Inter generational fairness

westernpromise

ukcarper wrote: »

Drawing arbitrary lines is not very helpful after all a boomer born in early 60s has more in common with a gen Xer born in late 60s than a boomer born in the 40s.

Quite. There is a big difference between being born in 1945 and buying in 1970 and being born in 1965 and buying in 1990. You'd have been paying 20 times more for your house in the second case than the first, and you'd be straight into negative equity.

You might also have mentioned that someone born in the early 1960s is 10 to 15 years away from retirement, and is thus not in receipt of any pension, whether one of these fabled defined-benefit ones or otherwise. Many companies' pension schemes aren't open to you until you're some age such as 35 anyway. So someone born in 1965 wasn't even eligible to join a scheme until 2000, by which time the final salary schemes were already closing all over the place. I've changed job five times since 1996 and I've never been offered a final salary pension scheme in all that time, either because it was closed or because I wasn't old enough.

In relation to earnings property was at its cheapest in the 90s so those born in the late 60s benefited from that but those born in the early 80s were effected by the boom in the early 2000s.

Indeed, and those born in the early 60s were perfectly placed to be too late to pick up a bargain and just in time to collect a wad of negative equity. You were better off being born in 1960 or 1970 than 1965.

CLAPTON

ruggedtoast wrote: »

Change the record for God's sake Sir Oswald...

so what are you saying toxic toastie

that qualiity jobs of young people have never been so good
that real wages have never been so good for the young
that housing has never been so good for the young?

and who do you give credit for these achievements
-the Tories that you have increasingly been coming to love
-and/or the EU?

westernpromise

ruggedtoast wrote: »

Unlike when young boomers were roaming the streets, burglary and muggings and violent crime, have never been lower.

Boomers = filth

[Deleted User]

GreatApe wrote: »

a kid that starts full time work age 16 even on the min wage of £7.20ph who lives at home with their parents will be able to save £100k by the age of 26 that £100k is enough to buy a starter home in most the country outright.

Assumptions:
1. There is no HPI over 10 years
2. They can live rent and bills free for 10 years
3. They can only spend £350ish a month.
4. They have no periods of unemployment in 10 years, working their minimum wage job
5. Their parents are happy having a manchild leech off them for 10 years
6. Their parents don't chuck them out and make them rent somewhere, spending most of their income boosting a boomers property portfolio ;-)
7. They don't live in the SE (Like several million of the population do), where £100k wouldn't buy you a garden shed

GreatApe

ringo_24601 wrote: »

Assumptions:
1. There is no HPI over 10 years
2. They can live rent and bills free for 10 years
3. They can only spend £350ish a month.
4. They have no periods of unemployment in 10 years, working their minimum wage job
5. Their parents are happy having a manchild leech off them for 10 years
6. They don't live in the SE, where £100k wouldn't buy you a garden shed

Those are all reasonable assumptions.

6: 70% of the country live outside the SE
5: I would be happy for my children to stay with me until they are 26 especially if it was clear they were good enough to be setting themselves up for a good life rather than a !!!! one.
4: I've had many jobs in my life and close to zero downtime. Most people who lose their jobs find a new one within 3 months. Also they can improve from min wage so its a worse case
3: £350pm not including rent is fine most MSE people can get within that budget
2: Most parents would not charge rent to their kids especially before 20 and those that do typically only charge a small amount. Of course if you and your parents hate each other that is a problem and not just a money problem
1: There has been little to no HPI for a decade in most the country. I suspect the north midlands scotland wales and NI will still be cheap in a decades time.


This is assuming min wage, really you should assuming real increasing wages as the median male full time wage is closer to £35k than it is to the £15k min wage.

lessonlearned

The other thing is the trickle down effect of inherited wealth.

Today's young people stand a reasonable chance of gaining through inherited wealth, either at their parents death or In some cases before if their parents have been able to downsize and release some equity.

I know quite a few people in my age group who have downsized and passed some equity on to their 30 something children to help out with house purchase....... myself included.

This is not a new phenomena.

Back in the early 2000s when I was a new homes sales negotiator I often had first time buyers who were being helped by their parents. Generally they were in their mid 20s so Gen X.??

By comparison there are far fewer Boomers who have funded house deposits through inherited wealth. I only know one that was because she came from a very wealthy family where wealth had been trickling down for several generations.

Most of my peers were self funding. Our parents had no money spare.

missbiggles1

GreatApe wrote: »

a kid that starts full time work age 16 even on the min wage of £7.20ph who lives at home with their parents will be able to save £100k by the age of 26 that £100k is enough to buy a starter home in most the country outright. If at age 26 they find a partner who did the same thing together they would have 1 no mortgage home and 1 no mortgage rental to give them ~£600pm - 700pm rental passive income too on top of their full time jobs. If they keep working to the age of 30 they can probably buy another rental outright. If the woman has children by 30 she can give up work but would still have £1.2-£1.4k a month in rental income. The husband still on min wage would bring in £1k a month post tax which is not huge but with no mortgage or rent its enough to get by on for sure. Their rental income they can save further to increase their wealth or they can spend it for a higher quality of life. Lets assume they spend it all so they have about £2k a month disposable quite a decent life.
The woman can return to part time work when the youngest kid is say 14 and can return to full time work when the youngest kid is say 16-18. That is likely when she hits 50 so at least another 15 years of full time income from her so the family unit can save all of that additional income.

If they have 2 children, when they themselves die they can hand over 2 fully paid off homes to them so one each. That means their own kids have it even easier/better

That might not be possible in London where starter homes cost £300k but for Scotland, northern ireland, wales, north east, north west, west midlands, east midlands, yorkshire etc it is possible


Things do not seem that bad imo.
The above would be a worse case for a decent family with a decent upbringing.
of course if the family unit is dysfunctional or not very MSE or there is a divorce somewhere in between adding to costs and lowering incomes then things might not pan out well but that was/has been true for as far back as you care to recall.

The important thing to note other than things not being so bad is that this family leaves an inheritance quite a significant one. which means the next generation has even more. If they too leave an inheritance on top of what they received then the next lot have even more. etc etc

Young people are supposed to remain in education or training until they're 18 but, if they're working, NMW for a under 18s is £4.00 ph (£3.40) for an apprentice. NMW of £7.20 doesn't kick in until someone reaches 25. Your calculation also assumes that they would be being kept by their parents for the first 10 years of working life and that, at 26, they then meet someone equally lacking in a desire for independence and with no wish to pay their own way!

[Deleted User]

missbiggles1 wrote: »

Young people are supposed to remain in education or training until they're 18 but, if they're working, NMW for a under 18s is £4.00 ph (£3.40) for an apprentice. NMW of £7.20 doesn't kick in until someone reaches 25. Your calculation also assumes that they would be being kept by their parents for the first 10 years of working life and that, at 26, they then meet someone equally lacking in a desire for independence and with no wish to pay their own way!

Haha, When I met my wife I was 25. I'd lived in house-shares, avoided holidays, cars ect. and had managed to save up about £12,000 (and paid off all my student debt, including Masters). She was 23 and lived at home, went on nice holidays, had a nice little sports car and a held few grand in credit card debt.

It balanced us both out! Can you imagine what two souls that had lived at home for 10 years, saving their hearts out, would be like?

Firetastic

I was talking to advisor at the Job Centre who said their daughter was still at school and trying to get a part time job. However the old adage came in. Not enough experience however her applications were good.

I was thinking at sixteen or seventeen what experience are you going to have!? Come on. In my parent's day you could walk out of one job in the morning and have another one by the afternoon. My dad started work at sixteen. So if a sixteen year old can't get a job nowadays things must still be bad.

ukcarper

Median earnings for the 22 to 29 age group is £22k so if living with thier parents a couple would have no trouble saving the £21k 10% deposit on the average house in a couple of years.