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.

Yup!

Growing up my household had a joint income of £80k and we lived in a lovely house with a big garden, had multiple pretty nice cars (like a soft top BMW for example, not like a Bentley!), went on exotic holidays, ate out or had takeaways a few times a month, thought nothing of going shopping. My parents had enough left over at the end of the month to fill pension pots, put something aside for my future and help me with rent when I was at uni etc. My father worked for the local council and my mother for the NHS. I don't think mum has managed to have quite such a healthy pot as yours, but she's comfortable in retirement and has owned her home outright for a few decades.

My households joint income is slightly more than theirs was and we certainly live differently. Our house is considerably smaller, we a 6 year old Skoda, our holidays are either camping or visiting family, we don't eat out, have take aways or do many things which cost money, any shopping is charity shops or vinted, the mortgage should be paid by the time we retire. We are privileged compared to many and I'm grateful for that, but the way we live feels disproportionate to the income we have. It just doesn't go as far these days.

I'm no expert on economics but if you use the Bank of England inflation calculator you can see it. What cost £1800 now would have cost £900 in 1998. An £80k salary equivalent would be £153k today. Households today earning are paying double in living costs when the salaries haven't grown in proportion to the cost of living at all (someone earning £40k in 1998 would be as comfortable as someone on £80k today). But people still have this hangover that £80k is a superb salary, and so our generation should be able to have all the things our parents have based on earning a similar amount.

Yep, the flip from one parent being able to run a house reasonably well on 40-50 wages to the current situation where a household struggles on 80h+ of paid employment...

Something has gone extremely wrong somewhere & someone's laughing. (Not us)

Why are you all WTF? My guess is that they bought their house in the 1970s, maybe before, when it was a hell of a lot easier to buy property than it is now. They have done what a lot of sensible people of their ages have done. They aren’t special, and I think there’s some weird stealth brag by proxy going on.

There are four of us. And my parent's might need care and spend it all, who knows! It's not the point anyway.

I want young people to be able to live like my parent's generation, and be able to get a decent job, afford a house, etc. Even graduates aren't guaranteed good jobs now! I just think things suck for young people, and I don't want to live in a society where your prospects depend on inheritance, though I appreciate historically that's how things have almost always been in the UK.

All the pp's saying they're more educated and therefore should earn more than a factory worker.
My db graduated in 1974 but even then opted to work in a factory because it paid more than a grad entry level job.
Whilst house price rises have made the biggest difference you can also thank Thatcher for targeting the unions and passing laws to weaken them.
Factory jobs were quite rightly well paid, why should a graduate earn more?
And dinner ladies were employed by the LA not shitty companies like Compass so had decent pension provisions.
If anyone on this thread is not in a union then imo you can't complain.

Get out there and fight for your right to earn a proper wage.

Yes the new era of robber barons I feel!

Fuck off with the Generation X/ Baby boomers are all living their best life crap.

Factor in divorce and ill health and things are far less rosy.

My kids are happy to houseshare, rent for a long while and live in a flat. I would say they have lowered their expectations except I Iive in a flat and rented for ages!

With potentially £900k to inherit, I suspect that you will be very wealthy one day!

What about those that don't inherit?

Tbh the country is broke, the inheritance will be taxed or taxes in other areas will go up.

It's the same with renting. In the nineties I left my husband with our son who was around 4 and my 11 year old from previous marriage. I took out a bank loan for a deposit on a rented 3 bed house and the rent was £350 a month. I only worked part time. I managed pretty well with my job and working tax credits. Now the rents for a three bed in my area are at LEAST £1400 and there is a local housing allowance of £897 so anyone claiming UC will have to pay £500 out of their wages/benefits to clear the rent. That's a lot of money for someone already struggling with the cost of living.

House prices are criminal

a decent semi that cost around 5k in 1970 should cost around 50k if house prices had increased in line with inflation - not 300k

thats 250k that could be sitting in your pocket

It’s definitely housing but people didn’t amass the stuff or subscriptions we have now- you just had your tv really, the amount we pay on internet and mobile phones is insane, think of if you saved that amount, also holidays weren’t the thing they are now, also look at things that are the norm now, the cost of kids’ activities and things like birthday parties etc. so partly cost of living, partly our expectations now.

How old are your parents as that doesn't sound similar to the OP's scenario or those whose parents were working in the 70s and 80s.

Jeff Bezos, Elon Musk, Mark Zuckerberg, Alan Sugar. To name a few. Oh and Nigel Farage is part of the elite for those who are fooled by his beer swigging fag smoking antics.

It’s not about going ‘oh it was so easy for them’, I’m delighted for them, and to be fair my parents lived through the troubles so fair fucks to them and all like them, I hope they live long and comfortable lives.

and I AM gen X!

It’s about what is going wrong in how we are approaching politics/economics/social issues that people are in tons of student debt, both parents working full time, can’t afford a house, kids coming up in the system and taking one look at it and refusing to be part of it (record youth not working). What was society doing better then and how can we make it better for kids?

With respect to housing, a Staff Nurse salary was about £7k a year and income tax was also higher in the 80s (27%).

"The share of adults paying higher rates has increased enormously in recent decades. In 1991–92 just 3.5% of UK adults paid the 40% higher rate of income tax. By 2022–23 11% were paying higher rates, with that figure set to reach 14% by 2027–28. Of that 14%, 3.1% of adults will face marginal tax rates of either 45% or 60% – only slightly below the share who paid the 40% higher rate at the start of the 1990s."

Interest rates as we all know went sky high at the end of the 80s

The rates of 5% are similar due to the higher base price.

I think simpler lives is a key point. There were no cheap fast fashion clothes or home shops so you kept clothes for longer or made your own. People didn't expect their houses to look like a showhome and when starting out were happy to have hand me down furniture. Interior decor fashions lasted longer and people didn't change things in their homes frequently. Going out to eat was a special treat. Food was simpler and much less snacking. You had a landline phone bill but no costs for internet, smartphone, TV streaming. Households generally ran one car. Even if your income was modest, without those costs you kept a much higher proportion of it.

I am from that generation and this is not my experience but I am single and brought up my child on my owntwithout any financial input from my ex. I think being part of a stable couple with both of you earning made a big difference. I am skint now in my older years, with a small amount of savings that are now being eroded by the cost of living. Some of my contemporaries are well off but they are all in long term relationships, my single friends in my age group are in the main finding things tough.

& don't forget MIRAS

@Tallular819 one of the easiest things you can do is, when you get a payrise, put the difference into some tax efficient savings (and/or pension pot). It soon mounts up.

My dad left school at 14, my mum went to catering college but never worked after age 25 when she married my dad. They have a huge home (no mortgage) and several they rent out.. multiple vehicles, regular holidays, best of everything. No idea what they have in savings but it will be millions. Dad still works and nearly 70 but he loves it. They gave us the best of everything as kids, we went on holiday several times a year, had lovely clothes, nice meals out etc etc. But I never felt loved or valued. I’m a nervous wreck and have no self worth. Im
broke and can barely get through the week but my god my children know how loved they are.

I worked for Compass at one point, and I completely agree with you. It's one of the reasons I left. They and countless other companies seem to exist purely as middlemen who force their way in, then strip down quality of supply to the bare minimum to customers and do the same with wages (and personal pride) to the people who actually do the work.

There is plenty of money in the chain of providing and benefitting from quality service, but massive companies see it as their right to be forthright in promoting and heavily branding themselves, and forcing their way into that chain, and then taking the lion's share of it for themselves.

It’s easy to say that it was easy back in the day, it wasn’t, managed to buy a house but no furniture just made do with cast offs. Part of the truth is our demographic just don’t spend as much, I am comfortable now but still scrimp and save as it is a way of life a good example is my sons electricity use is upwards of 22 KW a day ours is an average of 6KW because we do not use tumble dryers dish washes etc. that’s just one example. We are careful and save for a rainy day, Kids were always looked after even spoilt but when I look back at the percentage we spent on our kids as compared with my grandchildren it’s impressive. Mainly life has moved on people expect things to be new shiny and available we just went without not saying which is best but life wasn’t easier just different.

Start small but regular and you’ll be surprised what you grow over time. I am spending, what seems to me to be a lot of money for 3 nights in a hotel (expensive city) at the edges of a business trip this month - but the cost is being covered by the interest I have earned on savings this year. Not from the savings themselves and especially not going on my credit card.

I started, when I earned less than £9k per year putting away £5 a week into the work credit union as a salary sacrifice (so it got paid straight from my paycheque before I got money in my bank account).

And as my wages increased over time, I increased my savings - as I was surviving on what I already earned. I’ve adjusted over time as family circumstances and costs of living changed. But I have consistently lived on less than I earn - while enjoying good food (sometimes boring and repetitive but good and plenty of it), having clothes to wear and enjoying life in general.

in the financial crash, my salary got cut a lot, and the only way DH kept his job was to spend 50% of his time overseas (2 weeks away, 2 weeks here, per month) working in both places. But we also cut our expenses back to basics and managed to keep paying the mortgage at the amount we had been paying before, even when interest rates fell . So the extra money went straight to paying off capital and reduced the term by almost 5 years in the end.

I have no stock investments- everything is just savings accounts in banks. I use the credit union to pay for holidays and Christmas etc, instead of getting them on my credit card, I save up for things not getting loans and paying interest, and what I spend on my credit card for cash flow gets paid off in full every month.

it is not easy, and I still watch what I spend carefully.