Can’t believe how much money my parents have amassed

[Tallular819]

My parents started out with nothing, not a penny from their families. My mum was a dinner lady, Dad was a secondary school teacher.

They paid off their mortgage in their 40s. As children we had a holiday abroad every year and multiple uk holidays throughout the year.

They had a lease car which would be replaced every 3 years with a new one.

They paid for mine and my sisters weddings and house deposits.

They’ve travelled all over the world in their retirement and I’ve just found out they have £200k in savings.

WTF?! DH and I have comparable careers, we run 1 old banger of a car, we have 1 uk holiday per year, we’ve stopped at 1 child, we’re on target to pay off our mortgage when we reach retirement, we have a grand total of £4k in savings. We don’t drink, don’t smoke, don’t buy expensive clothes.

Its just hit me how vastly different our financial situations are. I didn’t appreciate just how different the cost of living is today compared to 40 years ago.

I didn't say all people are buying new furniture etc., but it is a fact of life that people's expectations these days are so much higher than they were when I was young.

Where I live we have the same housing issues as in the UK, although I have seen prices quoted on MN which are lower than anything I've ever seen here. And yet I read just last week about a young couple, both working in supermarkets, who have managed to buy their first home - and it wasn't particularly cheap (and no, they didn't have help, but one of them has been saving since they had after school jobs).

We bought our first house 8 years ago (mid 30s as it took us that long to save a deposit). It urgently needed a new kitchen when we bought the house. We’ve just saved enough money to have it done. Work starts in September, cant wait!

And you are spectacularly missing the point that home ownership in the UK was not the norm several decades ago, yet you seem to think you are the only one being hard done by.

Housing costs have risen enormously here too, and wages have stagnated, but somehow many still manage to buy their own homes - although admittedly not nearly as many as used to be able to.

Well done!

We’re not talking several decades ago. We’re talking boomers who bought in the 80sand 90s. Several decades ago rents were far cheaper. Now younger workers are paying a huge proportion of their wages in rent. That’s if they can actually find somewhere to rent! Some of my sons graduate work mates had to live in hostels as they couldn’t find anywhere to rent- professional people working in one of the uks biggest insurers on good starting wages! No Hope at all for minimum wage workers in his city due to student lets and air bnbs and older people sucking up all the affordable properties to rent out for profit.

This is why youngsters can’t buy homes anymore. Not mobile phone contracts, not wanting new furniture, no Starbucks coffees, not a new washing machine instead of repairing one!

Graph

That entirely depends what you mean by "several decades" doesn't it? For people alive today, home ownership rates are in decline. So don't worry, we'll all get to experience that reality. Homeownership peak was 2007 I believe.

Of course some still manage to buy home, and some whilst young, most with some kind of help (living at home for example, not everyone can do this). But for lots of people it just isn't possible. I'm not sure why you feel the need to argue that fact. If the bank wont lend you anything close to what the house costs, what do you expect people to do about it?

I’m in with respect more for you. You could’ve had it on interest. Free credit for the last eight years and paid the damn thing off by now.

We couldn’t, for various reasons. Not worth going into on here though. I was just making the point that we don’t all buy brand new whenever we want it nowadays.

Think of the inheritance; you will have a fabulous retirement with all of that lot.
Yes yes I know they might use it all up on care fees, but statistically that is unlikely.

My parents were lifelong savers. They died with a relative fortune in savings and property, having started with nothing.

The only reason we have large savings is due to inheriting. We feel much luckier than our children. When we got married, property was affordable, and on one wage. Our plan is to give the money I inherited to our sons when they’re ready to settle down, no point leaving it to them when we die, or risking it going to pay for our care.

Well, that’s not the point I was responding to which concerned boomers being blamed for taking away free education. I don’t disagreed with you though. There are cohorts who hit peak fees, were steered towards degrees and were caught between a rock and a hard place where the degree no longer conferred advantage but was a minimum baseline for entry. This may be changing a little with apprenticeships but obviously only a benefit for younger people and, though I don’t have a figure to hand, probably only a benefit for a minority. My bigger point is though that the reality for different generations is nuanced and too many sweeping generalisations made.

Anecdotes aside It’s purely the ratio of wages to house prices.

Average in the 1970’s was x3 average wage for an average house it’s now close to x9 wage for an average house.

The population has expanded by over 10 million and houses occupied by a single adult has risen by 2 million so it’s easy to see why. It’s a very simple supply and demand issue. I only took a basic economics module at University in my first year but it is ridiculously easy to understand.

That is my reason to want immigration tackled, economic. Let in net contributors.

I’m not sure where you get the figure of 85%,
I have seen data suggesting more like 70%. You are correct though in what you say about the trend towards younger generations being less likely to own a home. The biggest driver of home ownership in the pensioner cohort has been discounted right to buy (thank your Mrs Thatcher 😑), so less about super cheap and easy to access mortgages and more about a very flawed ‘give away’ scheme that only benefited existing tenants and was always going to disadvantage the next generation.

America and Australia and New Zealand are all scrambling for net contributors under a certain age.
If you were to take emotion out of it and remove the family connection and look at Australian New Zealand parts of the US parts of Africa to be honest Dubai
Where would you choose to live?

ONS data. But you're right. It's closer to 80% than 85%, my mistake.

you miss a couple of key points (1) it’s not just about wage:house price ratio, it’s about interest rates. Low interest rates drive higher house prices and determine whether a house is affordable to buy. (2) it doesn’t matter whether someone coming to the uk is a net contributor or not; demand is still driven up and scarcity is a driver of cost.

I think I will ask for my mum's money- whatever is left- to go directly to my DC. That should address some generational resentment

When that time arrives @Holluschickie you can always do a Deed of Variation so that any inheritance bypasses you. I just did this for my DC.

The mass selling off of council houses and the complete failure to build new ones to replace them has been a huge contributory factor. And created the rise in private landlords.
Also people moaning about boomers but many of them have been the bank of mum and dad helping gen x, y and z onto the ladder but in so doing pushing prices up because people desperately wanted the house of their dreams.

While wages have definitely stagnated and opportunities are also thinner on the ground than they were, Gen Z are going to inherit massive amounts once their parents die. Of course some will consume it all via care home fees, but most won't. My father is still at home, with dementia, with my SM looking after him attentively at nearly 92. All kudos to her, she is giving her all.

But before you all think I'm in the money, the children of his second (more successful) marriage will inherit. I doubt I shall receive a penny, and TBF, I don't need or want it. I made enough myself for my needs, and I am really proud of being entirely self-funded. Nobody has given me a ha'penny.

Actually not quite correct: I inherited £400 from one grandma and £3500 from the parental side. I bought a garden table with one, which we still use, and a picture and a holiday in Canada with the other.

It's interesting that flat prices in Guildford are coming down as landlords sell. Almost every one and two bed flat is getting reduced in price as landlords sell.