Generational wealth differences

[KeenGreen]

My first AIBU so let’s see what I’m in for!

First to make clear none of the problems now are the fault of previous generations. It is not a blame game!!

So AIBU to be frustrated with the rhetoric that todays generations of young families have it no harder than previous generations in terms of wealth and they just need to be more frugal to have the same standard of living??

I am sick of hearing the idea that older generations. So called boomers (for the record I don’t like this term) didn’t have it easier than younger generations.

I am 38 I have worked since I was 16, lived independently since 17. Put myself through university all the way through to PhD. My husband is 39 works in a school as support staff (LSA) and takes up circa £1200 a month. He has a degree.
I work in a university and earn just under £50K before tax so our household income is probably about £65K not the lowest by any stretch but enough for us to struggle to balance costs. We claim child benefit but otherwise no extra help.
Husband only works term time of course, but that means he’s around for our child during holidays.

We have one DC age 5, and can’t afford any more.
Our closest family lives over 2 hours away, so we have no family support with childcare or help if there is a sick day or anything.

We have a mortgaged small semi detached 1930s house with 3 bedrooms, It needs a lot of work but we haven’t been able to do much because of time and money. Current mortgage fix ends in 2026 and I expect our mortgage repayments to go up by about 50% extra £300 a month.

We pay off student loans and my pension contributions are also high.
I took only 6 months maternity leave because I couldn’t afford to go to half pay for long and not into no pay at all.

My husband had virtually nothing in his workplace pension because of low earnings.
Mine is keep being devalued because of sector changes and it’s definitely not the best pension in education. (Teachers pensions are better).
I can’t even imagine what it will be like to try and live off my workplace pension alone and I would have to go all the way up to retirement age which I can’t imagine myself doing in a stressful job.

Retirement age for us is currently 68, that means we have 30 more years.
But with the way things are going I have no hope that there will be a state pension at all for us, or the age will be pushed even higher, so will probably be dead! Despite the fact I will have been paying in with tax national insurance for 50 plus years by that point.

I just feel frustrated about this idea that I hear people say that our generation just needs to work harder, or get better paid jobs etc because it’s not that easy. We both work hard in the education sector. Enjoy our jobs for the most part and find them fulfilling albeit stressful at times!

Like I said not about blaming previous generations for the picture we are in, but I don’t like the rhetoric of ‘well interest rates went up to 15% in my day’ etc when house prices were so much lower in proportion to wages and the cost of living right now and inflation over the last 10 years shows wages haven’t increased in line with this.

ps I know we are not the most hard done by! But still feel the pinch and we certain don’t live an extravagant lifestyle!

Even PIL (young silent generation) acknowledge that is was way easier for them to buy property and have only one working parent for them - even though it didn't feel easy at the time. They bought their 3 bed semi at 21 and their current house (4 bed detached) at 33 and MIL never worked after DC were born. All on a salary similar to yours in today's money.

My brother (young boomer - 12 years older than me) has mentioned multiple times how much easier it was for his generation. Multiple job offers straight after graduation (with zero debt) in addition to housing being comparatively cheaper. He still had to put in the work though to get what he has and make the harder decisions.

I'm mid gen X (13 years older than you, so had it easier in terms of house prices) and a state secondary school teacher - the biggest luxury I've had is being able to work part-time in a non promoted post. It is certainly much easier than the promoted FT teaching job I had before DC were born! Afforded because we could buy property when it was cheaper AND DH pushed himself to get promotions and put in long hours (left school at 17 and been on [low] six figures since 30) - of course, he was lucky and had the opportunities and the ability but he definitely didn't pick the less stress option. He certainly had periods of being stressed/anxious and hating his job. He would've liked to be a musician instead but he wanted more money that that was likely to yield so...

I would have liked to have not worked at times or had a less stressful job but still appreciate how lucky I am to be able to work part-time (I do 30 hrs/wk on average and pick up all the household stuff). If DH only earnt £50K/yr I wouldn't stayed PT (earn £30k/yr) for as long as I have. Yeah, we could've afforded it but we wanted to make sure our DC had the start we had (with no parental help) as a minimum and that neither of us had to work until state retirement age. That was the choice.

In the gentlest way OP, you really haven't maximised your earning potential. You self funded a PhD?! Could that money have been put on training for a well paid career or a house deposit?

Your husband has a degree but works as LSA in a school...why? That's not a full time role (when you account for holidays- in terms of hours over the year). He is earning less than if he worked full time minimum wage in supermarket or something. Why can't he use his degree or train to be a teacher if he loves working with kids.

I think you have something of a point about boomers having it easier. However, lifestyles often were a lot worse than today:

• People worked the jobs they had to to provide for their families, not necessarily what they'd choose
• Very few abroad holidays
• Many people didn't have cars/ shared one old one
• Very few day to day luxuries- convenience meals, take aways, nails done etc
• Kids often shared a bedroom
• Often couldn't afford for kids to do lots of activities

I think it's easy to look at the wealth boomers have now & apply it retrospectively, or look solely at house prices. I think you do have a point when it comes to housing. But I also think it's broader than that and they also struggled when they had young families.

Before anyone comes at me, I'm not suggesting by not having your nails done you can afford a house! I am comparing overall lifestyles then and now while acknowledging differences in hardships

Hi, @KeenGreen

You’ve said you work at university, but not in what capacity.

If you are an academic, I think few PPs understand the drive that leads people to this career. Especially after your late start, you have some big promotions with useful salary rises ahead.

I hope that if you are on the Professional track you have opportunities for progression but I know these are often scarce.

Your tenderness towards DH is very touching. Honestly, though, I think he owes you and DC something here. A PP suggested he might tutor. Would that work for him? He could set his own schedule and the pay is excellent.

Even the £10/day forum on MumsNet, if practised consistently, could bring him some useful income. Or he could stock shelves, etc. If he is really paralysed then professional help is warranted, for himself but also for you. If he is opposed to a diagnosis he doesn’t need to pursue that. But he does need to do something.

I haven't RTWT so this might have been bought up, but your husband is underemployed compared to his education. He could train to become a teacher and, as far as I'm aware, get a part-time position just a few days a week that would give him the same money as his current wage, and also give him a lot more down time/be easier.

Ultimately the decisions are up to you and your husband - but as a family you could definitely afford more kids. Your DH is choosing to stay in a v low paid role. He could go part-time as a teacher and do way more childcare for a second baby, or could work full time as a teacher and you both easily afford the childcare. It's about what you both choose

"Yes in many ways it was easier for the “boomer” generation- no university fees and coming out with £££££ of debt, house prices v wages were much more affordable. On the flip side I do think on the whole today’s young adults (by that I mean 40ish and under) in general expect a higher standard of living that they’re not prepared to forgo - eg nice holidays, regular meals out etc. "

Speaking as a boomer, I grew up having never been abroad on holiday. My first overseas holiday was camping around Europe at the age of 22.

At university, I didn't get a full grant so had to work as well as study. There were no loans of any kind to help.

My first house as an independent adult was one with no heating, no inside toilet, with dry and wet rot. Most of the renovation work we did ourselves after putting in a full days work. We had no TV, no car or meals out. On the rare occasion I had my hair cut, it was with a cheap trainee. The first time I had my nails painted professionally was less than 10 years ago. We put up with horrible living conditions, scrimped and saved for many years, in a way I doubt many later generations would tolerate.

I have no pension from half of my jobs as many were less than 2 years (I worked in IT where this was normal), and it was 2 years before you could get anything back as a pension. I paid £££s into SERPS for many years, and now have an uplift on my state pension of less than £5 a week. Our saving were decimated by high inflation, and at least 2 recessions. We lost out considerably due to the failure of mortgage companies, who we paid up to 17% interest - more than half our income.

Yes, we are reasonably well off now, but we sweated blood to get here, and even then much of this will end up benefitting the next generations, who think its their 'right' to have regular foreign hols, eating out, fancy nails, regular hair highlights, indoor plumbing and heating, a nice car, new clothes, a colour TV and other 'essential' tech. Yet they moan that they have no money to save towards their own future.

There is a lot of discussion about the OP’ and her husband’s choices and how every generation has it’s difficulties but the reality is that on the whole, the older generations are better off than those with young children. This link shows how pensioners are far less likely to live in poverty than children and working parents.

https://www.jrf.org.uk/uk-poverty-2024-the-essential-guide-to-understanding-poverty-in-the-uk

We have worked hard to do the ‘right’ thing.

I wonder though when you choose to be a student for 6+ years if you gave some serious and hard thought to the income that would generate?

You're still young- not yet 40- and I assume working in a uni with a PhD you're lecturing . There must be room for promotion?

Teaching was never highly paid, so for comparison if you'd done law, medicine, science, economics or computer science, you'd be far better paid.

Don't duck responsibility for your choices.

It’s not what you asked op but have a few more trips away. YHAs are great and if you book carefully you can get cheap rooms then have minimal food costs because of the kitchens. There are usually some places fairly near by so no huge travelling costs. Maybe you need a few more mini treats. We always camped and used the YHAs and when we could afford abroad the kids weren’t that fussed😂

I’m sure others have said this but you sound like you are in a good position to me. By the time you retire you’ll have no rent/mortgage payments and state + private pension to live off. Sounds perfect to me.

I don't bank on the state pension being around then. It's unaffordable for the country NOW

This exactly.

I hear this a lot and I do have thoughts on it.

I think ‘middle class’ is now very wide ranging and takes in anyone who is educated/employed at a certain level. What if we argue your point as though you are not middle class in today’s society. What if you are actually working class?

What if the term middle class needs recategorising and actually only applies to a small section earning over 100k?

I think if we were going to argue that point your lifestyle would fit very well against your parent’s generation of working class people.

Reference to Gardendiary post

The point being a generation ago they'd be better off. And I don't think we should be farming our children off to Nursery etc. Children need their parents!

I think if it does go then they’ll phase it out so working age people now will still get it.

i hear part of what you are saying I don’t think it’s easy for anyone these days unless mortgage free.
But you’ve made a decision for dh to take a lower paid job to spend time with your daughter which is great.
But at a cost.
You are fortunate you can make that decision. It would be far worse if you weren’t in a position to do so and still be struggling.

I'm not sure that's true.
Yes there are pensioners in poverty, as there are in all age groups. The % of pensioners in poverty is lower than other groups. A big drop from earlier generations. This is a good thing obviously but does suggest the older generation is better off than younger generations.

80% of Uk wealth is held by over 65's.

in 2018-20, median wealth among Brits in their 60s was 55 per cent higher in real terms than those of the same age in 2006-08, whereas median wealth for those in their 30s was 34 per cent lower.

I’ve seen my pension value drop while my contributions increase for instance. Whereas my older colleagues who are nearer retirement or have retired now are benefitted from when it was valued higher

Are you in USS or TPS? The contributions to USS went down by around 1/3rd a year ago and the benefits were enhanced. I appreciate that it's not as good as it was further in the past but it's still decent. TPS is one of the best schemes around.

I think the point is that previous generations did not have to 'maximise their earning potential' in order to afford a reasonably comfortable life.
It was very common for the second earner to be in a low responsibility /part time role, and plenty of main wage earners could afford to stop at a middle management level and still comfortably support the family.
I know lots of people of the boomer generation who bought 4 bedroomed detached houses with employment combinations such as bus driver + part time nurse, or middle-income insurance office job + a part time supermarket worker.
These days couples in job combinations like that would not be able to afford 4 bed detached houses in any but the very cheapest areas in the north.

But that graph also shows that children/working age families with children were every bit as likely to be living in poverty thirty years ago as they are now. Slightly more likely, in fact. Which would seem to confirm the idea that every generation has had its challenges.

Yes, you should be grateful lol
A declining standard of living is what we should all get used to.

I think we also forget that previous generations started adult life earlier. Start work at 16 and that's an extra decade earning many that are barely out of full time education by their mid 20s.

The knock on of that is that people fund their 'kids' much longer.

I got my first part time job at 16 and then bought all my own clothes, paid to go to cinema etc. It was totally normal to do so. I didn't get money beyond birthday or Christmas after that from my parents.

I now see my colleagues paying for holidays for their mid 20s DC and it seems to be expected that should be the case.

I'm not saying one is right and the other wrong but a late start to earning and funding children longer will impact finances significantly.

You should read 'The Pinch' by David Willets @KeenGreen - The Baby Boomers and how they should give it back.

I 100% have it easier than the generation before me.Between my parents and in laws, there are stories of having meals of cabbage water and using a wedged broom handle instead of a wardrobe as it’s all they could afford.

We bought our house without help from parents and definitely out earn them at comparable ages. I’m in my early 30s and expect to be able to retire in my 50s without any inheritance etc.

I have however maximised my earning potential and only have qualifications that directly have led me to earning more. DH doesn’t have a degree and has worked up to a management role at his company. It sounds like you may have prioritised costly education over seeking higher paid roles. That’s not a luxury anyone before me in my family has had.

So in my case it’s probably true that it was the same amount of hard, if not easier for me in my generation.

Also let’s not underplay childcare costs and societal expectations of the age when children can expect to be left unsupervised. My parents left me unsupervised from 6. That would be a social services case now, yet my primary school happily let me leave the school gates alone with my front door key for company.

People also lived closer to family. Had a swathe of relatives who would oversee the children if the mother worked. Childcare needs has impacted earning potential MASSIVELY. Nursery fees, wrap around care, holiday cover - in the OPs case they have accepted the husband has a more low paid flexible job to account for that.

Yeah I think my husbands wage wage is maybe 3 times my dad's was in 1980 (mine and my mums similar) but to build our house we need 10 x what they paid for a much bigger house in 1980. It doesn't add up!

As someone said before... essentials are more expensive and luxuries are cheap.

I don't think it's boomers fault though. And we do need to check our expectations.