Am I making a terrible financial mistake?

[Farticus101]

In the last few years I have had a really rough time. I fled an abusive relationship and moved in with family. Unfortunately, this has now not worked out and I have been asked to leave as parents couldn't cope with my DC in the house and the atmosphere was becoming toxic.

I don't want to uproot DC from their school and friends yet again (it will be their third move in 4 years) so have decided to rent nearby. However, the only rental properties in the area are absolutely horrendously priced for a 2 bed. I will go deep into my savings to pay for this.

Ultimately, my plan is to run through my savings (but will keep 1 or 2 thousand pounds as a buffer), then, when I don't have to do childcare, I can work full time which will at least cover the rent and bills (only just). Obviously rent may go up in this time though which means we would have to leave the home either way. There is no way I can buy a property unless I move hundreds of miles away.

Am I being unreasonable to rely almost solely on savings for the next three years?

Move and buy now. Otherwise genuinely you might never end up having the money to do it. If you move now the 7yr old can stay in the same place for the rest of their education whereas if you rent chances are you’ll end up moving anyway.

Many local authorities have a cap for savings and/or income. Mine does. If you have savings above a certain amount they expect you to spend it on rent or mortgage.

Move sooner rather than later. Kids adapt better when young and you can spend some savings getting settled in a really nice long term place.

You’re lucky you have savings! If this isn’t what savings is for, I don’t know what is.

I’d consider a move, buy something that I could afford,not spend all my money on rent.

I'm sorry this sounds like such a hard situation. I think in this position with children at those ages even though you said you've moved a bit, I'd prioritize moving somewhere more affordable because it will give you a lot more stability long term and they can establish friendships easily

Edited because I'm an eejit and realised I read the comment wrong 😂

At their ages the children will barely remember the moves. If at all.

Don’t squander money like that. You need to be more strategic.

You were correct the first time. You can have up to £16k in savings and still receive UC. Anything above £6k there are deductions made from the UC award. It was £4.35 for every £100 but I don't know if that's changed since April. It's when savings exceed £16k that UC stops completely.

Register as homeless with your local Council. Your parents could write a letter to say the relationship has broken down and they are giving you notice to leave. You might end up in temporary accommodation for a while but, depending on your local area, may be rehoused quite quickly. This probably won’t work if you’re in London. Or you could just join the housing register and may get priority as you have young children.

Most local authorities have teams that can also help you source private accommodation.

What is making your parents behave that way?
Even if you disagree with them, can you bite your lip in the interest of gaining some time to save a bit more?
So if your kids are spirited, can you get them to a bit more 'seen and not heard' just around your parents?

OP if you rent you will ALWAYS be at the mercy of other people, if you have enough for a deposit you could it, buy a place in a much cheaper area. If you don't have any ties where you are, why not have a completely fresh start and move somewhere in the North, or in Wales, where prices are SO much more reasonable. Just as an example Wellingborough, Northants - I've just consulted 'On The Market', and you can get a lovely 2 bed mid terrace for £185k, or the same size/style in Derbshire for £160k, and in Wales from as little as £79,995. Of course it may not be possible for you to move that far afield, but it does prove that there are places where you might be able to buy, and then as long as you can continue to keep paying the mortgage, you can be sure of a secure and stable roof over your heads for as long as you want it, MUCH better than renting.

Don’t throw that money away. Buy while your children are little and adaptable. Will you be able to get a mortgage if not earning?

I've been relying on my savings for the past 15 months & it's depressing as hell. Basically, I worked my arse off for 2 years, fulltime with overtime to save, just so I could live off my savings. All so my DH could chase an opportunity abroad.

If I was you I wouldn’t be bothering with my parents after this. They sound horrid and useless tbh

Well said.

Children have migrated with their families since time immemorial.

Don’t throw your nest egg away on rent for maudlin reasons. They seriously won’t even remember these moves.

I also would move. If you rent, you may have to move over the next few years anyway unless you get a Council flat. Private landlords can sell or want to move back in.

Your DC are at really good ages to cope with the move and buying a house will set you up for life.

Good on you for asking the question and also trying to do what is best for your DC. The only other suggestion I would make is to join Gingerbread to get support and form contacts with other single parents. Wishing you all the best

Aside from whether it's sensible or not to use your savings in this way, it's likely not feasible to get a rental in this way as any credit checks would be based on your income rather than your savings.

I agree that your children are probably more resilient than you think at this age & moving to a cheaper area may be a better option.

Hello OP,

My children (6, 4 and 1) have lived in three different countries so I understand very well what you're saying. But if what you're looking for is stability and permanence, then I'd move somewhere you can buy a house. Better to move now into a long term situation than stay somewhere that'll end up being untenable in the long run, and live with the constant stress of the landlord potentially raising the rent. Not to mention, as PP have pointed out, there are usually income criteria to rent a house.

Your parents are nasty and don't like your dc so you're losing nothing in terms of support.

If it were me I'd move now, rather than give dc a false sense of permanence and end up moving anyway in a couple of years, in a much worse situation as you will then not be able to buy a house at all.

I'd be getting my DC away from nasty comments where they are not made to feel welcome. Just a thought but what about a clean start and move up North where you could buy a 3 bedroom for £100-120k.

She didn’t. Another poster just randomly “presumed” it. 🤨

In answer to the question in your title, yes that sounds like the kind of financial mistake that could change the course of your entire life and your children’s lives for the worse. Especially if your savings are enough for a deposit elsewhere in the country.

Definitely make the move somewhere cheaper now. Otherwise you will get trapped where you are, never making more than enough money to just about cover the bills (in a best case scenario - worst you won’t even be able to do that).

Is there a reason why you won't do shared ownership?. It's not the best in the world but it's better than than throwing all your savings away on rent.

I think the stress of being in a financially precarious position for the long term will out weigh any near term impact of another move. I would take the plunge and move somewhere substantially cheaper where your savings will make for a healthy deposit on a property.

So much easier to make a big move now, whilst they're young and you have savings to do it ... than to run down your savings, live in cramped conditions and then have to move a year or two down the line anyway.