My quest to have £100k Net Worth by 26

hugheskevi

Ok, so those 2 surveys seem to say different things, one says £204000 and the other says virtually nothing.

Same survey, different stats

Total wealth is decomposed into the following in the survey:

• Financial wealth (exc mortgage)
• Pension wealth (exc State Pension)
• Property wealth (house value less mortgage)
• Physical wealth (cars, etc)

First stat is about total wealth. Second stat is about financial wealth. That is consistent with most people's wealth being tied up in their house (for those who own a house), richer people having a decent amount in pensions too, and financial wealth being quite limited, particularly amongst the poorest.

It depends what you include...He says not to include pensions in it.

Pensions are very important for total wealth, but irrelevant for short and medium term unless aged above 50. So it just depends on purpose - they only feature in my spreadsheets in long-term planning (and short-term cashflows, when I plan end of year lump sum contributions). They are noticeably absent in all my medium term scenario planning, a key drawback of pensions.

Personally, I would always have pension in total wealth, as for higher earners it can often be the largest part of wealth.

I just think il use savings + house value minus mortgage + any outstanding debts = net worth.

Fine, just be aware you are excluding pension and physical wealth. I did the same when I started planning, but rapidly finances get much more complicated such that pensions have to be a part of integrated planning if optimising tax avoidance. Soon after, they have to be a part of monitoring

I also exclude physical wealth, even high value items. The reason being that I would not sell the higher value item (jewellery, etc) so it doesn't make any difference to me whether it is worth 5p or £50,000. I find it also encourages saving - as otherwise major expense has no impact on net worth - I prefer to see big sharp declines when I spend lots of money, as that incentivises me not to do it. Plus it is simpler, and finally it errs on the side of caution which I like doing when measuring things such as net worth.

heathcote123

geneer wrote: »

If you don't mind me saying so, you don't appear all that unwilling make "brave" statements onanonymous forums yourself.

Well hello stranger! I was beginning to think you'd been banned again? What you been up to?

rictus123

Paid another chunk off the debt, moving in the right direction, net worth increasing daily. Car due its mot this weekend then will be getting rid and getting a cheaper to run van. Car returns 25mpg at the very most, not very cheap!! Apart from paying mot should be a no spend weekend. Busy tomorrow through the day, roll on Sunday though will get to relax and read the paper with a nice cup of tea and brekkie...one of lifes little pleasures. Next unplanned/needed expense will be paying to get a massage....really fancy one, will wait and hold out aslong as i can...or try to get gf to do it for cheaper Haha such a romantic.

On the earnings front we are earning out pay for the middle of March now so could say we are about a month ahead. Doing very well but looking forward to nicer weather and it gets alot easier and busier.

Anyone got advice on good places to go for buisness cards and leaflets/flyers? Looking to do a leaflet drop...hopefully get even more work on the go and bring forward that debt free date!!

atush

Cheapest way would be to produce them on your home computer and print them out.

In any case, you are getting rid of car and buying a van. Wont this put you further into debt?

rictus123

No, car is worth about £2500 and is £1500 to insure. Maximum 25mpg.

Could easy get a van that is £1500 and £1000 to insure, saving £1500 plus most likely halving the cost of fuel as wont drive a van for enjoyment,will just use it when i really need it so just for work.

So will actually be better for me to get rid of car than to keep it.

rockitup

rictus123 wrote: »

Next unplanned/needed expense will be paying to get a massage....really fancy one, will wait and hold out aslong as i can...or try to get gf to do it for cheaper Haha such a romantic.


Anyone got advice on good places to go for buisness cards and leaflets/flyers? Looking to do a leaflet drop...hopefully get even more work on the go and bring forward that debt free date!!

Rictus,

For business cards, try VistaPrint.co.uk, they often have deals where you get 250 for free just pay postage. They do fliers too but you may get those cheaper at a local printers, just ask around.

Better be nice to your girlfriend and ask her to do a massage for you, buy her a nice gift maybe. Out here I only pay £4 for 2 hours Swedish or Thai Massage (no rude comments please, those ones cost more:D) I suppose a massage in UK must cost best part of £40 now?

Keep up the good work paying down your debt...

rictus123

I will be phoning around local printers today, my dad has said he will give it a go and do it for me so will let him give me a sample first and see if its decent enough. Most people will just throw it in the bin anyway, its only a minority will read and only a minority of that minority that will actually be interested/keep it. The 250 business cards for postage cost sounds appealing.

Yeh i will ask her as we have the stuff for it Where about is it you are right now? That is really cheap id be getting one every 2 days. Its £60 where i am - Scotland. It works out at £1 a minute.

The money is not coming off until Monday now. Was thinking there is a property up for sale where i want to buy, its been on for 5 months so far, price being dropped twice. I was thinking when im debt free in summer i might rent for a year then buy somewhere just to make sure i like it....would alot of sellers be keen for this? Would we agree a price before or after the year as a tennant? Would allow me best of both worlds, move out into own place sooner and gives me time to save the deposit. Would only need a £5,500 deposit but would go for £11,000. Payments would be around £600 mark which is affordable for me alone. How would i go about this set up though? Or would i just have to rent what i can get an save until i can afford to buy somewhere different?

Just a thought so not needing the negitive posters going on about me changing my mind.

lvm

I'd be surprised if you found a property you wanted with a seller willing to rent it for a year then buy 12 months down the line. You're pretty much looking for a "Rent to Buy" agreement - huge in American apparently. You'd need a legal contract entitling you to purchase the property after 12 months at a pre-agreed price (usually based on market value at time of purchase, decided by 2 or 3 surveyors). Usually this sort of agreement is done on 3 or 5 yr rental with option to buy after that. My Dad has done a couple of these - don't know the exact details but he takes around 25% extra rental than market value but then pays some sort of deposit for the buyer. Don't know how this bit works.

You'd be better looking at the rental property available just now and see if one of those landlords would be willing to enter in to this type of agreement rather than other way around. Most sellers will need to buy their next house and not wanting to go into the property letting business.

And just my own opinion - you'd be crazy to pay £600 plus bills when your aim is to pay off debt and save a deposit. I know it's difficult living at home but you'll get you're own place quicker if you just cope with it a little longer and use the money for a deposit.

CKhalvashi

rictus123 wrote: »

Yep quite ambitious but planning is half the battle. Never realised it could hit so high,thought it was always around the 4-6% area. I havnt really done much research into that sort of area before and im not clued up what so ever, will look into it more now. Might change my view on saving.

Getting mortgage free asap while keeping liquid low would still do wonders for my net worth. The saving in ISAs etc is some way off just now though, need rid of business loans then save a little emergency pot in my current account that will be my £0 which will then let me save up for the cost of buying and furnishing my first house. Will look to pay off mortgage asap then i will be looking to savings.

Sort of almost seems pointless holding savings and better off investing in assets that could provide income - the most popular one i see on here being buy to let.

Well i dont want to sound cheeky or thinking im better than you but i doubt you planned to have that status by that age. So i believe that is one of the main differences. Who knows what will happen though, i will just try and make the most of every situation i find myself in. Thanks very much for your post, that is the exact guideance i am looking for.

BTL is only a good idea if you’re sure you know what you’re doing.

We’re upto 2 properties and about to go into 3 (and possibly 4), so we can keep a spare £20 cash, however it’s important to remember that we’re doing these MF, meaning that we don’t have £xxx on each going out each month.

Bear this in mind when planning, as this is where it can go SERIOUSLY wrong!

Best of luck

atush

rictus123 wrote: »

No, car is worth about £2500 and is £1500 to insure. Maximum 25mpg.

Could easy get a van that is £1500 and £1000 to insure, saving £1500 plus most likely halving the cost of fuel as wont drive a van for enjoyment,will just use it when i really need it so just for work.

So will actually be better for me to get rid of car than to keep it.

If you can actually sell your car then yes, this sounds a good idea. Esp if you are all about income you really need a van over a car.

Let us knowhow it goes, and congrats on paying off more of your debt this month.