Younger People (18-25) - Attitudes to money

Cleaver

mustrum_ridcully wrote: »

One thing I've noticed a couple of times in this thread is people saying they managed to get a house at 21/25/29... but no mention of deposit size.

Only 2 years ago an 21 year old could probably get a 100% mortgage. There were even mortgages that were 4-6x salary or 125% mortgages.

We were FTBers in 2004 when I was 23 and bought a house with a 27% deposit. The total cost of the mortgage was 2.7x our joint income and the monthly repayment was 18% of our gross monthly pay. We knew full well that the house would probably be worth less than we were paying for it in a few years (hey presto, we were right!) but the sums worked out above meant we were happy to go for it.

Five years later and we now have about 60% of equity of the original cost of the house (so I'm guessing around 50% to 55% of equity of what the house is worth now, but it doesn't really matter as we're not selling it) due to overpaying. Strangely our mortgage payments are now less than they have ever been, despite a period of resignment thinking that they would soar when we came off our fixed rate. We're earning a bit more money now so the monthly mortgage bill is around 10% of our gross pay.

There will be lots of people who had bigger deposits, bought a cheaper house and have made bigger overpayments. Lots of others will be similar to us. Lots of other will have taken 90% to 100% mortgages, may have not made overpayments and could be in trouble. But best not to generalise, as all people will be different (although many people on this board will still put my wife and I in the 'stupid' catagory as we bought close to the peak. Or should have sold it last year to rent).

SingleSue

neas wrote: »

indeed do people not tip in london? in plymouth I went to pizze express used tesco deals but tiped 10%.

Thought you always tipped? :P

I very very rarely tip.......especially not in places like Pizza Hut/Express, Mac D's etc.

Nice restaurants I might depending on service.

Edit - You can indeed get 2 meals for a tenner at Mac D's, I got 3 last night (2 adults, one child) for £12 and one was a more expensive Christmas menu meal.

jamtart6

mustrum_ridcully wrote: »

One thing I've noticed a couple of times in this thread is people saying they managed to get a house at 21/25/29... but no mention of deposit size.

Only 2 years ago an 21 year old could probably get a 100% mortgage. There were even mortgages that were 4-6x salary or 125% mortgages.

Saying you have a house means nothing, you could be thrifty or spendthrift - no way of knowing. Saying you bought a house with a 10%, 25%... 75% deposit really does mean something.

Another good indicator for thriftyness is whether you have more than 6 months mortgage/rent saved away (as Martin recommends) - I appreciate that some people are very thrifty but because they live on a very small income can't manage to squirrel away that much money.

We have a 32% deposit and have been living at home whilst putting away the amount we thought our mortgage would be (£700) each month to save this amount. We're 25. Our mortgage is 1.5 times our joint salary (as we are both starting new jobs in January). We could have got a much bigger mortgage but didn't want one as the house we are buying is perfect for us and we're very happy

neas

wife taught me to tip most times... its rude.

Like if you get a taxi... Waiters and Waitresses get paid low wage.... so tipping them if they been nice is a courtesy... obviously not for everyone.

I find i must agree now, if i was working as a waiter i'd be a bit miffed if i received no tip at all... think whoever it was was a tight wad and one prob gob in their drink next time they came in lol.

ed89

I'd like to think I am a fairly healthy position at the moment. I'm 19 just now - worked since I left school at 16 but on a considerably lesser salary than I am on now. I earn just about 20k per year. I've about £4k saved in the bank and put about £220 into savings and £50 into a pension each month.

It can be a bit of a struggle as our flat is quite expensive to rent (for us) and my girlfriend doesn't earn much. However, it's only 30 seconds walk from my office and in my hometown so it couldn't be better. Neither of us a have a car nor drive. If either of us did I am sure I would not be able to save as much.

I'd like to save at least £100 more per month but that would possibly mean looking for a cheaper (and likely smaller) flat. I like having a spare second bedroom to put the computer in, though I am thinking of renting it out to be able to save some more.

cupid_s

mustrum_ridcully wrote: »

One thing I've noticed a couple of times in this thread is people saying they managed to get a house at 21/25/29... but no mention of deposit size.

Only 2 years ago an 21 year old could probably get a 100% mortgage. There were even mortgages that were 4-6x salary or 125% mortgages.

Saying you have a house means nothing, you could be thrifty or spendthrift - no way of knowing. Saying you bought a house with a 10%, 25%... 75% deposit really does mean something.

Another good indicator for thriftyness is whether you have more than 6 months mortgage/rent saved away (as Martin recommends) - I appreciate that some people are very thrifty but because they live on a very small income can't manage to squirrel away that much money.

This is a good point. We were just 22 when we bought our house with 30% deposit but the mortgage was still officially 5 times my husbands salary (and I was at Uni still). I'm amazed they gave us a mortgage, though obviously happy about it.

At the moment our savings would cover over 90 months of mortgage payments because our rate is so low!

SingleSue

neas wrote: »

wife taught me to tip most times... its rude.

Like if you get a taxi... Waiters and Waitresses get paid low wage.... so tipping them if they been nice is a courtesy... obviously not for everyone.

I find i must agree now, if i was working as a waiter i'd be a bit miffed if i received no tip at all... think whoever it was was a tight wad and one prob gob in their drink next time they came in lol.

I did say I do if in a restaurant and the service had been decent that I would....just not for every single place.

I only sometimes tip a taxi driver and then that is only usually the change from a note...and my brother is a taxi driver!

Yep I am a tight wad and I admit it!:rotfl:

cupid_s

Waiters and waitresses used to get low pay but with minimum wage they are earning more than I was in most of my previous part time jobs so the need for tipping is slightly redundant now.

I do always try to leave about 10% though, unless there has been something wrong with the service. I often use my tesco clubcard vouchers or buy one get on free vouchers at restaurants and I'm so amazed at how cheap it works out I sometimes end up leaving about 20-25% tip. Also I often tell bar staff to keep the change (as long as it's not too much!) but both DH and I worked in pub and clubs for years and I still remember how nice it is when people buy you a drink or tell you to keep the change.

Castleman

Wow, these people with more than 20% deposits, buying before they were 26! And still being decent x salary!

Either, you have a very high salary, or you're buyng somewhere cheap in the country?

Quite a difference between buying a 2bed flat in most of london aged 25 say, and buying a 2bed flat in doncaster!

greyster

yeah I'm 26 in London and still saving for my first house and I have a good salary.