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Eddie_George

If You Are Young In Britain Today, You Are Being Taken For A Ride

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If you are young in Britain today you may well be being taken for a ride. Your parents also know this is happening to you but they don’t know what to do. In the media they learn of anonymous “Whitehall sources” claiming that the government already knows there is a strong risk that the next generation of adults will end up worse off than today’s older generation. They drip-feed this news out, managing down expectations.

The anonymous voices explain that many children and younger adults face the prospect of having lower living standards than those of their parents. These were the same sources that released the Social Mobility and Child Poverty Commission report of autumn 2013 explaining that now, for the first time ever, a grandmother in her eighties can expect to enjoy higher living standards than someone in their twenties who is in work. They said it was because housing costs for the young are now so high and wages, if you are young, are usually so poor. But that was not the only reason the young are worse off. Another factor is that the rich see them as an easy target.

More at link

Rings true with me. Boomer bosses who are utterly useless and do sweet Fanny Adams yet pay themselves well.

Edited by Eddie_George

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claiming that the government already knows there is a strong risk that the next generation of adults will end up worse off than today’s older generation

A strong risk?

An actual observable fact today. If you didn't buy property before 2004 you put up with renting whether you like it or not, or you borrow more than is sensible to buy a poor value home.

People are scratching their chins and daring to mention a 'risk' of what has been an obvious and observable fact for 10 years.

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I was in college twenty years ago. Let's see how things have changed...

Studentness: at the time we were pretty upset about student grants being cut back, however someone from a lower-earning family would get in the region of two thousand pounds grant (call it four thousand at today's prices). There was a vague threat of top-up fees from some colleges that nobody took remotely seriously at the time.

Cars: the mainstream culture dictates you have a car. I bought my first car almost exactly twenty years ago. It was a titchy-engined mark-1 fiesta and cost me about £330 quid for the first year's third party insurance. A similarly rubbish car for a twenty-one year -old today (I recently researched quotes for a 21-year-old with a late-nineties 1-litre Saxo ) is around fifteen hundred quid, so roughly twice the price in real terms.

Assuming zero student grant and £10k tuition charges my early-twenties counterpart is roughly £42k worse off in today's money on the grant/fees difference and an additional £1500 quid on the first couple of years of car insurance.

Ouch.

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Please persevere, it covers a lot of ground, even house prices! :)

Good article, thanks. I've been banging on about the themes in it for much of the day, elsewhere.

Uncovered some unbelievable enttitlement today with older people, who should be made in their 60s. Now trying to sell £2m+ house they've McMansioned up for a footballer type, since buying in 2010 for just under half that price. And stuck with other investment houses they outbid younger people on, now trying to flip for £100K+ more. Suspicion of a lot of MEW along the way. Vulnerable imo.

The older VI interest want to protect their HPI by any means possible, but the measures they are taking to put it all on the young, are ultimately going to see a harder crash in my opinion. It can't be escaped. The market feedback comes back twice as powerful from more directions, to policies/stimulus which is trying to defeat realities.

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I work with a bunch of late twenties, early thirties lot alongside a bunch of 40-55 year olds. I fall into the first group.

Sadly every single one of the young lot is now buying or thinking of buying....because they have totally bought into the idea that it's only going one way fast. And a 55 year old is 'helping' his 23 year old son buy a place - a 2 bed flat and round here that would mean at least £200K, so I suspect he's helping him to the tune of a six figure sum or very near to it, as he's probably earning mid twenties max so couldn't get a repayment mortgage for much more than 100k. When I said 'Who has the money? It is nonsense' his words were 'People must have it as they are still buying, but yeah, it's ridiculous'.

I replied that unless my salary doubles, through no effort on my part with the corresponding increases in both the personal allowance and higher rate tax bands, I wouldn't buy. And if I was still to be working full time, I'd already earn double the national average. I've cut down to 3 days a week, and see no reason to work any harder than that because my time is not being valued at the rate it should be given the cost of shelter, and given all of that money would be taxed heavily, why would I every bother?

His son would be better off not working at all then entering into this insanity really, because he's just setting himself up for a lifetime of drudgery. He had no words to that one.

Unfortunately, my younger sibling is now in the same position of 'needing to buy' thanks to a baby on the way and stupidly enough, I'm going to help them out and get my parents to do the same. There's no talking people round - we are still in a minority in actually avoiding it, even if there is growing sentiment towards our side of the argument (high house prices are not a good thing). Anyway we will give them a 40% or greater deposit, and advise very, very strongly to take a 14 year mortgage rather than a 25 year one with as long a fix as they can get (think you can still get 7 year ones) with a mortgage that allows overpayments, and chuck money at them.

The silliest part of it is I hope they 'lose' every penny I give them over the next few years, so my niece/nephew can have a reasonable life in the future!

Edited by Frugal Git

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And a 55 year old is 'helping' his 23 year old son buy a place - a 2 bed flat and round here that would mean at least £200K, so I suspect he's helping him to the tune of a six figure sum or very near to it, as he's probably earning mid twenties max so couldn't get a repayment mortgage for much more than 100k. When I said 'Who has the money? It is nonsense' his words were 'People must have it as they are still buying, but yeah, it's ridiculous'.

There is the final stage we're in of the malinvestment right there. "It's not earning anything in the bank." Older people only expecting more HPI - it's clever thing to do, as it only goes up, going in on the margin again at very high prices. Or using their savings to expose themselves to more property, to help their adult children paying dead money in rent.

They've had a very gentle and magnificently prosperous economic ride apart from a bump in late 80s/early 90s, which actually was a boon to helping people trade up. No wonder Major won again. They've loved that opportunity to trade up, against older interests. They outnumbered them politically, and HPC was welcomed. Now they resist it.

Debt and savings into buying expensive additional property when it goes 'poof' into the red, or into nothing, hurts when market turns from here. And I know of a few very intelligent senior young people in their early-mid 30s at top financial firms, who have no intention of buying a home at these prices. They rent, awaiting the crash, and they're positioned to help pull the plug on the market in the near future.

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Youths have been totally screwed over - big time.

I did uni, got a maintenance grant, was able to get summer work to save. Being at university was something special (a real achievement). Was able to buy a car in my final year - paid £300, got it insured for me and my then girlfriend (on an uncle's policy) for about £220. Petrol was £2 a gallon.

Left with a degree, no debt, some savings. It actually wasn't that easy to get work at the time - took six months. Nonetheless life to look forward to without being crippled by debt; less than three years later though a stretch at the time I was a joint purchaser of a house.

Edited by tinker

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More at link

Rings true with me. Boomer bosses who are utterly useless and do sweet Fanny Adams yet pay themselves well.

My daughter will be 6 years old next month, I pay £3000 per year into her child trust fund, she has 8 ounces of gold stashed in a safety deposit box and I intend adding a couple of ounces per year until she is 18.

On top of that I will give her a 1 bedroom flat that I own in Rugby outright but do not currently rent out which she can live in, sell or rent out.

Difficult to predict the future but at current prices she has about £74K of assets increasing £5K per year (3K + 2 ounces gold) plus whatever the flat goes up (or down) per year.

I am hoping 12 years from now when she is 18 it will give her a good start.

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My daughter will be 6 years old next month, I pay £3000 per year into her child trust fund, she has 8 ounces of gold stashed in a safety deposit box and I intend adding a couple of ounces per year until she is 18.

On top of that I will give her a 1 bedroom flat that I own in Rugby outright but do not currently rent out which she can live in, sell or rent out.

Difficult to predict the future but at current prices she has about £74K of assets increasing £5K per year (3K + 2 ounces gold) plus whatever the flat goes up (or down) per year.

I am hoping 12 years from now when she is 18 it will give her a good start.

You better hope she's sensible!

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It takes some doing. Productivity and efficiency should virtually guarantee every generations quality of life is far far better than the previous. That this has been reversed is a testament to the truly, unbelievably, astoundingly incompetent, evil, useless and criminal politicians who have been in charge since about 1965.

What can you do though. While things keep getting better in the BRICS, theyve still a long way to go, and we've a long way to fall before you get western living standards. Read MISH or Denningers blogs and its much the same there. The only saving grace being that in the US (unless obama continues to shit on the constitution) the young might not be skinned alive quite so much as cities and states can default, whereas here every goddamn thing gets put on the national credit card.

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Youths have been totally screwed over - big time.

I did uni, got a maintenance grant, was able to get summer work to save. Being at university was something special (a real achievement). Was able to buy a car in my final year - paid £300, got it insured for me and my then girlfriend (on an uncle's policy) for about £220. Petrol was £2 a gallon.

Left with a degree, no debt, some savings. It actually wasn't that easy to get work at the time - took six months. Nonetheless life to look forward to without being crippled by debt; less than three years later though a stretch at the time I was a joint purchaser of a house.

Yes it was! It was an educational experience, not a financial bum-shafting! :blink:

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Youths have been totally screwed over - big time.

I did uni, got a maintenance grant, was able to get summer work to save. Being at university was something special (a real achievement). Was able to buy a car in my final year - paid £300, got it insured for me and my then girlfriend (on an uncle's policy) for about £220. Petrol was £2 a gallon.

Left with a degree, no debt, some savings. It actually wasn't that easy to get work at the time - took six months. Nonetheless life to look forward to without being crippled by debt; less than three years later though a stretch at the time I was a joint purchaser of a house.

And many who are now in their 40's have no career progression - doing the same level of work day in day out for years at the same grade - because few above are retiring due to the cost of their living, which of course, is affecting those now attempting to enter the job market at its bottom.

Edited by LiveinHope

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I was in college twenty years ago. Let's see how things have changed...

Studentness: at the time we were pretty upset about student grants being cut back, however someone from a lower-earning family would get in the region of two thousand pounds grant (call it four thousand at today's prices). There was a vague threat of top-up fees from some colleges that nobody took remotely seriously at the time.

Cars: the mainstream culture dictates you have a car. I bought my first car almost exactly twenty years ago. It was a titchy-engined mark-1 fiesta and cost me about £330 quid for the first year's third party insurance. A similarly rubbish car for a twenty-one year -old today (I recently researched quotes for a 21-year-old with a late-nineties 1-litre Saxo ) is around fifteen hundred quid, so roughly twice the price in real terms.

Assuming zero student grant and £10k tuition charges my early-twenties counterpart is roughly £42k worse off in today's money on the grant/fees difference and an additional £1500 quid on the first couple of years of car insurance.

Ouch.

I was too. The grant was genuinely useful - and I wouldn't have been able to go to university otherwise due to penniless parents. Never could afford a car - only the students from rich families had them.

Somethings have got better though. A semi useful desktop computer (286 or if lucky, 386) was close to £2K to buy. Laptop? Forget it - close on £4K. Web? Nope. Mobile phone? No-one had them. Alcohol and food prices were probably the same in real terms or possibly cheaper nowadays. Clothes - definitely cheaper. DVDs? Try VHS tapes at never less than a tenner (when on discount). MP3s? Try CDs - again usually at a tenner or more a piece. Bicycles? you get a much better bike for £300 now than you did then.

It did take most graduates I knew a while to get a job (there was a recession at the time). But while there were fewer opportunities and they were much harder to find, there was less competition. Often they were real graduate jobs though - and in your field - not a call centre.

In short, while some things got cheaper and better - other stuff, particularly essentials like housing/education/energy, rocketed ahead. My suspicion is that education will massively reduce in price as it's virtualised.

Edited by StainlessSteelCat

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I was too. The grant was genuinely useful - and I wouldn't have been able to go to university otherwise due to penniless parents. Never could afford a car - only the students from rich families had them.

Somethings have got better though. A semi useful desktop computer (286 or if lucky, 386) was close to £2K to buy. Laptop? Forget it - close on £4K. Web? Nope. Mobile phone? No-one had them. Alcohol and food prices were probably the same in real terms or possibly cheaper nowadays. Clothes - definitely cheaper. DVDs? Try VHS tapes at never less than a tenner (when on discount). MP3s? Try CDs - again usually at a tenner or more a piece. Bicycles? you get a much better bike for £300 now than you did then.

It did take most graduates I knew a while to get a job (there was a recession at the time). But while there were fewer opportunities and they were much harder to find, there was less competition. Often they were real graduate jobs though - and in your field - not a call centre.

In short, while some things got cheaper and better - other stuff, particularly essentials like housing/education/energy, rocketed ahead. My suspicion is that education will massively reduce in price as it's virtualised.

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I've just posted an empty message! :blink:

I'm a complete plank sometimes! :huh:

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And many who are now in their 40's have no career progression - doing the same level of work day in day out for years at the same grade - because few above are retiring due to the cost of their living, which of course, is affecting those now attempting to enter the job market at its bottom.

And because companies have been kept afloat by QE and therefore bad management that should have led to being taken over or liquidations goes unpunished, and preserves the stale management hierarchy, instead of a proper recession letting in new blood

Edited by Si1

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I was too. The grant was genuinely useful - and I wouldn't have been able to go to university otherwise due to penniless parents. Never could afford a car - only the students from rich families had them.

Somethings have got better though. A semi useful desktop computer (286 or if lucky, 386) was close to £2K to buy. Laptop? Forget it - close on £4K. Web? Nope. Mobile phone? No-one had them. Alcohol and food prices were probably the same in real terms or possibly cheaper nowadays. Clothes - definitely cheaper. DVDs? Try VHS tapes at never less than a tenner (when on discount). MP3s? Try CDs - again usually at a tenner or more a piece. Bicycles? you get a much better bike for £300 now than you did then.

It did take most graduates I knew a while to get a job (there was a recession at the time). But while there were fewer opportunities and they were much harder to find, there was less competition. Often they were real graduate jobs though - and in your field - not a call centre.

In short, while some things got cheaper and better - other stuff, particularly essentials like housing/education/energy, rocketed ahead. My suspicion is that education will massively reduce in price as it's virtualised.

This is the weapon that is used against the young- "you're lucky, with your technology etc. Now buy my £250k house and your £50k education"

Zugzwang captured it nicely a while ago, along the lines of(can't find it) "your dustbin man has more RAM in his smart phone that existed in a continent in the early 70s, yet in the same period we've managed to make the cost of life's essentials like housing more expensive". It deserves a bit of contemplation as to how and why that could possibly have happened.

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Wasn't worth it, still poor.

Just put aside his political bias, we all know the parties are the same on this forum. At least this guy recognises the housing ponzi. That's something I think.

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To me, it looks like anything that can't be globalised or made digital is going up in price.

Plus, there is a deep seated attachment to land by the powers that be (and as a result, those under them) - and they are happy to keep prices high because by renting it - you can make money for doing nothing.

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Just put aside his political bias, we all know the parties are the same on this forum. At least this guy recognises the housing ponzi. That's something I think.

Its not that at all, its just not well written and asking for more money. Nothing about where to go next.

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Young people most definitely are being screwed but as with young people before around 1955 they are castrated and unable,unwilling and mostly unaware to do anything to change things. It is not their fault as the government machine has spent the past 35 years implementing a plan that would result in future generations being placated by a combination of bad education and sedation.

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