To think I some people have really got it right! BUT HOW?

[whalesandsharks]

So as the title says...

A few couples I know (all mid 30s-40's)
Seem to have it all sorted very fast...they are set up so well that they aren't exactly rich per se but are "untouchable" (for want of a better word!)

Two examples are...

One couple...she works part time...2 days a week (in a professional role) and they have 2 rental properties (not big ones, two apartments) that he mostly manages.
They have no mortgages which helps massively I know!! But all parents are still around so no inheritances as such.

Another couple...he works part time doing odd jobs (plastering of a shed, tiling a floor etc) and she is a teacher working a 3 day week. Again no mortgage....

They all have dc, how have they done this?? They have skipped through the pandemic untouched, nothing changed.
Here's me and dh working out asses off in 9-5 jobs, one dc(can't afford another one right now!), renting (can't afford to save) dh was furloughed and had just got back to full pay and then yesterday I was told I am getting made redundant 😫

I know I'm venting but how have they done this, is there a magic trick I don't know of?? These people didn't attend private schools and lived in the same village as me growing up. I am at a loss as to where I went wrong!

[quote whalesandsharks]@CruzControl they never had high paying jobs to be honest. I only know they have no mortgage because I overheard her say to her dh something about one of the properties taking longer to close and she couldn't understand because it's a cash offer like the last time! Those words never really left my head...I know I shouldn't hold to things like that but I'm having a hard time I suppose. She worked full time before they had dc I suppose but I'm guessing on an average of 30k and he worked in several hands on type jobs. Brick work etc...[/quote]
Bricklayer is a fairly high paid job, especialy when housing estates are flying up on a paid by the brick basis. If he was willing to throw the hours in and work fast he will have been on very good money last decade or two

Some of the building trade is cash in hand which must help. Also someone has mentioned weddings. The average wedding is what £25K!! Who on earth can afford that along with a hefty deposit for a house. Must have 200 plus people, must have a dress costing ££, must have an evening do etc etc.

We got married in a very snazzy place. I wont mention as its too outing but we only had 25 people (and it was 25 years ago). The new rules around getting married in new venues had just come in and there were only a handful offering a wedding service and most were loss leading it.

We looked at Cliveden but they had sky high prices that we couldnt afford. We went for something equally nice but they had priced to test the market. Yes we were lucky but even now I wouldnt dream of paying £25k for a wedding. All those relatives that you feel you need to invite. No thanks!

My children go to private school, we have a loan free 3 year old Audi, a million pound house and around 30 other properties we rent out plus a Kent holiday home. We ski twice every year and have a summer holiday.

I shop in Aldi, do my own cleaning and ironing and save money where we can. We financailly plan, never spend beyond our means and i don't own a single designer item.

We've not been given a dime, didn't go to Uni, set up our own business in our 20s which we still have and worked our tits off when everyone else was out boozing.

So no, it's not all down to luck, family money etc.

And at the same time, by saying our financial 'success' is simply down to hard work is not saying that those not in our position haven't worked hard either.

But it pisses me off when people say that people only have success as they have family money/lottery win etc. It's simply not true. My Dad had to go to school with holes in his shoes and they didn't have an inside toilet. My mum was also very working class.

I think a lot of people on this thread have forgotten the part about luck. Many posters have said "i worked hard, was frugal, and made good financial decisions" but forgot to add "but luckily, i've never had to take substantial amounts of time off work due to ill health, the company I worked for never went into insolvency, the area I bought it didn't get blighted by over-supply of housing so prices didn't crash".

It's like all those property makeover programmes of the 00s where people would boast about how they'd "added" £140k of value to their house, forgetting that £139k of that came from house price inflation.

We kid ourselves that we've made good financial decisions in order to justify our choices, but every good investment requires a bit of luck. That's not to say you didn't put the hard work in to making that decision (e.g. researching to find good up and coming areas) but unless you're the sort of person who predicted every government policy change, macro-economic factor and acts of god that can be the difference between a "good" investment and a "bad" one, you have to acknowledge luck played a part.

I think this is important because it also helps those who made "bad" decisions realise that sometimes, it was down to pure bad luck. And the friend who is successful isn't better than you, she may just have been luckier.

To get "rich": you earn money, you save money, you invest money, in that order. You get rid of debt first. Make a 5 year plan. It can take more time but you will get there. They are what is called the "millionaires next door" They don't have expensive car, they buy at Aldi but have garnished bank account. If you spend it, you don't have it. The first single thing that you can do for yourself and your kids is to get on the property ladder as quick as possible. There is a lot about this on the internet already.

@WhatWillSantaBring

I think a lot of people on this thread have forgotten the part about luck. Many posters have said "i worked hard, was frugal, and made good financial decisions" but forgot to add "but luckily, i've never had to take substantial amounts of time off work due to ill health, the company I worked for never went into insolvency, the area I bought it didn't get blighted by over-supply of housing so prices didn't crash".

It's like all those property makeover programmes of the 00s where people would boast about how they'd "added" £140k of value to their house, forgetting that £139k of that came from house price inflation.

We kid ourselves that we've made good financial decisions in order to justify our choices, but every good investment requires a bit of luck. That's not to say you didn't put the hard work in to making that decision (e.g. researching to find good up and coming areas) but unless you're the sort of person who predicted every government policy change, macro-economic factor and acts of god that can be the difference between a "good" investment and a "bad" one, you have to acknowledge luck played a part.

I think this is important because it also helps those who made "bad" decisions realise that sometimes, it was down to pure bad luck. And the friend who is successful isn't better than you, she may just have been luckier.

This is very true, poverty is often due to illness, and catastrophy, not laziness, but you can better your circumstances. This is definitely true.

I used to date a very posh chap who went around moaning that his mum and stepdad ONLY gave him £50k to help buy his first flat, when all his boarding school chums were getting entire properties handed to them.

Meanwhile, I saved and scrounged and delayed kids and worked jobs I hated for years to get ahead.

The only people I know that are in this position (or from the outside seem to be) are those that had parental support or married young. So friends either got gifted some money or could live with their parents to save (many dont have that option). I do think marrying young seems to play a big part in couples I know. Which makes sense as they would have had lower costs from a young age.

[quote whalesandsharks]@diamondpony80 they are not extravagant at all, they have 10 year old cars as such,I know one of them is adverse to car payments etc she hates the thought of debt so I'm assuming (perhaps wrongly) that she wouldn't put herself in that position.

I have realised that they are not big spenders to be honest! I suppose that helps them save. They don't buy clothes that much for their dc, they get all hand downs from friends and siblings. [/quote]
You've answered your own question there. They're probably very thrifty and use the money saved wisely. During Covid we've managed to save on average £500 a month by changing our lifestyle. Overdrafts have been written off and debts paid we could not have thought of doing beforehand. Had we done it from the start we could probably be mortgage fee now. Doesn't take much to tip the balance one way or another.

It's part luck and part budgeting. Common theme on the thread has been many married young and started saving earlier. You need money to be lucky. You cant start a business without money. Money comes from doing shitty jobs and budgeting everyone has got to start somewhere. We bought ten years ago when property was cheaper, however 10 years from now, people will say the same to be people who are buying now.

I have realised that they are not big spenders to be honest! I suppose that helps them save. They don't buy clothes that much for their dc, they get all hand downs from friends and siblings

This could be a lot of it. If you have new cars on finance, buy a lot of clothes, gadgets and food and drink out of the house, that could easily be £1k pm spending for a couple, or even more. Cut all that right back and you've a lot of money available for property investment and/or being able to afford to work less.

If they were buying properties in the late 1990s in cheaper areas of the country, they could have had tiny mortgages (£20-30k) that they've easily been able to afford to pay off, used leverage to buy multiple properties, couples getting together after they've bought their own properties so all increases are doubled. You mention some of these people being in the trades, so they have the skills and contacts to do the work themselves or joined up with others, eg a builder, plumber, roofer and carpenter working together.

Certainly, where I am, in the late 1990s and early 2000s, you could buy several properties for hardly any deposit, the rents would have been double the mortgage and the values tripled in under 10 years (£30k properties increasing to £100k).

Also, in my city, people were putting deposits on new builds in the early 2000s and they could sell the property at a profit before it was even built as prices were going up so fast and deposits were tiny, £99 deposit bought you the right to a property for a certain price, say £50k, but before it was built, people would pay £80k for the same type of property, so you could make £30k profit just like that.

Fast forwards 20 years and people who have done this sort of thing have now paid their mortgages off and have quite a decent amount of assets, mainly due to being lucky with the timing of the market.

if you marry young and it's a good partnership where both of you are truly working together for mutual benefit then that's going to to really help you to get ahead in life!
then again if you have two very clever talented and accomplished people will there not always be rivalry?
will one always not want to be the 'star' and the other one resent that?🤔

It's better to look at how the majority of the people around you are faring rather than just one or two "lucky" ones. They're the outliers. If you look at most people you know,how are they?

I worked from 16 and saved a lot of money. I also had a gap year during which I worked and saved. Then I moved to uni and lived out of halls paying rent with my partner who worked full time. That meant my living costs were not as much as people in fully catered halls with en suites. I did have to drive but had always bought my own cars I saved up for to buy outright and never spent alot on them. I worked during uni and saved what I could of my loan. My parents contributed around 200 a month to my uni expenses, the rest was loans.

After uni I used my savings to pay for my postgraduate course to avoid further debt. This really helped as most of my peers who didnt have wealthy parents had to take out bank loans with high interest rates.

I then took whatever job I could earning what I could until I got into a job in my field. I did a further postgrad course but studied module by module paying for this as I went from my wages.

My partner and I saved alot by living frugally and putting money into a high interest account. We had holidays but always very VERY cheap - Ryanair 1p flights and last minute deals. A couple of family holidays we went on were paid for by parents when I was fresh out of uni.

We bought our first house in the 2000s using what we had saved and my parents gave us £1k towards solicitors fees. The rest we paid ourselves. We got a house that wasnt beyond our means and didnt stretch ourselves. It was cheaper than renting too.

We then began to overpay our mortgage as soon as we were able and continued to do so as our incomes increased.

As we have earned more, we havent stretched ourselves to a larger property, have had home improvements but only in later years, carried on only booking cheaper holidays and bargain shopping. We had children later so when we were earning more.

We should hopefully have our mortgage paid by the time I am 45 and my student loan is already paid off. We have some savings but spent quite a bit in recent years on car upgrade, home improvements and fertility.

We are currently considering whether to hold off getting a larger property and keep on track to pay off the mortgage or bite the bullet. We will probably stick with the small property to be mortgage free first and then reassess at that point.

In summary, we have got to this position mainly by working from young, living frugally, getting on the property ladder early and overpaying, having children late and now being on good incomes.

@Dillydallyingthrough

The only people I know that are in this position (or from the outside seem to be) are those that had parental support or married young. So friends either got gifted some money or could live with their parents to save (many dont have that option). I do think marrying young seems to play a big part in couples I know. Which makes sense as they would have had lower costs from a young age.

I think the marrying or being in a cohabiting relationship young really does make the difference. You're nearly halving your outgoings (save for things like mobiles etc will still be 2 people worth). It does mean theres a much bigger sum of money post expenses.

I know all of the 'drug dealers' comments were said unthread in jest, however I have just today read on a local news site that a local couple who seemed to have loads of money (early thirties, two kids, average jobs, I presumed had wealthy families) have both been arrested and charged recently for money laundering and drug dealing. Their house was raided by police and there is footage on the news website of their designer trainers being bagged up by police for evidence.

So maybe more people than you might think are getting money in illegal ways!

So maybe more people than you might think are getting money in illegal ways!

I didn’t say it in jest. The drug issues in this country are massive. Someone is making a lot of money.

I also think a huge part of it comes from working and establishing careers pre-children. It always surprises me when people have children very young, and usually women have no career to get back to after which makes climbing the career ladder that bit more difficult

We probably look like this (to anyone who can be bothered to care). Mortgage on a decent house paid off in our 30s and I worked 2 days pw while children were young.

It was a mixture of luck and design. We never had financial help from parents but they were always there to help with practical stuff and support emotionally which saved money and probably increased our earning power.

I had a good established career before DC were born, so could work PT on a salary similar to some people's FT jobs. Working PT and not stepping away from work completely was very good for my career when I did eventually go back FT. It I'd taken those years off completely there's no way I'd be doing what I'm doing now.

We married young and stayed together, which has been a massive benefit financially. In our youth, while others were travelling or partying we were establishing some security. Some people will think that was a wasted youth, they may be right but you can't have it both ways.

Apart from the mortgage, which we over paid from the start, we have never borrowed a penny. If you add up what cars and fridges etc on credit cost over time, the difference is huge compared to waiting until you've saved. If we can't pay for it we can't afford it. People sneer at older peope talking about how they managed with little when they set up home but we really did and we're benefiting from that now. When we moved into our first home, we had a microwave and a single hob as a kitchen, deckchairs my parent's lent us and the portable TV from DH's childhood bedroom for our living room furniture.

I think the biggest factor though is that we're generally happy people, content with what we have. We don't feel the need to "treat" ourselves and prefer a long walk with a flask of coffee to a day at a theme park. I see so many people who, compared to us, waste money on things they need to make themselves feel better. A holiday they deserve because they're miserable at work, a takeaway because it's been a hard week, and stuff, so much stuff. All those £5/£10/£50 "one off" purchases add up.

I do think marrying young seems to play a big part in couples I know.

DH and I got married at 26, where's my millions?
A supportive partnership does help though - we lived in London for a bit (which I hated) so DH could do his job, then later DH supported me through an MSc.

My friend with the nicest house is a 1st generation immigrant who has had no parental financial assistance, I find her inspirational.

Haha. We got together pretty young too, and while there are no millions knocking around, I think it cushioned us from the impact of some less optimum decisions made.

Whatever people want to believe there is also a certain amount of luck no matter how hard you work
Luck you haven't had to deal with an illness , luck you bought your house at right time , luck you weren't kicked out at 16 and various factors.
Off course hard work helps and good luck to anyone that does there best
But to the person below who lives in a million pound house now , did you buy it at a million? As ok saying we own this and that and no luck involved whatsoever
My parents lived in a £650000 house but they bought it 20 years earlier for £70000 in their wildest dreams they couldn't of expected it to go up that much and neither could many people predict houses would go up this much , they have risen beyond what anyone would if expected ( not that that is a good thing for most and whats keeping a lot of people from being able fo get on property ladder )
I have a friend who has successful business and several properties but he will openly say luck plays a part as working hard doesn't always guarantee a business will work. Many a good business has gone under whilst many a dodgy one continues

Also lots of people on this thread saying we saved, only drive 2nd hand cars, no new furniture etc. Isn't that normal?

"These people, unless they're investment bankers with bonuses the size of my entire mortgage, have ALWAYS been given money."

I haven't been given money. I worked hard, bought well, overpaid, lived frugally, made good decisions.

I've had break ups, illness, hard times. I prioritised my home throughout and now am in a good position

We've always lived well within our means. We could have raised enough to buy in a better area than we did and if we had, it might be worth more than our current house is...or we could have lost it when we both lost our jobs in the same week (with a combined service of 28 years, we didn't see that coming) or when DH has a long absence from work due to cancer.

Yes, I fully accept we've had some luck (I'm back in work and DH is well) but we've had some misfortune too. We planned to be able to accommodate some bad times.