'Life savings' - do people still have them?

'Life savings' - do people still have them?

Author
Discussion

Garvin

5,157 posts

176 months

Tuesday 12th August 2014
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Yes, some of us have been saving since we started working full time - good pension schemes, max ISA protection, high interest accounts, stocks and shares. Now 'sitting pretty' relative to some of my 'live for the present' friends and colleagues who are only now realising they are completely screwed for retirement and no time to recover the situation - the same folks who thought us stupid for planning so far ahead, so long ago!

Boringly, we lived within our means but now have little fear of old age!

Jasandjules

69,825 posts

228 months

Tuesday 12th August 2014
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I have enough life savings. As long as I die in the next two weeks.

CraigyMc

16,326 posts

235 months

Tuesday 12th August 2014
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Garvin said:
Boringly, we lived within our means but now have little fear of old age!
I lived so far within my means it caused a problem.

There's a balance to be had.

(Sorry, this post isn't meant to be funny)

Ari

Original Poster:

19,328 posts

214 months

Tuesday 12th August 2014
quotequote all
Garvin said:
Yes, some of us have been saving since we started working full time - good pension schemes, max ISA protection, high interest accounts, stocks and shares. Now 'sitting pretty' relative to some of my 'live for the present' friends and colleagues who are only now realising they are completely screwed for retirement and no time to recover the situation - the same folks who thought us stupid for planning so far ahead, so long ago!

Boringly, we lived within our means but now have little fear of old age!
Except that when they, and you, go into an old people's home, guess who will be forced to pay for it until almost every penny of that carefully hoarded stash has been drained away by the state... wink

Sorry, I'm with you, you've done the right thing, but it won't necessarily ultimately put you in a better place.

Ari

Original Poster:

19,328 posts

214 months

Tuesday 12th August 2014
quotequote all
Justin Cyder said:
Ari said:
you just finance it.
It's this that in no small part is stuffing the country.
No, its ok, the government have zeroed interest rates so those people will never have to suffer.

The savers suffer instead...

carreauchompeur

17,830 posts

203 months

Tuesday 12th August 2014
quotequote all
Interesting, I have been regularly saving for the last couple of years however the fund does get raided fairly often hehe

Putting £400/month into a pension should count as decent forward planning though, hopefully it's still there when I come to claim it!

Wacky Racer

38,099 posts

246 months

Tuesday 12th August 2014
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Jasandjules said:
I have enough life savings. As long as I die in the next two weeks.
hehe

Justin Cyder

12,624 posts

148 months

Tuesday 12th August 2014
quotequote all
Ari said:
No, its ok, the government have zeroed interest rates so those people will never have to suffer.

The savers suffer instead...
The tide is going out in the next few months & when the BoE get going in earnest, it'll be a different story. Easy credit is never that easy in the long run.

RizzoTheRat

25,085 posts

191 months

Tuesday 12th August 2014
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BobToc said:
RizzoTheRat said:
Oh no it doesn't (sorry, bit to early for panto season?) There's loads of people who took out mortgages when rates were higher that reverted to a small amount above base rate at the end of the term, banks didn't expect rates to go so low, I know a couple of people paying less than my 1.49% Obviously interest rates on savings have fallen too but there's still ISAs paying more than that and you can even get 3% (pre tax) on a current account
I'm not sure that really stacks up for most people. If you're paying 40% tax on interest received (while you're wife isn't, I suspect most people with substantial savings are in the 40%+ bracket) then you need to earn 2.5% to breakeven on a 1.5% mortgage. The key problem most people will face is that there's typically a cap (as you note) on the amount of money that you can earn more than 2.5% on, and Santander's limit of 20k is pretty generous in the market. On a 20k mortgage, the 50bps spread will earn you £100/year, which while good for a night out, isn't quite life-changing.
Agreed it's not a massive difference (IAS's now down to not much better than the mortgage, and I'm gaining about 0.3% on my Santander account and 0.9% on the wifes) but we plan to move house again in the next year or two, and my current mortgage is portable. If I paid off a chunk of the mortgage I'd have to borrow it again at at a higher rate when I move and that's the point where it will make a lot more difference.

RCBRG

603 posts

140 months

Tuesday 12th August 2014
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I'm trying to save, but even putting away a very considerable portion of my reasonable salary, I'd be lucky to get enough for a house deposit in this area within 5 years. Saving sucks

oldcynic

2,166 posts

160 months

Tuesday 12th August 2014
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gottans said:
The cost of mortgage in interest payments far outstrips any interest on a savings account, would be cheaper paying part of the current mortgage off with savings if you have no other use for it.
A family friend has a pretty substantial mortgage at 1% below base. His bank manager has given up trying to persuade him to change products, as he was unable to offer any convincing benefits. Didn't stop him trying!

Ari

Original Poster:

19,328 posts

214 months

Tuesday 12th August 2014
quotequote all
Justin Cyder said:
Ari said:
No, its ok, the government have zeroed interest rates so those people will never have to suffer.

The savers suffer instead...
The tide is going out in the next few months & when the BoE get going in earnest, it'll be a different story. Easy credit is never that easy in the long run.
I hope you are right, but I won't hold my breath.

eltax91

9,842 posts

205 months

Tuesday 12th August 2014
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oldcynic said:
A family friend has a pretty substantial mortgage at 1% below base. His bank manager has given up trying to persuade him to change products, as he was unable to offer any convincing benefits. Didn't stop him trying!
1% below base? Isn't base at 0.5% at the moment? So he's actually getting paid for his mortgage?


Justin Cyder

12,624 posts

148 months

Tuesday 12th August 2014
quotequote all
eltax91 said:
1% below base? Isn't base at 0.5% at the moment? So he's actually getting paid for his mortgage?
That's my mortgage. It was on the news in 2008ish when about 1500 of us on that deal were written to by C&G to inform us that we wouldn't be getting paid now our mortgage rate was effectively their burden. Suits me, I've over paid the bd furiously ever since.

HenryJM

6,315 posts

128 months

Tuesday 12th August 2014
quotequote all
Ari said:
Except that when they, and you, go into an old people's home, guess who will be forced to pay for it until almost every penny of that carefully hoarded stash has been drained away by the state... wink

Sorry, I'm with you, you've done the right thing, but it won't necessarily ultimately put you in a better place.
Actually it will, it'll put you in a much nicer nursing home.

sjabrown

1,910 posts

159 months

Tuesday 12th August 2014
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I try to have about 6 months worth of earnings saved and accessible should something untoward happen. It nearly did last year with a bump to the head rendering me unable to work for a short time.

Saying that I'm about to sink a lot into a house deposit.

Monkeylegend

26,226 posts

230 months

Tuesday 12th August 2014
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I have life savings. All I need to do is to work out how to access them from the ex wife.

Garvin

5,157 posts

176 months

Tuesday 12th August 2014
quotequote all
Ari said:
Garvin said:
Yes, some of us have been saving since we started working full time - good pension schemes, max ISA protection, high interest accounts, stocks and shares. Now 'sitting pretty' relative to some of my 'live for the present' friends and colleagues who are only now realising they are completely screwed for retirement and no time to recover the situation - the same folks who thought us stupid for planning so far ahead, so long ago!

Boringly, we lived within our means but now have little fear of old age!
Except that when they, and you, go into an old people's home, guess who will be forced to pay for it until almost every penny of that carefully hoarded stash has been drained away by the state... wink

Sorry, I'm with you, you've done the right thing, but it won't necessarily ultimately put you in a better place.
Old peoples home means you are in no fit state to enjoy things to the full anymore. Therefore the trick is to consume the 'stash' and enjoy it at a rate that coincides with it hitting zero at the time, or just before, incarceration occurs!

HenryJM

6,315 posts

128 months

Tuesday 12th August 2014
quotequote all
Garvin said:
Old peoples home means you are in no fit state to enjoy things to the full anymore. Therefore the trick is to consume the 'stash' and enjoy it at a rate that coincides with it hitting zero at the time, or just before, incarceration occurs!
Yes, but the difference in quality is huge, the level of care, attitude and tolerance varies enormously.

My father has vascular dementia and is in a home, it's the best one in the area and for all that he is Ill he is also aware of his surroundings. He is as happy as he can be where he is, it's expensive but, so what? He can afford it, if he couldn't I would, I certainly wouldn't have him anywhere less than the best place I could find him.

And by best place I don't mean most expensive, i do mean best care but that costs, it costs much more than the state would pay,

Garvin

5,157 posts

176 months

Tuesday 12th August 2014
quotequote all
HenryJM said:
Garvin said:
Old peoples home means you are in no fit state to enjoy things to the full anymore. Therefore the trick is to consume the 'stash' and enjoy it at a rate that coincides with it hitting zero at the time, or just before, incarceration occurs!
Yes, but the difference in quality is huge, the level of care, attitude and tolerance varies enormously.

My father has vascular dementia and is in a home, it's the best one in the area and for all that he is Ill he is also aware of his surroundings. He is as happy as he can be where he is, it's expensive but, so what? He can afford it, if he couldn't I would, I certainly wouldn't have him anywhere less than the best place I could find him.

And by best place I don't mean most expensive, i do mean best care but that costs, it costs much more than the state would pay,
State care? Pah, who said anything about state care? My pension ends when I finally expire, not when I enter any care home! That will be sufficient on its own to fund some pretty good care. This leaves all the other 'stashed' resources to be frittered away on wine, women, song and fast cars until I am no longer 'capable'.