Spending Your Str Fund

[Meenzer]

Try looking at moneysavingexpert.com - its all about saving money without having to live on beans (although there is a thrift forum if you like that kinda thing).

Heard of it. Is it good?

[redwing]

I've rule for myself.

Savings is capital and should be used to fund capital projects and provides short term self-liquidity if required.

Income is for spending.

Excess income goes into savings and adds to the capital fund.

Capital projects include buying a house, paying for education/skills/training or buying other assets that don't depreciate (which rules out cars).

But you can lend savings to yourself. So, you can lend yourself £10,000 for a car. It's just that you settle a term with yourself and pay back the loan by increasing your savings from income each month.

Borrowing from yourself is a lot cheaper than from a bank. You can cut out their margin. You only need to pay yourself interest at the rate at which it was being earned from your deposit account.

Quality of life - the beans on toast or caviar questions - really should be paid for out of income.

[huw]

That house is depreciating at £2k a month. So in theory, I'm making £2k a month, tax free.

And think about how much tax-free cash you've made by not visiting Vegas (assuming you haven't )

[CharlieChuck]

Don't open a spreadbetting account is the advice I've got for any STRers.

I've managed to not spend any in 4 years, except for replacing my car which had I still owned a house I woul dhave got a loan for so there's interest savings there anyway.

It depends on your attitude to money, chances are if you a STRer you're unlikely to squander it anyway as you probably wouldn't have sold in the first place, but would have mewed instead for cash to throw away on plasma's, 4x4's etc.