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  • FIRST POST
    • longleggedhair
    • By longleggedhair 11th Sep 17, 12:26 PM
    • 233Posts
    • 328Thanks
    longleggedhair
    What's wrong with people.
    • #1
    • 11th Sep 17, 12:26 PM
    What's wrong with people. 11th Sep 17 at 12:26 PM
    Despite earning big money, why are some people in big debt and have no savings.

    I think it's definitely a psychological thing. I had parents who were professionals & earned very good money, but never had any money, because while they are both intelligent people they are financially illiterate. Money was just wasted on needless things and quite often financial problems would crop up.

    The experience as a child changed my whole mindset and as an adult I've saved & invested with every pay rise. Just added up my latest total and im around £200,000 after 12 years....and it really was very easy! I don't earn big money (just above minimum wage) I did have a small inheritance and have done well with my investments.

    The key is not to chase the posh cars/clothes/phones. I absolutely love my life, I live it to the full but that money gives me so much security and happiness you wouldn't believe. I know that if I want I can walk out of work tomorrow I can, it gives you choices. And that security is worth far more than material things.

    As others have said it's important to live life and enjoy it, we only come this way once, but what I don't understand is why most people haven't "seen the light" (time is precious, we don't have much so why spend most of our life at work to buy things that make us feel better about going to work, which then results in us having to be at work almost forever) I work with people who hate work, are desperate to leave but have no prospect of ever being able to become they are driving the posh car, the designer clothes etc

    It seems so simple to me...but why have so few seen the light?
Page 3
    • Zola.
    • By Zola. 11th Sep 17, 5:06 PM
    • 1,037 Posts
    • 381 Thanks
    Zola.
    I think Social Media has caused a huge upsurge in people becoming more reckless with money. Everyone wants to look wealthy and show off, and what better way than to flaunt the next holiday you are on, the new flashy car or the new Rolex watch to the X number followers on your social media accounts.

    Look at guys like Conor McGregor, a huge global star, always flaunting and bleating on about how rich he is, a sickening show off. People try to copy him or be him. Look at how many copy cat McGregor suits there are. People growing beards and buying checkered suits haha.
    • Barny1979
    • By Barny1979 11th Sep 17, 5:19 PM
    • 3,743 Posts
    • 43,166 Thanks
    Barny1979
    Can I ask a couple of questions, how old are you OP and what is your future plan?
    • jimjames
    • By jimjames 11th Sep 17, 5:22 PM
    • 12,003 Posts
    • 10,442 Thanks
    jimjames
    Take cars for example. It wasn't that long ago that people drove older cars without any real hesitation. Now new drivers are wanting brand new cars. The average of the cars on the road must have reduced significantly in the last 10-15 years.
    Originally posted by Anonymous101
    It's quite interesting looking at the car park at work. The cars driven by the youngsters in customer services on low wages are significantly newer than the cars driven by older staff on vastly better salaries. Those who can afford them tend to not buy them, not sure what that really says unless it's learning from experience.
    I think Social Media has caused a huge upsurge in people becoming more reckless with money. Everyone wants to look wealthy and show off, and what better way than to flaunt the next holiday you are on, the new flashy car or the new Rolex watch to the X number followers on your social media accounts.
    Originally posted by Zola.
    Very true. I saw a comment from someone a few weeks ago about how much in debt they were. Next post was showing all these fantastic outfits they'd just bought, none of which could be described as essential
    Last edited by jimjames; 11-09-2017 at 5:28 PM.
    Remember the saying: if it looks too good to be true it almost certainly is.
    • warehouse
    • By warehouse 11th Sep 17, 5:28 PM
    • 2,965 Posts
    • 5,533 Thanks
    warehouse
    It's quite interesting looking at the car park at work. The cars driven by the youngsters in customer services on low wages are significantly newer than the cars driven by older staff on vastly better salaries. Those who can afford them tend to not buy them, not sure what that really says unless it's learning from experience.
    Originally posted by jimjames
    Funny you say that. On another forum I frequent one of the younger members posted this during a chat about car leasing v car buying...

    Friday before last I got my first personal lease.
    £213 a month, £1200 deposit, Volkswagen Golf TDI 1.6 SE Nav Edition.
    Sold my 09 plate CAT D Fiesta for £1200 cash, that covered the deposit. 24 month contract. 20k mileage allowance.
    £2556 a year. £5112 in total over two years. It's nothing really? Give it back after 2 years and upgrade to a nice little C-Class at 24 if I'm in the position that I'm hoping I will be.

    "It's nothing really" he says. Oh yes it is.
    Pants
    • jimjames
    • By jimjames 11th Sep 17, 5:32 PM
    • 12,003 Posts
    • 10,442 Thanks
    jimjames
    "It's nothing really" he says. Oh yes it is.
    Originally posted by warehouse
    Indeed. Also he conveniently forgot the £1200 deposit from his calcs so it's £6300 which won't be available for the next deposit so he's gone from owning an asset worth £1200 to owning nothing after paying out £5100 over 2 years.
    Remember the saying: if it looks too good to be true it almost certainly is.
    • badmemory
    • By badmemory 11th Sep 17, 5:38 PM
    • 668 Posts
    • 659 Thanks
    badmemory
    £2556 a year. £5112 in total over two years

    Rinse & repeat & they could buy a totally new car. As for the 20k mileage allowance, well it would be enough now - no commuting & long distances only rarely, but back in my "youth" that would be gone in a year (or less).

    I spent my money doing things & going places not on a status symbol. But then I never did care too much about what other people thought about me.
    Last edited by badmemory; 11-09-2017 at 5:43 PM.
    • Barny1979
    • By Barny1979 11th Sep 17, 5:52 PM
    • 3,743 Posts
    • 43,166 Thanks
    Barny1979
    CAT D Fiesta though, lucky he got £1,200 valuation if an insurance "write-off"?
    • eskbanker
    • By eskbanker 11th Sep 17, 7:40 PM
    • 5,466 Posts
    • 5,269 Thanks
    eskbanker
    You may evangelise about having 'seen the light' but many wouldn't necessarily see your way as being better than the one they've adopted (whether consciously or not).
    Originally posted by eskbanker
    I don't think that anyone having no emergency funds, living from payday to payday in overdraft and needing loans to cover unexpected items could be seen as anything other than worse than having savings to cover such items. Entirely their choice how to live their life but I can't see a lot of dispute that spending more than you earn is less preferable to having savings. Obviously the level of savings could make a massive difference.
    Originally posted by jimjames
    Yes, I agree with you - just to be clear I'm not disputing that debt is best avoided, my point was more about OP's more contentious recommendations around lifestyle choices and not being materialistic - I'm not denying OP's right to have those opinions but just feel that it's a bit steep to criticise those who choose to take a different view, especially in the wording of the thread title.

    Or to put it another way, expressions such as 'you can't take it with you' and 'no pockets in a shroud' may be tired cliches but that doesn't necessarily make them invalid! Fundamentally I do agree that people should live within their means though, but just don't have an issue with those who choose to spend it all on whatever they want....
    • strongboes
    • By strongboes 11th Sep 17, 8:01 PM
    • 82 Posts
    • 57 Thanks
    strongboes
    why so judgemental? young person, high disposable income, probably no dependents, possibly living with parents.

    older person, family, mortgage, commitments etc, who honestly cares what someone spends their money on. quite strange
    • Gambler101
    • By Gambler101 11th Sep 17, 10:05 PM
    • 494 Posts
    • 1,219 Thanks
    Gambler101
    Never borrow except for a mortgage, and save 10% of your net income for retirement, and 10% for emergencies/holidays/xmas etc and you wont go far wrong.

    That applies whether you are on benefits or a million a year.
    The instructions on the box said 'Requires Windows 7 or better'. So I installed LINUX
    • darkidoe
    • By darkidoe 11th Sep 17, 11:17 PM
    • 859 Posts
    • 974 Thanks
    darkidoe
    Indeed. Also he conveniently forgot the £1200 deposit from his calcs so it's £6300 which won't be available for the next deposit so he's gone from owning an asset worth £1200 to owning nothing after paying out £5100 over 2 years.
    Originally posted by jimjames
    That's excluding insurance and fuel to run the car and maintenance costs!!

    Ah that's why I can't convince myself to get a car. Imagine the opportunity costs of not using that money to be invested!!

    Save 12K in 2017 # 9 £7 616.65/15 000 (50.78%)
    Save 12K in 2016 # 8 £19 721.58/12 000 (164.35%) Achieved!
    • binaryuniverse
    • By binaryuniverse 12th Sep 17, 7:40 AM
    • 367 Posts
    • 170 Thanks
    binaryuniverse
    Saving £200'000, over 12 years on minimum wage "easy" ?

    When I was on minimum wage, doing 39 hours a week, once my living costs had come out, I was happy to see a tenner a week.

    Even on the salary I'm on now, I don't see £200'000 being easy. It's doable if I had absolutely no living costs, and little/no social life. But then I wouldn't be living.
    • Anonymous101
    • By Anonymous101 12th Sep 17, 8:01 AM
    • 977 Posts
    • 343 Thanks
    Anonymous101
    It's quite interesting looking at the car park at work. The cars driven by the youngsters in customer services on low wages are significantly newer than the cars driven by older staff on vastly better salaries. Those who can afford them tend to not buy them, not sure what that really says unless it's learning from experience.
    Originally posted by jimjames
    I've noticed that myself and think there's various reasons as to why this happens. There's an element of competition and an element of not knowing any better. With a bit more maturity people take a number of years to get that impressing people you don't like won't make you happy. However young lads chasing girls will strive to show their wealth though as its a primary indicator of success. In biological terms "investing" money in a flash car is probably a good investment for a young lad. Once married and settled down they'll have less disposable income, have learnt from their financial mistakes and will no longer be competing for women.
    • Uxb
    • By Uxb 12th Sep 17, 8:29 AM
    • 903 Posts
    • 980 Thanks
    Uxb
    ...and that is the nub of it.
    It is in effect a mating call/display.

    Just like the animal world we watch wildlife program showing all the various strategies in displays - "peacock-ing"
    So it is in humans, females are looking for nest and offspring providers and that means in today's world looking at male earnings potential.
    100,000 years ago it would have been ability to provide food, safety and kill cave bear!
    That these evolutionary adaptions work is proved by the fact that those that do not have them are destined not to mate and pass on their genes so the peacocks with the small tail dies out.

    Showing such displays of apparent wealth by the male even if false or pointless in life (like the male peacock's tail) is going to get you a "better quality" of female.
    Of course females do the same via makeup and false t*ts to attract males.

    Those who refuse to 'play the game' usually end up living permanently on their own.

    The main advantage of car ownership is the ability to go as and when you want in an instant and to visit places where without a car it would be next to impossible to access. Want to visit Avebury stone circle or the White Horse hill in Wiltshire without a car - no chance. Same for example the Museum of Army Flying in Middle Wallop Wilts. Equally the mountains and scenery of mid/north Wales - essentially inaccessible without a car.
    • AnotherJoe
    • By AnotherJoe 12th Sep 17, 8:54 AM
    • 7,219 Posts
    • 7,719 Thanks
    AnotherJoe
    ...and that is the nub of it.
    It is in effect a mating call/display.

    Just like the animal world we watch wildlife program showing all the various strategies in displays - "peacock-ing"
    So it is in humans, females are looking for nest and offspring providers and that means in today's world looking at male earnings potential.
    100,000 years ago it would have been ability to provide food, safety and kill cave bear!
    That these evolutionary adaptions work is proved by the fact that those that do not have them are destined not to mate and pass on their genes so the peacocks with the small tail dies out.

    Showing such displays of apparent wealth by the male even if false or pointless in life (like the male peacock's tail) is going to get you a "better quality" of female.
    Of course females do the same via makeup and false t*ts to attract males.

    Those who refuse to 'play the game' usually end up living permanently on their own.

    The main advantage of car ownership is the ability to go as and when you want in an instant and to visit places where without a car it would be next to impossible to access. Want to visit Avebury stone circle or the White Horse hill in Wiltshire without a car - no chance. Same for example the Museum of Army Flying in Middle Wallop Wilts. Equally the mountains and scenery of mid/north Wales - essentially inaccessible without a car.
    Originally posted by Uxb
    Two different things there. Mating and the other benefits of owning an car. On the second point, that can be covered without owning one*, it's just a matter of balancing the various costs and a lot of people are saying new technology will seriously change the balance towards non-ownership.

    * many people don't actually "own" their cars now.
    • kauto
    • By kauto 12th Sep 17, 10:11 AM
    • 24 Posts
    • 28 Thanks
    kauto
    This thread is amazing.
    Its' been so interesting reading this thread, props to the OP.

    For me, it boils down to Human nature as to why some people are more financially 'savvy' than others. Another big factor is fitting in with the 'norm'.

    I also think people want things instantly (without doing the saving bit) and society is fortunately/unfortunately (depending on your view) geared up to provide this.

    A big one is your own life goals too.

    "Be Fearful when's others are Greedy and Greedy only when others are Fearful"
    • jack_pott
    • By jack_pott 12th Sep 17, 10:41 AM
    • 4,006 Posts
    • 5,070 Thanks
    jack_pott
    Thats what they have been doing for 30 years. I think it was Sir Geoffrey Howe who really developed the wheeze of reducing income tax and replacing it with stealth taxes (20% VAT... Insurance Premium Tax... Tax on building sand we dredge from the sea bed etc etc) Succesive governments have carried it on.
    Its a sneaky way of increasing inequality whilst presenting it as something else. Every time they increase the income tax threshold by £1,000 they say its to reduce tax for the low paid. But of course the lowest paid weren't paying income tax anyway, but will be hammered by the stealth taxes the Government slips in to replace income tax. Even the guy sleeping in a cardboard box pays stealth taxes. Those earning a bit more will save £1,000 x the basic rate. But those who save the most are the highest paid saving £1,000 x ther highest rate. Yet the Government aided by the right wing press presents it as help for the low paid. Brilliant.
    Originally posted by Glen Clark
    Well that's interesting, because the last time I mentioned Frank on a forum I was told that it's communism.

    I think you need to read the book before you start arguing with it, because what Frank advocates has absolutely nothing to do with the Howe policies you describe. In fact he devotes a large part of the book to explaining what's wrong with them just as you have. Frank's policies will reduce inequality rather than increasing it, which is precisely his objective.
    • justme111
    • By justme111 12th Sep 17, 11:03 AM
    • 2,788 Posts
    • 2,669 Thanks
    justme111
    Despite earning big money, why are some people in big debt and have no savings.

    I think it's definitely a psychological thing. I had parents who were professionals & earned very good money, but never had any money, because while they are both intelligent people they are financially illiterate. Money was just wasted on needless things and quite often financial problems would crop up.

    The experience as a child changed my whole mindset and as an adult I've saved & invested with every pay rise. Just added up my latest total and im around £200,000 after 12 years....and it really was very easy! I don't earn big money (just above minimum wage) I did have a small inheritance and have done well with my investments.

    The key is not to chase the posh cars/clothes/phones. I absolutely love my life, I live it to the full but that money gives me so much security and happiness you wouldn't believe. I know that if I want I can walk out of work tomorrow I can, it gives you choices. And that security is worth far more than material things.

    As others have said it's important to live life and enjoy it, we only come this way once, but what I don't understand is why most people haven't "seen the light" (time is precious, we don't have much so why spend most of our life at work to buy things that make us feel better about going to work, which then results in us having to be at work almost forever) I work with people who hate work, are desperate to leave but have no prospect of ever being able to become they are driving the posh car, the designer clothes etc

    It seems so simple to me...but why have so few seen the light?
    Originally posted by longleggedhair
    Deep lifestyle priorities philosophical issue. What we live for and what brings one happiness and whether different ways of living bring higher or lower quality type happiness. Does happiness given by spending have an inherently lower quality than happiness brought by a walk out fund ...
    • armchaireconomist
    • By armchaireconomist 12th Sep 17, 11:12 AM
    • 165 Posts
    • 188 Thanks
    armchaireconomist
    How have you managed to save £200,000 in 12 years earning circa minimum wage?


    Let's presume you've earned (the current MW) £7.50 over that period consistently and work 40 hours per week, that's still a PRE tax income of £187,200.


    Something in this doesn't add up...
    • kauto
    • By kauto 12th Sep 17, 11:25 AM
    • 24 Posts
    • 28 Thanks
    kauto
    The experience as a child changed my whole mindset and as an adult I've saved & invested with every pay rise. Just added up my latest total and im around £200,000 after 12 years....and it really was very easy! I don't earn big money (just above minimum wage) I did have a small inheritance and have done well with my investments.
    Originally posted by longleggedhair
    Armchaireconomist
    "Be Fearful when's others are Greedy and Greedy only when others are Fearful"
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