Redistributing wealth between the generations

I think that just as times have changed, the difficulties faced by each generation have changed. I don’t think things are necessarily easier/harder, but they are different. When I was young, jobs were plentiful, if not particularly well paid, and rented property was easier to come by. We managed to rent and save, which is much harder to do now. Hardly any of my friends had cars, but public transport was better, and we walked - a lot! My children are both renting, they have reasonable jobs, but rents/council tax etc are so high now, saving any meaningful amount isn’t possible. I hope we don’t need long term care, as inheritance is about their only chance of getting on the housing ladder. We do help out where we can, and we’re happy to do it.

Going back to the original question - why - I think that some parents like to keep the apron strings tied and others like to help their children so that they have an easier time of it, or most likely a combination of both. Plus of course some are now in a position to help whereas our parents, some having survived one or even two world wars, had little enough.

I feel as though I'm redistributing my wealth all the time. We've just booked a holiday for the dgcs in the autumn half term and I feel I could live comfortably on that amount for a good while. Still shocked at the price hike for school holidays. So we are doing what Tim Hartford suggests - giving our dosh to the midlife people( both daughters in their forties) we did the ridiculous mortgage thing of absurd interest rates and no they won't take little Wifey's salary into consideration ( cue for coy glance at me suggesting I would go home and breed) and there are still cheap houses around as our own first house is now a snip at £170k and my parents home considered a 'good address 'for £120 k.

As an example of how house prices have inflated, , a dd recently paid just over 100 times what the house had last sold for in 1971. (Yes, we had a good old nose on the Land Reg.) And in fact that was a very reasonable price, compared to similar nearby. A fairly basic 3 bed semi, nothing at all flash.

OK, this is in an expensive area, though still considerably more affordable than London.
It wasn't as if the house was done up, either - it was a probate sale, clean and obviously loved, but very little had evidently been done for several decades.

If salaries have gone up by anything like 100 times, I have to say it's news to me.

I believe if you are lucky enough to be able to have children you should support them as much and for as long as you possibly can, I wouldn't of bothered to have any if I was going to stop the support once they became adults.

To get back to the OP “redistributing wealth between generations” I think one of the problems is that, while lots of younger people benefit from help from their parents, many don’t.
The many who have no parental help with a deposit for a house, no assistance with university costs, no ferrying to and from hobbies or the “best” schools, no help from an inheritance, will really lose out. This property owning advantage or disadvantage will also be passed on to their children.
So is it inter-generational? Or is it property owners versus the renters?
(I admit we have helped our three children in many ways including house purchase deposits. But I’m not sure it’s “fair”. It’s also helped to inflate property prices.)

mernice

My father died in 1962. He was headmaster of a large school in a large City.
He died intestate.
When his finances were sorted mum received a year of his salary = £1,000.
The house we then lived in was 1 of 10 originally built by a private company who went bust and the council bought them up.
In a leafy suburb with walled gardens and wrought-iron gates, wisteria and lilac trees and attached garages, it was an idyllic place to bring us up in but, after dad's death, mum had to find a job, and soon, as my brothers were 16 and 5 at the time. When she approached the council to buy the house with a deposit of £500, DOUBLE the £250 deposit required.
The head of housing (who lived 4 doors away) refused as he wasn't convinced mum could meet the repayments which were LESS than the rent. ???
That house sold for £684,950 in Nov 2016. It's part of a large northern town, not a swanky southern scene and the road and general area is now, exactly as it was then in 1962.
From that, I can extrapolate the facts that a 3 bed semi with front and rear gardens, veranda and attached garage was, in 1962, selling for £1,750 needing a deposit of £250 and a headmaster's salary was £1,000 = 57.4% of the house price.
How does that equate nowadays...I wonder.

A new research paper from Angus Deaton, Nobel laureate in economics, also finds that we are all persistently disappointed by life. Around the world, people tend to feel that in five years’ time they will have climbed a rung or two on life’s ladder, but most of us fail to do so. It is not quite clear why: did we not get as much money, status and sex as we were hoping for?

The article is quite fluffy and written from an American perspective. - but the above perhaps sums it up.

Are humans ever satisfied? I think we strive more in our youth, want more, want to see ourselves moving on. It seems more desperate and urgent to be 'getting on', especially today when discussions online, articles, twitterfeeds and news programmes focus on divides yet never make the point that all of life tends to be a struggle in one way or an other, and then you die!

The ease I know know is because I became very ill with stress-related conditions and had to leave work. I had a life of hardship as a single parent. I felt the pinch though, so returned to work, against doctor's advice. There is no more 'striving' and very few aims or goals left. but many pensioners are still working, many women who have had their OAP moved back six years with little notice are struggling financially. The world isn't rosy for many old people. We mustn't forget that. How awful it is to work hard for a lifetime and find yourself in the twilight of your life still having to count the pennies? That happens too.

Younger people tend to have hopes and dreams. We did. They strive because they have to. No one is going to give them a life on a plate, ready made. It's nice to be young, bit it's also hard work, raising a family, paying bills etc. The pressure is on. But it's ALWAYS been like that.

That is probably the gist of the article.

We had an endowment mortgage but. luckily, a move of house meant we switched to a standard mortgage before people realised that endowments were never going to pay out enough to clear their mortgage - feel so sorry for those who didn't switch. People writing these sorts of articles usually forget to mention the sky high interest rates we had to contend with - we, like many other couples, had second hand furniture and hand me downs and a holiday was camping with a tent borrowed from my sister in law. We had just one car that my late husband spent his spare time working on to keep it running! I have worked most of my adult life and, even though I took early retirement at 59 I have since looked after my daughter and my three grandchildren on a full time basis so she can continue to work after becoming a single parent when ex s-i-l walked out on them. We are not lazy or greedy - that really makes my blood boil when I see those accusations and yes, many of us do help out our adult children simply because we have been there, done that, struggled through and care enough that we don't them to have to do the same. So much that is written in the media is designed to set one generation against another - what we need to do is unite in battle for a fair life for us all, regardless of whether we are young people starting out or older people trying to enjoy their retirement years!

I'm really not surprised that we get attacked from all corners when all we can offer is 'my deprivation was worse than yours' and absolutely no appreciation of the difficulties facing young people today. Smug self satisfaction at our own perfections and total lack of sympathy for the younger generations doesn't help anyone or win us any friends.

To get our deposit in the 1970s we lived with in laws for a year to save up £1000 - the deposit on a house that cost £8000. We did little, no car, I worked in a London bank and OH had a salary of £1000 pa. All our early lives were very difficult and we were permanently broke. Interest rates went up on a regular basis and we had no help from families (expect for living with in laws in the the first year). I married when I was nearly 18. But is was OK, I knew everything!! (not)

Another Pythonesque comment... by dint of hard work and few treats we managed to save £3250 in the 1960s. That would have bought a house but the one we liked cost £500 more than we had. We asked the BS with whom we had saved the sum for a mortgage. We were turned down even though we were both professionals and in work. Another few years renting before we could even get the small loan required. I can't remember that we felt entitled to anything but did withdraw our savings from the BS concerned

Some parents are partially supporting adult children because the young adults are out of work and cannot get work. In this kind of case, I find it quite natural to help out, after all we love our children!

The price of property has sky-rocket all over Europe, whether you want to buy or rent. Renting property, you are IMO basically using your money here and now to keep a roof over your head and not able to save for the future, so investing in property makes better sense.

I do agree that for our generation it makes no sense that younger people move into a house and want and expect to buy furniture and everything else not only new, but the latest fashion as well and feel entitled to have holidays etc.

I would make it very clear before offering an AC help while they are saving up for a house, that they can save much more quickly if they do not go on expensive holidays and evenings out while they are saving up.

However, each to his own, I can well believe many of you bite your tongues rather than risk offending your dear ones.

I will never understand my own children.Brought up the same but chalk and cheese with out a doubt.
There must be something in the genes I think, because so are mine (well, one is) sarahellenwhitney

I've skimmed the article now, and it's an interesting idea.
We're currently staying in a rather affluent part of the SE and I'm amazed at the apparent standard of living of so many people. Mostly 'babyboomers'.

“Young people go to the gym” “young people have holidays “ etc. So much bitterness

Excuse me gillybob, that is NOT bitterness, it is a fact. I include my own AC in that!

It is remark regarding the difference in lifestyles and the expectations of a generation.

It illustrates the way in which being 'hard up' is relative. And not all young people have disposable income, but we tend to hear a lot more about how awful it is for younger people today but very little about the real hardship suffered when their grandparents were making their way in the world.

I really do think we live in a mad world when a person with very little still HAS TO HAVE an iphone costing £500+ and nothing else will do. Comparisons are odious but the way society has evolved in terms of wants and material goods is quite shocking. The word deprived does not apply to many. Not only that, grandparents are still supporting their adult children and going without themselves, when they have known hardship and have budgeted for most of their lives. Many pensioners are still living with very little.

As others have said the old are being demonised from all quarters. Is that not bitterness and anger gillybob?

AmMaz - I was going to make a similar point.
The thing that helped us older folk to become economically stable was the fact that it was easier to get a job in our days. There wasn't the same worry of being made redundant, or on a short -term contract.
So we weren't so scared of committing to a mortgage even though borrowing money wasn't easy.
I worry that our grandchildren will have to struggle in an unpredictable job market.

I wonder how many who have commented on this thread have actually read the article I posted a link to.

Very few of them, I'd suggest, janea. Now Gnet has made it worse by making it a featured 'discussion' and completely skewing the OP's original purpose by calling it 'Why are so many pensioners still supporting their adult children?'

So not even Gnet bothers to read the OP.

Unfortunately in some areas there are no jobs out there - and those there are pay minimum wage! Plus there are hundreds applying for every job.

Jalilmal108
How true. Doesn't always work out like that does it.
You can take a horse to water but can't make it drink
I will never understand my own children.Brought up the same but chalk and cheese with out a doubt.

I’m not bitter about the younger generation, But articles like this are meant to arouse that feeling.
In the early 70s, we had no money to speak of. The mortgage for a little terrace, (and I’m not talking about near London) when we managed to get one after much saving and doing without, plus rates and utilities left us with £6pw to live on. It meant walking to work, no nights out and no holidays. Things did eventually get better though the 17% interest period didn’t help.
I agree that house prices are ridiculous now, but they seemed ridiculous back then too.
I don’t remember feeling as aggrieved as some do today. We do occasionally help out if needed and have acted as a ‘stay over’ place when offspring were moving house, but I don’t want to fund others’ lifestyle with my hard earned money.

I'm glad that my AC have their own homes without asking mum or dad or inlaws for help. They all started work at 16 and all had left home before they were 19 to pursue their careers and none have ever claimed benefits. If you want something, there are jobs out there and you'll appreciate what you buy with what you earn, far more than the easy money of handouts.

Day6, only thing I'd say is that the workplace has become a highly competitive and unbearably stressful environment - for professionals and blue collar workers alike it seems to me, with workers' rights seemingly a thing of the past. Nowadays you've got to be grateful to have a job, be willing to put in hours over and above, and then return home and be the perfect parent with a full social diary for the kids to show you're doing the best by them - and that's competitive too.

Not saying any of the above is right - far from it - but must be hard to buck the trend. Question is how was it allowed to get like this? I have my own very un-PC opinion about that!

Different generations have different values.
Like others we started off with an old banger ( the car, not the wife ) and mpg was the major consideration in the purchase.
Todays generation veer towards leasing a new vehicle.
We are expected to subsidise their lifestyles and in particular child minding is not only expected but taken for granted.
I get a daily email from Gransnet showing the five main topics of conversation, as I do from Mumsnet.
I rarely read the Mumsnet contributions but one topic was why should we have it all and they should struggle. For me that sums up their attitudes.
We expected and indeed received no help from our parents, that was the norm.
I spoke with a lady from the gym some time ago who informed me that her daughter and partner and child had moved back in with her so that they could save for a deposit for a house.
They were paying her £250 a month!! going on holidays and even had another child whilst staying there.
What I didn't realise it at the time, and only found out by reading my email from WhatMortgage was that it impacts the householders future life financially.
The money that she is subsidising her family with could have gone towards her pension and this will never be regained and it could even mean that she will have to work longer before she could afford to retire.
I never saw her again.
The cynic in me tells me that she probably couldn't afford to carry on with her gym membership fees.

and to make some possibly tongue-in-cheek observations.
Yes,I thought it was tongue-in-cheek and tried to respond in kind!