Money suggestions

[jaffab]

Ha ha! Of course all that information, 'Wise' as it most probably is ,relies on a large income.

If you are referring to my post, then you have missed the point - none of them require a large income, except maybe the insurance part (and I did say as you can afford it). I was doing the above when I had no money at all.

[sethorly]

'Average' household incomes of £50,000 per annum!

Average UK income is 26500 pa. So for a couple, which is what I referred to, it's around 50k, and when both are earning (ie. before kids) is the time to build up that cash cushion.

Of course we're talking average income, so half the population will earn less than this. Furthermore, some will earn more but choose to put all their money towards buying a house, or invest it in their kids. These folks will struggle to put money aside for emergencies, but my point is that the first priorities, regardless of how wealthy you are, should be getting rid of expensive non-mortgage debt and building up some sort of cash fund (even if it's 30 quid per month, which is where I started). So this is not just advice for the lucky wealthy people.

Picking up on something jaffab said that is really good is "Dont try to keep up with the Joneses". When people buy stuff to make themselves feel better or look good, it's called succumbing to "status anxiety". For me, choosing to ignore status anxiety (20-odd years ago) was a turning point in so many ways. But again, many people don't even have the option of improving their status by buying stuff.

[dangerman]

I think Jaffab has written some really logical and rational bits of advice down there. It may be worth laminating for some... Me, for example. Thanks for taking the time to share, it's good to keep thinking about - asking myself questions before I buy etc, I need to make that more of a habit.

Jansman, I also agree with your take. The definition of 'rich' should be decided upon by the individual, and it looks to me that you're a rich man. You have peace of mind and your quality of life is high. If that's not rich then I don't know what is.

I watched a youtube video recently, can't remember if it was a book review... Anyway, it pointed out that most people wouldn't give up their arm or leg even for a million quid. So, presuming your legs and arms and kidneys, bone marrow and bits of liver is similarly priced, you're already very very wealthy!

However - my take on this thread isn't about being wealthy or about who is 'richest', it's the concept of growing money as a preparation for future perceived potential problems. I've learned, similarly to what Jansman says, that money/wealth/value is relative.

I used to believe that wealthy people were the baddies because they were hogging the dosh, keeping it for themselves. Statements like "99% of the wealth is owned by 1% of the population" prove to piss off poor people, who feel that money is a limited asset and that it needs to be shared out - resulting in political tension and socialism. Not that I'm not a socialist of course, I love the NHS and all that. But I'm also not a socialist.

While some are spending their time and effort to grow strawberries and squashes, I want to learn how to grow money. Money to prepare with. Everyone needs skills and from my perspective, in the current climate, money growing is a good skill and prep. We can all be multi skilled, I can learn to grow spuds as well. Which I might do next.

Also, when you think about it, whether you're prepping for a natural disaster, war, economic collapse, rioting and displacement (basically anything that isn't the zombie apocalypse), money could be key to your managing happily or not.

[jaffab]

dangerman, spot on. Having a reasonable bank balance does not make you either happy or rich - it just means you are not unhappy or stressed about having too little. If my bank account grew by say £10,000, I would be no happier than I am now. Being rich is more than money.
Rich for one person is different than the definition of Rich for another person.
For some people, having the latest iphone, GTI, kitchen doo-dah makes them rich. For others, its just being close to family. For others, its just having their health. And for others, its their children. For others, it will be helping others.

[Catswhiskers]

Please don't bite! I read a leaflet years ago re getting out of debt. I found it interesting reading their advice...keeping paying the monthly amount to each..don't fall behind but increase payment on your LARGEST debt, not the one charging most interest, even a couple of pounds extra every month. When it is paid off, continue paying that amount off your next largest one on top of the original payment. I would have been inclined to pay off the most expensive one but then I'm not a financial wizard. Just remember the Martin Lewis mantra..can I afford it, do I need it, will I use it? Wish I had remembered it this morning but heck, I can go back for a refund. If you have lots of time and patience Martin Lewis shows you how you can use one bank to transfer money to another and thence to another, covering their minimum monthly in lodgements and getting a good return. I don't have enough brain cells left to juggle like that. You will reach your goal as long as you believe you can. Doubt or discouragement is the killer.

[dangerman]

I really like Martin Lewis. I've used his site for years and think there is a lot of very useful ideas on there. The forum is a bit aggressive though. Lots of angry people with bad attitudes.

His advice is totally logical and makes since almost all the time, but it's not the only way of thinking, it's just a philosophy. His market, his niche, is people like I have been in the past. People who have not managed their money well but now want to start being better about it. I've used his advice in the past, in fact I recently tarted my very last and final credit card. That will be clear by August and so will my last ever kitchen loan.

There is a guy called Dave Ramsey in the states who has a very useful but basic step by step plan and youtube channel for specific advice for people who phone him. His advice, which makes sense too, is you should pay off your smallest debt first. He said that it has a psychological benefit to actually see progress. He also says that before you do anything you should get a thousand bucks together so that you won't use credit cards as emergency funds anymore.

[Catswhiskers]

I really like the comment Jaffab made about waiting 5 days. Sometimes a delay lets things get into perspective too. I'm not a " change it every year" person. My kitchen is 19 years old and was never finished. I got quotations for a new one in January but didn't have time to decide. That was five weeks ago. Now? Resprayed doors, one cupboard becomes drawers, new worktop and walls a different colour, saving me literally thousands! That will do me fine, I've got my eye on an old camper van. That too can wait now to see how I feel in a month or two.
When my brother came back from Australia and bought his home, they were seriously short of money. His mantra? "Make every pound a prisoner". We used to have a contest called "Points for bargains" and would see who could get best value. Now he is comfortably off, frequent holidays, antique bits he has "picked up". He can't understand why I prefer to help my children or buy Prep stuff. He laughed last week when I told him about my freeze dried foods but then most people can't see what is happening around them or have the idea that the government will take care of them....wrong! I still sometimes remember the old mantra but then again, I frequently also hear "It's only £1", especially boxes of Maltesers. Don't buy anything you will be binning or stuffing in the back of a cupboard in a months time. Do allow yourself a treat but don't squander your resources.

[Juno]

I really like the comment Jaffab made about waiting 5 days. Sometimes a delay lets things get into perspective too.

I totally agree. Yesterday my husband (who is generally pretty good with money - he's responsible for us having finally switched our utility provider off a standard tariff) texted me saying "are you home on Monday to get SkyQ installed?". First I had heard of this! We use FreeSat, NowTV to PAYG the F1 occasionally, Netflix and Amazon Prime (on a cheap student subscription as I'm an OU student). So, I asked him some questions about what it was, how much it cost, etc., and actually within about fifteen minutes of exchanging texts he had realised it wasn't going to give us a significant benefit, and that he'd actually fallen for the "great deal" on something that we wouldn't have bought otherwise. Funny as he's usually pretty sensible about these things!

[jaffab]

All,

A money book recommendation for anybody interested in money. It's not a 'how to be good with money' book (there are plenty of these out there)... this is more of a 'scare the pants off you' money book. So the recommendation is:

Web of Debt - by Lisa M Harrison

My review: Covers the history of money from how money got started (here in the UK with Talley sticks) through to the creation of the Bank OF England, the use of Gold then Silver as the backing of money, then heads in the direction of the USA, covering the war of independence, what the Fed is, money around the world (including various countries bankruptcies and how it affected the people), and why Money is not what you think it is. It is the history of money, the current state of affairs, why the world is doomed, and possible solutions. It is a very very interesting read. The original book was published at the end of 2006 and predicted something very bad was going to happen (the 2007/2008 crash). It has a revised version out there (updated in 2009) with an added section which covers what happened in 2007/2008 and what the press said happened verses what really happened and the size of the bail outs. The author worked in the financial services industries for years, and now teaches economics at universities and advises large organisations on finance.

From the amazon reviews:
EXPLODING THE MYTHS ABOUT MONEY. Our money system is not what we have been led to believe. The creation of money has been privatised, or taken over by a private money cartel. Nearly all of our money is now created as loans advanced by private banking institutions -- including the Federal Reserve, the stock of which is 100% privately owned. Banks create the principal but not the interest to service their loans. To find the interest, new loans must continually be taken out, expanding the money supply, inflating prices -- and robbing you of the value of your money. Web of Debt unravels the deception and presents a crystal clear picture of the financial abyss towards which we are heading. Then it explores a workable alternative, one that was tested in colonial America and is grounded in the best of American economic thought, including the writings of Benjamin Franklin, Thomas Jefferson and Abraham Lincoln. If you care about financial security, your own or the nation's, you should read this book.

Note, if you know what to google, there are copies of the book in epub and pdf format which you can find downloadable for free. Ayy-Arr Jim lad.