To think buying my own place would be a terrible idea?

[nohouseforme]

Dp and I have been together a few years and live together. He owns his house but I don't pay towards the mortgage but do pay a contribution to bills and pay for most of our food. We aren't married and won't be getting married.

Basically, due to a combination of horrible bad luck and less than stellar life choices I've ended up in the situation where I have no significant assets and no real savings of my own. I have no private pension and have accepted a long time ago that I will (barring a miracle or lottery win) never own my own property and will likely have to work until I drop. Whilst I'm not 'fine' with this I've accepted it is what it is. I was born into a poor family and have never had much, living in extreme poverty at times, and as such I've given up being frustrated at not being able to afford certain things, am very frugal, and just generally try not to stress out about financial things as I know I don't have much choice and I will just have to deal with things as and when they come up as I always have. I work full time but just above MW which is very standard for this area and I'm very lucky to have even found a full time contract. I'm very proud of myself for finally paying off all my debt so am now completely debt free and trying to build up my credit rating.

My contrast Dp has been very fortunate. From a middle class family, got family help with his house deposit and earns quite well. He works hard and is careful with money but I think is a little bit blind to the good luck and extra advantages he has had over many (including me) that's helped put him in this position.

He's been encouraging me to save a deposit for my own place which I can then rent out and is a potential source of income for retirement.

Whilst I agree this is a good plan in theory, in practise I think it would be a terrible idea.

I have max £200 a month of disposable income to put into savings for a deposit. If I did so, after 5 years I'd have a deposit for a very cheap place, but in those 5yrs I then could not do anything more than the basics. No holidays, no paying for any unexpected expenses, nothing. That's really not a sacrifice I'm prepared to make!

Also, I'd then have to worry about fees and the like which are thousands extra, and renting comes with huge additional expenses and risks like someone trashing your place, just general wear and tear that comes with being a landlord, tenants who refuse to leave and having to go through expensive court proceedings to get them out, etc. That's if a bank would even give me a mortgage in the first place as I'm in my 40's and don't earn much.

I don't disagree that investing in something for the future is a good idea but I don't think this is a viable option. Aibu and should seriously consider this, or am I right and DP is BU to think this is possible in my current circumstances?

Is he aware of your financial situation or does he think you are better off than you are because from what you have said, it's not something I would even consider in your situation, way too much financial pressure on you.

I think for a buy to let mortgage you need 25 - 30% deposit so it would take a lot longer than five years to save up anyway.

Is it a mutual decision to never marry or is it to protect his financial interests? Do you have children?

Would you even pass affordability checks to get a mortgage on your own? You typically need a larger deposit for buy to let, interest rates are higher and they're sometimes reluctant to lend to people who don't already have or haven't already had a residential mortgage.

Buy to let is not something that should be done by someone with no means of financial back up. It's a terrible idea in your circumstances.

Tbh your best bet would possibly be moving somewhere with better job prospects. But that's not necessarily easy either, if you have no financial cushion. Have you considered it? How old are you?

To be honest, I think it is a good idea to get a property, in the long term nothing is going to increase in value as much and sounds like you might need it. The trouble is, it doesn’t seem feasible based on what you have said.

He doesn’t exactly sound like a partner to me.

@PalomaColumbine good point!

He doesn't want to get married, I'd love to but I'm not too fussed either way. I don't want him for his money or his house so if he doesn't want to, to protect his financial interests, that's fine with me. I'll continue to work and support myself either way, I always have done.

No children, nor do we want any.

What would your financial situation be if you split? At the moment it sounds like all your financial security rests on being with this man, and you never know what the future holds.

For example - could you afford to rent on your own? It doesn't sound like you could if you're currently not paying rent/mortgage but have little left over each month.

My husband and I don’t “want each other for money” either. But we do both take our financial security seriously and would want the other one to be taken care of financially should anything happen, plus be able to enjoy a retirement etc. We are both capable of supporting ourselves, but we are also a team and support each other toO.

I think you'd be better off paying into a pension with your spare cash. Buying to let can be risky and a hassle.

@JustWhatWeDontNeed I'm not sure but I don't think I would, especially right now with interest rates being so high.

I'm not interested in moving, the whole of our county is like this in terms of low wages and seasonal work so I doubt it would help much even if I did, unless it was significantly further away. While it has it's problems, I love where we live! All of my work experience and qualifications are in a low wage industry. I'm ok with this though, I have a secure job, a good work/life balance and enough to be comfortable with a few treats. Working a job with more money that I hated wouldn't be worth it for me.

Op what planning are you doing for your future? How would you support yourself if your relationship ended or he died? How old are you?

I think that it would be good to save a small amount in a stocks and shares isa with a property as an aspirational aim. You can review that in a couple of years. I’m in a similar position with a dp who has no property. We’ll move in together at some point - my dc aren’t ready now - and most likely I’ll buy a place outright. Dp fortunately is a higher earner with a good pension but I would want him to aim to buy a property in case I die first.

@TarantinoIsAMisogynist I don't rely on DP for anything financially, we have separate bank accounts and I spend what I earn myself and never get money from him.

The contribution I make at the moment in bills and food is roughly equivalent to a cheap rent so yes I'd be able to afford that if we split. I'm also finally able to save money at the moment which I wasn't before. I don't have much in there yet but I will keep adding to that and could use that if we split.

I would say you’re right, houses are stressful and time consuming - but I would be putting anything spare into an ISA or your pension. Perhaps research what would be the best option for you - moneysavingexpert is great and you will get tailored advice on the message boards.

I would suggest to your DP that for a bit of joint savings/fun money perhaps both pay into a credit union or football pools or similar, where there is a chance of winning some extra or prizes etc to be shared by you both. That can be emergency/holiday fund etc.

I think whether it’s a house or something else, your partner is right in that you need to be planning for your future.

Personally I probably wouldn’t do buy to let, on top of the fact that you would need 25% deposit minimum probably to get that at the moment, it also comes with quite a lot of financial responsibility once you have tenants in. Obviously everyone will have a different experience of being a landlord and it can be a great investment but the couple of friends I have who have done this have regretted it because the property ended up trashed, tenants had to be taken to court to evict etc, being a landlord is definitely not the easy passive income that a lot of people think it is (or should I say being a GOOD landlord isn’t) which is why I’d never think of doing it as I just think it’s too much hassle.

Why don’t you suggest buying a place together and him renting the property you live in together out?

I think he is very right in encouraging you to save and get into the habit of saving. He is also right that if you have a focus for the money (such as buying a house) you are then less likely to dip into those savings for treats and things. A goal for the savings will mean you are less likely to raid them.

I think you are in a financially precarious position. You may see your DP as lucky- others may see him as savvy. I’d take his advice. You might never be in the position to actually buy a property, but having a nest egg will do you no harm at all.

I think it would take a long time to have enough to buy - and keep - a property by saving £200 a month. Also I agree with you about the overall stress and opportunity costs. I'd be tempted to split that money between a savings account and tracker fund instead to try to build up some money for the future.

Your concerns around buying property are valid but I think he’s right you need to do something for your future. You don’t have a pension so at some point you would likely rely more heavily on him. How about an ISA?

You’re right - you don’t have the money to be a successful landlord. The tax breaks come in for the rich with a dozen properties.
i would try to save something in case you need to rent your own place sometime.

I think a lot depends on your age. If you are 57 then you are right to think scrimping towards buying a place is a non-starter and would only cause problems if you split from your partner and needed to claim assistance. Same goes for pension to be honest.

If you are 32 then the situation is different and yes, I think it would make sense to plan to buy somewhere.

£200 pcm into a pension with the resultant tax benefit plus possibly a matched contribution from your employer would make much more sense.
Has he made provision for you in the event he dies? It would be extremely tough if you lost your partner and your home at same time.

In your position I would save say a couple of grand in a cash ISA just in case you ever do split up and you need to find somewhere to rent, and then put the rest away for a pension (however you do that-LISA, SIPP, extra contributions through your employer etc.) If buying your own property is out of your reach then at least you will have more money in your retirement and a nest egg.

How do you only have £200 left each month? How much are you paying him.

Oh I absolutely think I should invest in Something, I just do think property is a good idea in my circumstances.

Tbh I've always been so poor and/or in debt I've always just lived paycheck to paycheck trying desperately to keep my head above water, so things like savings, pensions and buying property was so wildly out of the realms of possibility I never really considered it. Now I'm in a much better financial position I can consider it but I need to look carefully at my options and be realistic about what is possible.

It's a basic rule of saving to never put all your eggs in one basket. Properties are expensive (stating the obvious!) so, unless you have a huge savings pot, buying a property takes up pretty much the whole basket all on its own.

Diversify.

OP focus on paying off all your debts then saving up a little nest egg. To get a btl mortgage you'd need 25 percent deposit minimum so I think sounds out for you but you could build up money in ISA's as it's tax free. Also you could/should pay into your pension fund as much as you can afford or you will be so broken in retirement.