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.

We are now relatively well off in retirement, thanks to sensible decisions made 25 and more years ago. There's no final salary pension, because we were effectively self-employed, but we have made regular savings into a DC pension and our family home's value has increased several times over in the 30 years since we bought it. Our inheritance from our parents has been passed down to the next generation to get them their first property and they will inherit very well when we pop our clogs.

All anecdotal but one of my friends is slightly older than my friendship group as a whole- not quite a generation, but think starting work in mid-late eighties rather than us doing the same in mid- late nineties and her stories about work then absolutely blow my mind. Like a different world.

She says it was normal to get two pay rises a year and 10% rise wasn’t that unusual. She always had amazing company cars at that time too. She reminisces about some of the fab cars she used to get to drive. She worked in HR.

My boss about 15 years ago was moving house and he told me that his father had advised him to always overextend yourself in your mortgage because your salary would quickly catch up with annual pay rises!
My boss ignored this as it was obvious what way the wind was blowing. We worked in civil engineering and the payrises were becoming pitiful even then.

A lot of money has been taken out of ordinary working people’s hands - work pensions, payrises, overtime, bonuses, decent expense accounts, mileage, company cars. I don’t understand where it’s gone and why.

Yes, I think it's two things:

1. More women working after having children = pushing house prices up as families could afford to pay more on two wages.

Obviously the astronomical increase in house prices is a huge factor.

2. However we can't get away from the fact that we are a more consumerist society now, wanting more and better holidays, eating out, takeaways, cars, bigger houses with up-to-date decor, and just things.

As many who grew up in the 80s and 90s, we lived a fairly frugal life: mainly UK camping holidays, had one functional car, never ate out unless it was a very special occasion (and then it was just the Harvester!), house decor and furniture etc were saved up for and only when absolutely necessary.

I do try and emulate some of this, eg we're staying in our current house and saving to pay off the mortgage (hopefully finished when we're late 40s), rather than buying somewhere bigger and better (which we could afford to do). We only have one car (which we save up for and buy second hand) that lasts until it starts costing £££ in repairs... House could do with new bathroom and redecoration, which we could afford to do, but then we wouldn't be saving the money to pay off the mortgage, etc etc.

But people are having to take mortgages into retirement in many cases and the children are not leaving home as they can’t afford to! The point is, the old model, which was actually quite short lived through the 20th century, has now broken and thw assumptions that there will be time and space to do this accumulation could be just… outdated now. Therefore the point of this discussion should be, what can working and young people do now instead, to mitigate how much society and the economy has changed?

Crying with laughter at the idea that the current problems are exclusively caused by Boomers buying up Council housing and utility shares in the 80s, and absolutely nothing at all to do with globalisation, de-industrialisation, technology advances not to mention greedy bankers inventing sub prime mortgages, derivatives, and trying to solve the mess they made by quantitative easing.

My MIL was a stay at home Mum, FIL was a police man, their house is now worth £900k... meanwhile we earn over £140k between us and ours is half the size of theirs. Which is annoying as they're rattling around in it and we have a family of 4, but hey ho. I appreciate I sound entitled, it is quite unfair though!

With the older people I know it was property that put them in a good financial situation. My parents bought their first house early 1970s for about £6k, sold it in the 80s for £45k and bought a lovely big 4 bed for £65k and had their mortgage paid off by the time I left home when they were in their early 40s. That house has recently been valued at £800k. I don’t think it’ll ever happen like that again!

It's also worth remembering there was no subscriptions for TV channels etc WiFi bills, nails, lashes, disposable clothing, Amazon etc etc. we had a milkman that called weekly & the video guy that came round with a suitcase of films on a Fri & Tuesday! We went KFC maybe once every 6 months it was a special treat never McDonald's there just wasn't the demands on money like there is today, on top of general living costs

Can anyone tell me for which political party I should vote next time so that I’m never accused of doing wrong by subsequent generations?

My parents were similar.

Got married in 1962, bought their first house for about £3k when my mum was PG with me, sold it 2 years later for £5K. They were lucky that house prices were on the up all through their house buying career. They also bought some doer-uppers and made huge profits. They worked their way up to buying a lovely thatched cottage with 2.5 acres for £24k in 1973. Remember though £24K in 1973 was a lot of money when the average 3 bed detached house (in our area) would sell for about £15K. This house also needed a lot of work. My father had been an electrician as a youngster, so he & a qualified electrician friend re-wired the house, it needed re-thatching, but they were able to delay this by a few years by be-friending a local thatcher who would patch any leaks with my father as labourer. My parents convinced me that having bare floorboards in the bedroom was trendy & that everyone had ice on the inside of their windows in the winter - at least I had an indoor lavatory unlike them when they were children. Holidays? You're joking! - didn't I realise that some people save all year around to spend 2 weeks in a house like mine?

However, 42 years later, this house had to be sold in order to pay for my father's care home fees & mum moved into a much smaller house close to me in the local city. They made a huge profit & sold for about £750k, bought new house for £350k.

Daddy had dementia & developed a fear of water for some reason. Increasingly he would become very aggressive and would lash out when we tried to encourage him to drink or wash - we understood this came out of his fear, but there was no reasoning with him. This was so unlike him as he was previously so laid back & non-confrontational & very distressing for us all. Since he had such complex care needs only one home within 100 mile radius was able to take him & that cost about £1,800 a week increasing to £2.5K by the time he died. Not to mention the cost of travelling 140 mile round trip to visit him twice a week. Under the pressure/guilt of all this,, 2 years later, mum had a stroke which left her paralysed down her left hand side, unable to walk, swallowing/choking problems, incontinent & with such complex needs that she needed 24 hour care. She refused to allow me to give up work to care for her & decided to go into a home. Although I was very willing, she wanted to retain whatever dignity she had & didn't want me feeding her, changing her incontinence pads etc. She was determined that I continue my career & was worried about my pension should I give up work to care for her.

Their savings having been depleted to zero, the house had to be sold to pay for that as this was another £1,500 a week. By the time that they died in 2019 & 2020 respectively, my brother & me inherited the grand sum of £25K.

Our mortgage is paid off now……but in our fifties. So we’re able to save more. Or we were but that’s another story.

Before that we’ve been on the breadline plenty of times but we learnt to budget.

So that’s no leased car, no nails or beauty treatments, no holidays or going out. You saved to buy a cheap car. Everything went on our home. It wasn’t like that all the time but enough to make sure we don’t want to get in that position again. My first car was an old banger I think a couple of hundred pounds lol. Kids drive round in nice cars nowadays. And no one cared about what car you drove or the labels you wore……

So good for your parents, they probably scrimped and saved every penny. Like my dad did. Theres so much pressure now to waste money …… you can shop 24/7. We didn’t have the internet when we were young so no amazon prime, no sky, Netflix etc bills. It’s not easy now for sure, but lifestyle choice plays a huge part in spending. You see it all the time on here, I make a great salary buy why can’t I afford loads of holidays posts.

I think it’s a combination of factors.

we expect more. My parents were reasonably affluent compared to other people in the small town I grew up in. We didn’t go on a foreign holiday until I was 14. ( though other less well off did)

we went out for dinner more than most, but it was the local Chinese, and was occasional treat for birthday’s etc.

but now it far more expensive to buy a home. The availability of credit has actually made us all poorer, and slaves to credit.

I also think that class perceptions have raised expectations. Lots of people consider themselves middle class where in previous generations, they’d be working class.

same with university degrees. The harsh reality is that the more people have them, the less valuable they are. They are no longer the magic key to well paying jobs. Many graduates are currently in jobs that don’t need a degree.

I think this is an entirely valid concern. I don’t think OP is suggesting her parents should have less, just worried about the decline in living standards.
My mum was a SAHM until I went to secondary (I was the youngest). My dad had a professional career but not vastly paid at all. We had holidays, they paid off mortgage and had new cars.
Now My husband and I earn well but we have a similar standard of living and both have to work very hard in high pressured, high paying careers. There would be no option for me to stay at home.
If you have one earner, earning an average salary life is now exceedingly hard.

@Fractiontoomuchfennel the only reason people were getting high percentage pay rises was because inflation was rampant! This was obviously not a good thing in terms of the health of the economy, but did have the advantage that the real value of your mortgage payments quickly reduced. Hence people taking out high mortgages because they trusted they would be eroded by inflation.

Over the last years inflation and interest rates have mostly been low in historical terms, with the cost of living and interest rates rising again comparatively recently. This means the high real cost of mortgage payments was maintained for far longer, but did mean greater price stability until recent years. We all know how painful the cost of living increases have been, but on the plus side wages will increase and the relative value of mortgage payments go down.

I don't think OP is complaining about her parents' financial situation, simply saying how different it is to her own.

I'm from a generation who didn't have university tuition fees (although a lot fewer people went). We had grants towards living costs (means tested) and I worked in my holidays, though not term-time. Many of us bought homes just a few years after graduation, often family houses rather than starter flats (100%, 25 year mortgages were a thing). Bride's parents tended to pay for weddings. Being a SAHP and number of children were choices based on personal wants, rather than governed by money. I know my DC are having to work harder to have less choice and less security.

My mum bought a house as a minimum wage single mum. Imagine that now! Oh and sold it for 10x the value 10 years later I kid you not.

In 10 years I doubt I’ll see a percent or two let alone 10 fucking times!!!!!

Compound Interest really makes a huge difference over time, try out this calculator with small monthly savings over 40 years and it isn’t hard to get substantial savings.

https://www.thecalculatorsite.com/finance/calculators/compoundinterestcalculator.php

Good for them: and for you and your sister! Not everyone of their generation was so savvy.

Is everyone who thinks the boomers were greedy and ruined life for succeeding generations sure that our generation is behaving perfectly and voting appropriately? My parents were concerned when Rachel Reeves announced the winter fuel payment would no longer be paid as they’d relied on it to help with their fuel bills over winter.

Another concern they have is the lack of mental health provision for the younger generation because they used it for me when I was younger and developed an eating disorder.

They dislike the Tories so wouldn’t vote for them but are now wondering if they made a mistake voting for Labour. I’m just not sure how easy it is to be certain that one is always doing the right thing, either for oneself, one’s family or subsequent generations given the current state of the economy and unaffordable house prices?

I am very pleased that my children have a better standard of living than we did at their age. They had deposits to get them on the housing ladder and have houses that are worth more than ours.

By the same token, we did better than my parents, who had a small two bed house that they lived in all their married life. They paid their way, but never had spare money.

We have also done the thing that older people are said to be reluctant to do. We have downsized to a smaller house, with lower bills, in an effort to reduce out outgoings.

When people say that young people cannot possibly save for a deposit, I am a little confused

If they live with parents, earn NMW but concentrate on saving as much as possible, they could quite easily save £5,000 per year (£100 pw) - after four years they could put a £20,000 deposit on a £200k property (typical property price in some areas).

I’m talking no driving lessons, no car, minimal socialising..it can be done !

They might need to take in a lodger or purchase with a friend, but it is not impossible

All I can say is vote with your conscience - but do vote. You can't complain if you didn't exercise your right to have a say. Especially for us women who had to fight for the vote.

It's just a hugely different time economically. My parents had professional jobs though my mum worked very part time and my dad retired at 55 out of choice because he'd "done my bit and want to enjoy my life". That would be an absolute dream for me and my husband.

They didn't live extravagantly but had/have a big detached seafront house in SE, now worth about 700k, two cars paid for up front (there were three at one point when my sister and I were learning to drive), we went to private school, piano lessons, tennis coaching etc. Numerous pedigree pets and all the expense they entail. But it was perfectly possible and normal then.

I don't begrudge it one bit but it does grate when they criticise us or our kids for incurring expense which is unavoidable these days or making do with options that they wouldn't have contemplated. For example when we bought our own house they said we were "mad" for getting a "tiny" terrace with no off street parking, yet we had really stretched ourselves! And for "farming out" the kids to nursery though we couldn't have paid the mortgage without my salary. And for my son "racking up debt" going to uni. Erm, well it's not free any more so ....

We've done all right ourselves admittedly as got on the property ladder at the right time (just) which was hugely lucky and were also fortunate enough to receive some modest inheritance. I also just about evaded student loan fees. So we are able to save quite a bit but will then have to juggle allocating it between being for us to retire comfortably and to help our kids have a leg up with buying property/paying off student loans. But I'm not moaning - we have it bloody easy compared to the next generation and the one after that.

My kids have both said they don't want to have children. I know it's a flippant thing for young folk to say but I kind of think if it turns out to be true that's not a bad thing, the way things are going.

I’m a woman too and I’m grateful to the brave women who got the vote for us all. I’m not aware that I’m complaining though? Can you explain what you think I’m complaining about?

I’m still unsure which way I’d have to vote to be completely sure I’d voted to ensure that following generations had the best possible outcome though? As you say, I’d have to vote with my conscience but that will surely mean different things to different people?

I’m sorry that your parents are so unpleasant ☹️