Our savings and investments journey

Wobblydeb

sunil1234 wrote: »

i would say an asset has to be working for you, in accounting terms thus its NOT an aseet if you live in it and hence dont earn a return from it.;)

Of course it is an asset in "accounting terms". Do you think that businesses don't include their premises (if they own them) in their accounts?

This is not accounting though, so it's up to you whether you include it or not OP

I am going to follow with interest, as you are very close to my own situation .... decent income coming in, and living well within your means I can really relate to what you are trying to do, and understand how difficult the shift is from comfortably off, to properly wealthy...

I have done the regular saver thing for a few years now - probably started at about your age. Then last year I started a S&S ISA - and am up about 7% at present, despite taking some horrible losses. I have managed to feel okay with the ups and downs on the stock market by putting in my spare monthly cash, NOT the initial savings. It also means you avoid the risk of mis-timing the market by not sticking £100k in all at once

I would also encourage you to think about pensions - and agree with N1AK that you don't want your £1m target to stop you thinking long term. It will actually be easier to reach £1m if you include the pension because of the extra cash your employer and the government (in tax allowances) are putting in

bendix

malik999 wrote: »

The answer is concentrate on ideas for increasing your income (current £4648). Becoming a millionnaire really isn't that difficult in todays world.

Brilliant suggestion. Why didn't anyone else think of that before?

I've got some more. If you want to win the Olympic Gold Medal for 100m, concentrate on running faster.

Oh, if you want to be a cover girl for Vogue, try to focus on being less ugly in future.

Glad to help.

terakris

bendix wrote: »

Oh, if you want to be a cover girl for Vogue, try to focus on being less ugly in future.

I lol'd.... sorry :rotfl:

VT82

I'm going to disagree and say this isn't a good ambition. Why concentrate on how much money you'll have when you are 40, rather than how happy you'll be at 40, or how happy you'll be over a lifetime?

Your narrow goal might make you less happy. Even though you don't explicitly say it, you give the impression that you would consider not having kids because it might impede your millionaire goal.

Excluding your pension means you might be less wealthy over your lifetime, as you will turn down free money, just because you won't have it at age 40. That's just pointless.

If you are not including your house as an asset, you risk not moving to a better house as it will swallow up your cash, even though it might make you happier, and be a better home for your kids. Ignoring the argument over whether or not you should include it in your personal wealth (I include the equity in mine in my net wealth), it's something worth spending money on.

I think you should try and maximise your interest, not because it will make a big difference to your wealth (it will have almost no impact on how much money you have 'at the end', compared to how much you earn), but just to get satisfaction from doing that. But don't aim for getting satisfaction by seeing a big number on a spreadsheet. That's not happiness.

sunil1234

Wobblydeb wrote: »

Of course it is an asset in "accounting terms". Do you think that businesses don't include their premises (if they own them) in their accounts?

This is not accounting though, so it's up to you whether you include it or not OP

Thanks buddy

But a business buys premises to run an operation, generate an income, make a profit or maybe not if its a charity.

An individual has a house because they need shelter and security

Any thoughts?.....;)

bendix

sunil1234 wrote: »

Thanks buddy

But a business buys premises to run an operation, generate an income, make a profit or maybe not if its a charity.

An individual has a house because they need shelter and security

Any thoughts?.....;)

And if they didn't have that asset, they would be spending their wealth renting that shelter and security.

Here's a tip: Putting a winking emoticon at the end of a nonsensical post doesn't make said post any more logical.

malik999

bendix wrote: »

Brilliant suggestion. Why didn't anyone else think of that before?

I've got some more. If you want to win the Olympic Gold Medal for 100m, concentrate on running faster.

Oh, if you want to be a cover girl for Vogue, try to focus on being less ugly in future.

Glad to help.

Its actually not really as daft as it sounds. I see nothing in any of her work/posts that she is doing this. From her subject line of becoming a Millionnaire i was expecting to read about home online business she has setup and other revenue streams she is looking at such as investments, other work, rental income, etc etc
She is not going to make £1m by calculating she spends £17 on car parts and £20 at the hairdressers.
My 'serious' advice/experience is to get her to concentrate on increasing that £4646.
I find the advice on this forum is always about cutting back, buy cheap food, don't buy newspapers etc few people ever talk about increasing income to aid investments.

sunil1234

bendix wrote: »

And if they didn't have that asset, they would be spending their wealth renting that shelter and security.

Here's a tip: Putting a winking emoticon at the end of a nonsensical post doesn't make said post any more logical.

lol i knew this could go on and on and on.....

are you offended with me putting a winky, why?

at the end of the day, its a subjective science. Call your house an asset, i do not....

you dont have to rent if you dont own, you can squat, live in a cardboard box whatever. Its not about opportunity cost in my opinion, and lets remember, this is all about opinion.

TTFN (am i allowed to smile?):)

mintedmatty

Asset Definition - Any item of economic value owned by an individual or corporation, especially that which could be converted to cash.

I can see where the OP is coming from regarding that he is only considering assets that provide income, but a property should be definitly classed as an asset

MGCP

No reason at all why "assets" should be restricted to those that make you income. A car loses money when you drive it out of a showroom but try telling an insolvency practitioner that it isn't one of your assets when they come knocking!

I could own gold when the bubble bursts and suddenly find it has lost half its cash value, but it never stopped being an asset.

If I own a house worth half a million, sell it and buy a house worth quarter of a million, I've just converted half that asset into cash.