To be so sad about my slide in living standards?

[ColdNow]

I grew up in a not so nice area, but my parents had a big house with a huge garden that they bought on two fairly modest salaries when they were younger than I am now. My mum took years out of work when I was born and although things like holidays and eating out weren't a regular occurrence, my parents admit they were never really stressed about money despite having several children and easily paid off their mortgage.

Fast forward to now, where I did my very best to do the 'right' things. I got a good degree, decent and stable job, married and bought a property before TTC. I'm now pregnant and feeling so sad about our financial situation. We purposely went for a modest property with a tiny garden to give ourselves a buffer, but now with the huge increase in our mortgage repayments and other expenses we're struggling to keep afloat. I would love to work part time when I go back but it's now looking very unlikely that we'll be able to make it work without being extremely stretched. I'm always worried about money and already buy all my clothes second hand, shop at budget supermarkets etc. The main cost is housing though, because we live in an expensive city, but this is the city I grew up in and where all my family and friends are, and moving away would be a very difficult choice to make and remove us from all our support networks.

I just feel so sad that within a generation the things my parents were able to offer me (space, time) I'm not able to offer my child, despite me earning far more comparatively than they did. I'm also the youngest in my family and the older siblings are much better off than me, again just because of time - they got onto the property market much earlier before prices sky-rocketed and now although I don't earn a lot less than them, I'm only just scraping by. I notice this at work too, I have colleagues at the same level of seniority and pay to me but a decade or more older, and the houses and lifestyle they sustain far exceed mine.

I don't know what the purpose of this thread is except to just say that it makes me sad that this is the situation I'm in, and people younger than me (I'm in my early 30s) are even worse off.

@user1477391263

Yep and if you dig a bit further at the older end it’s more than that, I think as the average is dragged down by those that die much younger (as children or in younger fitter adult life) from freak accidents or aggressive illnesses that are hard to treat.

@Twiglets1 you know care homes aren’t a lifestyle choice right?

A lot of people end up in them for the last few months to 1-2 years of their lives, as whoever was supporting them before (family members or live out paid carers) become unable to cope with their rising needs.

3 out of my 4 grandparents did (time living there varied from a couple of months to two years).

people are in the ‘old’ age bracket (let’s say over 75, or 80) for 5-10 years on average.

about 500,000 people die each year. Mostly over 75s in the ‘old’ demographic of course .

if you look at where people were living when they died then it will show about half of them were in care homes.

But how do you know this? It could be eaten up by med/ care fees?

My husband's uncle died recently and his care home feels were £7000-odd a month. His house wouldn't have paid for it for long.
This was in Kent.

You need some financial advice to ensure you get to spend more of that yourself!

I don’t know where that comment came about care homes not being a lifestyle choice … duh… obviously.

I think your views have been affected by your personal experience of 3 grandparents going into care homes. None of mine did. And statistically speaking, as I said before and provided a source to back it up, it’s relatively rare to end up in a care home.

Where is your source to back up your assertion that half of people were living in a care home when they died?

A quick Google says 21-23% of deaths are in care homes and 55% of deaths are people who are 80+. Assuming the vast majority of care home residents are 80+ this suggests about half of all people who die aged 80 or over will die in a care home.

Very often elderly people will be discharged from hospital into a care home for end of life care. It can literally be for a few days.

Hmm, my elderly great aunt was sent there for some sort of palliative care, she was only there for a couple of weeks at the most. It cost some money but hardly a whole inheritance. I think there will be quite a lot of cases like this, as hospitals need beds freed up for other things...

You are so right.
I don't know what the solution is.
** My father was able to provide everything we needed from his working class wage. Including Holidays, Days out, all our clothes, all the Bills. My mother had a small side line employment. Even after promotion Dad saved for a deposit on a three bedroom house when he was Forty. ( After relying on council accomm) Then he never looked back . The way forward is a Public sector job or Medical degree.

The solution is to switch from a version of capitalism (neo-liberalism, in the UK since 1979) designed to enrich the rich, and switch to one where all individuals and companies pay their fair share in tax and we use government spending to redistribute money from the richest to the poorest. This money can then be used to ensure that everyone can have a decent, secure home and the basics (which includes warmth, decent food and reliable and fast access to the internet - this is 2023). It can also be used to educate and train people to enable them to better themselves should they want to.

Is there anyway you could extend your mortgage term to get your payments down for a while or swap to interest only. Could take the pressure off whilst your on maternity

I’m in a similar situation in regards to housing but the difference is I could be your parent. I have a child your age, I’m 50ish.

I did not get to buy my home until a few years ago as I was stuck renting for nearly 30years. The rest of my family have bigger nicer homes no mortgage or low mortgage and I completely missed out when houses were affordable (when my siblings bought).

I will not be mortgage free until I’m in my 70’s and the bills are a struggle. I economise as much as I can already. No answers for you I’m afraid but wanted to let you know some people of older generations are in the same boat.

My father has so far spent £250,000 on care home fees.

Most inheritance from property relies on someone like the OP borrowing a lot (unless you just keep it and live in it) to complete a chain, the best thing for working peoples living standards is cheap basic property, but there has been SO much effort put in over the years by the media and various VIs to make this not happen, and the public went along with it! Mind boggling really......

If most of it is expected to come from a house the bond markets/interest rates might also eat some.

We’ve come a long way with women being able to work in any field that they like, I understand why you think that it might be taken for granted now. But I don’t have a choice in not going to work if we want to keep a roof over our heads. I have to go to work to pay for our tiny two bed house and utilities - we cannot survive on my partners income alone. I want to be at home with my son but I don’t have a choice. We can’t cut back anymore. Phone is old, clothes are old, switched utilities for better deals, batch cook food from discounted supermarkets. Then add in the astronomical nursery fees, sure it will free up money when my son is 4 but then he will start school. I want to be at home with my child, everything has turned on its head. Women have gone from having no choice in wanting to work to having no choice in having to work. We are going against what nature intended for mothers, I don’t want someone else raising my child 9-5 Monday to Friday.

I need to find some time to read all these replies but I want to say, i could have written this, word for word. I too am pregnant with my first child and am fixated on the fact that it seems impossible for it to have anywhere near my quality of life growing up. I am terrified about income, nursery fees, never being able to move from our first home (small 3 bed semi).

Sure, i will be told to get a grip, but WHY shouldn't I be able to give my child the lifestyle I had growing up. I too feel i have done everything right, good degree, good salary (but also likely at the top of the range as you OP).

We has large houses from about 10 (parents worked their way up whilst father's business became more successful), mum stayed at home, i went to weekly boarding school (due to where we lived) we had wonderful holidays, I went to university and my parents were and are still able to be, incredibly generous.

It makes me feel so, so sad that I won't be in a similar position. I find it very difficult to come to terms with the fact my child's life won't look like mine did. And i certainly find it very unlikely we will be able to consciously have another.

Funnily enough OP and @BobbidyBibbidyBob - I feel exactly the same.

Very fortunate to have a privileged upbringing. I am very lucky in many respects as I am now in a well paid career and managed to get on the property ladder last year.

I am currently pregnant and whilst I am incredibly excited for the next chapter - the financial reality of it all feels like a slap in the face and fills me with dread.

We know next year will be tight with maternity leave. However even after that there is the ongoing struggle of child care - even with the free hours this will be an incredibly high cost. There is absolutely no way we could afford our mortgage / bills on a single salary, or even with one of us on a part time salary, so we will both have to work full time, we have no family help nearby either, so we will be reliant on childcare.

I always thought I would have at least two children - however we did the sums and there is no way we can afford two unless the mortgage rates go back down. Which seems unlikely. I find this a sad reality to come to terms with.

I often hear comments along the lines of...
"Having children is a lifestyle choice" - however having children is necessary to keep civilisation going and frankly shouldn't be reserved either to the rich or force people to make incredibly significant financial sacrifices. There is a lot of coverage at the moment about how there is a decline in birth rate - its no surprise, childcare is not affordable and not taking up childcare is not affordable(!).
"The interest rates were previously really high - I don't know why you took out such a large mortgage" - I am sure I am in the same boat as many that we stretched ourselves to our full budget only to afford the bare minimum of what met our needs property wise - no-one wants to pay the current prices we have to for property(!) and no-one is able to afford more than the starter home. I know friends who rent who got massively stung with rental increases - so it isn't like there is much of an alternative.

It just very much feels like the social contract has been broken - and I do think people who recently got on the property ladder and are starting a family are really struggling.

@Pollyanna123456 @BobbidyBibbidyBob just to give you some hope, I'm coming out of the childcare years now and it has been tight but we do feel hopeful. We're at a stage where we can give our careers uninterrupted focus to maximise wages and we are almost done paying twice our mortgage in childcare so can afford a house that fits our family soon. There is light at the end of the tunnel 🙂

I feel that living standards and equality were improving through the 60s and 70s. 50s in the US.
Then Thatcher and Reagan arrived and everything started to go backwards. Trickle Down Economics was the con they foisted on us for a while. The gap between the lowest workers pay and the CEO of a company used to be around 1:50. Now it's in the hundreds. People (the media)are quite happy to call nurses and train drivers greedy while bankers and executives need to be rewarded.
Then they brought in 'performance related pay' so they didn't need to give you a pay rise at all if they didn't want to. A friend of mine in the Civil Service hasn't had a pay rise for seven years.
I don't know what the answer is, but voting for Etonians and the likes of Trump isn't it..

I agree with you OP, I might be in the same age bracket as the older siblings you mention as I bought my first flat 20yrs ago and my children are now teens. I work in the public sector, same dept for 20yrs. Salaries have barely changed here for 10+ years and I can see the impact. When my children were young I worked 3 days pw, so did majority of my peers, 3 days pw was the norm for parents at my work place then. Now all new parents here seem to work full time and not because they want to, 2 separate colleagues have told me they aren't having second children because they can't afford nursery fees or a larger home, I would be in exactly this position if I were starting a family now, wages are stagnant, everything else has risen enormously, it seems really unfair that this huge discrepency between the decisions I had about my family and the decisions my colleagues now have is simply down to them being 10yrs younger than me.

I grew up in the 70s and it wasn't any better than it is now for many, my mum had to work when we were small she did nights and my dad worked 6 days a week 12 hours a day, the interest rate was 15%, we had a cold house, no central heating for years, we shared bath water, and everything was hand me down and I mean everything even underwear, we never ever had a takeout or an ice cream off the ice cream van, never went abroad and for years our only holiday was day a trip to the nearest coastal town. Father Christmas brought only useful gifts like a school coat and gloves etc. carpets were worn down and we didn't even have them in some rooms. Ice would be on the inside of our windows. Things got a bit better when I was around 12 years old, don't get me wrong we had a great childhood never went hungry had lots of freedom to play, everyone else in the street seemed to be the same but it certainly wasn't the good old days for my parents.

The answer is to stop borrowing money, stop trying to outbid others on basic property with borrowed money (this has stopped now thankfully) and stop buying things we dont really need, the bankers etc. skim off the top, if there is nothing to skim they are out of business, the public brought this mess on themselves with their childish need to outdo others by borrowing and buying more than the next person, no wonder the bankers and advertisers are laughing their heads off (they wont be laughing when the recession turns up, that is why they are all out in force whining for rate cuts)

It's not people with borrowed money that are outbidding others, it's people with family help/inheritances and therefore in a position to offer more or at least take out lower mortgages. Those who don't (and I'm going to inherit sweet FA, so that's not going to help) still need to live somewhere and the 'basic property' is still 5-10x the average income, so they have to borrow more than they would have done a generation ago.

The only thing to change this would be some kind of big reset button being pressed on the cost of basic properties - either a price crash (which isn't necessarily a golden ticket for those struggling) or for enough houses to be built that would be priced at a lower multiple of that average income.

Or they move to cheaper areas, which pushes up the prices there, and leads to other problems - such as the six primary schools in Hackney that are closing due to people being unable to afford to have enough children and/or remain in London for them to attend.