So much money

ButterCheese

flaneurs_lobster said:

Re your a) - not really surprising that people are coming into 6-figure sums, demographics are that the post-war generation ("boomers") bequests are now arriving with their offspring. A lot of that money has come from the huge rise in house prices together with the significant increase in house ownership.

Is it (b) normal? Probably not the right term but it is what it is - is it right/just? A political discussion not for this forum.

c) Are you suggesting that this forum could be used as a channel to target the recently enriched? Probably, although an overt attempt to solicit information by posting would be spotted by the admin and members very quickly. Communication by PM is more problematic - I've always assumed that MSE admin can interrogate these messages but your concerns are well founded.

I agree with a) above.  e.g. my parents bought a 100 acre farm 55 years ago.  They spent their lives improving it and making good business decisions, whilst never spending beyond their means.  But they are very wealthy.  They still take packed lunches to outdoor events as they refuse to "waste" £10 each on lunch.  That sort of mindset can also pass down through generations, so many people want to ensure that their money is working for them, rather than seeing it as an opportunity to buy a new Porsche.

Each person will have their own view on whether inherited wealth is just luck, or if it derives from older relatives making wise decisions to help out future generations.  I'd tend toward the latter.  In my limited experience, friends who have no money, often have parents with no money but very active social lives!  Make of that what you will

leosayer

It's a feature of our progressive tax system.

Anyone with a small amount of savings and average salary is unlikely to be troubled by taxes and thresholds such as:

• Higher rate tax
• Clawback of personal allowance
• ISA allowance
• Pension annual allowance
• Lump sum allowance
• Capital gains tax
• Savings interest tax 
• Inheritance tax
• etc.

Therefore there's little surprise that such forums are disproportionatly represented by those with high earnings and levels of wealth. 

That's not to say that everyone can't benefit from the knowledge sharing on this forum, but for me at least, it was the recognition of such taxes that brought me here.

DjangoUnchained

my personal journey with the whole MSE forums. I started off 8 years ago in the debt free wannabe when i was dealing with debt from credit cards and loans about £80k in debt and was in trouble. It helped me immensley. Im now completely debt free, paid off house and a few £100k in savings /pensions and isa's.  Point is, you pick the forum that is relevant and helpful to you at the time.

Bostonerimus1

Markets are at their highest ever and >£100K is not an unusual amount to have in DC pensions and other investments if someone has been saving consistently. Combine that with the almost criminal lack of financial knowledge in the population and it doesn't surprise me that there are many post that say "I have £xxxk and don't know what to do".

CliveOfIndia

My personal feeling is that probably inheritance plays a large part in this.  Take, for example, the scenario where someone is getting along OK, they earn enough to live on reasonably comfortably, but are by no means rich, and have only a modest amount left over to spend on luxuries.  And possibly don't have much left over to build up a sizeable savings pot.

Or, someone who struggles to make ends meet every month.

In either case, if a parent or close relative dies, they may inherit a sizeable sum.  After all, if the person who dies owns a house outright, £100K is not a lot of money for a house these days, not by a long chalk.  So suddenly inheriting a six-figure sum is, I would wager, far from an unusual occurrence.

So you've got these people who are either currently struggling, or maybe doing OK but with not a lot to spare, suddenly finding themselves with a very large sum of money.  Some may choose to take a trip to the nearest Ferrari dealership or book a world cruise - but I suspect a large majority of such people are pretty sensible and would like to know how best to invest the money for the longer-term, and how to maximise the returns.

Tax_Slave

 Now retired and my wealth is via a career as a bank robber. But sadly I have had to now retire because it’s so hard to find a bank branch that’s open these days.

DRS1

I do wonder about those people who make such a post (what shall I do with £500k) and then never come back.  Are they just having a laugh?

jimjames

DRS1 said:

I do wonder about those people who make such a post (what shall I do with £500k) and then never come back.  Are they just having a laugh?

Possibly. Or a timewaster/fantasist. Or student trying to complete an assignment by getting others to provide the relevant info.

Tax_Slave

People do come into large lumps of money at times.
A friend divorced with own 4 bedroom detached house and no mortgage. Aged 58 and working 4 days a week in IT (well paid job). No idea when it comes to finance. His mother died two years ago and he inherited after taxes when house was sold £435,000. I asked what he planned to do with money and how he had invested it. He replied ‘it’s still in the bank while I decide’.
Speaking further he had let £435,000 sit in a standard current account for 8 months while took his time to make a decision on what to do with the money 😳
When we spoke last he had bought max amount of premium bonds (£50,000), upgraded his car + new kitchen and popped remaining £350,000 onto a 1 year fixed rate account in NS&I because all money was protected rather than just £85,000 elsewhere.

Vitor

This is the type of data the ONS produces - Household total wealth in Great Britain - Office for National Statistics

Median household wealth was £293,700 in the period April 2020 to March 2022 (50% of households have less wealth than the median, and 50% have more.)
The wealthiest 10% of households had household wealth of £1,200,500 or more, while the least wealthy 10% had £16,500 or less.
The non-property component of household wealth is heavily concentrated in the upper deciles.
In decile 8, 9, and 10, non-property wealth often exceeds £300k, £500k, £500–600k respectively.
At least 8–9 million UK households (top 30–35%) have more than £100,000 in non-property wealth.