Upper class habits to stay rich

[publicsectorlife]

What habits do the upper class have to stay wealthy? What would they never buy that they would consider a waste of money?

Our household income is very good. But yet we seem to be haemorrhaging money with high mortgage, commuting and childcare costs.

But yet our friends with generational wealth (ie small mortgage) seem to be living such a different lifestyle with about 6 holidays a year.

We can’t do much about having no inherited wealth but I think we must be missing a trick.

Yes, my husband is reluctant to pay into our son's SIPP as it's locked away so long, but even 1k per year til 18 becomes 130k over 50y without any input or effort with a modest 4% compounding. That's a huge gift, a significant chunk of pension.

250k is 1.8m in 50y! Enough to set up a few grandchildren with 250k SIPPs of their own...

A child can’t have a ‘trading account’. A savings account would be silly as well. Hmmm not sure you have a trust fund you’re enjoying.

Of course a child can have a trading account.

DS has a Junior ISA with HL and him and DH choose the shares together

No they can’t. You can’t open one until you’re 18. Give it a go.

As above, DS has one

OK, the fact that kids can’t transact, which platform?

Happy to be corrected (really!), but under 18 is usually a Bare Trust account only.

https://www.ajbell.co.uk/dealing-account/what-is

Last paragraph under the section entitled What’s the difference between a Dealing account and an ISA?

"AJ Bell also let you open Dealing accounts for children"

Is that to me? Where does it say you can have this <18

https://www.ajbell.co.uk/faq/can-i-open-dealing-account-child

It’s a Bare Trust.

Buy classic well cut clothes, good quality materials, that last
Same for bedding, curtains, furniture etc. Replace them once every 25-30 years
Polish leather shoes, have them reheeled and resoled.

Have other things repaired. Hand things down to the next generation.
Buy 2year old Volvos and keep them for 20 years.
Don't waste money on tat. Candles, cheap ornaments, phone holders, water bottles etc.

Invite guests round, don't eat out. Garden parties rather than soft play, self cut logs for fire rather than ringing the fuel merchant.
Grow your own - most decent size houses have veg patches, fruit cages and greenhouses.
Make your own jams, pickles, liqueurs, bottle fruit. Make your own compost.

Why would it be silly for a child to have a savings account? 🤔

I had a post office account when I was about 5 for pocket money, birthday money etc. I was working at 13, where was I supposed to keep the money, under the mattress? DS had a savings account from much the same age. He saves birthday money and his pay into it. Currently saving for university.

Be born into wealth.

Marry wealth.

Earn wealth.

Invest wealth.

Manage wealth - Understand money and don't stick your head in the sand, take reputable advice.

Ignore flashy fashionable trends and FOMO spends.

Buy less - and better. You can't afford cheap shoes if you're not rich. Clever second hand / sales etc buys can last you years and the slightly lived in look is a particular type of wealthy signal. The duchess in her shabby country tweeds look.

Avoid disastrous people whose behaviour can derail wealth - the husband with a gambling issue will drain it.

Granted, the first sentence on this Q&A page says "You can open a "bare trust" Dealing account for children where the parent or grandparent is the trustee."

The second, and only other, sentence which follows immediately after says "Alternatively, you can set up a designated Dealing account and operate it on behalf of a child."

I mean, there's being selective and then there's this.

Of course a child can have a savings account. 🙄 I had an Abbey National building soc account as a child.

And why on earth is it 'silly' to start a child on confident financial literacy?

If you follow the discussion, it was why would you take money out of a trust to put in a savings account.

The law tends to be pretty selective on tax matters.

It was part of a discussion about paying money out of a trust, not just in the context of savings. One wouldn’t rip money out of a trust to put in a child’s savings account.

Oh and a designated dealing account is in your name, in your estate, and does not legally belong to the child.

Again, a child cannot transact.

You replace linen every 25-30 years? Can I ask which brands you buy? I invested in high thread count bedding (John Lewis) a few years ago but can’t see it lasting that long. Albeit I donated it to family when I emigrated, so it only lasted a few years for me.

The other tips you listed are good for living frugally but I don’t think they make much of a dent in terms of truly amassing wealth, they just allow middle and low earners to hold onto more of their wages. All good advice though.

High thread count suggests you are talking about cotton.
Linen tends to last longer.

Because it’s utilizing 18 years worth of personal tax allowance. You never get it back. A trust that has investments and and making money is effectively using £12570 to pay someone tax free. Well, actually, the trust pays a tax and the child claims it back from the government.

And why on earth would it not be ok to have a savings account. Kids can quite happily have it sitting there. Admittedly at the moment it’s not keeping up with inflation but whilst the grandparents can pay school fees out of excess income it’s a safe haven till the day where it might be sensible to use for school/uni/house.

Presumably making their wealth make them more wealth. Private banking & having someone manage their investments /property portfolio/other. Using loopholes to evade tax & preserve even more money. Using charitable endeavours to offset tax. Getting peerages & power & influence to make more wealth.

Bed linen = sheets, duvet cover and pillow cases, to me.

What do you mean by linen and what fabric is it typically?

Linen IS a fabric. Like cotton is a fabric and silk is a fabric. A very nice one too.

Linen and bed linen are two different things. I know, its confusing.