Millions have saving of less than £100
Discussion
I too use 0% credit cards to spread the cost of purchases where I feel it is sensible - debt isn't necessarily a bad thing providing it is affordable and you have a clear view of what you owe coupled with a feasible plan to pay it back.
I also pay for large things on a credit card as a matter of course, holidays, furniture that is ordered ETC as it makes the credit card company party to the deal incase it goes south.
I also pay for large things on a credit card as a matter of course, holidays, furniture that is ordered ETC as it makes the credit card company party to the deal incase it goes south.
Four Litre said:
Oakey said:
Four Litre said:
Without doubt we need to hear stories of how 'Ive never had finance / cash is king / I can live for 10 years on my savings / I retired at 18 as I saved so much!' delete as appropriate!
If PH ever needed an anthemhttps://www.youtube.com/watch?v=XzbAEHdy8oU
https://www.youtube.com/watch?v=gUhRKVIjJtw
It's this: https://youtu.be/hcxs-CH4kG0
Four Litre said:
basherX said:
Cue massive pissing contest.
(I agree, a genuinely scary statistic)
Without doubt we need to hear stories of how 'Ive never had finance / cash is king / I can live for 10 years on my savings / I retired at 18 as I saved so much!' delete as appropriate!(I agree, a genuinely scary statistic)
The way it's constantly dropped into threads on here I sometimes feel like I'm the only one who doesn't.
torqueofthedevil said:
When people say they are mortgaged up to the hilt, you can pretty much only get 4x wage. So it's always around about the same proportion of your wage - how are people getting these huge mortgages?!?
I think it depends on your definition.We borrowed half what we could, just because the monthly repayments at the max amount were terrifying (to us).
We both work but budget on being able to survive if one couldn't work, for whatever reason. I have an inbuilt fear of financial trouble, I must have ancestors in yorkshire
kiethton said:
Not going to lie but I live my life on credit, although all at 0% - all my month to month spending goes on my credit card and is normally paid off at the end of the month.
However my first flat deposit and now the renovation works for my current flat are all on them = my annual base salary on credit cards (40% taxpayer by some margin). Thing is, these cards cost me less than my mortgage interest rate leaving me to invest cash into my flat renovation and travel (not an asset admittedly).
They'll eventually be repaid when the interest free period expires via a remortgage with the cash released invested in high quality equities/secured corporate bonds.
Jesús Christ. However my first flat deposit and now the renovation works for my current flat are all on them = my annual base salary on credit cards (40% taxpayer by some margin). Thing is, these cards cost me less than my mortgage interest rate leaving me to invest cash into my flat renovation and travel (not an asset admittedly).
They'll eventually be repaid when the interest free period expires via a remortgage with the cash released invested in high quality equities/secured corporate bonds.
To be clear, are you saying you intend to remortgage to clear off cc debt and also then invest this new loan?!
torqueofthedevil said:
When people say they are mortgaged up to the hilt, you can pretty much only get 4x wage. So it's always around about the same proportion of your wage - how are people getting these huge mortgages?!?
I suppose part of the problem is that because of the way house prices have rocketed, it is taking people much longer to get on the housing ladder, so when they do, that 4x salary is much further along the path of their career earning potential.We bought our first house when I was 28, so by the time my wife stopped working to raise the kids when I was 36, my salary had increased by more than enough to cover the shortfall of hers. Obviously it was still tough going, as our outgoings had increased too, but if we'd not got onto the property ladder until I was 36 and also had the kids later, there's no way my earnings would've covered the shortfall over that later time frame.
I also know a few people who had to take much lower paid jobs after being made redundant, who are suddenly well over a 4x multiple.
torqueofthedevil said:
When people say they are mortgaged up to the hilt, you can pretty much only get 4x wage. So it's always around about the same proportion of your wage - how are people getting these huge mortgages?!?
5x is still possible. I'm glad I'm not still there but I've done it in the past mainly go get a foot in the door due to prices being so huge in the south east. And that was 5x COMBINED salary of me and the missus!Sheepshanks said:
Surely PHers have their cash invested in multiple BTLs?
The way it's constantly dropped into threads on here I sometimes feel like I'm the only one who doesn't.
The way it's constantly dropped into threads on here I sometimes feel like I'm the only one who doesn't.
Nope - I'm another one, Sheepshanks!I don't really have much in the way of savings, either. I see two issues with this - here in the NW (Manchester) rental costs are phenomenal and take up the lion's share of my wages, and those rental costs go up every year without fail, whereas wages do not. Also, there is no real incentive for many to save, even if they had the disposable income to do so - interest rates are rock-bottom. A few years ago I took out an ISA - my last review was that the interest rate was being cut (again) to 0.25%.
I know that f someone who went through a divorce and had to set herself up again with a house, absolutely all of her spare money goes into mortgage overpayments. Her point was,and it makes sense to me, that if something happens and she desperately needs a sum of money one payslip cant cover then she will get one of the multitude of 0% credit cards on offer and pay the sum borrowed by not paying her mortgage as the overpayments allow her to stop until she's back in line should she need to.
Makes sense to me to he honest, she has a back up plan that at least in this climate of borrowing will work and she is reducing her interest on her mortgage by thousands. I very much doubt she has more than £100 in the bank but i wouldnt call her poor or stupid. Just show how a headline does not tell the full story.
Makes sense to me to he honest, she has a back up plan that at least in this climate of borrowing will work and she is reducing her interest on her mortgage by thousands. I very much doubt she has more than £100 in the bank but i wouldnt call her poor or stupid. Just show how a headline does not tell the full story.
Wozy68 said:
The more you earn the bigger the house the more expensive the car, the fancier the holidays. Big earners just have the ability to borrow/spend more. Agree it Doesn't mean they have more in the bank.
That isn't necessarily so, I'm by nature frugal and what I spend on a house/car/holiday isn't based upon what I could afford to spend rather on what I think it's worth. I know plenty of wealthy people who are very unostentatious, perfectly happy to drive around in a ten year old car and live in the same house they bought decades ago.
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.
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.
Edited by danny0001uk1 on Friday 30th September 07:30
Edited by danny0001uk1 on Friday 30th September 07:33
klmhcp said:
kiethton said:
Not going to lie but I live my life on credit, although all at 0% - all my month to month spending goes on my credit card and is normally paid off at the end of the month.
However my first flat deposit and now the renovation works for my current flat are all on them = my annual base salary on credit cards (40% taxpayer by some margin). Thing is, these cards cost me less than my mortgage interest rate leaving me to invest cash into my flat renovation and travel (not an asset admittedly).
They'll eventually be repaid when the interest free period expires via a remortgage with the cash released invested in high quality equities/secured corporate bonds.
Jesús Christ. However my first flat deposit and now the renovation works for my current flat are all on them = my annual base salary on credit cards (40% taxpayer by some margin). Thing is, these cards cost me less than my mortgage interest rate leaving me to invest cash into my flat renovation and travel (not an asset admittedly).
They'll eventually be repaid when the interest free period expires via a remortgage with the cash released invested in high quality equities/secured corporate bonds.
To be clear, are you saying you intend to remortgage to clear off cc debt and also then invest this new loan?!
Intention is to remortgage when the renovation works are complete, most of my cards have 0% offers which run for another 18-28 months so makes no sense to pay them off immediately as the cost is 0%. After I've remortgaged (even withdrawing equity should go from a 90% to 60-70% LTV with reduced interest rate (3.5% - 1.3%) and reduced term (35 - 28 years). In the interim I'll put the cash into the high quality equities & Corp bonds as above - selling up at the pre-requisite time to repay the CC debt on expiry of the interest free periods.
In the current climate debt is cheap, my atage in life (mid 20's) is the time to take the risks knowing it'll either pay off ha simply or I still have time to rebuild my life should it hit the fan...
I have VERY little in savings. We are skinting ourselves now so in 20 years time we should see the fruits of our labour...!
Saving (if it's the only thing you do) is for mugs.
If you'd saved £100k in 1990, and just left it in a few accounts (or even worse, premium bonds) you'd be worth a lot less now than you were then.
It makes no sense to save up a lot when interest rates are scandalously low.
If the rest of the country (broadly speaking, obviously) wishes to run their lives by being in a load of debt the least you can do is take advantage of the low interest rates and buy some houses
My Dad keeps going on about "Yes, but the the interest rates rise..." "Yes, well I used to have an 18% mortgage..." etc etc but we just aren't in that world anymore.
And won't be for a very long time, if ever.
Saving (if it's the only thing you do) is for mugs.
If you'd saved £100k in 1990, and just left it in a few accounts (or even worse, premium bonds) you'd be worth a lot less now than you were then.
It makes no sense to save up a lot when interest rates are scandalously low.
If the rest of the country (broadly speaking, obviously) wishes to run their lives by being in a load of debt the least you can do is take advantage of the low interest rates and buy some houses
My Dad keeps going on about "Yes, but the the interest rates rise..." "Yes, well I used to have an 18% mortgage..." etc etc but we just aren't in that world anymore.
And won't be for a very long time, if ever.
Edited by TheLordJohn on Friday 30th September 08:53
kiethton said:
klmhcp said:
kiethton said:
Not going to lie but I live my life on credit, although all at 0% - all my month to month spending goes on my credit card and is normally paid off at the end of the month.
However my first flat deposit and now the renovation works for my current flat are all on them = my annual base salary on credit cards (40% taxpayer by some margin). Thing is, these cards cost me less than my mortgage interest rate leaving me to invest cash into my flat renovation and travel (not an asset admittedly).
They'll eventually be repaid when the interest free period expires via a remortgage with the cash released invested in high quality equities/secured corporate bonds.
Jesús Christ. However my first flat deposit and now the renovation works for my current flat are all on them = my annual base salary on credit cards (40% taxpayer by some margin). Thing is, these cards cost me less than my mortgage interest rate leaving me to invest cash into my flat renovation and travel (not an asset admittedly).
They'll eventually be repaid when the interest free period expires via a remortgage with the cash released invested in high quality equities/secured corporate bonds.
To be clear, are you saying you intend to remortgage to clear off cc debt and also then invest this new loan?!
Intention is to remortgage when the renovation works are complete, most of my cards have 0% offers which run for another 18-28 months so makes no sense to pay them off immediately as the cost is 0%. After I've remortgaged (even withdrawing equity should go from a 90% to 60-70% LTV with reduced interest rate (3.5% - 1.3%) and reduced term (35 - 28 years). In the interim I'll put the cash into the high quality equities & Corp bonds as above - selling up at the pre-requisite time to repay the CC debt on expiry of the interest free periods.
In the current climate debt is cheap, my atage in life (mid 20's) is the time to take the risks knowing it'll either pay off ha simply or I still have time to rebuild my life should it hit the fan...
I had a rather old fashioned upbringing with regards money and HP was seen as the devil's net. I got into a little trouble when I joined the police, having to cope with a massive cut in wages. I had a bit over 3 months income in the bank and 18 months later it had all gone and I was overdrawn.
Skip to now I've retired. I've got savings. Not much but in the region of 6 months, and we don't break into it. I'm after a new camera for Xmas from my wife and she suggested buying it now: I'll lose no interest and it will probably still be going strong when I'm not. The logic is irrefutable but it is difficult to go against a lifetime's habit.
The credit card took a hit this month with a holiday which went over budget a burst pipe in the loft. That won't be cleared this month but will next.
I like having money in the bank but it is wasted there. No interest. It is an expensive form of comfort. I could buy a blanket and squander the rest.
I put a fair sum in what I knew was higher risk investments with some friends. What could go wrong? That was in early 2008. We've had to buy out two members so risk is out.
I'm coming over to the idea of spend, spend, spend. I'm not so sure I am frightened by the less than £100 savings.
I have an American friend with a few children. She reckons that although they all have great jobs, with decent pay, they are on a knife's edge financially. If the husband or wife loses their job they will have to sell the house and other assets. With the kids' children having to be put through school, their savings have gone.
Whilst I assume, without evidence, that they have more that $121 of savings, I doubt they have enough to maintain their lifestyle for 6 months. These are staunchly middle class American families enjoying the good life.
So it is not only in this country that people are living pay slip to pay slip.
Skip to now I've retired. I've got savings. Not much but in the region of 6 months, and we don't break into it. I'm after a new camera for Xmas from my wife and she suggested buying it now: I'll lose no interest and it will probably still be going strong when I'm not. The logic is irrefutable but it is difficult to go against a lifetime's habit.
The credit card took a hit this month with a holiday which went over budget a burst pipe in the loft. That won't be cleared this month but will next.
I like having money in the bank but it is wasted there. No interest. It is an expensive form of comfort. I could buy a blanket and squander the rest.
I put a fair sum in what I knew was higher risk investments with some friends. What could go wrong? That was in early 2008. We've had to buy out two members so risk is out.
I'm coming over to the idea of spend, spend, spend. I'm not so sure I am frightened by the less than £100 savings.
I have an American friend with a few children. She reckons that although they all have great jobs, with decent pay, they are on a knife's edge financially. If the husband or wife loses their job they will have to sell the house and other assets. With the kids' children having to be put through school, their savings have gone.
Whilst I assume, without evidence, that they have more that $121 of savings, I doubt they have enough to maintain their lifestyle for 6 months. These are staunchly middle class American families enjoying the good life.
So it is not only in this country that people are living pay slip to pay slip.
You cannot use credit cards as a plan B for when TSHTF
if you cannot cover your daily expensies you cannot cover the min repayment. Even 0% have a min repayment. The more you use them the more that min payment increases.
You end up using other CC to make that min payment. The whole thing grows out of hands almost exponentially.
Im not so sure about the idea thst you plough it into your mortgage either. Perhaps if you can clear that in full. But like a post earlier a guy with a 97k salary lost his house- obviously unable to pay the mortgage. Ses you are hedging your bets that your period of troubles do not last as long as the grace period from over-repayments.
Perhaps I am wrong but it seems better if possible to have cash in the bank because you can, to a degree, calculate how long you can cover everything should you need to- it gives a degree of certainty.
Also any extreme event where you might need to sell up to release equity will involve sellinn a highly priced illiquid item in a downturn. You might get lucky you might not.
if you cannot cover your daily expensies you cannot cover the min repayment. Even 0% have a min repayment. The more you use them the more that min payment increases.
You end up using other CC to make that min payment. The whole thing grows out of hands almost exponentially.
Im not so sure about the idea thst you plough it into your mortgage either. Perhaps if you can clear that in full. But like a post earlier a guy with a 97k salary lost his house- obviously unable to pay the mortgage. Ses you are hedging your bets that your period of troubles do not last as long as the grace period from over-repayments.
Perhaps I am wrong but it seems better if possible to have cash in the bank because you can, to a degree, calculate how long you can cover everything should you need to- it gives a degree of certainty.
Also any extreme event where you might need to sell up to release equity will involve sellinn a highly priced illiquid item in a downturn. You might get lucky you might not.
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