Millionaire Challenge

nat21luv

That's perfect LL, thank you. I was seriously thinking of BTL whilst renting but my friend got a little carried away and suggested I was being selfish for putting income before my children. All these books I've read warned me of people like her

When I'm saving I need a goal to work to, I find it quite hard to focus otherwise so this is putting me on the right track

lessonlearned

nat21luv wrote: »

That's perfect LL, thank you. I was seriously thinking of BTL whilst renting but my friend got a little carried away and suggested I was being selfish for putting income before my children. All these books I've read warned me of people like her

When I'm saving I need a goal to work to, I find it quite hard to focus otherwise so this is putting me on the right track

I think you just need to think it through. Presumably, if not now, then in the future, you will need to think about schools for your children.

Good schools will push up house prices in their catchment area. It may well be that you need to rent to live in the right school catchment area, if the prices are too high for you to buy. Loads of people do this, purely to get their children in to a good school.

It's all about weighing things up and working out which suits you best. Don't forget things change over the years, what is best for now might need to change in the future anyway.

tinktay84

Hello,

Hi Nat, LL is right, I am now living in a much nicer area with great schools due to renting our house out and renting a house to live in.
At first we saw it as the profit from the house we own & rent out would pay towards the rent of a house in a nicer area. Now, despite several major blips the money we make is building in an account towards another BTL.
Like you I have young children (2 of) and they are in good schools/nursery & are well rounded, intelligent children. We are cruel as we dont allow them to have a tv in their room, put them both to bed at 7 & insist on sitting at the table for tea as often as possible. haha so cruel I know.
I had lots of comments about uprooting the kids, not putting them first, not spending enough time with them but people now see why we do what we do.
At the moment both myself and my husband are working stupidly long hours to try and catch up after our latest blip, He leaves the hosue at 630am, I leave with both kids at 730, drop them to 2 different places, then have to return home to swap to my work van & head to work. I have had family members on a rota to collect the kids which im very lucky with as in the past I never asked for help so now that I have they have all agreed sstraight away.
The way I see it, im building money with a view of getting a total of 4 BTLs which hopefully will then bring in an income to build enough deposit for a house for us as a family.
Im running out of time though as my son is nearly 8 and cant share a bedroom with his sister much longer. Our landlord has said we can convert the attic if we want but its a bit of a sticking point, our landlord is brilliant and we couldnt ask for a better one to be honest but do we really want to pay to convert their house? Im getting to aa point where I am prepared to as I dont want to move & I cant see us buying for at least 5 years.
Anyone that says yourr selfish is blind. Is it selfish to build up a future for your children & instil a work ethic at the same time?

nat21luv

Your poor poor children, they sound just like my poor sprogs! Such a hard life being made to have 12hrs sleep every night!!

Lucky for me my boy is 9 and my DD is 3, I'm renting in a great area with separate boys and girls grammar school on my doorstep. I could live elsewhere in my town but quite frankly I love that my children have nice children to play with here. The house I rent is 3 bed with a massive master bedroom that I use for 4 foreign students so this is a nice income stream. My boy likes sharing a room with his sister but I know I can't really leave it that much longer, a year or two tops.

I'm trying for the police this year and if that doesn't work out then I will go down the btl route. Be silly not too while I have so much time on my hands and the kids are at school....oh and single no hassle

megan01

Hey everyone, thought I would drop by again! I'm coming to the end of my Law degree. As much as I would love to make my millions by being a solicitor, I cannot hack it. I would have a meltdown after 5 minutes, it is so unbelievably stressful doing Law.

The past couple of years I have been saving what I can from my loans and grants, being incredibly frugal and I have got 5k. Nearby, there are some new builds going around, where you only need 5% of the value of the property as a deposit (5k) and I was considering doing this, and renting it out, once I have a job in a couple of months ? It would be an easy first house to rent out, nothing needing doing to it.. and rent coming in paying off the mortgage on it. What do you all think?

funkybob989

As fascinating as this idea and all the plans in the thread are, is anyone else concerned that with inflation etc, a million really isn't a big enough goal for the type of financial freedom and lives most of us in here are talking about?

I should mention I am early 20s so I'm thinking quite long term about cost of living and inflation when I ask this. And obviously, its not a reason to not go ahead with plans. I'm just worried maybe we aren't thinking big enough.

MKeynesMoneySaver

Don't forget that on top of the deposit you also need money for solicitors, etc. I can't remember how much I paid on top for buying my house but it was a significant sum although some of that was stamp duty.

BTL mortgages often have sizeable mortgage arrangement fees as it seems to be the trend with most deals I've seen recently.

Also it would be advisable to have some money aside for void periods if you didn't have an agreement with the letting agents in place.

I'm sure some others here would be able to advise you more thoroughly.

GreatBigBookcase

Kitty, 40's a great age. (But then, I say that about whatever age I am!) I've been emailing a woman whose company sources below market value properties from motivated sellers in/around Rotherham. I've never really spent any time in Rotherham so I'll be exploring when I'm back to see if I'd be happy investing in property there, but the deals she talks about certainly seem to stack up financially, e.g. buy two-bed terrace c.35-40k, 8k to do up to good rentable standard, buyer pays both sets of legal fees and a finders fee to her (her fee is 2,950 I think), rental income around 400p/m. And because of buying below market value, there's already built-in equity as after renovation, etc. she reckons the property would be valued at around 70k. And no, I don't mind you asking at all! Happy to share what I've learnt recently, good property karma. I can PM you her details if you like or forward you the last deal she sent me so you can have a good look at it?

LL, I looked at the tax cafe website, those guides look great so thanks for that tip.

Nat, ignore your friend!!!

Tink, I hope I'm as cruel a mum as you are to BabyKay when s/he arrives.

Megan well done you for coming out of Uni with some savings. MKMoneySaver makes sone good points re extra money needed for fees, void periods, etc. Once you're in a job your salary might cover those things would they? Otherwise, it might be worth waiting a while longer just to build up a rainy day fund to make sure you can cover all eventualities? Good luck!

funkybob, very good point! Actually the 'million' to me is kind of irrelevant. I can honestly say I have absolutely no idea what I might need to live on in the future, or how much I need to save/invest now to make sure I achieve it. After nearly 20 years of working since university and focussing on seeing the world and essentially having a good time living (just) within my means, it's only recently that I've thought seriously about money in terms of savings, investments, making what money I have work for me, etc. If I wasn't pregnant, I might not have got to that point yet even! But it's good that you ask such questions at a younger age than I am...what sort of figure do you think you might need to achieve financial freedom? Whatever it is, you'll have a great chance of achieving it if you're starting in your early 20s.

Really enjoying this thread and reading other people's ideas. Hope everyone has a good weekend.

Chai_2

Funkybob, You raise an interesting point but one that I see many getting confused by.

A million is a great target due to the type of skill and knowledge you would acquire to get there but really we should be looking at what financial freedom looks like to us and what we would need to afford that lifestyle.

Here's an example... I live in a 1 bed flat for £200 pm all inclusive in the canary islands sun for about 11 months of the year. 5 min drive from the beach, full internet,cable, 2 swimming pools on the complex, fresh food market and 4 hrs away from London. Im living really well here and this is the budget end.

A huge place with a private swimming pool is around £900 including bills!!!!! So you can really live it up without becoming a millionaire. Although I love visiting London I dont need to live there, im planning on buying and living part time in the outskirts of London when i get back where a house there for 130k would be 250k just because of the postcode and the train takes me to London in 20 mins!

Its a matter of choices and thinking outside the box and redefining what a prosperous life is to you.

lessonlearned

Chai wrote: »

Its a matter of choices and thinking outside the box and redefining what a prosperous life is to you.

This is exactly it - so well put.

I actually live quite frugally and yet live very well. I deny myself nothing, I eat well. I don't worry about putting the heating on. I have nice clothes, my home is well furnished and comfortable.

I can spend or not spend it really doesn't bother me either way. When I do spend I buy wisely and well. I don't buy rubbish but will try to buy quality at a fair price. I enjoy a haggle and am fond of a bargain.

You don't have to be "stinking rich" to enjoy a good standard of living. Apparently China's richest man (I think he may be the world's richest person) who is a multi-billionaire lives on 20 dollars a day.

For most of us that £1m is just a number. I think for many of us the real goal is financial freedom. I actually already have it.

I am working to improve my finances so that I can ensure I maintain that financial freedom in the future and so that I can help my kids achieve the same happy state.

Like most young people these days - despite being in full employment - they are finding it tough. I want to give them a bit of a leg up.

My youngest son used to be such a spendthrift but now he is a completely reformed character. I am pleased to say he has finally seen the light and is keen to both make and save money and invest in his future.

I used to try and teach him the value of money - more particularly how having money behind you gave you freedom and choice.

In the end - exasperated with him - in order to get my message across to him I coined the phrase "You need a 'f**k you' fund.

He had never heard me swear (I don't normally) and he was very much amused by this. Oddly enough my unconventional approach worked, the message finally sank in.

We were chatting about something just today and he said "Mum, I now totally get what you mean about having that 'f**k you' fund.":rotfl::rotfl:

Financial freedom is the goal, the actual amount is largely irrelevant. For me the £1m is just a number. I can live perfectly well on a lot less, I can be equally just as happy with £1m.

£10m would be even better. :rotfl::rotfl: