Discussion
I posted on here a good while ago now, but would like a fresh outlook on it. I am 22 and rent a place with my partner. We are both on low incomes (she is studying part time to become a teacher), my income will go up the more I take on at work (it is slowly going up). I had £17.5k in savings 2 months ago, but we decided to buy a panel van to convert to a camper as it is something we have wanted to do for a very, very long time. I have spent £3.5k near enough on the van itself so far, getting a somewhat decent one and sorting a few bits out to keep it in good shape. Also since then decided to pay car insurance yearly instead of monthly to reduce my monthly outgoings (plus it worked out £40 cheaper.)
Down to just over £13.5k now. Am I wrong to be a bit disheartened that I am going backwards? I feel a bit guilty that I have spent such a chunk of it.
The plan is to buy a house in probably 5 years once my partner graduates in 3 years, qualifies in another year and then another year to save on a much, much higher wage. So realistically, I have 5 years to save and before we got the van, I was saving £300+ a month. Obviously I haven't saved over the past 2 months as I have been piling money into the van conversion bits, but I hope that once that is done, I can get back to my usual saving routine.
Has anyone on here done similar in that they spent a chunk of savings and feel a bit guilty about it? I see lots of people my age is £25k in savings somehow and it baffles me.
How does everyone else deal with savings? Spend it if it you want, or are you quite strict with them?
Edit - I have been a bit of a terror the past 12 months with car repairs as well. I have probably spent £2.5k on the upkeep of our other 2 cars. Not ideal and not all of it was actually necessary to be honest... I would've easily had £20k by now (before getting the van) had I been a bit more strict with it.
Cheers
Down to just over £13.5k now. Am I wrong to be a bit disheartened that I am going backwards? I feel a bit guilty that I have spent such a chunk of it.
The plan is to buy a house in probably 5 years once my partner graduates in 3 years, qualifies in another year and then another year to save on a much, much higher wage. So realistically, I have 5 years to save and before we got the van, I was saving £300+ a month. Obviously I haven't saved over the past 2 months as I have been piling money into the van conversion bits, but I hope that once that is done, I can get back to my usual saving routine.
Has anyone on here done similar in that they spent a chunk of savings and feel a bit guilty about it? I see lots of people my age is £25k in savings somehow and it baffles me.
How does everyone else deal with savings? Spend it if it you want, or are you quite strict with them?
Edit - I have been a bit of a terror the past 12 months with car repairs as well. I have probably spent £2.5k on the upkeep of our other 2 cars. Not ideal and not all of it was actually necessary to be honest... I would've easily had £20k by now (before getting the van) had I been a bit more strict with it.
Cheers
Edited by gman88667733 on Wednesday 29th July 15:24
You're 22 with a healthy amount saved, obviously doing something right. Well done so far.
Your van purchase will be fun and save on holidays in the long run, you've got to have some fun in life.
Key things though, if a house is on the horizon look at a Lifetime ISA. £4k a year will earn the £1k bonus (25% interest). You and your partner can put money in.
Another tip,ditch expensive mobile contracts. SIM only will save a fortune.
Your van purchase will be fun and save on holidays in the long run, you've got to have some fun in life.
Key things though, if a house is on the horizon look at a Lifetime ISA. £4k a year will earn the £1k bonus (25% interest). You and your partner can put money in.
Another tip,ditch expensive mobile contracts. SIM only will save a fortune.
Edited by superpp on Wednesday 29th July 15:33
I think you are worrying about a first world problem. Most 25 year olds have 25k of debt not savings.
Don’t feel guilty about spending some on a camper. Go and use it, relax and enjoy.
You need to live your life not worry about saving every penny, you can’t take it with you.
Take the girlfriend away and chill out, you are doing fine
Don’t feel guilty about spending some on a camper. Go and use it, relax and enjoy.
You need to live your life not worry about saving every penny, you can’t take it with you.
Take the girlfriend away and chill out, you are doing fine
I have a H2B ISA with a few thousand in at the moment. I put £200 into it every month.
I am on a SIM only contract, I buy cheaper phones outright when needed.
I suppose you're right, I need to look at it that as long as I have enough for a healthy deposit saved up in 5 years time, whatever happens in between is irrelevant.
I am on a SIM only contract, I buy cheaper phones outright when needed.
I suppose you're right, I need to look at it that as long as I have enough for a healthy deposit saved up in 5 years time, whatever happens in between is irrelevant.
OP for your age you are doing great. At 22 I had nearly £30k of student loans and then rather than save money borrowed to buy a car and rest of what I earned went out the other way. I had to learn the hard way and only started to mature financially in my 30's.
As an aside don't compare yourself to others, I've done the same in the past but it does nothing positive for you. I have family members and mates who were fortunate that their parents/grandparents could gift them money to help with deposits. I know guys who's parents provided them 100-200k for house deposits. It's never a level playing field so no point comparing.
Just keep doing your thing. Also yes it's painful to spend chunks of cash...can't get away from it lol
As an aside don't compare yourself to others, I've done the same in the past but it does nothing positive for you. I have family members and mates who were fortunate that their parents/grandparents could gift them money to help with deposits. I know guys who's parents provided them 100-200k for house deposits. It's never a level playing field so no point comparing.
Just keep doing your thing. Also yes it's painful to spend chunks of cash...can't get away from it lol
Finish converting the van to a good standard and you ll double if not triple your costs,(should you need to sell).
So as has been said its an asset.
Keep plugging as you are as you have a plan, its not like you havent.
Alternatively "IF" you could afford a small mortgage now whilst rates are low and no stamp duty, buy a house now and then when your current plan comes good you ll have already paid a chunk off and can move on up the ladder as such.
Your really not in a bad place IMO
Again as has been said theirs alot of 22 yr olds that have 25k in debt or even have 25 pence to there names approaching pay day.
The insurance thing is something ive done for years and now we "guess" the next years car costs (servicing, insurance and tax) then divide it by 12 months and pay it in to a separate account then it is there ready, also meaning that we have a buffer if one of them chucks a big bill.
So as has been said its an asset.
Keep plugging as you are as you have a plan, its not like you havent.
Alternatively "IF" you could afford a small mortgage now whilst rates are low and no stamp duty, buy a house now and then when your current plan comes good you ll have already paid a chunk off and can move on up the ladder as such.
Your really not in a bad place IMO
Again as has been said theirs alot of 22 yr olds that have 25k in debt or even have 25 pence to there names approaching pay day.
The insurance thing is something ive done for years and now we "guess" the next years car costs (servicing, insurance and tax) then divide it by 12 months and pay it in to a separate account then it is there ready, also meaning that we have a buffer if one of them chucks a big bill.
gman88667733 said:
I feel a bit guilty that I have spent such a chunk of it.
As odd as it may sound, I think that this feeling is (within limits) quite healthy and stands you in good stead.I have always been the same in that whenever I buy myself a toy, I feel a bit of guilt.
Sometimes if you save up for something you realise by the time you get there that you didn't want it quite as much as you thought!
Well done on saving what you have, fantastic job!
I'd advise "piggybanking", so split your savings up into chunks. One account for car running costs, one for house savings, one for Christmas, one for holiday, something like that. Then you can clearly see if you're moving in the right direction against your individual saving goals. Did it a few years ago and it really helps me feel more positively about money but also spend money guilt free on the things I need to. Plus we have far fewer months that last longer than the pay cheque
I'd advise "piggybanking", so split your savings up into chunks. One account for car running costs, one for house savings, one for Christmas, one for holiday, something like that. Then you can clearly see if you're moving in the right direction against your individual saving goals. Did it a few years ago and it really helps me feel more positively about money but also spend money guilt free on the things I need to. Plus we have far fewer months that last longer than the pay cheque
Having any savings at all at your age seems abnormal so don't sweat it, but don't be reckless with it either. I'm 24 and have substatial savings for my age and all my mates call me Jewish but I enjoy saving more than spending as I can hopefully see myself in a nice house by the time I'm 30. I did an apprenticeship that paid for my degree so no debt, parents helped me out with a house and I got a lodger to help pay the mortgage and I drive a s
tty old Skoda Fabia.
One thing I'd recommend is setting up a stocks and shares ISA, I put in £400 a month (my outgoings are pretty much nil atm) and I'm currently 20% up on my portfolio over the past year. Money going into this makes it harder to spend too and much better rates than a savings account (negative interest with inflation). All the small things like buying lunch daily, gym membership, expensive phone contract, designer clothes, leased cars and eating out regularly are all unecessary things we can live without and all add up.
tty old Skoda Fabia.One thing I'd recommend is setting up a stocks and shares ISA, I put in £400 a month (my outgoings are pretty much nil atm) and I'm currently 20% up on my portfolio over the past year. Money going into this makes it harder to spend too and much better rates than a savings account (negative interest with inflation). All the small things like buying lunch daily, gym membership, expensive phone contract, designer clothes, leased cars and eating out regularly are all unecessary things we can live without and all add up.
Drezza said:
Having any savings at all at your age seems abnormal so don't sweat it, but don't be reckless with it either. I'm 24 and have substatial savings for my age and all my mates call me Jewish but I enjoy saving more than spending as I can hopefully see myself in a nice house by the time I'm 30. I did an apprenticeship that paid for my degree so no debt, parents helped me out with a house and I got a lodger to help pay the mortgage and I drive a stty old Skoda Fabia.
One thing I'd recommend is setting up a stocks and shares ISA, I put in £400 a month (my outgoings are pretty much nil atm) and I'm currently 20% up on my portfolio over the past year. Money going into this makes it harder to spend too and much better rates than a savings account (negative interest with inflation). All the small things like buying lunch daily, gym membership, expensive phone contract, designer clothes, leased cars and eating out regularly are all unecessary things we can live without and all add up.
That sounds grim, why haven’t you bought a house if you are saving so much? tty old Skoda Fabia.One thing I'd recommend is setting up a stocks and shares ISA, I put in £400 a month (my outgoings are pretty much nil atm) and I'm currently 20% up on my portfolio over the past year. Money going into this makes it harder to spend too and much better rates than a savings account (negative interest with inflation). All the small things like buying lunch daily, gym membership, expensive phone contract, designer clothes, leased cars and eating out regularly are all unecessary things we can live without and all add up.
OP, live your life, you have a nice sum saved and are continually adding to it. You can’t save everything and imho are doing it the right way by enjoying your money whilst saving it too.
I’m 31 now and I partially regret ploughing all my money into houses when I was your age and not being as ‘free’ as many of my friends were, it’s worked out quite well financially but I do feel I missed out on some experiences, I’d have lived to have a camper van and travelled!
Lord.Vader said:
That sounds grim, why haven’t you bought a house if you are saving so much?
Because I've got everything I need, a car a motorbike, nice pushbike. I don't need to impress my mates with materialistic ste for an instagram lifestyle. It not like I don't go out, I go to town with my mates I'm just sensible with it which more people my age should be like and they woulnd't be in such debt. My thoughts are, the more I save now the earlier I can retire comfortably. I'm looking for a house to buy atm, just waiting for work to change my contract so I can buy a house up North. If you’ve got a help to buy isa I would convert it to the LISA. You can pay in £4000 a year to those, either monthly or lump sums and you get the bonus in cash instead of being paid to the solicitor at the end, and if you decide not to buy a house with it you can use it as a pension pot at 65.
Also I mirror what people said above, if you’re privately renting maybe look to buy something smaller now to pay off mortgage instead of rent
My OH is doing a masters so I bought just on my income, and instead of £750 rent I’m paying £450 on a mortgage, and I’ve got the security of not getting kicked out etc.
Might be a idea
Also I mirror what people said above, if you’re privately renting maybe look to buy something smaller now to pay off mortgage instead of rent
My OH is doing a masters so I bought just on my income, and instead of £750 rent I’m paying £450 on a mortgage, and I’ve got the security of not getting kicked out etc.
Might be a idea
Edited by Nickbrapp on Wednesday 29th July 21:36
Drezza said:
Lord.Vader said:
That sounds grim, why haven’t you bought a house if you are saving so much?
Because I've got everything I need, a car a motorbike, nice pushbike. I don't need to impress my mates with materialistic ste for an instagram lifestyle. It not like I don't go out, I go to town with my mates I'm just sensible with it which more people my age should be like and they woulnd't be in such debt. My thoughts are, the more I save now the earlier I can retire comfortably. I'm looking for a house to buy atm, just waiting for work to change my contract so I can buy a house up North. If you are planning to buy in 6 years, what will you have spent on rent (assumed), stamp duty savings, low interest rates, house price increase (or maybe decrease) ...
I don’t have Instagram / Twitter / snapchat / Facebook so my comments aren’t being driven by trying to ‘impress’ on SM it’s my own experience; I had two houses at 25, I’m just saying don’t let your 20’s pass you by with money in the bank, get it spent on experiences.
I'd love to buy instead of be renting. But the property we are in is nice and rural (in the middle of the Moor) and is cheap for the area at £450, has masses of open land around it for our dog to have a really good time. Lots of space inside for us, it's private and quiet. Realistically, we wouldn't be able to afford anything in the area/even remotely similar without £25k+ deposit.
We have been spoilt with our current place really. Unlimited parking space for the van + cars too.
I had been adamant that I wanted to buy and not rent, but then this place came up 10 minutes down the road from my parents house and we had to make a fairly quick decision on it.
I've been saying for the past 2 years probably that I really want to get to £20k in my savings so I can just then forget about that portion and then anything on top I won't feel bad about saving. Obviously that went out of the window by buying the van. But that has set me back probably 12 months, maybe less if I was trying really hard. So not the end of the world.
I think my goal now is to be back at £15k by the end of the year, or at least be close to that. And then next year once the van is done, I can really try hard to get back on track to getting the £20k so I can relax a bit.
Edit - I know it probably sounds bad, but I don't think we could go from where we are now to living in a flat or similar in the middle of a town. It would be a completely different style of life.
If we could buy the place we are renting, we would. (Can't though as it is a weird set up. One huge cottage split into two properties)
We have been spoilt with our current place really. Unlimited parking space for the van + cars too.
I had been adamant that I wanted to buy and not rent, but then this place came up 10 minutes down the road from my parents house and we had to make a fairly quick decision on it.
I've been saying for the past 2 years probably that I really want to get to £20k in my savings so I can just then forget about that portion and then anything on top I won't feel bad about saving. Obviously that went out of the window by buying the van. But that has set me back probably 12 months, maybe less if I was trying really hard. So not the end of the world.
I think my goal now is to be back at £15k by the end of the year, or at least be close to that. And then next year once the van is done, I can really try hard to get back on track to getting the £20k so I can relax a bit.
Edit - I know it probably sounds bad, but I don't think we could go from where we are now to living in a flat or similar in the middle of a town. It would be a completely different style of life.
If we could buy the place we are renting, we would. (Can't though as it is a weird set up. One huge cottage split into two properties)
Lord.Vader said:
Except you haven’t got a house, so either you are living at home or renting which I’d class as grim.
If you are planning to buy in 6 years, what will you have spent on rent (assumed), stamp duty savings, low interest rates, house price increase (or maybe decrease) ...
I don’t have Instagram / Twitter / snapchat / Facebook so my comments aren’t being driven by trying to ‘impress’ on SM it’s my own experience; I had two houses at 25, I’m just saying don’t let your 20’s pass you by with money in the bank, get it spent on experiences.
I pay the mortgage on my parents house which works out cheaper than even renting a room as I've got a lodger. It costs me £400 a month for a 3 bed semi all bills included when the mortgage is £800 after lodger has paid. They help me out as I didn't have uni costs, I pay their mortgage so they don't lose out, everyone wins. I'll be buying in the next year or so, then work my way up to a nicer home or BTLs. I've seen how much better off people are that invest early with compound interest in shares etc so think I'm doing right not buying Gucci shoes or the new Iphone 11. If you are planning to buy in 6 years, what will you have spent on rent (assumed), stamp duty savings, low interest rates, house price increase (or maybe decrease) ...
I don’t have Instagram / Twitter / snapchat / Facebook so my comments aren’t being driven by trying to ‘impress’ on SM it’s my own experience; I had two houses at 25, I’m just saying don’t let your 20’s pass you by with money in the bank, get it spent on experiences.
To OP, just put away the max you can into investments whilst not having to scrimp on life too much and you'll be in a better position than most.
Most 25 year olds have £25k in savings.... I will have some of what you are smoking.. 
You are doing great, really great, but going backwards is part of life. The sooner you get your head round this the easier it will be to cope.
You also have to understand the value of money and moving money from one asset class to another.
You still have that van, its not worth nothing. So you just moved some money from cash into a physical asset.
Will it be worth the same as cash over time, no. Will it ever be worth nothing, no. The bit in between is a loss but you offset this against your enjoyment of the van... so the "actual" cost might be in depreciation but your enjoyment will offset this loss.
Most people who start life after education with £0 balance take quite a few years to get savings built up. Most end up going -ve on their bank balance well through their 20s and even into their 30s.
You clearly have you head screwed on so you need to start looking at the normal investment path people take i.e pensions, ISAs and paying down any debt. You need to get your money working for you.
As for renting, its just another asset class. Property is one of those investments thats always done pretty well, so you could consider renting your place but buying a place to rent out. Then the rent coming in from that property could pay your rent on yours... then later down the line you would own a house which is a good thing.
If I were you I would form a 1,3 and 5 year plan with reasonable goals and then run with it.
Just make sure you make your savings work for you within your risk profile, the HTB ISA is a good start.
SIPP is another good plan to get started.
Remember through life there will always be ups and downs with everything including investments and the key is to stay calm and stick to your plan. So long as your plan has a reasonable goal you should always be able to get very close to it no matter what happens.
Have a read up on the 4% rule of investing and the rule of 72. I wish at 22 someone had explained those to me.
You are doing great, really great, but going backwards is part of life. The sooner you get your head round this the easier it will be to cope.
You also have to understand the value of money and moving money from one asset class to another.
You still have that van, its not worth nothing. So you just moved some money from cash into a physical asset.
Will it be worth the same as cash over time, no. Will it ever be worth nothing, no. The bit in between is a loss but you offset this against your enjoyment of the van... so the "actual" cost might be in depreciation but your enjoyment will offset this loss.
Most people who start life after education with £0 balance take quite a few years to get savings built up. Most end up going -ve on their bank balance well through their 20s and even into their 30s.
You clearly have you head screwed on so you need to start looking at the normal investment path people take i.e pensions, ISAs and paying down any debt. You need to get your money working for you.
As for renting, its just another asset class. Property is one of those investments thats always done pretty well, so you could consider renting your place but buying a place to rent out. Then the rent coming in from that property could pay your rent on yours... then later down the line you would own a house which is a good thing.
If I were you I would form a 1,3 and 5 year plan with reasonable goals and then run with it.
Just make sure you make your savings work for you within your risk profile, the HTB ISA is a good start.
SIPP is another good plan to get started.
Remember through life there will always be ups and downs with everything including investments and the key is to stay calm and stick to your plan. So long as your plan has a reasonable goal you should always be able to get very close to it no matter what happens.
Have a read up on the 4% rule of investing and the rule of 72. I wish at 22 someone had explained those to me.
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