Do your friends / work colleagues save and or invest ?

David_Evans

bcfclee27 wrote: »

Spot on and well said.

Some colleagues have gone down the overpay mortgage route which I agree with to a point and is much better than just paying the standard mortgage month in month out like the masses do.
But suggest investing instead and you get horrified looks.

I was similar and overpaid on the mortgage until I found this forum.
But then I was always very intrigued by the stock market.

I would always pay off my mortgage before investing in stocks etc.
Controversial, but I'm quite 'Old School' about debt - ie I don't have any.

David_Evans

Amoux wrote: »

I'm relatively young (27yo) and I've talked to friends about it, but literally very few people I know invest in stocks and shares. If conversation ever goes in that direction it inevitably leads to an irrational fear that it is reckless or so complicated that you need a degree in economics to do it.

And these are smart individuals with good degrees, in highly paid, highly skilled jobs. If even this cohort cannot get to grips with the idea of investments, it does make me wonder more widely how financially illiterate people must be in this country.

The only investments that people seem to only care about is getting a house.

This is probably due (in part) to the UK govt encouraging home ownership over renting.
It gives the gov more control of the population.
It discourages industrial action and enables houses to be used for care home fees etc.

Culture in Germany etc has long been different.

ian1246

Most of my friends live payday to payday. Negligible saving, racking up loans & debts, spending ridiculous money on nights out/new cars on finance etc.... Most don't even have a pension/pay more than the auto-enrolment amount into it.

A couple, good friends to myself & wife, have 2 kids and a 3rd on the way, with the husband earning really good money - he doesn't have a pension or even life insurance (they have a 3bed house with mortgage). Wife also doesn't work (does cash in hand caring once a week). Yet despite this they have several different cars & eat out all too frequently/ spend continuously.

I worry for them - they are living within their means, but at the cost of their future (no provision whatsoever), which, when you think about it, isn't really living within your means (getting old is an inevitability!)....

I think its a generational thing (we're all in our 20s) - all too many people are financially illiterate.

Now granted - i dont have investments yet. But what i do have is an emergency services pension whilst my partner puts £170 a month into her private pension. We re also building towards a £10,000 emergency saving buffer then plan to overpay mortgage - we want to upgrade to a 4bed detached house. Once we ve achieved that it ll be a combination of overpaying the mortgage (our "safe" investment), then investing into a vanguard ISA....

David_Evans

ian1246 wrote: »

Most of my friends live payday to payday. Negligible saving, racking up loans & debts, spending ridiculous money on nights out/new cars on finance etc.... Most don't even have a pension/pay more than the auto-enrolment amount into it.

A couple, good friends to myself & wife, have 2 kids and a 3rd on the way, with the husband earning really good money - he doesn't have a pension or even life insurance (they have a 3bed house with mortgage). Wife also doesn't work (does cash in hand caring once a week). Yet despite this they have several different cars & eat out all too frequently/ spend continuously.

I worry for them - they are living within their means, but at the cost of their future (no provision whatsoever), which, when you think about it, isn't really living within your means (getting old is an inevitability!)....

I think its a generational thing (we're all in our 20s) - all too many people are financially illiterate.

Now granted - i dont have investments yet. But what i do have is an emergency services pension whilst my partner puts £170 a month into her private pension. We re also building towards a £10,000 emergency saving buffer then plan to overpay mortgage - we want to upgrade to a 4bed detached house. Once we ve achieved that it ll be a combination of overpaying the mortgage (our "safe" investment), then investing into a vanguard ISA....

It's interesting.
My impression has been that the country is on a turning point.
Old industries (eg Steel) with final salary pensions and job security have died out.
But people don't seem to be adjusting to the need for a more individualistic approach.
They seem to have the same mindset of the generation before - who assumed the govt would take care of them.

Bravepants

I occasionally talk about investing to my colleagues and friends. I think because I have learnt to live more carefully and spend a lot less than I used to, and through the medium of T'Internet I have read about other peoples' experiences and that there is more to life than spend, spend, spend, I feel almost duty bound to pass on my own revelation!



As a result, one of my colleagues has started investing in a multi-asset, lifestyle type fund.



Another of my friends, who is very intelligent, says he just doesn't "get" pensions. I told him I invest and he immediately mentioned the word "gambling". He is self-motivated, bright and a quick learner, so I don't think it's an intelligence thing, but more a kind of "can't be bothered finding out" thing. It's disappointing to be honest, because he is quite capable.


Other colleagues have the McMansions and big cars, and again know nothing about how their pensions actually work, or how simple it is to invest. They've risen up through the ranks and salaries and their lifestyles have indeed inflated with it.



It IS a cultural thing definitely, they are all keeping up with what their peers expect them to do! Comparing cars and houses, and not really thinking about their future. Perhaps they plan to downsize in the future? But for me finding a home that you love, spending money on looking after it, raising a family there and having all that history I think I would find it hard to leave my home for the sake of money, when I could have done something "alternative" about it!



Yes, I worry about them all too, they're all just blindly following what everyone else has done in the past and will continue to do into the future, unless financial education is taught at school. I would prefer to have learnt about investing, rather than woodwork!

Fatbritabroad

I'm quite open and vocal with people at work about investing etc. You do get some who say O it's only because you have the Money and earn big salaries without seeming to realise I've always done it even when i was paid an average salary (it's only Been the last 6 years I've earnt a good wage) I am open because I want people to approach me and ask me and actually a few have. I obviously don't tell them what to invest in just give them pointers and direct them to the monevator website for further info. I think if people were more open it would help massively

somethingcorporate

I talk regularly about these things with colleagues to varying degrees. Some care deeply and we discuss strategy (including making some huge decisions on how pensions are invested etc). Others really could not be bothered.

Thrugelmir

bcfclee27 wrote: »

I was similar and overpaid on the mortgage until I found this forum.
But then I was always very intrigued by the stock market.

People see a rising market and jump on the bandwagon.

Wise words from a renowned investor and banker Sir John Templeton.

“Bull markets are born in pessimism, grow on scepticism, mature on optimism and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.” “If you want to have a better performance than the crowd, you must do things differently from the crowd.”

Mr.Saver

I don't have time to learn it (or follow the market, etc.) (neither do I)

I heard / thought about it, and I want to, but ... (procrastinating)

I'm not smart enough for it (do you need an economics degree?)

It's too risky (like gambling?)

I don't have enough money for it (do you need to have a million first?)

My husband (wife, dad, etc.) manages my (our) money (but it's your money)

So, the answer is no, they don't.

In fact I talk a lot about topics related to money. I wouldn't ask for their figures, but I'd tell them how to do the calculations, and let them do it themselves.

I, a migrant, work in a multicultural workplace. I work with people from different continents. This doesn't change the fact that most people around me don't take control of their own money. They are either being ignorance or let the money control themselves. This proves that it's not the British culture or education's fault.

Interestingly, they would rather "invest" in bitcoins than stock and shares. One of them actually has made a fortune, but the rest are not lucky enough. Maybe the one successful example has had some influences on their decisions? Or cryptocurrencies are easier to trade because they are not regulated? I couldn't tell.

I also had some success on changing their minds and planning for their own future. One switched from bitcoins to ETFs, one switched to a 1.5% interest paying savings account from his 0% interest current account, and some people started to think about their pensions. But overall, I think most people still have a long way to go on their financial literacy path.

Thrugelmir

bcfclee27 wrote: »

As for investing in stocks and shares I literally know nobody. When I speak to others about investing (what I save per month goes into stocks and shares), they look at me like I'm putting it all in Ladbrokes betting shop and there is no outcome aside from losing all your money.

People vary in nature between optimists and pessimists. That's a combination of genes and our life experiences. We all plough our own furrows. Very easy to lose money when investing. If one makes the wrong call. For the majority their pension fund will be their largest asset. Besides the property they buy on a mortgage. There's a significant difference in betting a £5 on the Grand National, and buying £2k of shares because someone down the pub suggested it was the right time to profit. While the £2k might not be lost entirely. Even 10% is a hefty loss of capital. Why not simply pay down the mortgage quicker. Not as exciting but a safe guarranteed return. With a certainty of outcome. Once the mortgage is repaid removes a major financial worry for life.