Things I have learnt since becoming rich (a.k.a. fuck you: Nigella and Jamie)

[TheAutumnHere]

1. Having an oven that holds temperature stops cakes falling
2. A stand mixer simplifies baking by a factor of at least 4, and improves the results
3. Branded vacuum cleaners actually remove dirt from the floor
4. Le Creuset pans don't stick, and just wipe clean
5. Baking with children is delightful japes, when timed the morning before the cleaner comes
6. Corn fed chicken is the bomb

Just leaving a note to my past self - who never cut herself any slack and thought she was a slattern and a crap cook.

There we have it.

A few BTLs of their own - and enjoying finding a bargain while on their weekly shop.

All that it takes is a little bit of nous and organisation, and you can have a great quality of life on a small budget. Absolutely no need to feel disadvantaged - expensive does not mean better.

I knew I was just a whinger that had to pull myself together & try a little bit harder to make sure that my family had quality meals. I hadn't realised that I'd also fallen short of average by not picking up a few BTLs. Only tiny ones.

( I don't have BTLs even now.

Dirty, filthy business that I wouldn't touch with a barge pole.

What's wrong with investing in stocks and shares to boost businesses?

Oh, I remember, because the inevitability of people needing somewhere to live make BTL seen as a more secure investment than, say, emerging renewable energy technology. And protecting your wealth is your responsibility to your children.

)

I love the way all the BTLs on MNs aren't landlords, if they are they are good ones providing a service, they all have tiny properties or simply inherited them, they are not worth much, don't make any money on them etc etc.

It is important to recognise that for many young people today their ability to own their own home, let alone 2 or 3 depends on whether their parents were homeowners & could help with a deposit &/or provide space for them to live at home. Very hard to do it on Income alone.

What's wrong with investing in stocks and shares to boost businesses

Because equity markets are pure as the driven snow. The whole finance sector morally beyond reproach, not prone to excessive risk, fuelling boom and bust cycles, or causing financial crises resulting in austerity that hammer the poor.

I hadn't realised that I'd also fallen short of average by not picking up a few BTLs.

And apparently also yet to realise that it doesn't make you "rich" if you invest in a second property to rent out. My cousin's flat that he rents out is a shoebox. He paid about £90k for it, and I know the mortgage is around the £80k mark. But, of course, having £10k equity makes him rich don't you know. What with his "portfolio" and all that.

And with regards to stocks and shares and all that jazz, as a qualified accountant (although not practiced for a decade) and as someone, (as mentioned up thread) who dated a billionaire who happened to own a hedge fund, and current DH who works in finance, I've got a teeny weeny bit of knowledge in that area. In fact one of the areas he's now investing in happens to be renewable energy. But don't let your plethora of kitchen aids and Le Creuset stop you from educating us all on the subject of what to invest in.

As the old saying goes, "How do you make a small fortune on the stock market? Have a big fortune on the stock market."

OP, other than the "startling revelation" that having slightly better quality appliances can help towards a better end result domestically, you are pretty clueless.

@Courtney555

Have you ever been poor?

Absolutely irritates me to the back teeth when people say stuff like "Oh I shop at Lidl and go to carboots" as if it's somehow comparable to being poor. It's very easy to say you wouldn't see yourself as disadvantaged by having to shop there if you have never personally experienced it. The fact is, you have a choice. Believe me, if the choices are taken away from you you would feel a LOT different.

He paid about £90k for it, and I know the mortgage is around the £80k mark. But, of course, having £10k equity makes him rich don't you know. What with his "portfolio" and all that.

But why did he do it other than to make money?

Acceptable rich is crepe pans, John Lewis, cleaners and the stock market. Unacceptable rich is BTL.

I love the way all the BTLs on MNs aren't landlords, if they are they are good ones providing a service, they all have tiny properties or simply inherited them, they are not worth much, don't make any money on them etc etc.

That doesn't sound bitter at all. Sorry, if someone renting out their BTL isn't a landlord, exactly what are they?? All of ours are tiny flats or council houses. Because you are covered by the council if the tenant wrecks the place and there's always a queue for social housing so they don't sit unlet for long between tenants. And correct, you don't make much money off it. But hopefully the mortgage gets paid off by the rental income, and in 20yrs you have an asset to continue renting to provide you with a pension income. Hopefully the market hasn't imploded. Being a landlord is no easy run. Tenants can be a right pain in the arse, don't care if they ruin the place because, meh, it's not theirs, and cause damages that they expect you to be on call for 24/7.

It is important to recognise that for many young people today their ability to own their own home, let alone 2 or 3 depends on whether their parents were homeowners & could help with a deposit &/or provide space for them to live at home. Very hard to do it on Income alone.

Didn't have a penny from my parents. Neither did DH. Both of us have lived independently since 17 and 18, and supported ourselves entirely. I (and DS) will be one day in receipt of a trust fund (before someone misinterprets that mentioned up thread) but we do not benefit at all from it now. I have three cousins who don't have any BTL. All three are young couples. All three have their own places with a mortgage. They don't have fantastically lucrative jobs or parental hand outs. Two of the women are sahms, the third works part time. Two of the men are electricians, one is a personal trainer. So whilst one view may be that it's unbelievably hard to get on the property ladder off your own back/income, that's three couples I know, who live in perfectly nice houses, on one income, or one and a half incomes.

Surely the point is if you have a million pounds in equity on your house you could sell it and move somewhere a lot cheaper and realise that equity into cash.

So you could move somewhere an hour on the train from London (sacrificing your time with the commute), buy a four bed family home for maybe £300k and then you've got £700k sitting in the bank. Invest that in some funds and draw down at 4% a year and you can take an extra £28k home before tax. That's an option people who don't have that equity don't have. It might not be a choice you make, but it's still an option.

Or if you have a million in equity on the house, you're not paying the rent on that house you'd be paying if you didn't own. Lots of friends in London are paying thousands a month for a house: if you don't have to rent and were lucky enough to buy in a time when you now have equity, you save a proportion of that money each month. You can then choose what you do with it - do you use it to make your life easier by paying for a cleaner, or maybe you save it so you can travel more, or retire earlier. Again those might not be the choices you make, but they're all options you have that someone in the same position but renting doesn't have.

Then we come onto the definition of "rich". The average income in the UK for full time employees is just over 30,000 (using the last set of ASHE tables). If you are earning more than £47k per year you're in the top 20% of earners. If you're earning more than £61k then it's the top 10%. Over £81k makes you top 5%. Earning more than 80 or 90% of people in full time jobs (never mind the fact that often part time jobs are even more poorly paid per hour), sounds pretty well off to me, even it's not in the realms of the super rich. So actually, buying a meile washing machine outright is pretty unlikely to be "normal", especially when you combine that with the fact that significant portions of the population have no savings at all with the fact that the washing machine cost would be around 1/3 of the take home income of someone on the median salary (cheapest on JL is £650). Quibbling over "rich" vs "well off" vs "comfortable" isn't hugely valuable when people are classing those in the top 10% as not especially unusual, when in fact they're out earning 90% of the population.

www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/adhocs/undefinedannualsurveyofhoursandearningsasheukpublicandprivatesector90thto99thpercentiledata

www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/datasets/agegroupbyoccupation2digitsocashetable20

The financial crisis was to do with CDOs - which are predominantly repackaged BTL loans.

It's a dirty business with no redeeming features.

Thank you @Nacreous

I don't think BTLs in themselves are bad, it's useful to rent sometimes. However we now have younger people less likely to own properties & those that do more likely to own more than one. A lack of social housing, rents that are often double the mortgage, higher living costs, towns that are dead apart from the Summer, etc. Plus we have an ageing population with "wealth" more concentrated in their hands.

I'm often confounded by MN.

To me a 4 bedroom house is not a "bog-standard family home" - it's somebody doing rather well for themselves.
Also see, being in the position to buy a buy-to-let, however tiny.
And as pp said, choosing to shop at Lidls, poking round carboots and "enjoying getting bargains" is very different from having to.

It's all relative, innit?

I'm in a homeowner by the way & in my 30s

That doesn't sound bitter at all.

Yep because pointing out the issues with 2nd homes & buy to let's must mean your bitter.

Courtney555 Have you ever been poor?

Yup. When I was starting out, I lived absolutely hand to mouth.

Absolutely irritates me to the back teeth when people say stuff like "Oh I shop at Lidl and go to carboots" as if it's somehow comparable to being poor. It's very easy to say you wouldn't see yourself as disadvantaged by having to shop there if you have never personally experienced it. The fact is, you have a choice. Believe me, if the choices are taken away from you you would feel a LOT different.

Er, sorry but I kind of ruin your argument there. Because I have been there, with no "choice" and felt no disadvantage whatsoever than I do now. In fact it's by having the experience of barely having two beans to rub together, that I know how well you can live for virtually peanuts. I bought second hand nearly everything back then, and I still do now, because I love how much value it provides.

But why did he do it other than to make money?

Sorry, what a stupid question. You invest to make money. That's what an investment is. What are you trying to imply?? That it's outrageous to invest? Should he be making a loss?

Acceptable rich is crepe pans, John Lewis, cleaners and the stock market. Unacceptable rich is BTL.

@TatianaLarina that's made me chuckle no end.

You're good with investing in shares but renting out a flat is morally bankrupt and the cause of the financial crash

So whilst one view may be that it's unbelievably hard to get on the property ladder off your own back/income, that's three couples I know, who live in perfectly nice houses, on one income, or one and a half incomes.

Yep all the statistical data is wrong because you know people.
Why can't people recognise their privilege?
If I was 5 yrs younger with everything being equal I wouldn't own my own home.

If you invest in shares, you can direct your capital to allow businesses to grow - which makes jobs, and depending on your choices can also drive innovation.

If you invest in BTL you're making houseprices rise, passing cash down to asset rich individuals and betting on a return from other people needing to rent/buy at increasingly high prices. If your brother didn't buy the flat for 90K, maybe a FTB could have had it for 85K and got their foot on the housing ladder.

Yep - I'm good with investing shares - but the only way I'd buy a second home would be to house a family member.

Sorry, what a stupid question. You invest to make money. That's what an investment is. What are you trying to imply?? That it's outrageous to invest? Should he be making a loss?

No of course not, but just own it. You want to make money off the back of those that don't have that privilege or opportunity.

MBSs in general. Repackaged by the financial sector using mortgages in complex financial instruments.

There were many causes of the crisis. Sub-prime mortgage disaster was a trigger in the US.

If I was 5 yrs younger with everything being equal I wouldn't own my own home.

Well that's your personal experience. These couples are all mid twenties. One has two DC. One has two DC and one on the way. One has 1 DC and one on the way. With either one average income, or 1.5 average incomes. And yet miraculously they manage this impossible task.

Then there's the childless couples who both work full time who say they can't get on the property ladder.

You either can't afford to buy in the area you want (in which case, you can afford a property, just not the one you want) or you're doing something spectacularly wrong with your income if there's two of you with no dependants and can't afford anything. Not being able to afford what you would like to own is not being unable to get on the property ladder. I'd like a penthouse in Knightsbridge. I don't pretend I can't get on the property ladder because I can't afford that.

I can, however, afford a Smeg toaster, so, you know, swings and roundabouts.

And avocado toast.

You forgot the avocado toast.

That's why I couldn't afford a property.

So you could move somewhere an hour on the train from London (sacrificing your time with the commute), buy a four bed family home for maybe £300k and then you've got £700k sitting in the bank.

A 4 bed family home for 300 an hour from London. 😂

Good luck with that. (Not forgetting moving costs, stamp duty and high commuting costs).