I just can't understand...

[Marmut]

how some people manage their finance...

I am an immigrant and came here as a student with a stipend (no family supporting me financially). Even living on a stipend and a very part time work, during my study, I managed to save more than £10k. I did that by making sure I saved every month and minimised my ongoing by very rarely eating out, walking everywhere, cooking my food every day and socialising by inviting people over so I could do it on the cheap (cooking the food, etc.). I guess what I am trying to say is that I am not always have a good salary/income to rely on and yet I always manage to maximise savings by minimising my expenses so that I can spare some money to save.

Anyway, 19 years later after I came here, our mortgage was paid off, I have a saving of nearly 80% of my annual salary (my own, not a joint saving), an emergency buffer of about 3 months outgoing, my pension is also on track, and I may be able to retire 8-9 years earlier than the state pension age. We also have a £18k saving for our DD and, provided we continue with our monthly saving, it will be about £50k by the time she is 18. Although our joint income is about £100k (ony very recently), I carry on with weekly meal planning (adjusting the meal plan based on what is on offer) and keeping close watch on the budget of our groceries and family outings. I buy things when they are on sale and only replace things when they are broken. I continue bringing pack lunch daily and only occasionally buy lunch while at work. We do not deprive my DD of life experience, as we still still go to holidays abroad every year (which we plan ahead and I have a specific "top budget" in my mind) and she still joins any club she is interested in.

I am aware that my post sounds like a humble brag. But it really frustrates me to see how other people could have "got" out of a dire situation if only they were willing to manage their finances properly and go for the long game instead of instant gratification. Even saving a very small amount, if it is done regularly and continously, will make a big difference.

The benefit trap is a real thing but OP doesn't mention benefits.

@AuContrairePubicHair We bought our house 9-10 years ago. I did prioritised paying off our mortgage as my job was not permanent.
I understand the situation for those who are on UCs and how the UC rule limits one's ability to save. Having said that, I suppose, most UCs are supposed to be a safety net and meant to be a temporary measures rather than permanent ones.

It doesn’t sound like a humble brag but it does sound incredibly condescending. You can’t see how people might be impacted by things like chronic illness, bereavement etc that will have a huge knock on effect on finances and mental health and the ability to get yourself into good financial habits?

Everything comes down to time v money and those who are often most squeezed have little of either. It then becomes a difficult cycle to break out of, especially as the tiniest unexpected expense - eg a £60 parking ticket - can set you back totally.

I just am not sure what the point of posting something like this except to make people feel bad about themselves.

Oh piss off its not even an attempt at a humble brag. It's just a full stop brag.

What's your current wage?

What's your partners wage?

How much is your mortgage per month?

@AuContrairePubicHair why on earth are you quoting the OP? You’re literally the first person to comment! 🤯

Have you ever read anything about the poverty trap?

Who is "we"? You and your UK husband who got a headstart here? And what's your job / qualification? Easier to earn a good income as a GP, accountant, etc. than as a translator or customer service representative for example.

It’s all situational. I was in a very good position financially in 2018. Then my husband died. I had to extend my mortgage period to be able to afford it, and I have 5k of debt which I struggle all the time to get on top of. add to that Covid, cost of living crisis, career opps decreased as have children to care for 100% of the time . You are lucky that life hasn’t done you a rough one- but there is still time
for that to happen.

@Marmut id be interested to know what industry you and your partner are in and what annual review you had 20, 10 years ago and now? It’s easy to compare when that isn’t involved.

average wage in my area is 25k. If you had 2 kids - one under 5 and one in primary school you can say goodbye to most your money 20/10 years ago due to nursery and after/before school clubs let alone anything else. You’d need tax credits to prop yourself up and god forbid you saved money you’d be penalised.

Well for a start you earn a good bit above the national household average, and you are financially savvy which many people aren’t.

What is your question? Surely it’s actually very easy to understand that some people don’t have as much money as you?
Buying a home a decade ago is a huge one for a start, uni was cheaper if either of you have a student loan, house prices were significantly cheaper meaning you didn’t have a huge outstanding morning when rates increased and had the benefit of absolutely rock bottom interest rates for most of it allowing you to make a huge difference by overpaying.

Even living on a stipend and a very part time work, during my study, I managed to save more than £10k

Saving £10k while studying suggests it was a very very generous stipend and a highly paid part time job. I couldn't save 80% of my income because my bills come to 50% before I even look at food.

Buying your house 10 yrs ago helps. 10 yrs ago houses in our area were priced 200k less than they are now. Having just the one child also helps. Be grateful for what you have achieved OP but I agree your post is a little tone deaf as not all situations are equal.

I think there's a lot of education that could be done in schools to help teach people more about money.
But some people just like to consume. And tbh they're the ones that keep the economy buoyant.

Currently the UK is in the grip of a takeaway boom - providing lots of low paid jobs. Not just takeaway food but coffee too.

It also claims that the coffee shop market is estimated to be worth £15 billion each year.
https://www.newfoodmagazine.com/news/188797/brits-spending-more-than-ever-on-takeaway-coffee-report-claims/

The UK's takeaway market is estimated to be worth £31.5 billion,

The elephant in the room is the high level of consumerism especially.
Every time I visit a shopping center or high street I’m really surprised at the amount of people buying/eating out. Same for food deliveries, it seems now to be something people do several times a week. And holidays as well.

Not talking about people living hand to mouth, but when there is 100-200£ to spare it seems that saving is not prioritised. Yes to a treat from
time to time but that doesn’t mean any money available should be used for treats.

I think this is a classic case of you not being able to look past yourself OP.

In some parts of the country, especially if single so living alone, rent & household bills alone take up a lot of your income. The average household in the UK spends 42% of income on rent, that is higher in London at 72%. Once you add onto that council tax, utilities, food shopping, travel costs, there is often not much left over to save anything at all.

Good for you.

This is a ridiculous post, tbh. You have a combined salary of £100k and one daughter……. Please take your head out of the sand and look around.

I sort of agree with this but I do think there is an element of the invisible people here.

Our local coffee shop is always full, the shops are pretty busy, but I volunteer at our local food bank and that is also full every single week. They aren’t the same people.

Ffs for someone on such a high horse you really have no awareness of your surroundings.

You went to uni in the days fees were >30% of what they are now. Possible even less. So you aren’t paying back 10s of 1000’s in student loans.

You bought a house when they were half the price they are now.

You earn significantly higher than the average annual household income.

Since you’re so amazing, why did you not educate your family aged 7 so they could have financially supported you through uni too??

There’s definitely an element if people not managing their finances properly. You only have to look at one of those money makeover shows to see people with two prime subscriptions, huge sums spent on takeaways etc. Could be due to people not being financially aware or being time poor.
dh and I always prioritised saving but we went to university in the 1980s and no student debt. Additionally we have been fortunate to have good health and nothing that has had a huge financial impact eg losing job or a child requiring additional support.
I think our age is also a factor: our parents were born during WW2 and had a very different mentality eg debt was bad, you repaired items and lived within your means. Inevitably that rubbed off on us and perhaps made us more cautious re expenditure.

Most people stand no chance of earning what you earn. A lot of people are doing the scrimping that you do and still don’t have enough money to save because there is nothing left even with everything cut back to nothing.
You are being very short-sighted and smug, but congratulations on being perfect 👏

I agree with this entirely. I think OP is talking about average, middle income people who spend up to (and beyond) their income every month with no other priorities at all. They have absolutely no headroom when the tiniest thing goes wrong.

I too am an immigrant, and one thing I have noticed is the huge number of Brits who have convinced themselves that this is a rich country. It really is not. We have nothing like French, German or Dutch levels of productivity, and sky-high housing costs which eat into our smaller incomes far more than we gain by slightly cheaper food. Add in a cultural predisposition to snobbery as a hangover from the class system, and the 'keeping up with the Joneses' mentality and it's a recipe for disaster.

Finally, because of the disastrous distortions the housing market wreaks on the overall economy meaning that for every £23 'invested' in residential property just £1 goes into productive investment, many who might be in a position to save/invest don't think it's worth it. They just borrow more to buy a more expensive house, and the cycle continues.

You probably need to give a but more detail, such as how much you paid for your house and how much you earned and saved. Most people cook at home most of the time and plenty of people try to save money.

I'll bite. Well done OP but I don't see the sense in making your life utterly miserable to save every penny you can. Some financial prudence? Sure. But competitive miserliness is not for me. If that makes me a wastrel in your eyes so be it.