real rate of return to be 2% and maybe another 1% risk premium for secured lending to a member of the public; so your mortgage rate would be about 5% on average. And if the economy looked like it was overheating a bit and inflation was rising, it would be quite normal for the bank to increase nominal interest rates from the average level of 4% to 6%, and that would push your mortgage rate to 7%. Nothing unusual at all. If you look at rates through the 80s, 90s and early 2000s, you'd see peak rates regularly going far, far, far higher
If you couldn't find a way to adjust to those sort of rates over the next few years, then I'm afraid you're part of the zombie economy.
ATG said:
This ^^^
...
If you couldn't find a way to adjust to those sort of rates over the next few years, then I'm afraid you're part of the zombie economy.
Sooner or later some kind of adjustment will have to take place (or another huge crash), but I just don't see any government intentionally bringing it about. ...
If you couldn't find a way to adjust to those sort of rates over the next few years, then I'm afraid you're part of the zombie economy.
But as you suggest there are too many "zombies" (as you put it) who think they are doing rather well out of the current system but who are actually teetering on the edge of disaster. A couple of % points on interest rates is all it would take.
ATG said:
If your mortgage rate went up to 7%, would you be in real difficulty?
You sound like my Dad (no bad thing...). But I just can't see us going back towards 6% savings account, real pay rises, real growth at 15% mortgages in my lifetime; I am 28.I think there are far too many folk living close to the breadline and mortgaged to the hilt (as it were) for us to return to how it was during my Dads working lifetime.
The Government aren't going to screw the masses (even if they're doing it the wrong way), to please the 'sensible' minority.
They've proven they'll do whatever is necessary to keep the whole lot going.
AmitG said:
Willy Nilly said:
My girlfriend is in such an office. One of her colleagues has a combined income of 6 figures with his other half and they live pay cheque to pay check.
They were talking about homelessness (mainly among men...) on 5Live earlier in the week. A man texted in who said he was on £97,000/yr 12 months ago, lost his job, had to sell everything and had £20 to his name. There but for the grace of god and all that lot.
It's one thing not having any saving due to not earning much, but I can never understand people that spend everything when they are earning enough to save, but it's people like them, that allow people like me who do save, to have businesses to invest in via various means.
I work in an office with a lot of high earners, and I see the same.They were talking about homelessness (mainly among men...) on 5Live earlier in the week. A man texted in who said he was on £97,000/yr 12 months ago, lost his job, had to sell everything and had £20 to his name. There but for the grace of god and all that lot.
It's one thing not having any saving due to not earning much, but I can never understand people that spend everything when they are earning enough to save, but it's people like them, that allow people like me who do save, to have businesses to invest in via various means.
The bloke I used to share an office with was earning very good money - low 6 figures. But he had 2 kids in private school, a massive mortgage, he was overhauling the house with an extension and stuff, and his wife loved to spend money (and didn't work). Skiing and a big summer holiday every year. Got through every penny of his salary every month, zero savings. His car broke down and he had to get a 2k bank loan to buy a shed.
The sad thing is that he didn't even enjoy the lifestyle, he said that a lot of it was about keeping up appearances amongst the social circles in which they moved.
Another guy I used to work for - managing director level, probably earning 200 - 300k GBP/year (this was a while ago). Again, huge mortgage, kids in private school and his wife was really into horses. So that means paying for horses, horse food, vets, stables, clothing, horse box, and that's before you even start riding. The sums were eye watering. He claimed to have no savings.
TBH I felt a bit sorry for some of these people. You start off by envying them, but then you look closer and you realise that they are utterly trapped. Historically, salaries and bonuses in the financial industry have been quite high. With the industry now in severe decline, and jobs disappearing by the day, a lot of people realise that their days are numbered. They know they cannot earn this money elsewhere, but they have gotten used to the lifestyle, and they have to keep it up even if they don't want to, because it's expected of them. In some cases they know that if they don't keep it up, divorce is likely to follow. Their worst nightmare is losing their job or getting a pay cut. So they spend every waking hour worrying about their future, they try to keep hold of their job by any means possible, and they will degrade themselves in doing so.
http://www.dailymail.co.uk/news/article-1167074/Pi...
Living the dream lifestyle and everything goes belly up, but couldn't loose face. It must have been better to have come clean to the wife and daughter rather than kill them, but I'm lead to believe he was a very unpleasant man. It doesn't really sell the high earning lifestyle to me.
TheLordJohn said:
ATG said:
If your mortgage rate went up to 7%, would you be in real difficulty?
You sound like my Dad (no bad thing...). But I just can't see us going back towards 6% savings account, real pay rises, real growth at 15% mortgages in my lifetime; I am 28.I think there are far too many folk living close to the breadline and mortgaged to the hilt (as it were) for us to return to how it was during my Dads working lifetime.
The Government aren't going to screw the masses (even if they're doing it the wrong way), to please the 'sensible' minority.
They've proven they'll do whatever is necessary to keep the whole lot going.
z4RRSchris said:
i am lucky to earn 6 figs, i have zero savings (29, rented house, no kids) - find life much better when you just spunk it.
Have you no pension either? In your position, you could have a very nice lifestyle and save for you retirement, probably retire earlier than most and still live really nicely. Do what you like and I hope you have fun, but you would do well to get some financial advice.
TheLordJohn said:
ATG said:
If your mortgage rate went up to 7%, would you be in real difficulty?
You sound like my Dad (no bad thing...). But I just can't see us going back towards 6% savings account, real pay rises, real growth at 15% mortgages in my lifetime; I am 28.I think there are far too many folk living close to the breadline and mortgaged to the hilt (as it were) for us to return to how it was during my Dads working lifetime.
The Government aren't going to screw the masses (even if they're doing it the wrong way), to please the 'sensible' minority.
They've proven they'll do whatever is necessary to keep the whole lot going.
The goldilocks scenario would be to give people confidence in the immediate future of the economy but a healthy degree of fear of the future. That would give people both a healthy fear of carrying huge amounts of debt, but also the confidence that they could do something about it. A bit of well placed fear can really focus people's minds and boost productivity. But the mongs have just thrown a big Brexit shaped spanner in the policy works, so the chance of anyone taking on any risky structural reform policy at the moment is zero.
On the "not in my lifetime", with luck you've got many decades to go. Look at the world 60 years ago and see how much it has changed in that time. No reason to think it won't change just as much again in your life time. If you can see 5 years into the future with any accuracy, you're usual doing pretty well.
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