'I make £120,000 but I can’t recall the last time we went out for dinner’

GeneHunt_2

“The squeeze has really hit me and my family. Even though we have a reasonable income we have had to economise, swapping Ocado deliveries for trips to Tesco, never changing our cars or going on city breaks. I can’t remember the last time we went out for dinner,” says Guy Jackson, 53, a financial compliance officer in the City, who lives in Farnham, Surrey, with his wife, Sharon, 50, and their sons Tom, aged 17, and Harry, 16.
Much of Jackson’s £120,000 basic salary – which is at the upper end of the Squeezed Middle – goes on his sons’ school fees. The boys attend Lord Wandsworth College, the independent day and boarding school that counts rugby legend Jonny Wilkinson among its alumni.
“The boys are flexi-boarders, so they stay at school on various nights of the week,” says Jackson. “Annually it’s costing £45,000 after tax, which is a considerable outlay, but I’m happy to pay because I want them to have the best start.”
With the prospect looming of university with fees of up to £9,000 a year, he has some tough decisions to make. “I have a £350,000 mortgage that I have to start paying off if I want to retire when I’m 65, so the boys will have to get loans,” he says. “I also worry about whether they will ever manage to get onto the property ladder and will do all I can to help – but by the same token, I don’t want to become a cash cow. The truth is, I can’t afford to keep on supporting them.”
Jackson’s tone is matter-of-fact. Like the rest of the Squeezed Middle, he is keenly aware that his situation evokes little sympathy. “I know if I were to have a conversation with someone on a council estate, they would think I was mad,” says Jackson, wryly. But the trickle-down economics central to wealth creation is only effective if benefits accrue to every stratum of society. And the more the finances of people like Jackson are constricted, the less they spend on goods and services. The less they spend, the more providers of goods and services will suffer.
“But with taxation at its current levels and the rising cost of essentials, it is quite difficult for people like me to maintain our standard of living in the current climate, and that is a worry.”

http://www.telegraph.co.uk/lifestyle/10812086/I-make-120000-but-I-cant-recall-the-last-time-we-went-out-for-dinner.html

Money saving expert he is not :rotfl:

53 with a £350,000 mortgage :eek:

What a joker.

[Deleted User]

Their financial problems are due to the cost of their kids educations.. He'll be paying out about £44k in school fees (http://www.lordwandsworth.org/school-fees-229112.html). University will be cheaper!

He'll be taking home £6k a month and paying out £3600 in fees, probably paying £800 on an IO mortgage, £400 - 600 on car payments. £150 a month in gas/electric, £70 in mobiles, £400 in food .. i can imagine how his poor £120k salary gets eaten up by his lifestyle.

It's the old problem - people's 'lifestyles' and expenses rise as they increase in salary. I don't feel too sorry for him really

I know a few people like that.. earning > £200k with IO mortgages, expecting that one day bonuses and ever increasing salary will take care of it

chucknorris

GeneHunt wrote: »

http://www.telegraph.co.uk/lifestyle/10812086/I-make-120000-but-I-cant-recall-the-last-time-we-went-out-for-dinner.html

Money saving expert he is not :rotfl:

53 with a £350,000 mortgage :eek:

What a joker.

I'm 56 and have £485k of mortgage, that in itself is meaningless, it is the overall wealth position that is important. He doesn't sound very savvy, so I'm not defending his particular financial position, just picking up on your generalising comment about age and mortgage.

purch

It's not the size of the Mortgage, or his age that jumps out.

It's the fact he say's he has to

I have to start paying off if I want to retire when I’m 65

which indicates that he has had the mortgage for some time but has done nothing to repay the capital.

The bloke only earns £120K yet seems to think he can live like someone earning twice as much.

You can't pay £45K school fees, have a £350K mortgage and have holidays, new cars and the rest.

Do the Math :eek:

observingthedebate

chucknorris wrote: »

I'm 56 and have £485k of mortgage, that in itself is meaningless, it is the overall wealth position that is important. He doesn't sound very savvy, so I'm not defending his particular financial position, just picking up on your generalising comment about age and mortgage.

I agree with you, it is not just about the quantum but how your income (and your debt) is structured.

Said that, I would never even consider signing up for an IO mortgage. Deferring responsibility is a dangerous game.

chucknorris

purch wrote: »

It's not the size of the Mortgage, or his age that jumps out.

It's the fact he say's he has to which indicates that he has had the mortgage for some time but has done nothing to repay the capital.

The bloke only earns £120K yet seems to think he can live like someone earning twice as much.

You can't pay £45K school fees, have a £350K mortgage and have holidays, new cars and the rest.

Do the Math :eek:

Yes his spending doesn't appear proportional to his income. When the economic downturn first happened and banks were in trouble, I was surprised to learn that a few of my friends had no savings. It was when you had to be careful not to have over £50k in one place (or in places covered by only one FSA guarantee), I was really surprised when I innocently asked where they had their savings and the reply was 'we don't have any savings' (not even ISA's!). This is from couples that have top of the range cars and (for one couple) fly business class when holidaying! Because of their spending I had wrongly assumed that they would have substantial savings, so they obviously don't have a spending to savings/wealth position sensible proportion either. From that experience I learned not to bring up the subject again.

PasturesNew

I need some medical help - how can I stop my heart bleeding?

chucknorris

observingthedebate wrote: »

I agree with you, it is not just about the quantum but how your income (and your debt) is structured.

Said that, I would never even consider signing up for an IO mortgage. Deferring responsibility is a dangerous game.

I do agree with what you are saying, but my mortgage is interest only, although I have it easily covered, both by equity and other (non property) investments. He doesn't seem to have worked to a plan, that is his problem, hopefully for his sake he will address that as he seems to be aware of the problem (have to confess that I haven't fully read the article).

chucknorris

PasturesNew wrote: »

I need some medical help - how can I stop my heart bleeding?

Vote tory, it will soon clear that up.

the_flying_pig

the school fees are by a distance his biggest outgoing [and, i might add, a pure 24-carat luxury item that, living in farnham is laughably unecessary] but with kids aged 16 & 17 he's got another three years' worth max to pay. after that he'll be fine.

much more importantly, only the torygraph could describe a £120k p.a. city worker [comfortably in the top 1% of earners] as part of a 'squeezed middle':rotfl:

observingthedebate

chucknorris wrote: »

I do agree with what you are saying, but my mortgage is interest only, although I have it easily covered, both by equity and other (non property) investments. He doesn't seem to have worked to a plan, that is his problem, hopefully for his sake he will address that as he seems to be aware of the problem (have to confess that I haven't fully read the article).

Yes, this is what I meant by saying that the structure of your income is as important as the structure of your debt!

The aversion to IO mortgages is my own personal thing, it dangerously leads people to deferring repayments or like the guy in the article, get towards the end of the loan without having made any repayments. Of course it is fine when, like you, one is prudent and works to plans.