BBC website - is it possible to live on £40000 per annum?

[matchmaker]

http://www.bbc.co.uk/news/magazine-15197860

I'd love to try..................

[marcosgt]

Most of them live more extravagantly than my family.

I guess the question is when you took out your mortgage! For most people that will represent a big chunk of their income, for older people very little.

M.

[Oakey]

Joint income of £40k and living in a £300k house? That's 7.5x their income!

Not to mention a new car every two years!

[hornetrider]

She seems a bit of a minor petrolhead, which is all good. However I smell porkies... how does a nurse pay off a 5k loan in three months? Remortgage probably (which is fine, but her quote is disengenuous).

Kate said:

I don't have a credit card. I haven't ever been overdrawn. I've had a loan once, £5000 for a car. I had the loan three months and I paid it off.

[Oakey]

I just had a quick look on Facebook and if the Kate Rossiter from Bristol on there is her, that's not her with the Megane

[Digga]

A friend posted something about this on their FB. They said the article spoake about £200 rent. What are sensible rental yields?

[Oakey]

"Kate and Jai do not have children, but Kate puts their large disposable income down to being good at financial management."

Large disposable income? With that mortgage? Really?

ETA: Actually, the article only says they live in a £300k house, not that they paid that. That's probably what they claim it's worth.

Also, that first couple at the start who owe £360k on a £310k house, it laters claims they were made bankrupt. Would they not have lost their house?

[Puggit]

Live? Yes

Live like you want to, and keep up with the Joneses? Absolutely not.

[Oakey]

doogz said:

With what mortgage? We have no idea how big their mortgage is, or how long they're paying it back over. The fact that they have a £300k house doesn't really tell you much.

Yes, I edited my post, do keep up

[alock]

Oakey said:

Also, that first couple at the start who owe £360k on a £310k house, it laters claims they were made bankrupt. Would they not have lost their house?

I think if it's a family home and children are involved, it can be quite easy to keep the home and mortgage out of the bankruptcy.

[Road Pest]

alock said:

I think if it's a family home and children are involved, it can be quite easy to keep the home and mortgage out of the bankruptcy.

And when the beneficial interest is handed back, apparently they can't do it in negative equity so some of the mortgage is written off.

[Digga]

Puggit said:

Live? Yes

Live like you want to, and keep up with the Joneses? Absolutely not.

The Jones [not their real name] bought one of the houses neighbouring ours. Paid top price and have just set about what, judging by the plans, is £200k worth of work.

We'll see how they go on one salary, with the kids school fees and the running costs of the ghastly hot tub. (Why would people use one of these things!? It's like sharing underwear with strangers.)

Even if inheritance is involved I can see trouble with running the lifestyle and with stamp duty, they are putting themselves firmly into negative equity.

[Agent Orange]

doogz said:

Oakey said:

"Kate and Jai do not have children, but Kate puts their large disposable income down to being good at financial management."

Large disposable income? With that mortgage? Really?

With what mortgage? We have no idea how big their mortgage is, or how long they're paying it back over. The fact that they have a £300k house doesn't really tell you much.

"and now owe £360,000 on their £310,000 house"

Their mortgage is £360K so assuming 25 year mortgage that's around £2000 a month assuming 5% interest rates. It's also their only debt.

Their joint income in £40K so take home around £3.5K assuming both are PAYE. Her husband might be self employed with a limited company.

So they have £1.5K left and assume £1K a month to spend on heating, bills, food and luxury treats etc. That leaves £500 a month into savings so £6K a year. ie. a £2K holiday a year plus £8K to buy her new car.

If their mortgage is variable rates are less that 5% so the £1.5K will increase.

Sounds like it is do able if properly managed and they never have children!

[Oakey]

No, that's the other couple, the article is all over the place. One minute it's talking about one couple, the next the other, then back to the original.

[gunners100]

Agent Orange said:

"and now owe £360,000 on their £310,000 house"

Their mortgage is £360K so assuming 25 year mortgage that's around £2000 a month assuming 5% interest rates. It's also their only debt.

Their joint income in £40K so take home around £3.5K assuming both are PAYE. Her husband might be self employed with a limited company.

So they have £1.5K left and assume £1K a month to spend on heating, bills, food and luxury treats etc. That leaves £500 a month into savings so £6K a year. ie. a £2K holiday a year plus £8K to buy her new car.

If their mortgage is variable rates are less that 5% so the £1.5K will increase.

Sounds like it is do able if properly managed and they never have children!

take home will be about £2500

[Agent Orange]

Oakey said:

Also, that first couple at the start who owe £360k on a £310k house, it laters claims they were made bankrupt. Would they not have lost their house?

No it doesn't. It's the second couple Monica and Bryan that were made bankrupt.

[Agent Orange]

gunners100 said:

take home will be about £2500

Whoops! There's me making a typo and using that for the basis of my calculations.

In which case I stand corrected - they're ****ed as it sounds like they are reliant on the currently low interest rates.

[mondeoman]

I think the article is being very "economical" with the facts and it really doesn't ring true for her and her £300k house, 2-3 holiday a year and a new car every 2 years. The numbers don't add up, for me at least, unless they have no mortgage and consider a wet weekend in Brighton a foreign holiday.

Their monthly take-home is going to be c£2.8k (if they both earn about £20k so both lower rate tax payers), so thats £34kpa
Holiday for two abroad = £2k easily
3 times a year is £6k, leaves £28k
Half a new car each year is what, £7k, leaves £21k
Mortgage, assume they bought a while back at £150k, variable rate, makes it £500 pcm, so £6k, leaving £15k.
Car insurance, life insurance, Sky, water, gas, electric, Council tax say another £400 pcm, £4.8k, leaves £10k.
Food for two, say about £300 pcm, £3.6k, leaves £6.4k.

oh

It is do-able if you don't have debt ...

The only thing I missed is pensions.

[12gauge]

I live on about 1/10th of that.

That the BBC even needs to ask that question shows they live in cloud cuckoo land.

[greygoose]

doogz said:

12gauge said:

I live on about 1/10th of that.

That the BBC even needs to ask that question shows they live in cloud cuckoo land.

The article is quite clearly about couples, that own their own house. So the fact that you live on 1/10th of that is pretty irrelevant, since you clearly don't fund a mortgage with that.

I dunno, Northern Rock must have lent to someone .