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That's a good point. The way things are going, kids won't need to know about mortgages because they'll never afford one.
Mortgage Rate Rises
- Thread starter glenimp617
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That's a good point. The way things are going, kids won't need to know about mortgages because they'll never afford one.
Soldato
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Thing is you don't even need to work it out yourself these days.
Just need to put the numbers into an online calculator and it will spit out the payments. Good way to see what effect the interest rates have.
Just need to put the numbers into an online calculator and it will spit out the payments. Good way to see what effect the interest rates have.
Have said this for years.
Of all the things that could be taught at school personal finance should be number one.
I can't think of anything (except basic maths, English language and a few others) that would be more useful.
I mean people using CCs don't understand things like when interest starts, setting up minimum DDs
What more universally valuable course could there be? How much better off might even a few people be?
I don't think it's mortgages. But personal finance needs to be taught. It's shocking how few people even know that (technically) you make more by putting into savings if the rate is higher than paying off your mortgage.
So many see the mortgage being the bigger number, so overpaying is "better"
This obviously excludes any personal reasons or special circumstances
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More about general finances.
Many don't have a clue what things cost/value of things.
A colleague at work thinks its odd I have a spreadsheet with all my outgoings/incoming for each month, while she lives in her overdraft while ordering take out most days and complaining she has no money.
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Soldato
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You don't need a spreadsheet to live financially sensibly.
You don't no, but it can be helpful to visualise what you have spent and how much extra you have left after your wages (specially if you dont make much money anyway). Then you can make a informed decission on buying lets just say "extra things"
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Soldato
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Forgive me if I'm extending too far here, but this reads as if you're against raising the bar for customer protections in accounting (because you lose your advantage) but in other threads you're for, for example, raising the minimum wage or raising low pay or giving the public sector inflation payrises, which has the same effect, losing an advantage for those earning higher.
You get annoyed at things reducing your advantage as an accountant, I get annoyed at different generations getting preferential treatment on house prices, pensions or whatever.
There isn't much difference in principle imo.
Ps i agree on the additional income bit. At school it was expected that certain kids would do well academicly and go to uni...personally now I think I'd have been better off getting taught the trades. A train driver job pays more than I earn now (train drivers are well paid, they never told me that at school). School is terrible at setting people up for life skills and helping kids target a career.
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Soldato
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Not in theory but in practice some people do and they are terrible spenders.
There's no reason not to have a credit card (if paid off every month), gives you extra protection.
If a person can't trust themselves with it though they are better off without.
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Indeed, just some self discipline and balking at the wife wanting to keep up with the Jones'
I don’t use a spreadsheet or need one I’m far from my overdraft each month either. I got into a small amount of debt years ago and the bank wouldn’t help me when I asked, so I made the decision to change my circumstances and always keep a buffer to shield me from unforeseen circumstances.You don't no, but it can be helpful to visualise what you have spent and how much extra you have left after your wages (specially if you dont make much money anyway). Then you can make a informed decission on buying lets just say "extra things"
Soldato
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Its about 50% as charged m'lord
What I am annoyed about is where "protections" end up costing me money
Eg the insurance one I mentioned, being savvy enough to shop around properly would save me money, I would be rewarded in effect with better pricing.
Those too lazy to do so ensured profits for the insurer and hence they could offer better deals to those who were willing to move.
It happens a lot in finance that in order to protect the lazy they create an environment where they reduce the benefits for those who will take the time to sort the best deal.
There is a very fine line between protecting the consumer and overly influencing the market. We tend to go to far now with the latter, bringing in "protections" that are really ante competition.
Again we have been over this, its very difficult to compare generations. We specifically had teh conversation on my first house and how it was not cheap in comparison to two salaries and in many ways worse than an equivalent people would buy now.
Ignoring the other things I mentioned, such as the additional fees we paid over X% mortgage, the fact tax rates were higher, and tax allowances significantly lower. Etc etc
Dont get me wrong I am not massively hung up on this, its just that being a financial person my only gain to be had as a "side hustle" from my job is being most able to take advantage of that angle. I cant do on the side jobs, that many other professions can do.
Thats my point.
School IMO shouldnt be about telling you train drivers earn good money. Again this is asking the state to find you the opportunities in life.
Its not going to work if 25% of the kids leaving school want to be a train driver
Soldato
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You can't keep adding the issue of the day to schools' curricula. Especially given the huge lag from being in school to taking on a mortgage.
There is not enough time to deliver everything, so adding new items means taking something else out.
People who are taking on a multi-year financial commitment for tens of thousands of pounds have some responsibility to check things for themselves.
Indeed but to spitball a few elements of it you could do
- Wage at purchase
- Interest rate of mortgage
- Value of property
- Salary gross
- Net take home
- Stamp Duty (as applicable)
- Legal fees for completion of purchase
Soldato
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You don't, but it makes it very clear and easy to see the trends in your spending.
This exactly.
Plus I am not sure I would have wanted some of my teachers giving me advice
The number of people who fail to read their mortgage offer is I would say probably 90% plus
Its rare when people ask me about it that they say they have ever read it.
Most of the time the questions they ask are covered in their offer!
Soldato
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I used to be a big spreadsheeter for my finances...... Since getting married and having a child i dont any more due to time, i should probably go back to it as i 100% am no longer making the most of what spare money i have
it used to be i knew to the nearest £50 what my money was doing. The thing was i actually enjoyed doing it.. We did a total ground up redecoration of our house with 2 major extensions - front and rear and i recorded every paint brush, every pack of sand paper etc. (we spent in region of £120k on it and that included doing much of the donkey work ourselves) *I just realised that sounded very insulting to professional painter and decorators and handy (wo)men - sorry was not my intention!!!! my dad was self employed and did that stuff years ago and i absolutely respect the trade)*
is it necessary? no, so long as a person lives within their means of course not, but doing it for a few years does give you a good understanding of where your money goes and what not, and people who are sailing close to the edge probably should do it..... for everyone else, it can be a useful tool to keep on top of things but its not essential. What ever works for the individual..
Having written the above i think i will to go back to it to be honest.
it used to be i knew to the nearest £50 what my money was doing. The thing was i actually enjoyed doing it.. We did a total ground up redecoration of our house with 2 major extensions - front and rear and i recorded every paint brush, every pack of sand paper etc. (we spent in region of £120k on it and that included doing much of the donkey work ourselves) *I just realised that sounded very insulting to professional painter and decorators and handy (wo)men - sorry was not my intention!!!! my dad was self employed and did that stuff years ago and i absolutely respect the trade)*
is it necessary? no, so long as a person lives within their means of course not, but doing it for a few years does give you a good understanding of where your money goes and what not, and people who are sailing close to the edge probably should do it..... for everyone else, it can be a useful tool to keep on top of things but its not essential. What ever works for the individual..
Having written the above i think i will to go back to it to be honest.
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Soldato
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You could, but its basically irrelevant anyway.
You need to get with it now and not complaining about X in the past etc.
Its just so different now. There are so many factors such as in the 70s and early 80s you would struggle to get a mortgage for many people, capital controls.
It was very much a thing to build a relationship with your local building society as it was often the only access to borrowing people had.
banks mainly didn't offer mortgages. Its just a different world.
That the thing, train drivers, lorry drivers, tradespeople such as plumbers, electricians, brickies etc are all well paid relative and good solid jobs. I would say things such as train and lorry drivers may well phase out over next couple of decades as we go more and more autonomous in those areas. But the others are still very much trades that will continue.
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I literally live in my excel spreadsheet. I've mapped out the entire years finances already to plan for a garden renovation, holiday and the dreaded mortgage renewal in July
Soldato
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Yep.
When I was at school the "thick boys" were directed towards trades, even being sent out for a day to visit the local college to see which one they fancied most.
(the thick girls were directed towards shop work, care etc, how times change!)
In the late 80s one of those trades was an ok job, but by todays standards they were not as well paid.
What we see now is the drive for uni level education for the masses, meaning a lot less were diverted to trades and as such a shortage has happened. And then supply and demand dictates the salary.
Again its that comparing things that can see decades of impact culminating in the scenario now.