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!

I agree op.

We are in a very similar situation to you but roles reversed. I work in a school on a low wage. I could earn more but we have young children and with childcare costs and taxation we wouldn't be any better off. Or maybe marginally but the dc would be in childcare 8-6 every day.

The difference is my parents generation there was nearly always a sahp.

Some in our parents and grandparents will have had it easier. Some will have had it harder. Just like with us and our children.

Anyone who says 'our generation' or 'that generation' to discuss people born within a specific timeframe is going to be overgeneralizing. Giving advice or assumptions of what they're doing wrong based solely on year of birth is going to be unreasonable and likely frustrating.

Generation theory has no substance to it - some find it interesting, it's been good for marketing and a laugh sometimes, but there is no real reason to separate someone born in 1963 from someone born in 1967 or someone born in 1978 from someone born in 1982 as if they would have had entirely different experiences in finances based solely on date of birth. Larger research groups are moving away from using it, but some still do because it's become so ingrained and it gets attention even with so little supporting it.

OK so there are issues with cost of living. However I'm 60 and when we bought our first house interest rates were 10%. By the time I had my first child in the late 80s it was 16%. Mortgage took 3/4 of DH wage. I worked in the evening as there was one nursery to cover 4 small towns and the fees would take ALL of my wages. I didn't have a car and we rarely went on holiday. No takeaways, or coffees or ready made lunches. We often ran out of money and just had to choose which bill not to pay. Clothes were expensive in real terms and a formula and nappies were very expensive. The nappies took all.my child benefit for example. No UC or housing benefit. Truth is there are issues but us boomers didn't have a walk in the park either. I had zero family support as it simply want the done thing and most parents worked until mid 60s. Your DH needs to get a much better job. FWIW I'm still working a physical job and will be until 67 when I get my state pension.

A SAHP. Because childcare was none existent. People had no choice, and just had to live without the extras in life.

If that is so, it all seems a bit pointless. Work all your life for a home , only to hand it over to greedy care home owners.

Fair enough, it’s a very different picture for millenials and gen z though. I am pretty sure quantitative research shows millenials as first generation who on average have poorer living standards than parents. Gen x particularly at older end benefitted from lower house prices and maybe even from free or much cheaper university? Plus their parents may in many cases have been the generation prior to the boomers, right?

You’ve missed the entire point of my post

it’s about high skilled and not well enough paid people.

Our society doesn’t provide a decent enough standard of living for well skilled people never mind low skilled, that’s the whole point.

You really think that the lack of housing has nothing to do with the additional 10m+ people who’ve come here over the last 25 years? It is literally impossible to build enough new houses each year for the current 500k+ yearly population increase, let alone the natural increase.

He could absolutely train to be a teacher and I have encouraged this multiple times over the years but he doesn’t think he’s capable or wants that stress and pressure. I feel I need to support what he feels comfortable with.

Ok I see you have now updated why your DH earns so little.

But then you have to accept that many people work all their lives with quite a high degree of stress and pressure for a higher salary.

Another nasty greedy boomer here and this is an interesting idea that i have been pondering on. We did get glimpses of other lives via magazines and but of course there were no Instagram and YouTube "influencers" with their shopping "hauls", picture perfect homes and fabulous holidays. I am thankful that I was spared all this in my youth as I was vain and impressionable and can imagine getting caught up in what is essentially a fantasy world.

If you are short of money you could reduce your pension contributions and then increase them at a later date as you mentioned them as being high.

I currently work with a woman whose aim is to save £1k a month but she spends all her time complaining how expensive everything is, and about the cost of living crisis, etc. She was recently talking about whether she could visit food banks as she feels she needs to... But she refuses to listen to reducing her 'saving budget.'

I don't see the point of living life full of bitterness and resentment at other generations or even other people. Maybe count your blessings that you have a job, a joint income of £65K and a 3 bed semi. There are plenty of people with far less. Maybe it is just a question of changing your perception of your financial situation.

YANBU but why hasn’t your DH trained to be a teacher?

“could earn more in a state school doing the same role but he is happy and settled and been there for 10 years”

“He could absolutely train to be a teacher and I have encouraged this multiple times over the years but he doesn’t think he’s capable or wants that stress and pressure”

So the real issue is he doesn’t want to upset his very comfortable work life or step outside his comfort zone. That’s fine but then you both have to accept the consequences which is not having much money to spare, now or in future.

You have minimal childcare costs and a spare bedroom. Doesn't sound all that bad to me.

@MumCanIHaveASnackPlease My early thirties hairdresser earns more than the OP, I know because he was talking about discussions with his accountant as they didn’t qualify for child benefit. He is now in his second property, a 3 bed, in which he has just built a huge extension. They have two children and his wife works part time, also in a non-graduate role. OP’s husband could train to be a teacher through one of the employed pathways - within a decade they could double their family income, but I’ve edited my post having read OP’s update, that he doesn’t want to go down that route. Perhaps there will be other benefits - free or reduced fees at the independent school?

This.

Whilst I fully accept that house price inflation has caused many issues, I think you also have to accept that many people progress their careers over time and increase their salaries.

This involves stress and anxiety and sheer hard work.

“He could absolutely train to be a teacher and I have encouraged this multiple times over the years but he doesn’t think he’s capable or wants that stress and pressure”

Where I will agree with people from previous generations is that they had a much greater resilience.

They were much more willing to put themselves through enormous stress and high pressure in the name of “getting on” and providing for their family. It would be unheard of in my parents generation for parents to but hard work in the too hard basket.

My generation (millennial) are much less willing to do this.

I don’t think anyone is calling anyone nasty or greedy. It is about recognising opportunity available to older generations that isn’t available to younger. Obviously the average person in each generation is going to take the opportunities available to them, but there’s something going awry surely if things are in decline?

I agree with you OP, my Dad was a fitter at a chocolate factory and bought a 3 bed semi in York when he was in his mid 20s based on his salary alone (they didn't even look at my Mum's) they had 3 kids.

Both my husband and I have post grad degrees and professions with moderate incomes and couldn't get on the housing ladder until we were 30 in 2013, (and it's even harder now, so even though boomers had much more affordable housing even some of us millenials and gen xers had it easier than the current gen Z)

We also have 1 child and haven't had a second partially because of housing, childcare costs and general COL. We have a 5 year old in reception but bought a bigger house since our first and our remortgage August last year means we have just shy of £1500 mortgage. Childcare on top would cripple us and we don't want to downsize so we are where we are.

Also people wouldn't bat an eye if you were working part time with a 5 year old and your husband was the main bread winner on 50k. Currently I earn the part time wage and my husband has the full time wage. I am looking to increase my earnings but if I had another kid it would almost be pointless as I'd have to go part time again.

I also think there's alot of people who are relying on inheritance to pay off these mortgages so another compounding factor of generational wealth.

It sucks but unless Labour put some things in place, (like 100% tax on property bought by oversees investors like Spain have done), to bring property prices down and the wealth gap is going to keep widening (and the birth rate shrinking)

And something is definitely worryingly wrong if essential support functions are unaffordable. Anyone doing a job essential to society on a full time basis should be paid enough to live comfortably and to provide reasonably for a family should they choose to have one.

Not everyone is going to be able to maximise their salary plus for the previous generation it wasn't always necessary to have 2 workers earning their maximum to buy a house.

wage stagnation and house price inflation has done a number on the young.

Thing is your DHs job is completely his/your choice though. It’s not a generational wealth thing, it’s a personal choices and prioritization thing. I would love for one of us to work in a lower hour, term time job like that but we wouldn’t be able to have the standard of living we want for ourselves and our DC. You have chosen that lifestyle and it’s a valid choice, but you have to recognize it’s a choice and there is the potential to have more. I don’t think it was particularly easier for previous generations that it was for millennials, I’m a similar age to you and both my parents worked full time, we didn’t have a holiday every year and only ate out or had a takeaway on very special occasions. I would say my household has a better lifestyle than my parents did, although it was harder for us to get on the property ladder but still possible. The younger generations, Gen Z have it harder than millennials did/do.

have you researched pay scales before getting into academia?

many people make sacrifices and choose a career that pays well. Choosing financial stability over doing something they enjoy. Very few people are lucky to have both.

I chose tech for its earning potential and flexibility (options to wfh). My husband chose finance purely for the earning potential. It wasn’t his passion or something, but we both have no regrets at all.

we have zero generational wealth.

Really? I’m Gen X. We’re definitely worse off than our parents.

They had great pensions and retired at between 50 and 55. They had loads of windfalls as all the mutuals and building societies became banks. They made money from the selling off of the utilities (“if you see Sid, tell him”) and the stock market boom.

Their parents lived in council houses and got by. They prospered. We do ok, but nothing like they did.

This hits the nail on the head.

You are saying our generation has it hard and this is why you can't afford a better quality of life, but the reality is, the reason why you can't afford a better quality of life is because you've got a husband who is prioritising having an easy working life over maximising his earning potential. This is nothing to do with generational wealth differences and everything to do with your personal priorities and choices. No one at any point in history has been living a life of luxury on a TA wage.