Savings and Investments thread

bobmunro said:

Rob7Lee said:

valleynick66 said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

blackpool72 said:

Diebythesword said:

blackpool72 said:

I read somewhere that in the 60s and 70s we had roughly 5 working people for every pensioner we had.
That meant that pensions were affordable. 
We now have about 3 working people per pensioner.
This is partly due to people living longer,  but another cause for this is about 1 million younger people between the age of 17 and 20 are neither in education or work.
They are simply living at home on benefits. 
Unless they are genuinely in a bad way with a real reason  why they cannot work they shouldn't be paid a penny. 
The system in this country is broken and far too many people are being paid for doing naff all.
This needs to change  

1 million young people out of work isn’t enough to warp the figures that much, it’s very much the aging population and the refusal of pensioners to realise that in order for this country to get out the doldrums they need to take a hit to their state pensions and other state benefits like the fuel allowance. Pensioners are currently the richest generation, they can shoulder more of the burden. 

Huge generalisation there.
Not all pensioner's are rich, plenty are struggling. 
I agree the triple lock has to go at some point,  but the millions of working age people out of work and claiming benefits has to also be addressed. 

3.5m aged 50-64 out of work (Labour market stats for 2025 linked below) much more of a problem as these will likely never work again. https://www.gov.uk/government/statistics/economic-labour-market-status-of-individuals-aged-50-and-over-trends-over-time-september-2025/economic-labour-market-status-of-individuals-aged-50-and-over-trends-over-time-september-2025#:~:text=In 2025 there were 3.5,for not looking for work.

Current pensioner are the richest generation in history with 27% as millionaires. https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/datasets/totalwealthwealthingreatbritain?

They hold half of all wealth in the country and more than 65% of housing wealth. https://www.telegraph.co.uk/business/2025/10/08/pensioners-now-hold-half-of-britains-wealth/#:~:text=Pensioners now hold nearly half,generational inequality across the UK.

Pensioners were protected from 15 years of Tory Austerity. In fact they were the only cohort of people who got better off due to the triple lock. Every other age group came out worse off. Personally I've tried to move away from having the generational conversation as I think it's counterproductive and a wedge issue designed to place blame and cause division and detract away from the real issue of wealth inequality. But there is a strong corelation between generation and wealth so it does still form part of the equation. I believe most of the things the government are doing at the moment are tinkering without actually tackling the real issue. But if you're gonna tinker you might as well tinker with the wealthiest people not crap all over those who have been crapped on for 15 years.

How many of the 50-64 age group not working have chosen to do so, have paid into the system for the last 35-45 years and are living off their previous earnings and how many are claiming any form of benefit? I suspect there's far fewer of the latter. I'll certainly be joining that group soon and I won't be getting anything from the state, in fact I'll still be paying in, if I'm still here.

If you don't think a million aged 17-20 not in education or work isn't a major issue......... if that trend continues in 10-15 years time we'll have half the working aged population not working. We should be looking to have 95%+ in education or work at that age.

And wow - NSS - older people have more wealth than younger people, who'd have thought that would be the case, can't understand why I'm wealthier at 52 than I was at 22/32/42. Is it a bad thing that pensioners now are richer than the generation before (and those before and so on). If only we could pass more of that wealth down upon death...... instead the state will tax it and waste it.

It's not that older people have more wealth its that a particular cohort have a higher share of all wealth than any cohort in history. 

When the first baby boomers turned 40 their generation held 45% of all the wealth. When the first millennials turned 40 it was 4%. For gen Z it's forecasted to be less than 1%. Can you see a problem there? 

Your not comparing apples with apples, The silent generation were in broad terms quite poor, because the country was poor. By the time we go to the 80's through to early 00's wealth (in a large part due to property) and inflation earlier meant that those 40 year olds had seen their wealth grow. Also Generations are now living longer, so in part it is taking longer for wealth to pass down (I'm ignoring death taxes for this purpose)

I find it hard to believe that in say 2050 Gen Z will have less than 1% of the wealth. Baby boomers will sadly be a lot less in number (as they'll be approaching 90 or over 100) - where has their wealth gone, or is it with them in Heaven (and hell), even Gen X will be 75+. Where's all the money gone!?! 

It will go to corporations the likes of Blackrock and Lloyd's who are targeting between them 18bn of UK housing purchases in the next 2 years. Offshore ownerships and private equity are planning to hoover up the assets as they become available as boomers die.

I'm assuming Black Rock et all will be paying money for these properties? Where does that money go? And who owns Lloyds & Blackrock?

Well sure but with what that injection of cash will do to already massively inflated house prices will ensure that people will find it harder and harder to buy houses. For the majority of people it's the largest or only asset they will own in their life. Take that away and what do they have? 

And as for who owns them - a smaller and smaller class of asset owners.

Can you genuinely not see a problem here?

But that's not what you said.

I asked where the wealth would go that you were suggesting is disappearing somewhere (when the baby boomers pass etc), you said it would go to companies like Blackrock and Lloyds by purchasing these properties. That isn't removing the wealth from people, it's exchanging one asset (bricks and mortar) for another - Cash. If I sell you my house, assuming I sell at the market value, today I have an asset (House) worth 1.35m, tomorrow I have cash of 1.35m - the wealth hasn't left me.

You were saying the money is moving from the people to the corporations, that's simply not true. If they do buy up 18bn of property it will of course mean certain assets are moving (each way) more property will be moving to corporations and more cash/money will be moving to people.

My second point which you missed or misunderstood, who owns blackrock and Lloyds Banking Group..... Blackrock and Lloyds two biggest shareholders are Vanguard and Blackrock themselves. I.E. it's mine, yours and millions of others pension, ISA's etc that own large parts of these companies.

So again, where does the money/value/asset go? I think you are confusing asset choice and investment return, Blackrock etc are gambling that they'll make more money on Property than elsewhere (and they may be right, but I'm not convinced).

Where I was trying to get you to, is there is only one place the money goes to (meaning the assets diminish) that is currently owned by 'the people' - and that's to Government by way of taxation (in this instance, IHT). If there was no IHT and no crown receipts from death, the money wouldn't be leaving people. However some love the idea of IHT as they believe it redistributes wealth, yet in reality it doesn't.

The housing issue in this country is a whole other topic, until such time as we grow up and start building new towns and millions of houses (and all the infrastructure that requires) it will not change but likely only get worse.

Nope not missed the point at all in fact I think you have. 

You're kidding yourself if you think substituting an asset for cash leaves people equally well off. 

Those assets both the housing and financial are being owned by an ever smaller asset owning class of people. That's already happening. A much smaller proportion of people own financial assets than houses as is and that's only getting worse as well. The massive transfer of wealth from people owning houses to corporations and financial services that's coming as the boomer generation die is only going to squeeze people out of housing and make that worse. And the people that can't afford housing don't buy financial assets either. Having any kind of pension wealth at all puts you in the top 40% of the UK. For a large amount of people the only financial service they buy in their entire life is insurance.

So as said a smaller and smaller asset owning class. 

I get it's not gonna be a problem for you and yours but sure you can see its a problem for society?

Please explain to me, if I sell a property for market value how I am worse off? I had £1.35m in a property, I now have £1.35m in cash (and then wherever I choose to invest it). There has been no transfer of my wealth aside from a tiny amount to an estate agent and solicitor for the transaction.

You seem to believe the wealth is disappearing, I'm trying to work out where you think it's going? Your initial point was that it's going to these corporations that are buying up houses, but fail to see the point that they are paying for those houses, so at the point of asset transfer that is not having the effect of transferring wealth from individuals to corporations. You also seem to miss the fact that those companies buying the properties are ultimately owned mostly by individuals!

Now it may be that house price inflation will out strip other asset inflation/growth, but that's a whole other conversation and a gamble/bet. If I'd have 5 years ago bought property in my pension I'd be worse off than I am now as property has flat lined compared to the stocks and shares I instead held. How have property values compared to the stock market over the last 30-40 years? Not even in the same growth ball park.

There is broadly only one place wealth is going to from individuals and thats to the Government. Let's say I have £5m of asset, whether property, stocks and shares, gold, cash etc etc. That's what I have, if my wife and I die tomorrow that will end up at around £3.4m to my children, the remainder goes to HMRC. There's a true transfer of wealth away from individuals. If we get into the things like property tax it will happen further and quicker.

I'm not saying I agree at all with corporations buying up property and the potential effect that may have on the market, but that it is not the reason for any transfer of wealth and why Gen Z will own less than 1% at aged 40 (which I don't agree with either by the way).

So why haven't you kept all your wealth in cash then? Why do we have this thread? If cash is just as good then why do we need assets at all? Genuinely can't work out if you're being obtuse here!

So a boomer dies. The probate sells their house and pays the relevant taxes. House is brought by a private equity firm as part of a massive nation wide injection of cash into the market driving prices up further. The estate (most cases a house worth less than £1.35m and not much else once care costs have been paid) is split between on average 3 children, some will be passed to grand children and split even further. For the younger people receiving that money it's not enough to get them on the housing market. People who can't afford houses generally don't buy financial assets either so aren't benefitting by the roundabout route of the commidification of our housing market either. The cash is eaten up by increased rent and living costs, maybe a new car or a treat here and there. The majority is simply inflated away.

The wealth is not disappearing. It is being held by a smaller and smaller group of people. Part of the rapidly worsening wealth inequality that has been happening for 20 years. This is just a continuation of that but at a faster rate and exacerbated by the large transfer of wealth coming down the pipeline shortly.

Again, that wasn't what you were saying. Your comment was that these companies buying up property is taking away wealth, thats simply not true as I have explained. When I asked you where this wealth was disappearing to you said:

It will go to corporations the likes of Blackrock and Lloyd's who are targeting between them 18bn of UK housing purchases in the next 2 years. Offshore ownerships and private equity are planning to hoover up the assets as they become available as boomers die.

But that doesn't remove wealth simply because someone buys an asset from someone. I bought four gold sovereigns a couple of months ago from a lady at work. Just because I now own the coins, I haven't taken away wealth from her. She has exchanged the coins for cash (no idea what she then did with the cash) and I have less cash!

My example of cash was showing that when Lloyds Bank buys an asset, a house, (let's say from me) they would do so by paying me the asset value in cash. There is no transfer of wealth, I'm not suddenly worse off. I may spend that cash, I may invest that cash, if I invest it I may end up with a greater value than the house that Lloyds now own, or I might not (my pension the last 10 years has far far exceeded in value and growth my home). If Lloyds buy £18bn of property tomorrow, they aren't suddenly worth more and those who sold worth less. There is now £18bn of property owned by Lloyds who have probably £19bn less money due to costs. Conversely the sellers have no longer got 18bn of property but have broadly 18bn of cash (on day 1). Again, no transfer of wealth.

You've yet to give one example or any explanation as to how these house purchases are transferring any wealth to the corporations. But I have shown you how government is currently removing 7.5bn per annum of wealth (asset) which is set to be doubling in the next 4-5 years to 15bn (and I think that is before the 2027 change to pension funds).

I think you are making the observation that property will continue to rise at a greater rate than anything else money may be invested in, history tells us thats not necessarily the case or in more recent times even likely.

I have never talked about wealth disappearing, though you have gone to great pains to say that i was. I have only talked about wealth transfers.

I talked about wealth transfers from ordinary people to corporations. You said "who owns those corporations" to which I conceded they are owned by people (via a lot of offshoring and some hidden ownership structures) through financial products, but that those products are owned by a much smaller group of people. This isn't the 70s/80s with a thriving middle class when everyone has a share portfolio! Only about 10% of working aged people have anything invested outside of their workplace pension, and only about half have a workplace pension.  So there is a transfer of assets from the large proportion of people who have traditionally owned houses to a smaller proportion of people who own financial services products. Sure on day 1 the wealth calculation will be equal but again you are kidding yourself if you think they are in equally good position. By year 2 that equation will be massively unbalanced and will continue to exponentially get worse. Not owning any assets will very quickly erode the value of that cash, we aren't comparing property growth to other asset growth here. We are comparing asset growth to cash. And even if we ignore the growth in asset values vs cash point. The non-asset owners will be paying rent to the asset owners (via large multi-nationals) in order to live. Therefore more transfer of wealth!

This isn't a new phenomenon. Its been happening for 20 years and much documented. There are literally hundreds of economic papers (selection linked below) explaining this exact thing. The only point I am adding to it is that the bulge in wealth that is now held by those over retirement age and will be transferred in the coming 20 years and I am saying it is going to exponentially speed up what is already happening.

https://blogs.lse.ac.uk/inequalities/2024/10/29/the-uks-wealth-gap-has-grown-by-50-in-eight-years/

https://www.resolutionfoundation.org/app/uploads/2020/12/The-UKs-wealth-distribution.pdf

https://www.jrf.org.uk/narrative-change/changing-the-narrative-on-wealth-inequality

As for your point on Tax, I don't disagree its a leakage and a transfer of wealth (but by your measure "on day 1 the wealth still exists its just in different hands") but in the context of inequality its pretty small beans. If you want to talk about government transfers of wealth why don't we talk about how privatisation means that almost everything the government does is a transfer of wealth to corporations (usually those same private equity funds) through contracts and tax breaks, whether the children's care system, water provision, elderly care all of the cash goes back to the same asset holders. Or we could talk about how during COVID the government directly transferred £700-800bn of taxpayers money to those same corporations and funds. 

Every part of our economy, government and system is making the same small (and ever decreasing) group of asset holders richer whilst excluding everybody else.

Whether you use the words disappearing or transferring, your statement was that the wealth is moving from individuals to corporations and how by aged 40 Gen Z will have less than 1% of the wealth, when I asked where this wealth was disappearing to you used the example of Lloyds etc buying up the houses. My overriding point it that doesn't make wealth disappear or transfer, it's just held in a different form. It may mean corporations own more property, but conversely the individual will own more cash (or wherever they then choose to put that cash).

You are also making the assumption that every man and woman who sells a property to the corporations will leave that money sitting in an Atom savings account to form the opinion that more wealth will be held by the corporations because they're asset value will grow. But thats a completely different matter.

At least we agree that IHT is a true transfer of wealth away from the individual!

It's literally the definition of a transfer of wealth. Wealth is going from one group to another - transfer. 

I'm not making any assumption I'm literally quoting from the evidence linked above from the LSE, Joseph Rowntree Foundation and Resolution foundation. People who don't own houses very very rarely buy investment products. Only 10% of working aged people hold any investments outside the minimum workplace pension around 50% have a workplace pension. It's much more likely that the cash goes to paying off existing debt than investments. For many investments are now sadly so out of reach.

Again this is not an assumption about the future it’s evidenced on what's already happening. The only assumption is that it's going to continue to speed up and exponentially so when a massive amount of wealth is transferred in a short period of time.

Lloyds buying houses isn’t transferring wealth. It may be transferring housing stock to Lloyds, but in return ‘cash’ is transferring from Lloyds.

if I sell my house, my wealth hasn’t transferred to the buyer, the house has, in return the buyer has transferred me the money. Neither I as the seller nor the buyer is any better of worse off and no wealth has gone from one party to another.

we’re now into people who don’t have anything 🙈 what wealth are they transferring?

ps if no one sells their house to Lloyds or any other corp all will be fine 😉

I feel like I'm going insane. Have you actually ready any of my posts? Or am I just not communicating well? This whole time I've been talking about asset owners vs non- asset owners. So obviously we are talking about people who don't have anything.

The children and grandchildren of those with wealth and who hold assets will receive a share of an inheritance. But it likely won't enable them to buy a house or other assets. hence a much smaller asset owning class.

So yes we've established that on day 1 the maths says it's the same but we've also understood that going from owning an asset to owning cash means that very quickly you will be much worse off. 

Yes the people recieving the cash are not going to be part of the asset owning class. Read one of the studies I linked. As boomers who collectively hold a large amount of wealth, gradually die (sorry but it’s whats gonna happen) that wealth will be passed down to their estate. But when the estate is settled and once split between children and grand children the average amounts actually inherited by an individual are not going to be enough to purchase a house. Particularly with the massive targetted corporate investment in the market driving up prices. And so those people who inherit aren't able to buy a house and people who don't own houses generally don't buy financial products either so wont be owning those corprorations through investments. So the cash amount received will either be consumed by ever increasing rent (to the home owning corporations) or inflated away. If it is enough to get them something it will be far less in assets than their parent/grandparents had. 

Perhaps we need to evolve to a nation (as I understand many of our European neighbours have) where home ownership (the ‘asset’ which you refer to ) is not seen as the objective/ need to aspire to and we become more relaxed with renting?

Of course reform of rent controls / leases would be needed but maybe that change in attitude is what will tilt the balance ?

Not saying it’s right or wrong but given the growing unaffordability for many will attitudes change with time?    

This is already happening. A lot of the grads at work are very happy renting and some have no plans to buy property anytime soon, some already into their 30's and don't want to be tied down.

Property is not the golden egg investment it once was (although most of us never looked at your own home as an investment really anyway).

I think property purchase is an investment in the purest sense in that it provides a route to free accommodation later in life - and an endowment if/when trading down. The return on money invested may not be the golden egg it once was, but living rent-free is a pretty good feeling!

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

Rob7Lee said:

cantersaddick said:

blackpool72 said:

Diebythesword said:

blackpool72 said:

I read somewhere that in the 60s and 70s we had roughly 5 working people for every pensioner we had.
That meant that pensions were affordable. 
We now have about 3 working people per pensioner.
This is partly due to people living longer,  but another cause for this is about 1 million younger people between the age of 17 and 20 are neither in education or work.
They are simply living at home on benefits. 
Unless they are genuinely in a bad way with a real reason  why they cannot work they shouldn't be paid a penny. 
The system in this country is broken and far too many people are being paid for doing naff all.
This needs to change  

1 million young people out of work isn’t enough to warp the figures that much, it’s very much the aging population and the refusal of pensioners to realise that in order for this country to get out the doldrums they need to take a hit to their state pensions and other state benefits like the fuel allowance. Pensioners are currently the richest generation, they can shoulder more of the burden. 

Huge generalisation there.
Not all pensioner's are rich, plenty are struggling. 
I agree the triple lock has to go at some point,  but the millions of working age people out of work and claiming benefits has to also be addressed. 

3.5m aged 50-64 out of work (Labour market stats for 2025 linked below) much more of a problem as these will likely never work again. https://www.gov.uk/government/statistics/economic-labour-market-status-of-individuals-aged-50-and-over-trends-over-time-september-2025/economic-labour-market-status-of-individuals-aged-50-and-over-trends-over-time-september-2025#:~:text=In 2025 there were 3.5,for not looking for work.

Current pensioner are the richest generation in history with 27% as millionaires. https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/datasets/totalwealthwealthingreatbritain?

They hold half of all wealth in the country and more than 65% of housing wealth. https://www.telegraph.co.uk/business/2025/10/08/pensioners-now-hold-half-of-britains-wealth/#:~:text=Pensioners now hold nearly half,generational inequality across the UK.

Pensioners were protected from 15 years of Tory Austerity. In fact they were the only cohort of people who got better off due to the triple lock. Every other age group came out worse off. Personally I've tried to move away from having the generational conversation as I think it's counterproductive and a wedge issue designed to place blame and cause division and detract away from the real issue of wealth inequality. But there is a strong corelation between generation and wealth so it does still form part of the equation. I believe most of the things the government are doing at the moment are tinkering without actually tackling the real issue. But if you're gonna tinker you might as well tinker with the wealthiest people not crap all over those who have been crapped on for 15 years.

How many of the 50-64 age group not working have chosen to do so, have paid into the system for the last 35-45 years and are living off their previous earnings and how many are claiming any form of benefit? I suspect there's far fewer of the latter. I'll certainly be joining that group soon and I won't be getting anything from the state, in fact I'll still be paying in, if I'm still here.

If you don't think a million aged 17-20 not in education or work isn't a major issue......... if that trend continues in 10-15 years time we'll have half the working aged population not working. We should be looking to have 95%+ in education or work at that age.

And wow - NSS - older people have more wealth than younger people, who'd have thought that would be the case, can't understand why I'm wealthier at 52 than I was at 22/32/42. Is it a bad thing that pensioners now are richer than the generation before (and those before and so on). If only we could pass more of that wealth down upon death...... instead the state will tax it and waste it.

It's not that older people have more wealth its that a particular cohort have a higher share of all wealth than any cohort in history. 

When the first baby boomers turned 40 their generation held 45% of all the wealth. When the first millennials turned 40 it was 4%. For gen Z it's forecasted to be less than 1%. Can you see a problem there? 

Your not comparing apples with apples, The silent generation were in broad terms quite poor, because the country was poor. By the time we go to the 80's through to early 00's wealth (in a large part due to property) and inflation earlier meant that those 40 year olds had seen their wealth grow. Also Generations are now living longer, so in part it is taking longer for wealth to pass down (I'm ignoring death taxes for this purpose)

I find it hard to believe that in say 2050 Gen Z will have less than 1% of the wealth. Baby boomers will sadly be a lot less in number (as they'll be approaching 90 or over 100) - where has their wealth gone, or is it with them in Heaven (and hell), even Gen X will be 75+. Where's all the money gone!?! 

It will go to corporations the likes of Blackrock and Lloyd's who are targeting between them 18bn of UK housing purchases in the next 2 years. Offshore ownerships and private equity are planning to hoover up the assets as they become available as boomers die.

I'm assuming Black Rock et all will be paying money for these properties? Where does that money go? And who owns Lloyds & Blackrock?

Well sure but with what that injection of cash will do to already massively inflated house prices will ensure that people will find it harder and harder to buy houses. For the majority of people it's the largest or only asset they will own in their life. Take that away and what do they have? 

And as for who owns them - a smaller and smaller class of asset owners.

Can you genuinely not see a problem here?

But that's not what you said.

I asked where the wealth would go that you were suggesting is disappearing somewhere (when the baby boomers pass etc), you said it would go to companies like Blackrock and Lloyds by purchasing these properties. That isn't removing the wealth from people, it's exchanging one asset (bricks and mortar) for another - Cash. If I sell you my house, assuming I sell at the market value, today I have an asset (House) worth 1.35m, tomorrow I have cash of 1.35m - the wealth hasn't left me.

You were saying the money is moving from the people to the corporations, that's simply not true. If they do buy up 18bn of property it will of course mean certain assets are moving (each way) more property will be moving to corporations and more cash/money will be moving to people.

My second point which you missed or misunderstood, who owns blackrock and Lloyds Banking Group..... Blackrock and Lloyds two biggest shareholders are Vanguard and Blackrock themselves. I.E. it's mine, yours and millions of others pension, ISA's etc that own large parts of these companies.

So again, where does the money/value/asset go? I think you are confusing asset choice and investment return, Blackrock etc are gambling that they'll make more money on Property than elsewhere (and they may be right, but I'm not convinced).

Where I was trying to get you to, is there is only one place the money goes to (meaning the assets diminish) that is currently owned by 'the people' - and that's to Government by way of taxation (in this instance, IHT). If there was no IHT and no crown receipts from death, the money wouldn't be leaving people. However some love the idea of IHT as they believe it redistributes wealth, yet in reality it doesn't.

The housing issue in this country is a whole other topic, until such time as we grow up and start building new towns and millions of houses (and all the infrastructure that requires) it will not change but likely only get worse.

Nope not missed the point at all in fact I think you have. 

You're kidding yourself if you think substituting an asset for cash leaves people equally well off. 

Those assets both the housing and financial are being owned by an ever smaller asset owning class of people. That's already happening. A much smaller proportion of people own financial assets than houses as is and that's only getting worse as well. The massive transfer of wealth from people owning houses to corporations and financial services that's coming as the boomer generation die is only going to squeeze people out of housing and make that worse. And the people that can't afford housing don't buy financial assets either. Having any kind of pension wealth at all puts you in the top 40% of the UK. For a large amount of people the only financial service they buy in their entire life is insurance.

So as said a smaller and smaller asset owning class. 

I get it's not gonna be a problem for you and yours but sure you can see its a problem for society?

Please explain to me, if I sell a property for market value how I am worse off? I had £1.35m in a property, I now have £1.35m in cash (and then wherever I choose to invest it). There has been no transfer of my wealth aside from a tiny amount to an estate agent and solicitor for the transaction.

You seem to believe the wealth is disappearing, I'm trying to work out where you think it's going? Your initial point was that it's going to these corporations that are buying up houses, but fail to see the point that they are paying for those houses, so at the point of asset transfer that is not having the effect of transferring wealth from individuals to corporations. You also seem to miss the fact that those companies buying the properties are ultimately owned mostly by individuals!

Now it may be that house price inflation will out strip other asset inflation/growth, but that's a whole other conversation and a gamble/bet. If I'd have 5 years ago bought property in my pension I'd be worse off than I am now as property has flat lined compared to the stocks and shares I instead held. How have property values compared to the stock market over the last 30-40 years? Not even in the same growth ball park.

There is broadly only one place wealth is going to from individuals and thats to the Government. Let's say I have £5m of asset, whether property, stocks and shares, gold, cash etc etc. That's what I have, if my wife and I die tomorrow that will end up at around £3.4m to my children, the remainder goes to HMRC. There's a true transfer of wealth away from individuals. If we get into the things like property tax it will happen further and quicker.

I'm not saying I agree at all with corporations buying up property and the potential effect that may have on the market, but that it is not the reason for any transfer of wealth and why Gen Z will own less than 1% at aged 40 (which I don't agree with either by the way).

So why haven't you kept all your wealth in cash then? Why do we have this thread? If cash is just as good then why do we need assets at all? Genuinely can't work out if you're being obtuse here!

So a boomer dies. The probate sells their house and pays the relevant taxes. House is brought by a private equity firm as part of a massive nation wide injection of cash into the market driving prices up further. The estate (most cases a house worth less than £1.35m and not much else once care costs have been paid) is split between on average 3 children, some will be passed to grand children and split even further. For the younger people receiving that money it's not enough to get them on the housing market. People who can't afford houses generally don't buy financial assets either so aren't benefitting by the roundabout route of the commidification of our housing market either. The cash is eaten up by increased rent and living costs, maybe a new car or a treat here and there. The majority is simply inflated away.

The wealth is not disappearing. It is being held by a smaller and smaller group of people. Part of the rapidly worsening wealth inequality that has been happening for 20 years. This is just a continuation of that but at a faster rate and exacerbated by the large transfer of wealth coming down the pipeline shortly.

Again, that wasn't what you were saying. Your comment was that these companies buying up property is taking away wealth, thats simply not true as I have explained. When I asked you where this wealth was disappearing to you said:

It will go to corporations the likes of Blackrock and Lloyd's who are targeting between them 18bn of UK housing purchases in the next 2 years. Offshore ownerships and private equity are planning to hoover up the assets as they become available as boomers die.

But that doesn't remove wealth simply because someone buys an asset from someone. I bought four gold sovereigns a couple of months ago from a lady at work. Just because I now own the coins, I haven't taken away wealth from her. She has exchanged the coins for cash (no idea what she then did with the cash) and I have less cash!

My example of cash was showing that when Lloyds Bank buys an asset, a house, (let's say from me) they would do so by paying me the asset value in cash. There is no transfer of wealth, I'm not suddenly worse off. I may spend that cash, I may invest that cash, if I invest it I may end up with a greater value than the house that Lloyds now own, or I might not (my pension the last 10 years has far far exceeded in value and growth my home). If Lloyds buy £18bn of property tomorrow, they aren't suddenly worth more and those who sold worth less. There is now £18bn of property owned by Lloyds who have probably £19bn less money due to costs. Conversely the sellers have no longer got 18bn of property but have broadly 18bn of cash (on day 1). Again, no transfer of wealth.

You've yet to give one example or any explanation as to how these house purchases are transferring any wealth to the corporations. But I have shown you how government is currently removing 7.5bn per annum of wealth (asset) which is set to be doubling in the next 4-5 years to 15bn (and I think that is before the 2027 change to pension funds).

I think you are making the observation that property will continue to rise at a greater rate than anything else money may be invested in, history tells us thats not necessarily the case or in more recent times even likely.

I have never talked about wealth disappearing, though you have gone to great pains to say that i was. I have only talked about wealth transfers.

I talked about wealth transfers from ordinary people to corporations. You said "who owns those corporations" to which I conceded they are owned by people (via a lot of offshoring and some hidden ownership structures) through financial products, but that those products are owned by a much smaller group of people. This isn't the 70s/80s with a thriving middle class when everyone has a share portfolio! Only about 10% of working aged people have anything invested outside of their workplace pension, and only about half have a workplace pension.  So there is a transfer of assets from the large proportion of people who have traditionally owned houses to a smaller proportion of people who own financial services products. Sure on day 1 the wealth calculation will be equal but again you are kidding yourself if you think they are in equally good position. By year 2 that equation will be massively unbalanced and will continue to exponentially get worse. Not owning any assets will very quickly erode the value of that cash, we aren't comparing property growth to other asset growth here. We are comparing asset growth to cash. And even if we ignore the growth in asset values vs cash point. The non-asset owners will be paying rent to the asset owners (via large multi-nationals) in order to live. Therefore more transfer of wealth!

This isn't a new phenomenon. Its been happening for 20 years and much documented. There are literally hundreds of economic papers (selection linked below) explaining this exact thing. The only point I am adding to it is that the bulge in wealth that is now held by those over retirement age and will be transferred in the coming 20 years and I am saying it is going to exponentially speed up what is already happening.

https://blogs.lse.ac.uk/inequalities/2024/10/29/the-uks-wealth-gap-has-grown-by-50-in-eight-years/

https://www.resolutionfoundation.org/app/uploads/2020/12/The-UKs-wealth-distribution.pdf

https://www.jrf.org.uk/narrative-change/changing-the-narrative-on-wealth-inequality

As for your point on Tax, I don't disagree its a leakage and a transfer of wealth (but by your measure "on day 1 the wealth still exists its just in different hands") but in the context of inequality its pretty small beans. If you want to talk about government transfers of wealth why don't we talk about how privatisation means that almost everything the government does is a transfer of wealth to corporations (usually those same private equity funds) through contracts and tax breaks, whether the children's care system, water provision, elderly care all of the cash goes back to the same asset holders. Or we could talk about how during COVID the government directly transferred £700-800bn of taxpayers money to those same corporations and funds. 

Every part of our economy, government and system is making the same small (and ever decreasing) group of asset holders richer whilst excluding everybody else.

Whether you use the words disappearing or transferring, your statement was that the wealth is moving from individuals to corporations and how by aged 40 Gen Z will have less than 1% of the wealth, when I asked where this wealth was disappearing to you used the example of Lloyds etc buying up the houses. My overriding point it that doesn't make wealth disappear or transfer, it's just held in a different form. It may mean corporations own more property, but conversely the individual will own more cash (or wherever they then choose to put that cash).

You are also making the assumption that every man and woman who sells a property to the corporations will leave that money sitting in an Atom savings account to form the opinion that more wealth will be held by the corporations because they're asset value will grow. But thats a completely different matter.

At least we agree that IHT is a true transfer of wealth away from the individual!

It's literally the definition of a transfer of wealth. Wealth is going from one group to another - transfer. 

I'm not making any assumption I'm literally quoting from the evidence linked above from the LSE, Joseph Rowntree Foundation and Resolution foundation. People who don't own houses very very rarely buy investment products. Only 10% of working aged people hold any investments outside the minimum workplace pension around 50% have a workplace pension. It's much more likely that the cash goes to paying off existing debt than investments. For many investments are now sadly so out of reach.

Again this is not an assumption about the future it’s evidenced on what's already happening. The only assumption is that it's going to continue to speed up and exponentially so when a massive amount of wealth is transferred in a short period of time.

Lloyds buying houses isn’t transferring wealth. It may be transferring housing stock to Lloyds, but in return ‘cash’ is transferring from Lloyds.

if I sell my house, my wealth hasn’t transferred to the buyer, the house has, in return the buyer has transferred me the money. Neither I as the seller nor the buyer is any better of worse off and no wealth has gone from one party to another.

we’re now into people who don’t have anything 🙈 what wealth are they transferring?

ps if no one sells their house to Lloyds or any other corp all will be fine 😉

I feel like I'm going insane. Have you actually ready any of my posts? Or am I just not communicating well? This whole time I've been talking about asset owners vs non- asset owners. So obviously we are talking about people who don't have anything.

The children and grandchildren of those with wealth and who hold assets will receive a share of an inheritance. But it likely won't enable them to buy a house or other assets. hence a much smaller asset owning class.

So yes we've established that on day 1 the maths says it's the same but we've also understood that going from owning an asset to owning cash means that very quickly you will be much worse off. 

Yes the people recieving the cash are not going to be part of the asset owning class. Read one of the studies I linked. As boomers who collectively hold a large amount of wealth, gradually die (sorry but it's whats gonna happen) that wealth will be passed down to their estate. But when the estate is settled and once split between children and grand children the average amounts actually inherited by an individual are not going to be enough to purchase a house. Particularly with the massive targetted corporate investment in the market driving up prices. And so those people who inherit aren't able to buy a house and people who don't own houses generally don't buy financial products either so wont be owning those corprorations through investments. So the cash amount received will either be consumed by ever increasing rent (to the home owning corporations) or inflated away. If it is enough to get them something it will be far less in assets than their parent/grandparents had. 

Glad we agree that upon sale of the asset to LBG there has been no wealth transfer to the corporations (which was where this started and was my original response/disagreement).

The part of those inheriting can't be part of the asset owning class I disagree with (not that they won't but that they can't). When my father died (a boomer) his estate (which consisted of a house in Eltham) was split between my sister and I and my two children (70/20/5/5), my 20% I also gave to my children (aged 15 and 12 at the time) and I invested that for them in assets (predominantly stocks and shares, but a little bit of gold and some premium bonds), the value of those ISA's/LISA's, Gold & PB's now far exceed what it would have had it remained in property, by at least 2x.

On the flip side, my sister decided to spend the majority of hers, numerous (sometimes 4x a year) expensive holidays, a new car etc, I suspect she has little left. Now that isn't because she couldn't have kept the money in assets, she simply chose not to (for numerous reasons).

That's as much to do with financial education as anything else. Yet financial education is still rarely talked about let alone anything done about it. When I get new starters at work (Apprentices/Graduates) it scares me the lack of financial knowledge they have. I spend a fair amount of time running through that even at a basic level of saving, I'm pleased to say that 90% learn very quickly and start saving and investing straight away. I run a monthly lunch catch up with them all to see how our ISA's are doing!

I have a different view to many as to where house pricing will go, I don't think it will be the appreciating asset it once was (to the levels, it will still appreciate over time), even less so if any government actually pulls it's figures out and starts properly building.

IMHO, and it is just mine, there is no reason for assets to drift away from individuals to corporations or to fewer and fewer people, other than for taxation reasons and financial education. If every boomer put their assets into certain types of trust, there would be little asset transfer aside from periodic tax, and even without trusts it's IHT that will deplete assets of the people together with a lack of financial education, not because LBG are planning on buying houses.

Again on day 1 the maths says it's the same. Over time the gap grows exponentially.

What your describing isn't the average situation either when a person inherits or the amount the will inherit. Again less than 40% of working aged people have any form of pension and less than 10% have any investments above the minimum workplace pension. What your describing is people in that 10% recieving an above average inheritance which is such a long way from the average person. 

You can say you don't see any reason for assets to drift away from individuals and towards corporations or a small asset owning class, but its happening. And has been for nearly 20 years. The rate at which its happening has sped up massively since COVID and is IMO the main driver of the bad feeling around the UK and a lot of our economy struggles. 

Again I'm describing a phenomenon that already happening and is much reported on. There are literally hundreds of research and economic papers outlining this effect. It's seen as one of the biggest causes of growing inequality in the UK. All I'm pointing out is what's coming down the pipeline in terms of a population bulge and the higher proportional wealth that cohort hold means this effect that is already happening is going to happen exponentially quicker.  

Don't disagree that financial education but I think you're way off if your implying for most people the only reason they don't have an investment portfolio is bad choices and lack of knowledge.

I think we can agree to disagree on whether massive targetted corporate investment in the housing market is going to price people out of housing. Which again for most is the only asset they will ever own. 

You were referring to assets.

If the inheritance is or once was an asset (i.e. a house) it's not £5 or £10k. Take the average house price of about £270k and even if thats split between 4 people inheriting it, thats still over £65k each. If people (the type of people you refer to, i.e. do not own their own home and have no investments outside of a basic workplace pension) aren't investing at least the majority of that, then that is everything to do with financial education. 

I'm not saying ti isn;t happening to a degree, but it doesn't need to be.

Garys economics has a lot to answer for.