Calling those with a "high" level of savings/investments! (£50,000+)

YoungBusinessman

Obviously this £50,000 figure is not that high yet it is in my own humble opinion!

Just curious as to all the different situations surrounding how you got there? How long it took you to get a decent amount saved/at what age?

Paid down a chunk of my debts today by taking £2,000 out of salary and £3,000 out of my emergency fund. Fund is at the lowest it has been in 12 months...but i have not touched it in 12 months. I am not going to add to this fund until i dip into it and it decreases.

So debts are decreasing, iv a property in sight we have a completion date of 07/12 (having problems with mortgage currently!), not really looking likely that we will be able to complete...New savings plan starting next month simply a cash builder for 6 months so i can review job situation and maybe take the plunge and go completely self employed/start up ltd company in partnership.

Please, no time wasters/haters. This is not a bragging thread nor do i intend it to turn into one. Just like reading and learning about the different situations and did not see a thread with this information already.:beer:

jimjames

Started age 26 but by then had already owned a property for 2 years. Not sure if anyone would realistically be able to buy a 3 bed mid terrace in SE England on low wage at age 24 these days though!

talexuser

Was lucky to have paid off my last mortgage in 7 years as salary increased some 25 years ago, so saved and invested since then and bought the last house for cash. Biggest outgoing when young is the mortgage so if you can minimise that as soon as possible that's what I would recommend. However if you must borrow a mortgage can be the cheapest method so difficult to be specific for all circumstances.

Agree with jimjames, the property bubble just got ridiculous in this country when we reached 5 or 6 times salary mortgages, self certified with lenders virtually goading people to lie about their incomes.

rockitup

OP, it takes a mix of patience, discipline (spending/saving), setting realistic goals and hopefully a portion of luck thrown in too.

Trouble is now with this economy and lower growth, returns on investments are likely to be low for maybe 5 to 7 years (IMO). Savings rates are carp too so no easy ways of getting to £50k or £100k without hard work through building up your business.
Better investment and savings returns should return but do not base your projections on what happened in the good times.

Have you already exchanged contracts on your anticipated house purchase yet? Exchange needed for completion date to be agreed.

I wouldn't be in a hurry to finish up with your current employer until you have completed your house purchase and settled in (furnishings and all that). If you start a new business or partnership lenders will need 2 or 3 years audited books before granting a mortgage.

chewmylegoff

YoungBusinessman wrote: »

Just curious as to all the different situations surrounding how you got there? How long it took you to get a decent amount saved/at what age?

25% of net salary into a combination of S&S ISA holding low risk funds and instant access bank account, and 100% of bonus into fixed term deposit. i only started doing this about 3 years ago when, at 30, i suddenly realised that i was just wasting all my money on !!!! and needed to sort the situation out. it helps that i have a non-contributory pension with 10% of salary paid in by employer so i don't have to worry too much about that.

silver_inca

Agree chewmylegoff, I bought my first property at 27 - 10 years ago , i had a £40k deposit which i had solely saved up.

I steadied the ship for 5 years from then to get on my feet, and in the last 5 years i have bought 4 properties for BTL. It's a chance I had to take as i have no pension - but with the rates so low i am now getting 25% yearly return on my investments.

So now, the next step, as i've got older, and not to keep my eggs in one basket - i realised that S&S ISA are the next diversification step for me. Started this year and am maxing out my ISA fully on a passive portfolio of funds. The money from this comes from my rentals, without me dipping into my own income. I can list them if you like.

My problem is i now 70% in cash, i am holding in anticipation of a stock market dip so i can but a few companies for the divis. Leaving my money in an account earning less then 3% is driving me crazy!

Any advice is welcomed.

grizzly1911

Consistently spending less than you get, consistently saving every month (even small amounts) and not just through pension, not blowing bonuses completely. Not chasing new technology to quickly.

Think about the future it comes more quickly than you think. Just because you expect big salary in the future only usually means your commitments have grown too.

Don't rely on mortgaging and remortgaging to bail you out of overspending.

Dipping into S&S ISAs, beware, costs can hamper performance and keep monitoring performance. They are medium long term but don't stick with a dud.

I must admit to thinking about some more straight utility investment, to pick up the dividends, rather than the pittance on some of savings. Many seem to be struggling price was due to regulatory dithering though. Is it worth the short term capital risk.

YoungBusinessman

Well I can't thank you guys enough for your replies. Thread has fair taken off already. Just want to know all thoughts/ opinions and gather all advice I can as I start my new savings plan next month. Not needing anyone reminding me I have debts, it costs more to pay them off early so I'm letting them run.

January 2013 is very welcome to me sooner rather than later, I have a Payrise. Also taking on more work. Should see my income above £70k gross for 2013, I intend to have at least 50% of it by the end of the year.

I have many long term plans, I feel if I were to share them I would infact be shot down for being young, foolish and naive. I will however keep this thread going, update as I go along and seek advice where necessary.

In a few years I hope to be in a position of advisor as opposed to one seeking advice, I have a lot to learn and a lot of reading and listening to do. But a lot of work. So bring it on.

Michael_Nottingham

YoungBusinessMan

I suggest this MotleyFool article as a good read - its a great illustration of the impact of living well within your means and the cumulative impact that this can have. Especially if you are happy to do it early in life.

So how did I get into an ok position -

No Sky etc, Shop around for everything, Cashback Credit Cards / Cashback Websites / Discount codes, be your own financial advisor (using a finance package to track your savings / spend - e.g. Quicken, MS Money and others), using eBay / buying second hand, no takeaways, no expensive coffee habit, always thinking do I need x or y or can I leave it for a year, delaying buying a nice car until in my 30s

Then make sure that as you save you get the best return and then gradually up the risk profile (always doing your own research)

jimjames

Allison_Haskins wrote: »

No kiddies = plenty of £. Simples.

Or make sure you try saving all of one salary beforehand so you are used to living on one salary and you have savings built up ready for later when you are less able to save.

Zekko

Allison_Haskins wrote: »

No kiddies = plenty of £. Simples.

... and if you don't get married, you won't lose half your wealth in the divorce courts! :money: