Millions have saving of less than £100
Discussion
Fittster said:
scenario8 said:
Just to remind everyone, for the nth time, that even in London £100k pa is only a very average salary in a peculiarly PH kind of way.
Evidence for that fact?Evidence it's nonsense? Official data.
klmhcp said:
Some of you guys need a reality check. £100k is a very average salary in London. Not really enough to buy a nice place with and so I'm unsure why people think he's lying - he's like many: ok earnings but nothing to show for it. Seems ridiculous to people outside the young(ish) in London but it's a common story.
I'm always amazed at how people will work long hours to earn the money but do t bother to try and save or invest some. Their bosses must laugh at them gratefully.
In Pret a Manger? In Starbucks? Changing tyres in Kwik Fit? I'm always amazed at how people will work long hours to earn the money but do t bother to try and save or invest some. Their bosses must laugh at them gratefully.
I think it's you that needs a reality check.
As Richard Ashcroft said "slave to the money then you die"
I live to enjoy life and hopefully put 'enough' aside per month, I certainly don't live to accrue savings that I will never use.
klmhcp said:
London has 8m people living in it so of course stats will show wages as being less. The fact remains that if you're educated, bright and ambitious (so any decent grad), you can earn 100k in London within a few years without being in a particularly special role.
And possibly within your workplace your six figure earnings might be considered distinctly average. But even within London your earnings would remain well above average. Even amongst the bright, educated and ambitious you'd be doing very well.scenario8 said:
klmhcp said:
London has 8m people living in it so of course stats will show wages as being less. The fact remains that if you're educated, bright and ambitious (so any decent grad), you can earn 100k in London within a few years without being in a particularly special role.
And possibly within your workplace your six figure earnings might be considered distinctly average. But even within London your earnings would remain well above average. Even amongst the bright, educated and ambitious you'd be doing very well.C.A.R. said:
I'll level with PH -
Up until about 6 months ago I was firmly in this bracket. Even now, I end most months in my overdraft in my current account.
Situation - Private renting, no chance of a mortgage (no capital, obvs), 2 kids, Mrs works all the hours feasible / practical. My salary is high-30ks.
But most of PH will expect I live a life of luxury and have expensive toys / gadgets. Not so! No gym memberships or subscriptions in this house either folks. Not had a foreign holiday in 5 years, no fancy cars, kids not spoilt.
Awaits collective response "but that's just poor money management" Pfffft!
Life is bloody expensive. I can't make more cutbacks, since there's nothing to cut back on.
Purely out of curiosity I'd be interested to see a breakdown of your income and outgoings to support your claims. You appear to be claiming poverty more-or-less on what is realistically a 45k+ combined income assuming a mediocre wage for your OH. I don't buy it, sorry. That's just poor money management! Up until about 6 months ago I was firmly in this bracket. Even now, I end most months in my overdraft in my current account.
Situation - Private renting, no chance of a mortgage (no capital, obvs), 2 kids, Mrs works all the hours feasible / practical. My salary is high-30ks.
But most of PH will expect I live a life of luxury and have expensive toys / gadgets. Not so! No gym memberships or subscriptions in this house either folks. Not had a foreign holiday in 5 years, no fancy cars, kids not spoilt.
Awaits collective response "but that's just poor money management" Pfffft!
Life is bloody expensive. I can't make more cutbacks, since there's nothing to cut back on.
klmhcp said:
scenario8 said:
klmhcp said:
London has 8m people living in it so of course stats will show wages as being less. The fact remains that if you're educated, bright and ambitious (so any decent grad), you can earn 100k in London within a few years without being in a particularly special role.
And possibly within your workplace your six figure earnings might be considered distinctly average. But even within London your earnings would remain well above average. Even amongst the bright, educated and ambitious you'd be doing very well.Scenario8 is correct.
danllama said:
danny0001uk1 said:
I'm 30 year old living with mum and dad cause I can't afford a house on my wage 22k a year.
I'm also never out my overdraft even on payday! Have no savings or debt apart from od.
Im also single and have no plans and don't know what to do to change anything.
I just feel like I'm existing day to day, week to week, year to year if went back to this day 5 years ago everything would be the same job/money/accommodation etc.
Meanwhile my social circle which I've had since primary school all earn 40k plus with houses and long term relationships.
You need to change some things but it's not that bleak. First thing to do is get on spare room and find a shared house with people similar to your age and who you have a good vibe with. You'll feel a lot better straight away. I'm also never out my overdraft even on payday! Have no savings or debt apart from od.
Im also single and have no plans and don't know what to do to change anything.
I just feel like I'm existing day to day, week to week, year to year if went back to this day 5 years ago everything would be the same job/money/accommodation etc.
Meanwhile my social circle which I've had since primary school all earn 40k plus with houses and long term relationships.
Then as said above, really scrutinise your outgoings and look to save on things.
And of course in the meantime, look at either a new job or training/education to improve prospects.
Chin up, i'm not in a too dissimilar situation
ATG said:
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.
Very interesting post ATGI'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.
Stepping back a bit there are a number of factors skewing the distribution of both wealth and income toward the top 20-25% of the population, from globalisation to growing automation, all the government can do is try and mitigate these factors not worsen them.
Ultra-low interest rates kept in place for so long is now clearly a policy that is increasing wealth inequality, particularly on an inter-generational basis.
The problem is that we are almost helpless as an individual country to start returning to normality as virtually every other developed nation is doing the same, some even have negative rates.
Difficult times call for different methods and the answer may be a new "Bretton woods" to start returning interest rates to a more normal level on a co-ordinated basis. Only when the public starts to realise the long term impact of ultra-low interest rates will there be sufficient political will for this though.
NinjaPower said:
+1
I can't speak for all areas of the country as property prices and rents vary greatly, but where I live, if you went out and bought a tidy 2-3 bed BTL and put around £10-15k deposit down, the rent would be around £150-200 per month higher than the mortgage and the other obvious benefit is that someone else is paying off the property for you.
Far better than money in the bank in my opinion.
£10-15k deposit BTL is on a house value of around £50k. There aren't many houses around for £50kI can't speak for all areas of the country as property prices and rents vary greatly, but where I live, if you went out and bought a tidy 2-3 bed BTL and put around £10-15k deposit down, the rent would be around £150-200 per month higher than the mortgage and the other obvious benefit is that someone else is paying off the property for you.
Far better than money in the bank in my opinion.
If you want to do a BTL round here (sleepy Lancashire) you'd need £40k deposit. Maybe you'd get away with £30k
Our biggest employer locally is the NHS so salaries are averaging say £25k
The numbers forany people can't be made to add up
I reckon a lot of salary goes up people's noses, certainty around the main cities, I was naively shocked at what people thought was a relatively small habit. £250 to £300 on a weekend for drinks and food, smokes etc, doesn't take long to piss the whole lot up.
Ps - not suggesting any posting here does that.
Ps - not suggesting any posting here does that.
Casa1862 said:
I reckon a lot of salary goes up people's noses, certainty around the main cities, I was naively shocked at what people thought was a relatively small habit. £250 to £300 on a weekend for drinks and food, smokes etc, doesn't take long to piss the whole lot up.
Ps - not suggesting any posting here does that.
Indeed, that is the thick end of my entire months disposable income.Ps - not suggesting any posting here does that.
z4RRSchris said:
1800 rent and bills, spunk the rest. Circa 6kpm blown
Hang on a minute, you implied before you were living in a flat of 1 mill value..... yet you can cover rent AND bills for £1800? Really, you must have a damn generous landlord if he is accepting < 2 % yield. If you really are blowing through 5.5k+ a month with no real savings or investments that seems nuts to me. I've seen what happens when things go tits up for people in this kind of situation and it isn't pretty. I think a 6 months savings cushion for emergency use is a good target for anyone to aim at.
ThunderGuts said:
klmhcp said:
scenario8 said:
klmhcp said:
London has 8m people living in it so of course stats will show wages as being less. The fact remains that if you're educated, bright and ambitious (so any decent grad), you can earn 100k in London within a few years without being in a particularly special role.
And possibly within your workplace your six figure earnings might be considered distinctly average. But even within London your earnings would remain well above average. Even amongst the bright, educated and ambitious you'd be doing very well.Scenario8 is correct.
VolvoT5 said:
I think a 6 months savings cushion for emergency use is a good target for anyone to aim at.
Agreed, 6 months is a decent cash cushion, yet the reality according to ING data is that those who are savers now have an average of 1.2 months' income in readily accessible savings accounts (not sure if they're referring to median or mean). That's less than 40 days.The Citizens' Advice people reckon it's largely down to more and more people deciding it's not worth keeping much by way of savings when the interest earned is the square root of rockall. That refers to those who could save if they chose to, rather than those with nothing left after the essential bills have been paid.
NinjaPower said:
anonymous said:
[redacted]
I would suggest that for some, especially in London, it's fairly easy to blow £5k each month.At a guess:
£2000 a month rent
£1000 bills (council tax, Sky, broadband, gas, electricity, mobile phone, car payments/leasing, etc)
That leaves £500 a week to spend on shopping, food, drink, petrol, car expenses, hobbies, eating out, entertainment, clothes and other purchases.
That's before you factor in large purchases and holidays etc.
Sometimes a mistake is made in some of the data that we have inputted so a call was made to the finance help desk, they said that there was nothing that could be done and and it was still a decline so a call was made to our area finance guy, he got the details up and said he was a definate no; the reason, he lives month to month on pay day loans, he earns £76,000 per year.
He showed all the classic signs of being aware that most likely he would be declined, he didn't test drive the car "see if the finance goes through and I'll come back for a test drive", he didn't sign an order or leave a deposit "see if the finance goes through and I'll pop back and sign an order", he wasn't in the dealership for too long and the whole process was smooth and easy, he knew full well he was likely to be declined but I guess he just thought "you never know".
is anyone surprised by this headline? Most people under 40 probably have net debt (excl mortgages). Not only do they have no savings but they are saddled with a 1500 quid cc bill. Nothing has changed and it's not a sign of the times. It's life for many. I did genuinely feel bad for some of the stories I've read within this thread. I don't really believe in luck but I was given a good start with my education and that was key in getting a great job after graduating. I was poor with money until my mid 20's (over 40 now).
My brother who is 47 now, at 20 and a student bought a new car for 18k cash which he earned working 3 jobs during the holidays(took him 18 months). some people work their tits off and save it. some don't.
My brother who is 47 now, at 20 and a student bought a new car for 18k cash which he earned working 3 jobs during the holidays(took him 18 months). some people work their tits off and save it. some don't.
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