Life isn't all about saving money, you only live once. Someone said to me recently. Well, we live everyday and we only die once. There are still plenty of thing that I can do one day that I don't have to do immediately. We don't have to go to the cinema, theatre, meals in restaurants and we can happily keep saving money and preparing for our future.
I was trying to explain UK politics to my young hairdresser ( as I've said before I will pinch every penny but I no longer skimp on my hair) who was worried about her long term financial future. It's tricky one, I told her but you have to say no and go without. We only earn so much money and we can have it now or in the future but it won't be enough for both. I didn't have those choices at her age, I was at home with two small children and had no money whatsoever. I had no job so no money touched my hand - I was married and then, that was the way it was. Now, people seem ( in over hearing general chat in the hair dressers) busy having 'fun'. Nights out, weekends away, clothes accessories, nails and hair for every occasion appear to be the norm for so many people.
Now I don't profess to know anyone else's circumstances but who can genuinely afford it all. I explained to my incredulous hair dresser that she needs to pay one quarter of her income into a pension now and another quarter into savings. She then explianed that most of her income went on having a good time and life was for living. I gave my rather forlorn prediction that by the time she retired that state help may no longer exist and if she wanted to eat and keep a roof over her head without either rent or mortgage that she needed to make entire working life sacrifices to pay for it.
What's the answer?
I really don't know but some solutions could be...
1. Whilst young, unmarried or still at home, save 3/4's of your income.
2. House share or rent just a room for 5-10 years until you have a deposit.
3. Don't assume you can ever get by with just one job.
4. Whilst you're young and fit, work all hours and save.
5. Buy a house as soon as you can and keep that house for life- don't upgrade, we'd all have paid off our mortgages by now if we'd stayed in our first homes.
6. Don't expect to have your own home, a pension, savings and fancy holidays, cars, hobbies, meals out.
7. Keep taking qualifications and building your skill base, lots of these have to be supplied by employers.
8. When you get a home, furnish it second hand, learn to make do and mend.
9. If you can, buy a home with chimneys and when you can fit a wood burner. From then on, prepay for your heating and dry your laundry in front of the fire.
10. Other than a mortgage, never borrow any money.
11. Unless you have high incomes, or you are prepared to go without, don't have children. Or have them anyway and pay someone else to bring them up? Tricky one.
12. If you're going to university, have a genuine reason why. Have a career path or take a degree in something useful such as a science, maths, engineering, medicine or business. I kid you not but you can rack up thousands in student debts on a degree in puppetry. If you have no genuine career path, then get a trade training. You can make a good living from electrical engineering without a degree.
13. The alternatives? Spend it all when young, never own your own home, have no pension and be At the mercy of charities? As there may be no 'state' when we get there.
Finally, learn to make your own fun and amusement. Go away with your friends to basic campsites in secondhand tents, entertain in your own homes, share homemade food with each other, make home brew. It doesn't take money to have fun but it does take money to retire. Also, we won't all die on our 68th birthday, nor will we become incontinent, get dementia or have a stroke two weeks after retiring so it's always worth saving for the future.
I gave her a foldable tip and said......open a saving account with this and put every next tip in there too. I have a feeling though that it might go into a nice outfit but each to their own.
Now, over to you. What advice would you give to yourself if you were young again?
Until tomorrow,
Love Froogs xxxxxx
I would simply save. Nearly 20 years ago I moved 300 miles from a state not doing that well to a state that was doing better, but was also more expensive. I lived in cheap apartments, but I spent a lot on clothing and meals out. I'm now 46 and paying off debt and beginning to save. I do have some money put aside for retirement, but it's not as much as I should have had by this time. I suspect I will be working well into my 70s as long as my health holds out. Thankfully, I have an interesting job, making the most I've ever made due to getting a qualification that's difficult a few years ago.
ReplyDeleteI have never owned a home and I don't really ever expect to. It's too expensive here for many single people to buy. Thankfully, I have a good flat at a good rent that hasn't gone up in the six years I've lived here. It's safe, too. I won't compromise my safety, being a single woman, living in cheap accommodation, but not being safe.
Although I agree with most of your post, I do wonder about two points. The first one is how realistic is it for a young hairdresser to save 1/2 their salary and still have enough money to pay the bills unless they still live at home? A colleague lives in shared accommodation and pay over £400 per month. Perhaps where you live is cheaper than where I live? As for home ownership, it's so difficult to get approved for a mortgage these days and the deposits required are getting higher and higher as house prices rise that I think owning one's home will soon become the privilege of the wealthy.
ReplyDeleteShe's unmarried, no children , living at home, pays no rent, no bills. She can actually afford to save 80% of her income. Her income, £15,000 on which, with tax allowances she'll only pay tax on half of it. You can buy a three bed house here for £150,000. So, she needs £35,000 deposit and by saving £7000 a year, could have that in five years. She's 18 and could be in her own home by the times she 23 and on a senior stylist salary of £25,000 plus tips of about 10% on top could get the mortgage for the rest. Too many young people think, I can never afford a home so don't try. It's always worth the effort.
DeleteP.s shared accommodation costs the same here, but that here includes all bills including Internet.
DeleteI didn't realise hairdressers earned £15,000. I thought it was much less! Given her circumstances, yes she could save a lot more! I fear her family are not doing her any favours by not asking for any financial contribution!
DeleteYour advice is pure gold ! If I said something to a young person, it would be this : have fun if you wish, but up to a certain age. "Sensible" is a word that equals anathema to some youngsters but going to expensive bars and buying expensive clothes when you can't afford it soon becomes pathetic when you get older...... and also don't be a copycat ! Just because there are folks who can afford the holidays, big cars etc, if YOU don't earn the same wages, don't try to ape them. THEY will enjoy themselves, YOU will just live with the worry of increasing debts and a bleak future ! x
ReplyDeleteOh my! I had a similar conversation with a young teaching colleague recently. She's 23, still lives at home (doesn't pay for her keep) and spends ALL her salary every month on clothes, beauty treatments and going out. Her parents treat her like a princess, bought her a car (brand new Mini with personalised reg) and pay her insurance on it. She hasn't got a clue about mortgages/pensions/savings and thinks 30 is ancient, never mind looking ahead to retirement age. She just laughs and says she'll never get old.
ReplyDeleteShe is a lovely person and just says I sound like her mum whenever the conversation in the staffroom turns to 'grown up' chat! But she's not alone in her thinking. I worry that her generation haven't learned from our mistakes and the whole debt cycle will never go away. In fact it will get worse!
I can't imagine being that "sheltered" at 23. She will be in a for a very rude awakening, but her parents are at fault. She is old enough to pay for her own car and insurance at least. Man, people never learn.
DeleteI wish I'd left home earlier. I left home at 23 to get married (happily married 33 years and counting). If I'd had a few years on my own I would have gained more self confidence and independence; both of which are easily as important as money! (And who knows, being more confident might have helped me earn more anyway!)
DeleteOh how true, would have been mortgage free a long time ago if we had stayed in our first home. But we didn't, up sized, for more space, then hit 15%mortgage rate at the same time as realising we had actually bought a money eating pit. Hey ho, knuckled down got on with it, but had to remortgage a couple of times to get out of a hole - bad choice. Another lesson learnt. Wish you had been around then froogs. Like your weight loss campaign, third attempt to get out of debt, nearly there after 12 months around the edge of your blog. Have downsized, have savings and last bit of debt just transferred to interest free. Credit cards gone, overdraft gone, mortgage free in 3 years, if we stick to plan, even have modest savings for emergencies now, thank you so much for being a virtual ear.
ReplyDeleteI wish I'd saved more. Thank God for my superannuation- I work for the government and have never earned a lot but the super is really good. In terms of mortgages, in Australia the rate is dropping to 2 yes 2 percent interest. Happy Days. x
ReplyDeleteSensible advice but I am afraid many just need to learn the difficult way. Unfortunatley I have lost almost everything in my divorce. I think frugality will be my lot for ever so I am going to make the best of it and enjoy what I have.
ReplyDeleteA 28 year old colleague at work is saving up for a deposit on his family's first house. He was supposed to have the deposit together by last year but still no sign of being anywhere near!
ReplyDeleteI have spoken to him about bringing in a packed lunch from home rather than buying ready meals from M&S for lunch with a meal out every Friday and how much that would save in a year. It falls on deaf ears.
He insists on regular nights out, takes his children out every weekend - shudders at the thought of taking them to the park with a packed lunch - Frankie and Benny's all the way!
Oh and he refuses to have anything second hand in his house. Everything has to be new!
I have told him that I have no sympathy now when he complains that he has no money!!
He also wants to get married but both he and his fiancée want stag and hen parties abroad - he wants a week in Vegas!
I despair at times!!
such wise words, I'm struggling to get my 17 year old to see cash sense, our frugal ways irk him, our 'English' holidays annoy him, 'why cant we go to America', we've been to the brink and back and if we had seen sense would be mortgage free and had healthy savings by now.
ReplyDeleteAs a child, I understood why we couldn't travel everywhere and never felt bad because of it. I think social media puts a lot of envy out there and some people feel it worse than others. A lot of coveting and envying go on and for those weaker than some, it burns hard. Sure I would love to go to Greece, but we can't and I think I will be okay until we can one day.
DeleteShow your son just how much it costs to come to America and if he wants, he can work to pay for the tickets for everyone. Sounds bitchy on my part, but parents have to make kids view them as more than a bank.
If I could speak to younger me I would have said "be VERY careful who you marry!" I married at age 20 and am divorced now with 3 children. Hold off on getting married and having kids until you have an established career. Now at age 46 I find myself going to college to get a decent job and will be working till later in life just to save up some money.. I am and was frugal but I thought I would be going thru life as a memeber of a team- with hubby working and having a good paying job. That was not meant to be and I wish I had looked out for myself more. I try to tell this to young girls now, and tell my own daughter that she is smart and must get a good job... but so many of these kids are "in love" and are ready to race off and marry the first guy who shows them attention.
ReplyDeleteThis is great advice. Marriage is supposed to be a team, but making sure of your own future is essential.
DeleteI think it's sensible to consider how someone relates to money when choosing a spouse. I married someone from a privileged background and he has absolutely no concept of saving for the future. He lives by the "you only live once" philosophy, which isn't ENTIRELY terrible (my father is in his seventies and has never allowed himself to enjoy life) however, any time I point out that we have taxes and tuition and retirement to save for, he shuts me down. I have managed to save some, but he is constantly undermining me with his self indulgent spending. He has told me he is going to buy a motorcycle, an expensive purchase that will benefit no one but him, but there is absolutely nothing I can say or do to deter him. It's very frustrating, and frankly, might ultimately be the death of our marriage.
DeleteI echo many of the sentiments here. I stayed far too long in a marriage. That is behind me, I am on solid ground, financially as I continue to live prudently and frugally, without having the impact of my now DX. I find myself in a wonderful position in life, debt free except for some current medical, OOP debt that I will pay off in full. Needed a new car so in 12/14, I bought myself a used hybrid, dipping into my savings for my next forever home to do so. I've had some medical uncertainties, so felt that it was best to own a car outright. NO loan, affordable to run. Currently renting a home, but hope to downsize (this is a 4 bed, 2 1/2 bath Colonial) Summer 2016, and move out of this expensive town (youngest will be out of high school). My needs are few: a 3 bed, 2 bath, one car garage home with a patio/deck/porch for outside dining/sitting as well as a spot for my clothes line and a small, kitchen garden will do nicely. Agree to have a fireplace, at least one, and install a wood stove for supplemental heat. I live in an area that can get extended power outages. I also anticipate getting a generator installed, possibly upgrading windows, upgrading insulation, getting energy efficient appliances etc. That's down the road, meanwhile, most of what is considered furnishings here is second hand. Any wants are saved up for. We eat modestly as well. Priority is my future home, with the plan of paying if off as soon as possible.
DeleteSolid advice, Froogs, as always.
I have always been very careful but biggest regret is going to uni which didn't give me anymore than those I work with despite getting a first. I could have also started working sooner and therefore saved more.
ReplyDeleteOverpay your mortgage and allocate costs each month to all outgoings even if don't happen in that month e.g save for annual car insurance at £20 each month.
Other than that like you say Froogs save save and save. Open an ISA.
What would I tell my Younger self? "Life will throw you some curve balls. It's the way of life. Don't worry about what everyone else thinks. Don't feel you have to live according to everyone else's wishes. They don't feel they have to live according to yours. Most everyone falls in love. When you consider marriage--and hopefully you will--ask yourself if that person is first your friend. A friend will stick by you when times are tough, will celebrate good times with you, have your back and will be willing to stick with you for years to come. Don't sweat the small stuff. Drama is highly overrated. Save your worries for big things and those curve balls. Have children if you can. They're a gift from God; they teach us that we aren't the center of the world. Travel a little if you can. It's always good to see fresh horizons. Build a healthy savings and live within your means. Prices of everything go up. They always have. Plan for the future, but don't overlook today. Enjoy it. As you get older, the years will seem to slip by faster. Having known many 90 year olds, the regrets aren't about what they did, but did not do. Spend time with the people you love while you can. Fads and trends pass quickly onto the next. Do your best to ignore them. Know yourself and be authentic. Throughout your life, ask yourself regularly what would matter to you if you knew you only had 100 days (or maybe six months) left on earth. It'll help keep you grounded. Make it a habit to smile... to laugh... to make someone else happy in simple ways each day."
ReplyDeleteWise words, Elise :)
DeleteIm' not quite your hairdressers age(I'm 26) but at her age I was working almost every day, left home (my boyfriend and I lived at his parents for a year) to get on the bus at 06.20 in the morning with packed lunches and herbal teas for the day in our bags, and got back home at 19.20, made a filling meal for his dad and us, and was in bed by 21.00.
ReplyDeleteWe did occasionally go to the cinema or out for pizza with friends (once every two months) but that was it. I earned a ridiculously small amount as a seamstress. I managed to save a little. We had a food budget from the moment we started living together, even though we where still at home. The small amount I saved was spent when we started renting our own apartement, in another city. He now works independently as a landscape gardener/architect, and it is going well. I'm working part time and spending everything I earn on bills, some for my studies and honestly, most on my health issues. I have money aside and no problems, but feel guilty for using more money that I make. As soon as my health is stable I want to work/earn/save more, for our future home. We had a blast this past seven years of being a naturally frugal couple. I had faux pas (an expensive bike I never use, a coat and a bag I regret invensting in) but they taught me. We are now planning our wedding pretty frugally in the vast garden we have in this shared house, not quite as frugal as Jane, but we get spoiled by some of our guests (we invited 21 people) who help pay, make, or plan things. I know my situation is very lucky, and I could/will save harder to have financially stable future.
Thanks for inspiring me every day.
You don't need to have an expensive wedding to have a lovely time. We got married on a very small budget because that was all we could afford. I had a very simple wedding dress made for me. My bridesmaids' dresses were second hand. My husband wore his dad's kilt and jacket. We wrote out all our own invitations. Immediately after the wedding in the registry office, where we had under 30 guests, we had a cheap buffet meal at a local hotel. Afterwards, my in-laws opened up their house for more friends to come round for drinks (sale or return) and snacks. Our wedding cars were just two relatives' cars which my aunt attached some white ribbon to. My aunt's wedding present to us was a home made wedding cake. Although we hadn't planned a honeymoon, there was a whip round at my work and it was used to rent a holiday house for a week along with a hire car. We celebrated our silver anniversary this year. Good luck to you x
DeleteI didn't have an engagement ring - we needed the money for a deposit on a house - and I've never missed having one. My Dad drove me to my wedding in his elderly Morris Minor - a memory treasured much more than some anonymous stretch limo! I wore a cream suit and hat, as did my one bridesmaid. That was 49 years ago, it was a lovely wedding and we're still together.
DeleteThanks for the feedback and your lovely stories. We don't have an engagement ring either, our wedding rings are silver (i prefer it, also better for him since he has his hands in the dirt all day :)) and I sew my own simple wedding dress. We don't have groomsmen/bridesmaids, and we'll drive to the registry office in our (only) work car, probably with some balloons attached. I can't wait for the bubbles everyone will blow at us when we come out of the registry office, and all the honking that will be made on the way back home.. Two fairly cheap things that fill me with glee by only thinking about it.
DeleteOh how I wish I had someone like you giving me this advice when I was young, I love my parents so much, but I never had any good advice as to how to handle money, they still spend on stupid things now, so do my sister and brother. My Dad has always had a good income and was of the generation when property was still affordable so he is now retired and still has a nice lifestyle. My youth, was spent very much like your hairdresser, partying all of my hard earned money away. I am lucky enough to have been able to get on the property ladder but I still have a massive mortgage and no retirement savings. So my only hope is that I can gain enough profit out of this property and downsize and start saving for my future retirement. on approaching 50 I will have to save every penny. Your sound advice is something that should be taught in all high schools, all of my nieces and nephews are at university and will leave with debt I only hope somewhere along the line they get good advice like you are handing out. You are an inspiration to me, thank you for taking the time to write this amazing blog, Rosie xx
ReplyDeleteMy parents are still really frugal and have everything they want. They look at wants and not needs. I wish I had learnt this sooner. At least I have now. Like everyone on here your advice is invaluable and always keeps me on the wagon (so to speak).
ReplyDeleteMy errors are that I wasted money on silly purchases most of which were fashionable and I have given away to charity to declutter to clear space. I save regularly but do worry I may not have enough if I am made redundant. I could have saved at least another 50,000 if I hadn't purchased rubbish in my twenties and thirties!
What a wonderful post! I agree with everything you said. We have always been frugal and I still marvel that other people think being frugal means you are missing out on life. Spending money on clothes, parties and vacations isn't the only way to live. I enjoy my life very much. Last year I found out I had breast cancer (early stage, I'll be fine) and the first thing I thought about was a bucket list. And guess what? I didn't have one! I love my life just as it is. Give me time to read and sew and I am happy. I love my family and my family loves me, I have friends I stitch with and have coffee and a chat with. I am a very blessed woman. I have worries just like everyone, but I don't have to worry about debt. Partying and shopping are not on my road to happiness. Again, thanks for such a wonderful post.
ReplyDeleteBuilt our own house 40 plus years ago and still in it, mortgage free. Lots of room for gardens and animals....
ReplyDeleteTaught school for 9 years before we started a family ..saved 100% of my salary and much of my husband's to pay for house....no European vacations....
At least your young hairdresser has chosen a really useful trade - people always want to have their hair 'done', no matter how hard times get. She'll always be able to ply her trade and will always have the option to work for herself - either in her own salon or as a mobile hairdresser - in years to come. If I could see my time over again I'd definitely have chosen a vocational career path rather than the totally useless degree I did get. I went to college in 1979 so had my degree fully paid for by the state, I had a wonderful three years and it was a really happy time as I worked every holiday I was never short of money. However, looking back on it, my second-class degree from a second-class college never did me an awful lot of good job-wise and I would've been much better served going out to work at 18 - or even 16 - so that I could've got on the property ladder that much earlier.
ReplyDeleteWhat I'm glad I did in my late teens and 20s: completed some college, worked jobs that I enjoyed, lived alone in my own sweet apartment, knew plenty of men, used reliable birth control, launched adventures, stayed emotionally close to my family, learned to enjoy solitude, read widely, avoided booze and drugs, and enjoyed wholesome and low-cost activities like hiking and camping. What I wish I'd done differently: finished college (any degree), launched MORE adventures, stayed fit-for-life, and been more frugal (with things that don't matter as much, like clothes and furniture). And choosing a mate (if you want to) is key: Decide what traits matter to you (I chose someone reasonable and kind), don't rush, don't be influenced by others, don't be influenced by your own needs (for sex, for financial security, for a buddy), don't focus on a wedding, and don't rush to parenthood. Polly. (For some reason, Blogger considers me Unknown. I guess I can live with that.)
ReplyDeleteNice recap! Sounds like good fun :)
DeleteI don't feel the need to procreate right now and sometimes feel like I still should.
Now I have a great reason not to :D
Defiantly to save as much as we could when as through our married life we have had to deal with 3 & 2 day weeks in the early days , three redundancies and periods of out of work for 1/2 years used up any savings we built up in between redundancies and to take a chance at being self employed, I am self employed now but cannot physically build up my businesses as you dont know what is around the corner , My husband had skills of excellent carpentry but we never took the chance i know know it would have worked out , You never know what is around the corner and illness at 50 & 55 ended in we having to sell and rent , If we had learnt to be frugal at an early age This might have been prevented but i agree with learning money management in school as we were never taught how to manage it or save for that matter. xxx
ReplyDeleteDon't put all your faith (and money) in 'independent' financial advisers and pension companies...ah well...live and learn....and take great comfort that I am still one of the lucky ones, having taken my Nan's truly independent financial advice and never bought anything I couldn't pay for except a house.
ReplyDeleteAbsolutely , if you cant pay for it now you can't have it. Simple , all this buy now pay later is the beginning of the end for some as it can easily spiral out of control, you lose your job the interest piles up etc etc.
ReplyDeleteI am in my early'ish thirties and know quite a few people of my age and younger, who seem to think that having a CC debt, going out every weekend and spending every penny of their pay each month is the norm. It never has been normal for me, I've tried to always save what I can.
ReplyDeleteWhen I was 21, I worked a lowly paid job, I still managed to save over 5k in 2 years. My peers thought that this was weird and would ask "what are you going to spend the money on?". The money wasn't for anything specific, it was just for a rainy day (and that rainy day came, when I was out of work for some time following this!) It also meant I could buy my first car ( a cheap second hand runaround) without having to get into any debt, most of my friends bought brand new cars on finance!
My husband and I now put what we can into savings and our pension, we are also over paying our mortgage by whatever we can afford, which has seen our mortgage balance dramatically go down in the last year.
"Don't get sick?" I've lost significant opportunities and funds due to health problems largely beyond my control. I think I would tell my younger self to accept chronic health earlier, and apply for chronic health welfare earlier. Though I still want to get better I do not know how realistic that is. Being single cost me significantly, my peers were able to access any welfare sooner, and have been financially well off in the short term due to young family choices. I did go to University, and have debt as a result. I think paying cash for vocational qualifications, with the exception of medicine is the way to go. I've lost friends at a young age, so I would say, save (I did, it does give you options) but have a little bit of money set aside for regular treats. and "You can't have it all!"
ReplyDeleteMy son and his girlfriend bought their first home last year.they are in their mid twenties.they have both saved very hard to get a deposit together.they gave up nights out,holidays etc.because they realise the importance of owning your own home and being independent.they have both worked part time jobs while still at school and college.they are now trying to save up a years mortgage payments to give themselves a buffer should anything happen.I am extremely proud of them both and their mature attitude.A lot of their friends have this you only live once attitude to life and just fritter money away with nothing to show for it.I think parents need to instill in their kids a respect for money.they are just given everything on a plate and that does them no favours at all.
ReplyDeleteI think it is a good idea to save and try and get a house when you are young. It's sometimes not practical to only ever have your first house as entering the market in some areas is a tiny unit. But whatever you choose for a family home try and go for an energy efficient house ie solar panels and rainwater tanks. Big houses cost a lot to maintain - ie replacing carpets, re painting etc. Nobody needs a huge house - a well designed house with good storage and just the contents you need. There are plenty of web sites to buy good quality second hand furniture and if it ever becomes surplus to your needs you can often get your money back - definitely not the case when you buy new. I like having a newish car that is reliable and no nasty surprises in repairs (but I don't need a flashy car) but I agree an expensive wedding is the biggest waste of money - as is an expensive engagement ring. They then cost money to insure - crazy for something so small that serves no real purpose. Maintaining and improving work skills will ensure you can always earn a decent wage and a wide range of living skills like cooking or growing food will also reduce your living costs now and even more so when you retire. I too wasted a lot of money in my youth. I think until you get your head around the idea that you just need to save what is left after expenses you just keep spending on stuff to make yourself feel better - only it doesn't. Now I feel a sense of achievement when I get extra off the mortgage or cut down on groceries and grow some of my own food. Pensioners struggle now and there will be less and less in the government kitty to fund welfare in the future due to people living longer so most of us just need to assume we will not get government help. Obviously some people have no choice if they cannot get a mortgage or have lost their house through divorce or illness - and that can affect anyone unexpectedly as well. The thing is - once you start living more frugally you recognise consumerism for what it is and I know I'm glad I've seen the light!!!
ReplyDelete