To ask if any of you feel financially secure, and if so, what does it look like...?

(165 Posts)
Sugarbeach Wed 18-Sep-13 14:24:02

Is it even possible? Is it a realistic hope/goal?

wink1970 Thu 03-Oct-13 17:25:54

I'm not sure you ever feel completely secure (unless you are a millionaire).

I tick all those except the pension - though we do have a couple of rental houses to sell when needed.

However, it will never be enough. yes I am greedy.

alanapartridge Thu 03-Oct-13 17:02:24

angelintercepter

I can sympathise. I´m in a similar, if not far worse, position than you - had it all - big house (with big mortgage of course), nice cars, etc.....worked our asses off for 20+ years, OH expanded business then things went soooo wrong.....got so stressed I had a nervous breakdown, and the only way out (because we were tied to many commercial leases) was to sell our house, pay the bank off and virtually give the business away. We literally ended up with nothing, just the clothes on our backs.
Have never had kids (which now seems a blessing !) and now live abroad where we both work freelance and earn very little,(but probably more than we could in UK) rent an apartment, live hand to mouth (so under even more stress every month), haven´t a single shred of security, no possessions, no money for clothes, make-up, hairdos etc.,and because we rent, I can´t even have a dog (which would keep me sane). I´m 58 this month. Don´t stand to inherit a bean. Sometimes life doesn´t seem worth living, but guess you´ve just got to get on with it.
For those of you who didn´t feel very secure before reading this, I bet your bottom dollar you do now ! LOL

Comfortable Fri 20-Sep-13 23:56:05

I feel fairly secure. Joint net worth of roughly 2 million of which roughly a third is my paid-for home, a third is my savings/investments, the last third is spouse savings/investments. On top of that basic state pension entitlements we have accrued so far are worth about 150K each.

This is not how we are invested, but to illustrate, 1.4 million in Vanguard European tracker ETF would mean owning assets with (I estimate) an underlying smoothed earnings yield north of 6% and a dividend yield north of 3% last time I checked, so I reckon you could spend the dividends (call it 40K) and you would only be spending half the underlying returns. (I see risk differently from people up-thread and would cope with two thirds drop in balance. In fact I did, back in 2008/2009.)

Given house paid for, if no-one were working we wouldn't need our (paid-for but worthless) car and core/unavoidable expenses would come to 12K, so no danger of not being able to pay them.

Main risk for me is divorce, as spouse might get half the home. That seems particularly unfair given that I paid 80% of bills during the marriage and am retired, while spouse now earns as much as I used to and intends to work forever.

Next biggest risk is the home itself - a lot of money tied up in one place.

Since people may wonder, the source of 2 million funds is:-
1. my income earned since 1998 funded my savings and paid for the home
2. spouse income earned since roughly 2005 funded spouse savings
3. 400K from home value tripling since 1998.

itwillgetbettersoon Fri 20-Sep-13 21:48:19

I work in the public sector. I don't feel financially secure at all as I could lose my job anytime. 2015/16 is going to be a terrible year for local government so I will be surprised if I survive the next cull. I am late 40s, part time pension and soon to be divorced. I use to feel financially secure when I was married.

holidaybug Fri 20-Sep-13 21:16:49

Early 40s, largish house, mortgage nearly paid off, no other debts, save over 50% of what we earn.

Do I feel secure? No way! We couldn't afford to live comfortably without working - we'd be fine for a while but not indefinitely.

34DD Fri 20-Sep-13 21:11:07

Message withdrawn at poster's request.

34DD Fri 20-Sep-13 21:06:31

Message withdrawn at poster's request.

ItIsKnown Fri 20-Sep-13 20:56:29

DH and I are carers to two disabled DC. We have a bit in savings from more economically productive times (not nearly enough to not qualify for help before anyone says anything) but I feel financially secure these days when I've put money on the gas and electric meters and the fridge is full.

I hate being at the mercy of this the government but it won't be forever. We're both graduates and DH is extremely resourceful.

pencilsharpener Fri 20-Sep-13 20:37:33

I feel pretty financially secure. I'm about 15 years off an early retirement and have the equivalent of 15 years' net income in savings/investments. And a house with no mortgage. So I could quit my job any time I liked and not worry about the consequences grin

I'm not at all interested in possessions, so saving has always been easy for me. My car is a 12 year old rust-bucket!

morethanpotatoprints Fri 20-Sep-13 18:36:09

We are financially secure and it feels good.
We don't have a lot of money but are asset rich and some savings.
Pension is in a property rather than a fund, as I didn't trust these grin.
Everything is paid for, but not necessarily bought new.

amicissimma Fri 20-Sep-13 18:32:25

Having grown up poor the first thing I did was to make sure I was as employable as possible.

I trained in my main job but also got experience elsewhere evenings and weekends, so if one job went, I had a good chance of another in a different field.

I worked as many hours as I could so that I could build up savings. I would always save in preference to buying 'treats' (holidays, new clothes, technology, meals out, etc).

I wouldn't take any debt, apart from a mortgage, but even then I had to have saved enough deposit to minimize the chances of negative equity if the market dropped. I wouldn't buy anything unless I had the money in hand and if that meant beans on toast for months and clothes from charity shops, so be it.

Experience told me that things can go wrong unexpectedly, including ill health and death, so I didn't dare take on the commitment of DCs until I was confident that I had a good savings cushion, earning ability, a stable relationship (as far as I could tell, but I didn't commit until I'd known DH for years) and accommodation on a reasonable mortgage. I did risk fertility problems as this meant waiting until I was in my 30s.

My DH has a similar attitude. I don't think I could have married someone who didn't.

Our savings obsession habit does mean that are in a reasonably secure position, ironically just as our DCs are leaving home and costing us less! But retirement looms and we can't rely on the taxpayer, as others have said.

I do worry that the DCs will take it for granted. They seem OK, but have nothing like the drive to earn and save that DH and I had.

VivaLeThrustBadger Fri 20-Sep-13 17:58:51

I kind of feel financially secure but I'm aware that we're only a redundancy away from not been.

We only have about 30k on the mortgage left, we own our cars outright, we have furniture, etc, no loans and we have probably a years worth of wages in savings.

But dh has quite a specialist job and if he got made redundant he might struggle to get employed, certainly at such a level again. He's in his 50s which doesn't help.

I think I'll only feel truly secure once I've retired!

Want2bSupermum Fri 20-Sep-13 17:50:28

We keep our cash here in the US because cash limits for FDIC coverage are much higher. Our joint account is covered up to $500k.

Word I hear you on not wanting to end up with spoilt children. DD is two and DH came home saying we should 'do' FAO Schwartz. I put my foot down and said no. Nothing good comes from that. When DD is older she can earn special trips into town. I also think about other things which have an effect on their upbringing such as the cars we drive and our housing. We could have new cars every 5 years and live in a large house. Instead, I refuse to trade in my 8 year old car and expect I will be driving it for another 8 years. A car built today should last at least 150k miles. Housing wise we are looking at living in a house that can be converted into a multifamily once they move out.

Upthread someone was talking about divorce. I have a pre-nup in place and I take an active role in our finances for that very reason. My mother was the dainty housewife who didn't want to be part of the discussion. It cost her dearly. She got a great settlement from my father but still to this day she has no idea about household finances.

DontmindifIdo Fri 20-Sep-13 13:07:59

I am the only one who wants to know what festered does for a living/has done in the past to get to a high wage? [nosy]

wordfactory Fri 20-Sep-13 12:59:19

guilty that has been a huge issue for DH and I.

Obviously we don't want our DC to have the struggles we've expereinced, but on the other hand I dread them becoming spoilt little rich kids.

BraveMerida I wouldn't put $2 milllion in cash in a bank for sure!

It'd be wrapped up in stocks, bonds, mutual funds or some type of investment vehicle. You'd never earn enough interest on it, just having it sit in a bank.

And besides in the US (where my DHs and I major investments are), you are only insured up to $250k by the FDIC. So tons of cash just sitting in a bank = bad idea to me.

Beastofburden Fri 20-Sep-13 12:40:03

Exactly. If inflation is 2.5% you need to reinvest that each year, so you could only spend the surplus over inflation. Back to the 1%...

I think we are beginning to see why so many older people spend their capital on a BTL house. An income of some-one else's monthly rent (less tax, fees, etc) is inflation protected, while the capital grows in line with house prices. I tmight not make money for a comemrcial investor who is borrowing to do it, but it certainbly beats the bank account model.

We have a largish mortgage, 2 children who haven't yet finished their education and at least one of them will need some help through university, no pensions to speak of, a bit of savings (more than £20K) and a business that is providing enough for us to live on.

I don't feel insecure tbh. We've had our ups and downs, been made redundant a few times, lived off fresh air when the business was getting off the ground, that sort of thing. Things work out in the end. Having more money wouldn't necessarily make me more secure - money is meant to be spent (within reason) so I tend to think if you have more incoming you have more outgoing and, with it, the need to have even more money.

Security is a state of mind I think. It sort of depends if you are a glass full or half empty sort of person. From a personal point of view we had very little growing up. So long as I had more than I had then, I don't feel disadvantaged. I personally don't feel the need to stash huge amounts of cash away although I understand why some people do.

Actually security to me is the ability to make money if you need it. That doesn't mean paying off the mortgage, that means being able to comfortably keep up with the repayments. We've got that so I feel OK about it.

Idespair Fri 20-Sep-13 12:39:13

I think feeling financially secure from day to day is different from feeling financially secure in the long term. I only know one couple who are properly financially secure, they have about £10m grin. They do not need to concern themselves with the price of anything or worry they can't afford stuff or shop around. They can just have whatever they want. Incidentally they are extremely generous. Their child came to my ds birthday party and he was given £50 worth of really nice toys from them which he was thrilled with.

guiltyconscience Fri 20-Sep-13 12:36:27

Thanks Keden and Merida think you are right it's instigating good financial habits in them now whilst we are still here and hoping for the best. I am going to put it in trust under my sis's jurisdiction till they are 25.Decision made just gotta get it sorted thank you !

BraveMerida Fri 20-Sep-13 12:32:34

But I wouldn't feel secure leaving 2 million cash in a bank due to inflation, and it is not risk free, you are only protected up to 85k!

lifesgreatquestions Fri 20-Sep-13 12:30:32

I feel financially secure, and I agree that it's relative. I come from poverty (not enough food, sometimes homeless, the handmedown's hand me downs) as a child. I now have a great income, on a contract so it's reliably there for the foreseeable future. I am on a mortgage, I put a significant amount into savings each moths and can still afford to do nice things. We, OH and I, both live simply and manage money very well, no credit cards or purchase of useless or unnecessary gadgets. OH came from a lower middle class family who knew the value of hard work and money and while they weren't rich they were/are financially secure, own their own home, etc.

BraveMerida Fri 20-Sep-13 12:30:22

Been niggling me also, especially if some partner or spouse get a claim on it.....Maybe let dc have a taste of having to be financially independent, and what it means to be poor...while you are still around?!

MadeOfStarDust Fri 20-Sep-13 12:29:00

2 million would get you more than £20k - if that is the rate you are getting - 1% - I would sack the financial advisor....

For that level of capital and no-risk-at-all-put-it-in-the-bank savings you are looking at a minimum of 4% (I'm currently on 3.5% with a hell of a lot less than that...) just look through the financial papers this week....

£80k pa is not such small change....

guiltyconscience Fri 20-Sep-13 12:23:30

Bumble that is very commendable and we feel the same however I have creeping doubts about it as there is no guarantee they won't lose the lot in one way or another.Making me think what can we do to ensure after our days they don't fritter it away on crap obviously we try to instigate good financial habits in them but ......... any ideas anyone?

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