Why don't people look forward ?

giantmutantbroccoli

So it seems there's two types of people in the world - either you're a whiny self-made mess with no foresight and poor judgement, OR you're a lucky, spoilt, judgemental busybody with no idea of the problems others face? Lol this thread.

I can't imagine having £10k sitting in my bank account doing nothing. What a waste that would be, when with a bit of work that £10k could be growing into £15 or even £20k! Should I now have a rant about how people are foolishly not making the most of their money by allowing it to sit in their bank accounts at a low interest rate when they could be using it to earn even more money? That extra money you earn could then be used to earn even more money! In 12 months time that £10,000 could become £20,000 which would make a much more comfortable safety-net.
Or we could just accept that different people live different lives and that what makes one person feel safe and happy would make another feel stifled, and vice-versa that what makes one person feel happy would make another feel stressed. Not everything works for everybody, and there's more reasons than lack of funds to not have a £10k bank balance.

I think I'll stick to my long-term plan of becoming so rich I can build my own house out of gold bullion... which I will keep until the freehold is worth more than the solid gold bricks, and sell to gullible Arabian investors who think Lancashire is a district of London.
Try doing THAT with Bitcoins!

Bowling_4_Gold

I've never really understood people living payday to payday.

I have a fair bit in reserve currently, which I'm seeking to invest and grow. I'm young and don't really have many regular outgoings each month- which I suppose is not the case for many people.

p00hsticks

Jaylee, thanks for the reply – it’s interesting to hear another point of view, even if I don’t necessarily agree with it. I’ll try to respond to most of your points, starting with your final paragraph.

jaylee3 wrote: »

Sorry OP, but I think I find your post very naive.

In my view, the naive ones are those who think they are never going to be dismissed or made redundant, fall ill, have an accident, have their employer fail to pay them or have their bank account frozen for some reason, and fail to put any contingency plans in place for that happening. Note that I’m not talking about pensions, although some posters have extended the discussion to pension provision – I’m talking about the very basic ability being able to pay the rent/mortgage, buy food and heat and light your home for the next few months if you lost your job tomorrow. Some people seem to think that the government will immediately step in with benefits to meet all their bills if and when it happens – they won’t, and I think people should be prepared.

jaylee3 wrote: »

You are either very lucky, very wealthy, or very spoilt. Or possibly all three

Yes, I consider myself very lucky – I’ve a loving family, had a good (state) education (to university level), and been fully employed for most of my life so far, with just a couple of periods of unemployment (one of six months and one of eleven months), although I’m currently at risk of redundancy.
No, I’m not very wealthy; I’m a basic rate tax payer earning slightly above the average wage. However, I live well within my means (I don’t own a car, and didn’t have a holiday as an adult until my late 30’s), and by doing so I’ve managed to both buy a house (only because it is a basic two up two down mid-terrace in one of the cheapest parts of the country) and save in a ISA since they came in, so I do accept that I now have considerably more assets/savings than many.
My parents tried to give me the best they could, but were not particularly well off and I certainly wouldn’t say I was spoilt. They’ve not been in a position to be able to help out financially once I’d finished my education with things like house deposits, wedding costs etc, nor would I have expected them to. They did bring me up with the ethic to work hard, live within my means and save up for anything I wanted, which I’m very grateful for.

jaylee3 wrote: »

And I am guessing you are of the older generation (ie; born before 1960.)

Not quite, I was born in the sixties and am middle aged (recently turned 50).

jaylee3 wrote: »

If you own your own property/have a mortgage, there are always going to be repairs and maintenance to worry about, or a new kitchen or bathroom or windows or boiler. Nobody is going to have the multiple 1000s that these things are going to cost, so people take loans and finance, and this eats into any 'surplus' they may have.

I agree that if things like washing machines, cookers, boilers, cars etc break down there is a need to get them repaired or replaced ASAP – the same if the roof starts leaking or the guttering fails. But I’d suggest that things like this support my argument for the need for people to have a ‘rainy day fund’ put aside to cover such expenses.
And I’d also say that it’s just as important to have money put aside to pay the rent / mortgage, council tax and utility bills for a few months in case you lose your job – what’s the point in maintaining a property just to be evicted or repossessed ?
Big items like a new roof or new windows may cost ‘multiple 1000s’ but these are likely to be needed only once every ten-twenty years if at all. New kitchens and bathrooms also aren’t essentials, but luxuries to be saved up for.

jaylee3 wrote: »

Add to that, paying for every other 'life' thing: children, student loans, a wedding, a new car, your kids weddings, a few holidays, and general living, and you've not got much left.

This is where you and I are going to have to agree to seriously disagree. I don’t believe that any of these things listed are more important than keeping a roof over your head if you fall on hard times, and therefore they shouldn’t take precedence over setting up an emergency fund (or insuring against them happening) nor are they things you should get in debt for.
They are the sort of things where you ‘cut your cloth to suit your means’ – some people can only afford a small registry office wedding or a weeks holiday in a caravan in Skegness, others an exotic beach wedding and a Caribbean cruise. There’s nothing wrong with either as long as you’re not getting into debt or not missing out on higher priorities item to pay for – if you can’t pay for them then go without.
What’s more important for your children - keeping them fed and with a roof over their heads if mummy loses her job or daddy gets cancer, or making sure they have ipods, a trip to Disneyland and a nice wedding ?

jaylee3 wrote: »

The days are gone of good wages and low house prices and free uni fees and suchlike. Times are tough, everything is expensive, from house prices to car prices, from food to petrol, and most people have some kind of debt or finance

However little you have coming in when you are working, it’s almost certainly going to be less if you find yourself without a job. And you are still going to have most of the same expenditure, to buy food, heating lighting and put a roof over your head. In my view, it therefore makes sense to budget to put a little away when you are working in preparation for times when you cannot

jaylee3 wrote: »

And yes, a massive amount of people DON'T have lots of surplus cash. Some it is because they have squandered it on holidays and stuff, but mostly it's people who genuinely struggle month to month to make ends meet.

In the very first sentence of my original post, I specifically said that I recognised that there were some people on minimum wage and/or benefits, who are living hand to mouth, and that my post was not aimed at them.
However I believe there are a large number of people who DO have a reasonable income, more that they need to live on, but choose to spend ALL the excess on things like leather sofas, new kitchens and bathrooms, consumer electronics etc, foreign holidays without having the sense to put any of it aside, and then see their life fall to pieces the minute a bit of misfortune happens. It was these people that prompted my post.
A six month rainy day fund may not be sufficient in the long run in the case of serious illness or long term unemployment, but it will provide a breathing space at a time when one is most needed.

jaylee3 wrote: »

I guess that because I don't know a single solitary person under 50 who would agree with your points.

Does that mean that you know of no-one who has lost their job or suffered a sudden sharp drop in income for any other reason ? If that is the case, then you and your acquaintances are very lucky and, in this day and age, I suspect are in the minority. May I ask how you earn a living that is so secure ?

jaylee3 wrote: »

I am sure you know many though.

Unfortunately yes, I’ve known a few people who have been made redundant and a few more ‘let go’ without redundancy, and I’ve been in the same position myself. Some had savings (and were relieved they had), others didn’t. One got their house repossessed, others ended up with completely trashed credit ratings that they suffer from years later.

pimento

I think it's good to have some savings but I never managed it myself. I do think however, that the OP reminds me of this woman.

http://www.youtube.com/watch?v=DfYZqQbpnuY

lost_for_words

Another good reason not to live paycheck to paycheck is that the company I worked for had a habit of not paying us sometimes due to all sorts of excuses. This will lead to d/debits not being paid and you know what happens next.

jaylee3

pimento wrote: »

I think it's good to have some savings but I never managed it myself. I do think however, that the OP reminds me of this woman.

http://www.youtube.com/watch?v=DfYZqQbpnuY

:rotfl::rotfl::rotfl:

Georgiegirl256

p00hsticks wrote: »

.]They are the sort of things where you ‘cut your cloth to suit your means’ – some people can only afford a small registry office wedding or a weeks holiday in a caravan in Skegness, others an exotic beach wedding and a Caribbean cruise. There’s nothing wrong with either as long as you’re not getting into debt or not missing out on higher priorities item to pay for – if you can’t pay for them then go without.
]What’s more important for your children - keeping them fed and with a roof over their heads if mummy loses her job or daddy gets cancer, or making sure they have ipods, a trip to Disneyland and a nice wedding ?

Exactly, you've got to cut your cloth to suit your means. Anyone who has the spare funds and doesn't try and save some for a contingency fund, is IMO very naive.

I was made redundant a year gone December, luckily my husband has a good wage, so financially we were ok, but now we need the roof replaced which is costing thousands, luckily though we had enough savings to cover the cost, I'd hate to think what we'd have done if we hadn't, I prefer to pay for things outright and thanks to abit of careful saving....we can.

Anyone who thinks a new kitchen is a must is living in cloud cuckoo land!

dawyldthing

I think what people define as a need is also interesting too. I wouldn't class a car as a need as I think with public transport as it is and car being as expensive as they are (at least 1500 a year with insurance, tax, mot, petrol etc if not more before parking charges and the like).

The mains are mortgage/ rent, council tax, water rates and electric and gas bills and everything else is a desire if i'm honest as you can't eat an iphone, car, new kitchen etc and bar the car possibly getting you to work they won't impact your life if you don't have them or stick with what you have

Hermia

dawyldthing wrote: »

I think what people define as a need is also interesting too. I wouldn't class a car as a need as I think with public transport as it is and car being as expensive as they are (at least 1500 a year with insurance, tax, mot, petrol etc if not more before parking charges and the like).

It does depend where you live though. I live in the country and the bus service is laughable. I work in the county town and many people who work here live in the surrounding villages, but there are very few bus services that will get you into town before 9am. There isn't even a bus connecting up the two biggest towns directly!

dollywops

DD's boyfriend saves a set amount each month. Then, he uses what is left to live on for the rest of the month. Admittedly, he is on a decent wage, but still has to pay rent and all the other associated costs of living.

When DD started work, she was baffled by some of her work colleagues claiming poverty the last week of the month, not being able to afford much for lunch etc. These were, what she considered intelligent people, who were incapable of organising their finances. They obviously did not think forward, even to the end of the month!