Time to tackle the rentier economy.

The inheritance some of us were lucky enough to have has probably been invested in our own homes. Many people in our fortunate situation have been able to share that inheritance with our children, by way of cash towards a deposit on their first home.
The disparity between those of us who have been fortunate to buy a home and those who haven't will continue to increase.

I agree Whitewave, the tax system needs to be adjusted for reasons of fairness and a greater level of democracy. We are a country where home ownership is a tradition. With rents ridiculously high and tenancies not secure, little wonder home ownership remains the dream.

We also need a building project for social housing, with affordable rents and secure tenancies.

Yes, we've seen this with our three children born in and around those times. The differences between their friends - some find large amounts of money being dolloped in their laps. Hence some have no student loans, some have huge and increasing loans because the loans are now subject to high interest, some have been given huge sums of money and don't know what to do with themselves as a result, some have been given houses and expensive cars. Meanwhile, some young people are forced to live in high rent, decrepit shared houses and work for the likes of Sports Direct. Wages a pittance and appalling conditions.

It has to stop. It isn't fair, though many will simply shrug at that notion. It is desperately unhealthy on many levels for the whole country. The happiest countries are the most equal. The inequality I have seen growing in my lifetime saddens me and the subterfuge whereby people claim a right to their wealth because they 'worked' for it or some such. We all work and luck plays a large part in life. As if the world wasn't troubled enough, this has to be sorted.

Again I see differences here,WE are not traditionally a home owning country .The vast majority of Scots rented .Council housing was the norm not just for folk who were "poor" as is often peddled on here.Home ownership soared under Maggie Thatcher with the sale of those council houses .
I grew up in a council house,oddly my GP's owned a home but they were the odd ones out for their time in our area .Once the council houses were sold there was a rush to buy small flats in tenements not far from demolition ,so people had to buy bigger even if it was against their better judgement.

Some one said last week that people from all walks of life lived in council housing,that is my experience too.We were very lucky to get a council house ,brand new when we got married but bought after 8 years for a variety of reasons , one because houses were scarce for folk who couldn't get a deposit together and we could .
In those days the mortgage rate was 16% so home ownership that had seemed wonderful to the people getting discounts was suddenly a rope around their necks.In many cases literally!!

I think we have to remember that the term 'rentier' isn't just to do with 'rented accommodation'. It's a term used to describe any 'unearned income', so would include dividend income, money made from gambles such as 'shorting' in the financial markets etc. The essence of it is that you don't go and work 9 - 5 to 'earn' it and it is taxed at lower rates than the money you do earn from a 9 -5 job.

It's much more likely to be tucked away into tax avoidance schemes, too.

Basically, 'rentiers' are taking much more out of the economy than nine to fivers...

Perhaps the wealth tax could be used to kick start a social care overhaul?

We have a nice house, we have savings and I am still working in my late sixties.
I would like to enjoy our savings, help the economy, help our children. Problem is, we are terrified of having to fund care in our older age.
So, we will either leave not much or a lot.

MaizieD

I think we have to remember that the term 'rentier' isn't just to do with 'rented accommodation'. It's a term used to describe any 'unearned income', so would include dividend income, money made from gambles such as 'shorting' in the financial markets etc. The essence of it is that you don't go and work 9 - 5 to 'earn' it and it is taxed at lower rates than the money you do earn from a 9 -5 job.

It's much more likely to be tucked away into tax avoidance schemes, too.

Basically, 'rentiers' are taking much more out of the economy than nine to fivers...

Yes and rentier contribute nothing when a country’s economy needs a kick start.

The most important driver in an economy is demand, and their wealth, rather than being used by the wealthy to create demand is stuffed away off shore or in bank accounts property etc.

Even Johnson seems to understand that demand is the answer to the U.K. and its economic crises, but will undoubtedly stop short of the redistribution of wealth.

We have provided for our son while we can afford it.

Rosalyn69

We have provided for our son while we can afford it.

This isn’t about those of us who have worked our entire lives and bought a house to live in.

This is about those with vast wealth that is not used either to invest in a thriving business or to consume.

This economic class has not earned any of their wealth, but do use it to buy their way into power and privilege.

What is your definition of wealthy WhitewaveMark2 ?

Is it a multi millionaire, billionaire or small/medium business owners who have run their companies well and make a profit?

I dispensed with most of what I had to set my two D's up with their futures rather than sit on an expensive property and see them struggling.

I would wish for equality more than anything as I hate seeing oppression and depression among the young as their chances of ever owning anything are now as far away as ever.

GrannyGravy13

What is your definition of wealthy WhitewaveMark2 ?

Is it a multi millionaire, billionaire or small/medium business owners who have run their companies well and make a profit?

Someone who runs a business isn’t a rentier. It doesn’t matter how much the company is worth, it is being run for the good of the economy.

Thank you WhitewaveMark2

I think the lines get blurred with the likes of the owners of Amazon, Apple, Facebook etc who employ lots of people but juggle their corporation tax / dividend liabilities.

Those who have inherited millions which is in Land/Farms/Stately Homes etc might look wealthy on paper but are relatively-^cash poor^ . Particularly Stately home owners who have been hit hard by COVID-19 closures and opening restrictions.

The percentage of mega rich rentiers with no physical businesses employing people in the UK I imagine is much less than 10% quoted.

All these wealthy folk living in the UK have houses to upkeep which I imagine involves staff, they must be consumers (food, drink, clothing, furniture eating out) so some of their income is in circulation

Whether we feel it’s right or wrong I think it is human nature to want to hold on to what you have.

If they were to pay all of their taxes due I would not have a problem in them keeping their money.

I think to a certain extent saving off shore is a bigger version of the less wealthy looking for the best interest rates for any savings they may have.

I agree, and, if we don't solve this, we're (or rather, our children) are in for a bumpy ride.

But I honestly don't see it as achievable. Everybody sees the wealthy as having more money than they have, and would like to see them taxed.

With reference to Amazon. If people stopped using Amazon, which is perfectly possible, they wouldn't be a success. But people prefer to moan AND have cheap stuff.

There are those that buy cheaper on Amazon because that is all they can afford, especially the young. It is very easy to say stop buying if you can afford to buy elsewhere at higher prices.

toscalily

There are those that buy cheaper on Amazon because that is all they can afford, especially the young. It is very easy to say stop buying if you can afford to buy elsewhere at higher prices.

I have always been anti Amazon but it has been a life saver during lockdown.

If everyone were to boycott Amazon many thousands of people would be out of a job, whether it be in their warehouse, the delivery people or maybe even some of the folks in the supply chain.

If everyone were to boycott Amazon many thousands of people would be out of a job, whether it be in their warehouse, the delivery people or maybe even some of the folks in the supply chain.

That's, to a certain extent, nonsense. The demand for the goods would still be there, it would just be met by other suppliers and the jobs would 'relocate'.

I haven't used Amazon for many years now. I can get anything I want from alternative suppliers online. I'm in the fortunate position of not having to go for the cheapest option every time. I appreciate that some people feel they have no choice.

MaizieD

^If everyone were to boycott Amazon many thousands of people would be out of a job, whether it be in their warehouse, the delivery people or maybe even some of the folks in the supply chain.^

That's, to a certain extent, nonsense. The demand for the goods would still be there, it would just be met by other suppliers and the jobs would 'relocate'.

I haven't used Amazon for many years now. I can get anything I want from alternative suppliers online. I'm in the fortunate position of not having to go for the cheapest option every time. I appreciate that some people feel they have no choice.

That is like saying its ok to let such and such company go broke because all the other companies in similar lines will employ those who have been made redundant from said Company

Unfortunately it doesn’t work like that.

My children ( both born in the 80’s) will inherit the same from me as I will inherit from my father and the same as he inherited from his parents ( my grandparents) and so on . Meaning that the cycle will probably continue .

Unfortunately it doesn’t work like that.

Really?

MaizieD

^Unfortunately it doesn’t work like that.^

Really?

Yes

There was a report a couple of days ago that said that those born in the 1980s (our children) will inherit more than half as much money from their parents as the average person earns in a lifetime:
I don't understand how this is worked out. If an average house in the expensive south east is £500,000 and someone has the average two children, that is five to ten years salary. If the parent has to go in a nursing home, there will be less money.

If you want everyone to have the same then you should live in a communist country. There are those people who work hard and spend on stuff they need but save and invest their savings and are careful with money. There are others who work hard but spend every penny they get often on stuff they want not need tattoos etc. and never save. They don't try to save or invest. Wind forward just 5 years and the savers get richer and the spend it at once people are poor. Unless you control how much people can spend and what on there will always be inequality.

Those who save will pass on inheritance, and likely good saving habits, to their children and the cycle continues.

I worked to save money and invested in 2 b2l properties. When my Mum died and I inherited I bought 2 more. I have since bought 2 more. I will be able to leave each child 2 b2l properties. I pay tax on propeties and dh pays higher rate tax on the 3 b2l houses we own jointly. We supply a home for people to rent. We always have a waiting list of people wanting to rent from us. we make a profit but keep all houses in excellent condition and if an appliance breaks it is replaced within 24 hours.

Our home and holiday home in France will either be used to pay for our old age care if needed or else children and grandchildren will inherit. It is natural for parents to want to leave their worldly goods to their children.

Too many people spend more than they can afford and have not been taught to budget to live within their means.

newnanny yes, there was an experiment on either Channel 4 or 5 where they gave multiple families their benefits for a year ( I think) in one go the results were interesting.

Like your post some blew the lot, some were careful and benefited.