Look rich but very poor

[greyfoxy]

I live in a lovely house in a nice area, I wear nice clothes and I know people perceive me as being well off. The truth is I have absolutely no money. It's 2 weeks until pay day and I have £15 left. I will end up using credit cards to buy the essentials which is why I'm in this mess - my repayments are huge.

Anyone else relate to this?

If you have 15k savings why aren't you just paying off your cc debt?????

You are in a mess because you are living beyond your means . If you aren’t affected by job loss, ill health you need to tackle this. Downsizing isn’t a dirty word and can be quite liberating x

It's common that the more you earn, the more you spend because why not, I earn X amount, why can't I enjoy it. When debt becomes extreme or unmanageable then there is a clear issue. Most people have debt, not all debt is bad, there are financial products available to help fund certain purchases, a car, a mortgage, etc.
Anyone in debt and wants to sort it, then there is lots of help available.

Have you stretched yourself too thin? Anyway to cut back?

They are broke not poor.

They aren't rich either, but are living beyond means that ought to be comfortable.

Sure do. I live in a nice area. I have a car. But I'm maxed out on my credit card and overdrawn. Waiting on two payments to come in so at least being in the red should end. The issue was my youngest turned 18 and so not only CB stopped but I was getting widowed parents benefit too - that was worth £7k a year on its own. My DD is now at uni so that's an extra expense to top up. And a few other unexpected high bills (one for £11k, and no it wasn't the roof) and I've gone into the red each month for the last six.
I am that classic asset rich but cash poor. I've already downsized and am looking to get rid of some assets but meanwhile the cupboard is sparse.
Though caveat of course (as it seems to be expected) I'm still far more fortunate than many blah blah.

I think you need to pay off your CC’s by reconfiguring your mortgage or borrowing and cut them up for good.

we earn 10k nett per month, average outgoing all in is around £3k for my family of 4 (2 adults 2 tweens). That include 1 far flung holiday, 1 cheaper European holidays and a few uk break.
We could have afforded a more comfortable lifestyle, a bigger house and better holidays but we couldn't bring ourselves to. Not sure if we speak for all south east Asian, but the mentality of "saving for rainy days" is ingrained in us. In many ways I wish we can be less uptight with money and learn to enjoy it.

Enjoy it while it lasts, OP. The UK economy is in absolute dire straits and when the bond market collapses (which it will, both here and the US) it will be 1976 all over again.

Those who do not have savings behind them will stand to lose everything.

Winter is coming.

Does anyone actually enjoy family holidays? Especially flash ones- cost alone would make me depressed!

Is your lovely house in a nice area a rented property, or are you buying it on a mortgage?

either way you can change where you live so that you don't have £15 in your purse at the end of the month.

my repayments are huge.

do you mean your credit card repayments are huge or your mortgage repayments? If you don't give adequate information how can you expect a meaningful response....

There seems to be a lot of extreme views.

I'm sure the vast majority of people just live a lifestyle they can afford without extremes.

We dress fine, have a nice (but not madly luxurious) holiday, drive a 3 year old car, keep our house nice and well maintained.

We also live within our means and save money every month. We make sure we always have 3 months pay in savings. With the COL so high I feel blessed to be able to do that.

This thread is insane to me.

I earn pennies compared to those commenting but I have a beautiful new build, I have nice things. Yes I might not have multiple holidays but I have zero debt.

It’s amazing what living within your means can do.

Forums on mse are good for advice

Kids enjoy a week at Butlins or a 2 star all inclusive in Benidorm as much as anything else. That many holidays and the destinations is absolute madness!

There is a huge difference between being poor and living a lifestyle you can't afford with terrible money management and mumsnet really needs to learn the difference.

'Very Poor' people don't have options and choices like that, they don't have nice houses in good areas or mortgages, nice clothes and fancy cars or hobbies and holidays and the things mumsnet seem to thing are standard but then just no disposable cash/savings.

They have searching the sofa cushions or selling anything they can find in their over crowded low cost often run by slumlord houses to see if they can find change for a loaf of bread and a jar of filler to make sandwiches for the week for the kids.

I use to live like that and god knows how people do it now, it was hard back then when a loaf of bread was only 25p. Benefits and help has gone down and prices up since then.

No one had debt because people couldn't GET credit from anything other than loan sharks. Being able to qualify for things like credit cards in itself is probably a sign your not really that poor.

If you want more money then stop maxing yourself out too look richer, it really is that simple. You have options, its not like you have nothing, step down and start spending less so you have more available.

Any fool can spend all their money, and then moan about not having any.

Well you spend too much for what you earn then.

Too much rent/mortgage- too big a house/in too expensive an area
Too much on car- car too big/flash / repayments too big
Too much in clothes/accessories
Too much on household goods
Too much on other extras or things that are not necessary

Either you have been an over-spender and it has caught up with you and you haven't reduced your outgoings according to your incomings, or your circumstances have changed .
Either way, you need to sell stuff and reduce your outgoings- not take on debt-or get a better paying job.

DH and I had to reduce our outgoings when I had DS1. I saved a year's salary and had a year's maternity leave then gave up working. We had DH's salary - which meant we'd lost our biggest salary so we were more than 60% income down. I was lucky in that a redundancy came up at work as I was making the decision and I volunteered so that gave us a lump sum but not that much.

We just managed with much less I became a very careful shopper, we stopped buying clothes for me and DH, we cut out so much 'stuff' that we frittered money on. Got rid of a car. Stopped going away for any holidays at all for 2 years. Barely went out for meals, no takeaways, gave up subscriptions to gym, stopped buying anything we didn't need.

What helped was we had been paying our mortgage down before we had DC so were not stretched by that.

He worked hard had two promotions in 3 years. I then had DD and stayed at home but started doing consultancy work one day a week, then two and eventually 3 . We had 3 DC in 5 years and by the time DS2 was ready for school I was back up to 4 days - two working from home.

It was hard but I went back full-time when DS2 started school. We are better off now because DH has a much better salary than he had then but we were much more careful for about 3 years. Frankly we had been wasteful of money before we had DC. We are now good savers and live well within our means.

I could sugar coate it a bit... but I am going to give it straight, sorry.
This is the definition of stupid. You are wasting your life away living above your means, wasting precious sleep hours worrying. Feasting and then starving.
You need to look towards the inside and get your priorities re-arranged.

For the benefit of those of us who are not clued up on these things, please could you explain how a bond market collapse will affect the average person?

You can do lovely holidays with eurocamp and spend a fraction of what you would elsewhere. İf you want luxury they have upgraded cabins as well, still for a fraction.

Wondering if there's a debt reducing thread here to help people stay motivated? I've got 5k of debt but it's on an interest free credit card and chipping away at it. Got a few big bags of stuff to sell on vinted which I'm hoping will help. I've had loads of clear outs and been saving the stuff for when I've got time to upload which should be in the next few weeks.

This is absolute madness.

Apart from anything, the kids were rather get to spend more time with you day to day then you be away at your second job to pay for a luxury holiday. Kids are happy with simple holidays where they get to play, eat ice cream and spend time with their parents.

You aren’t overspending for the kids, you are overspending to have a luxury lifestyle that you think you ‘deserve’ but you cannot afford.

Your priorities in life are screwed up and you’d benefit from a serious rethink.

That’s crazy !
You have a very good income , how about you have one 2 week summer holiday with your family somewhere less expensive.
And maybe one other short break away ?
I know it’s miserable to never get away anywhere for a holiday .
My family has had some years with no holidays away at all.
Other years we have gone away for a week on the coast in a small cottage only 2 hours drive away .
having something to look forward to is good

There is no safety net though.

Death, life altering illness, event etc, or any thing with a whiff of "unexpected" leaves them utterly vunerbale with a very dramatic change in circumstance.

What I mean by that is one small event or series of events means they have no cushion and will have to immediately and aggressively change their life style. The first to go will be expensive school fees. So the children will be the first hit.

I have seen this a lot.