Young Lad turning to internet for savings advice...
Discussion
Hi all...
Obviously spoken to parents etc but was hoping the collective wisdom of the PH masses could help me...
Basically I am 20 and am looking at a wage matching my age for the foreseeable future. Lucky enough to have parents who let me live at home on the cheap but not lucky enough to have ones who will have £25k to spare one of 3 kids of similar age...
So, as usual here is the dilemna...
I want to buy a house (in my own name, regardless of whether a Mrs Jimbob arrives on the scene) ideally in the next 4 years (before 25) and was just looking for a bit of advice like where and how much money I should put away, how much will I need deposit wise, what luxuries I should include, how much is Council Tax, Gas, Electric, Mortgage Sky, etc etc...
I know it's a bit vague but I would like a night out at least once a fortnight and a week away in the sun every year, and of course a nice car; but am willing to go get a nice car with 80k on the clock if you know what i mean...
Really just trying to get a little plan together and stick to it in the next few years but just can't get round to it...
Cheers
jimbob
Obviously spoken to parents etc but was hoping the collective wisdom of the PH masses could help me...
Basically I am 20 and am looking at a wage matching my age for the foreseeable future. Lucky enough to have parents who let me live at home on the cheap but not lucky enough to have ones who will have £25k to spare one of 3 kids of similar age...
So, as usual here is the dilemna...
I want to buy a house (in my own name, regardless of whether a Mrs Jimbob arrives on the scene) ideally in the next 4 years (before 25) and was just looking for a bit of advice like where and how much money I should put away, how much will I need deposit wise, what luxuries I should include, how much is Council Tax, Gas, Electric, Mortgage Sky, etc etc...
I know it's a bit vague but I would like a night out at least once a fortnight and a week away in the sun every year, and of course a nice car; but am willing to go get a nice car with 80k on the clock if you know what i mean...
Really just trying to get a little plan together and stick to it in the next few years but just can't get round to it...
Cheers
jimbob
On £20k a year (£16k after tax) you should be able to save at least 50% of this as a deposit for a house. Four years at £8k gives you £32k + any interest which is a decent sized (20%) deposit on an averagely priced starter house. Whether you can get the £120k mortgage on your own is a different matter for which you won't know until nearer the time.
For the next four years, try and restrict your spending to 50% of your income and be sure to save the rest and not blow it on a massive holiday or motor - quite tough to do when you've got £25k in the bank and all your mates are buying flash cars... been there!
Depending on the mortgage, you'd be looking at about £1100-£1400 to run the house including all bills, mortgage payment etc. You'll then need to factor in your car, holiday and other social expenses. On a £20k salary this will be a very, very tight squeeze so find yourself a partner before then
For the next four years, try and restrict your spending to 50% of your income and be sure to save the rest and not blow it on a massive holiday or motor - quite tough to do when you've got £25k in the bank and all your mates are buying flash cars... been there!
Depending on the mortgage, you'd be looking at about £1100-£1400 to run the house including all bills, mortgage payment etc. You'll then need to factor in your car, holiday and other social expenses. On a £20k salary this will be a very, very tight squeeze so find yourself a partner before then
Merlot said:
On £20k a year (£16k after tax) you should be able to save at least 50% of this as a deposit for a house. Four years at £8k gives you £32k + any interest which is a decent sized (20%) deposit on an averagely priced starter house. Whether you can get the £120k mortgage on your own is a different matter for which you won't know until nearer the time.
For the next four years, try and restrict your spending to 50% of your income and be sure to save the rest and not blow it on a massive holiday or motor - quite tough to do when you've got £25k in the bank and all your mates are buying flash cars... been there!
Depending on the mortgage, you'd be looking at about £1100-£1400 to run the house including all bills, mortgage payment etc. You'll then need to factor in your car, holiday and other social expenses. On a £20k salary this will be a very, very tight squeeze so find yourself a partner before then
Living on around £700 a month on average (everything, but this is including 2 nights out a week atm For the next four years, try and restrict your spending to 50% of your income and be sure to save the rest and not blow it on a massive holiday or motor - quite tough to do when you've got £25k in the bank and all your mates are buying flash cars... been there!
Depending on the mortgage, you'd be looking at about £1100-£1400 to run the house including all bills, mortgage payment etc. You'll then need to factor in your car, holiday and other social expenses. On a £20k salary this will be a very, very tight squeeze so find yourself a partner before then
)... realistically wan't to put at least £500 a month away even next year when quite a few of my bills are going up...What's the crack with interest only mortgages at the moment, are they are good idea for the first few years?
1: Note to self: Find bars with law/medicine degree type students
Might be obvious but remember your cash ISA allowance is 5k a year, so start saving there, in 3 or 4 years you might be taking advantage of higher rates and avoiding tax on the interest.
Have a look with your bank at 12 month saving schemes, where you save up to £300 a month for a rate of say 5%
Good luck with it, I bought my first house at 25 when most of my mates were buying flash cars, by far the best thing I ever did.
Have a look with your bank at 12 month saving schemes, where you save up to £300 a month for a rate of say 5%
Good luck with it, I bought my first house at 25 when most of my mates were buying flash cars, by far the best thing I ever did.
Well done for looking into this at 20.
Generally, interest only mortgages aren't a good idea; it's better to repay, and if possible, overpay.
As you want to save monthly, a regular savings account will encourage you to do so and reward you generously.
However, their interest rates usually plummet after a year, so close it, sweep the money you've built up into a cash ISA (and any excess into a top savings account), open a new regular savings account and start again.
Again, the interest rates for cash ISAs and top savings accounts usually plummet after a year, so do the same.
Work out a reasonable monthly budget and stick to it, for example, you could allocate £500 for your regular savings account, £200 for going out, £50 towards your annual holiday, £20 for your mobile phone bill, and so on. You could even have separate accounts for each of these things; you'll have complete control of your money and know exactly where it's going, it's a great feeling.
Finally, keep away from law and medicine students, they're the WORST (or the best, depending on which way you're looking at it)
Generally, interest only mortgages aren't a good idea; it's better to repay, and if possible, overpay.
As you want to save monthly, a regular savings account will encourage you to do so and reward you generously.
However, their interest rates usually plummet after a year, so close it, sweep the money you've built up into a cash ISA (and any excess into a top savings account), open a new regular savings account and start again.
Again, the interest rates for cash ISAs and top savings accounts usually plummet after a year, so do the same.
Work out a reasonable monthly budget and stick to it, for example, you could allocate £500 for your regular savings account, £200 for going out, £50 towards your annual holiday, £20 for your mobile phone bill, and so on. You could even have separate accounts for each of these things; you'll have complete control of your money and know exactly where it's going, it's a great feeling.
Finally, keep away from law and medicine students, they're the WORST (or the best, depending on which way you're looking at it)
Edited by Swoxy on Monday 20th December 22:22
jimbobsimmonds said:
northandy said:
Good luck with it, I bought my first house at 25 when most of my mates were buying flash cars, by far the best thing I ever did.
Keep telling myself that...Explain how ISAs work please?
As someone else said you may need to move it each year to get a better rate, mines on a 15month 2.69% deal at the moment when that's finished I'll shop around and transfer it to a better deal (transfer don't withdraw and redeposit)
This is a bit off the wall but consider putting some money into training\education in something that can earn you more money in the near future. Five grand and some time spent now on something that will earn you five grand a year more in a few year's time is money well spent.
It's what I did many years ago but can't offer any concrete advice on good career paths these days! I got into IT when I was 24 and am now 46 with a decent house and no mortgage ... I was a shelf filler at Asda when I decide to make the change but higher education was basically free back then and I chucked some money at some specialist courses.
It's what I did many years ago but can't offer any concrete advice on good career paths these days! I got into IT when I was 24 and am now 46 with a decent house and no mortgage ... I was a shelf filler at Asda when I decide to make the change but higher education was basically free back then and I chucked some money at some specialist courses.
I'd echo the comment above, and say that you should always think about whether you can (or want to) do anything about the income side of the equation.
As other have said, set up a savings account, or ISA, and have the money go out automatically, but also see what you can do to move ahead more quickly at work, get overtime, or learn skills that will let you earn more.
Every 1k extra you bring home is 1k more towards the house, and likely 1k more every year.
1k rise per year, for three years, nets you an extra £6k at the end of 3 years, £10k after 4, and £15k after 5.
As other have said, set up a savings account, or ISA, and have the money go out automatically, but also see what you can do to move ahead more quickly at work, get overtime, or learn skills that will let you earn more.
Every 1k extra you bring home is 1k more towards the house, and likely 1k more every year.
1k rise per year, for three years, nets you an extra £6k at the end of 3 years, £10k after 4, and £15k after 5.
I'd just like to 2nd that, good thinking at your age, while others are peeing money up the wall on stuff that won't last. It's a difficult time for savers, but use your ISA allowances and regular savers etc. Get a deposit together and watch as house prices fall over the next 3-4 years, find a nice girl with similar realistic approach to money (they're just as rare as you are) and buy a house. Good luck!
Swoxy said:
Well done for looking into this at 20.
Generally, interest only mortgages aren't a good idea; it's better to repay, and if possible, overpay.
As you want to save monthly, a regular savings account will encourage you to do so and reward you generously.
However, their interest rates usually plummet after a year, so close it, sweep the money you've built up into a cash ISA (and any excess into a top savings account), open a new regular savings account and start again.
Again, the interest rates for cash ISAs and top savings accounts usually plummet after a year, so do the same.
Work out a reasonable monthly budget and stick to it, for example, you could allocate £500 for your regular savings account, £200 for going out, £50 towards your annual holiday, £20 for your mobile phone bill, and so on. You could even have separate accounts for each of these things; you'll have complete control of your money and know exactly where it's going, it's a great feeling.
Finally, keep away from law and medicine students, they're the WORST (or the best, depending on which way you're looking at it)
Thanks!Generally, interest only mortgages aren't a good idea; it's better to repay, and if possible, overpay.
As you want to save monthly, a regular savings account will encourage you to do so and reward you generously.
However, their interest rates usually plummet after a year, so close it, sweep the money you've built up into a cash ISA (and any excess into a top savings account), open a new regular savings account and start again.
Again, the interest rates for cash ISAs and top savings accounts usually plummet after a year, so do the same.
Work out a reasonable monthly budget and stick to it, for example, you could allocate £500 for your regular savings account, £200 for going out, £50 towards your annual holiday, £20 for your mobile phone bill, and so on. You could even have separate accounts for each of these things; you'll have complete control of your money and know exactly where it's going, it's a great feeling.
Finally, keep away from law and medicine students, they're the WORST (or the best, depending on which way you're looking at it)
Edited by Swoxy on Monday 20th December 22:22
With ISAs are they based on a Fiscal/Calendar Year or a year from when you opened it. So for example if i were to stick £5k in it in March and then stick £5k again in May would they both be tax free or would that count as £10k in a year?
Also I take its its best to show no loyalty and move your money around then?
Yea, I'll stick to medicine students; If i do end up (heaven forbid) liking some Law type she is just going to take more than her 50% for everything I'm worth 10 years down the line :@
ISAs operate on the Fiscal (i.e tax) yer. They run from 6 April to the following 5 April.
There are two types, Cash ISAs and Share Based ISAs. Cash based ISAs are less risky (being simple bank deposit accounts) whilst Share Based ISAs are inherently more risky (being based on shares purchased on the Stock Exchange)
Here's Martin Lewis' simplistic explanation of the difference between ISA based savings and "normal" savings.
http://images.moneysavingexpert.com/images/isa_cak...
There are two types, Cash ISAs and Share Based ISAs. Cash based ISAs are less risky (being simple bank deposit accounts) whilst Share Based ISAs are inherently more risky (being based on shares purchased on the Stock Exchange)
Here's Martin Lewis' simplistic explanation of the difference between ISA based savings and "normal" savings.
http://images.moneysavingexpert.com/images/isa_cak...
NorthernBoy said:
I'd echo the comment above, and say that you should always think about whether you can (or want to) do anything about the income side of the equation.
As other have said, set up a savings account, or ISA, and have the money go out automatically, but also see what you can do to move ahead more quickly at work, get overtime, or learn skills that will let you earn more.
Every 1k extra you bring home is 1k more towards the house, and likely 1k more every year.
1k rise per year, for three years, nets you an extra £6k at the end of 3 years, £10k after 4, and £15k after 5.
Do you know what, I would love too!As other have said, set up a savings account, or ISA, and have the money go out automatically, but also see what you can do to move ahead more quickly at work, get overtime, or learn skills that will let you earn more.
Every 1k extra you bring home is 1k more towards the house, and likely 1k more every year.
1k rise per year, for three years, nets you an extra £6k at the end of 3 years, £10k after 4, and £15k after 5.
I am working for a large defence firm in engineering (no prizes for which one) and all things going well they will pay for me to complete my HNC and at least a Foundation Degree (hopefully on to full, but this is a fairly long time commitment) in Electronic Engineering.
TBH i don't mind the work but could I do this forever on an engineering salary? No, probably not... I was just trying to use this to show that I could progress in a respected field.
I did well at GCSE 4As and 5Bs in proper subjects but lost my way at A-Level and decided work was the best way of giving me a kick up the arse. Uni i would have wasted but feel Im mature enough now to go and get a degree in something but really don't want to be a full time student...
Need a way to get into the City!!! Or any other decent salaried careers...
Any advice on what careers
I'm 21 and putting these plans in to place now.
From January onwards i'll be looking into drip feeding £450 every 4 weeks into an ISA and another £350 into a regular savings account.
Me and my fiancee are looking at buying a house in the next 3 years but it all depends on how prices of houses change.
Not limiting how much you spend each month but keeping a tab on how much you do spend is the best way going forward. The past two years I've been spending money stupidly but with a recent job change and a much, much better wage i've decided to get my a rse in gear and not pi ss my money down the drain.
From January onwards i'll be looking into drip feeding £450 every 4 weeks into an ISA and another £350 into a regular savings account.
Me and my fiancee are looking at buying a house in the next 3 years but it all depends on how prices of houses change.
Not limiting how much you spend each month but keeping a tab on how much you do spend is the best way going forward. The past two years I've been spending money stupidly but with a recent job change and a much, much better wage i've decided to get my a rse in gear and not pi ss my money down the drain.
jimbobsimmonds said:
NorthernBoy said:
I'd echo the comment above, and say that you should always think about whether you can (or want to) do anything about the income side of the equation.
As other have said, set up a savings account, or ISA, and have the money go out automatically, but also see what you can do to move ahead more quickly at work, get overtime, or learn skills that will let you earn more.
Every 1k extra you bring home is 1k more towards the house, and likely 1k more every year.
1k rise per year, for three years, nets you an extra £6k at the end of 3 years, £10k after 4, and £15k after 5.
Do you know what, I would love too!As other have said, set up a savings account, or ISA, and have the money go out automatically, but also see what you can do to move ahead more quickly at work, get overtime, or learn skills that will let you earn more.
Every 1k extra you bring home is 1k more towards the house, and likely 1k more every year.
1k rise per year, for three years, nets you an extra £6k at the end of 3 years, £10k after 4, and £15k after 5.
I am working for a large defence firm in engineering (no prizes for which one) and all things going well they will pay for me to complete my HNC and at least a Foundation Degree (hopefully on to full, but this is a fairly long time commitment) in Electronic Engineering.
TBH i don't mind the work but could I do this forever on an engineering salary? No, probably not... I was just trying to use this to show that I could progress in a respected field.
I did well at GCSE 4As and 5Bs in proper subjects but lost my way at A-Level and decided work was the best way of giving me a kick up the arse. Uni i would have wasted but feel Im mature enough now to go and get a degree in something but really don't want to be a full time student...
Need a way to get into the City!!! Or any other decent salaried careers...
Any advice on what careers
Having worked designing weapons systems in electronic warfare made my CV stand out a fair bit from the crowd.
Sounds like you are going in the right direction, so concentrate on getting the qualification, then look round again towards the end.
Bing o said:
Degrees really aren't worth s
t these days - if you have a reasonable job earning decent money, then work hard, apply yourself and play the game at work, you'll end up doing about as well as any grad, and you won't be in a stload of debt.
There are still plenty of jobs that require a degree. A good one still speaks volumes about ability.t these days - if you have a reasonable job earning decent money, then work hard, apply yourself and play the game at work, you'll end up doing about as well as any grad, and you won't be in a stload of debt. Law, medicine, engineering, finance, science, you won't find it easy to get started there without one.
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