‘Ask yourself a question: If I won a million, what’s the one driving motivation that would keep me coming into work?’
This is the scenario a consultant posed to the senior management team in a training session in one of my previous lives. Being singularly demotivated at the time, and because I thought it was a stupid scenario to use, I refused to play ball. ‘If I won a million, there is nothing that would make me come to work,’ I insisted. And I wouldn’t budge from my position.
Once we had bought this house and a car, our savings were gone.
I was recounting this story to a millennial the other day and his reply floored me. ‘If I won a million, I would keep on working,’ he said, ‘because a million’s not enough’.
I was both flabbergasted and angry.
There are so many people in this country and around the world who don’t have enough money to heat their homes or feed their families. If any one of them won a million it would transform their lives. For someone to declare a million’s not enough seemed to me to be obscene. And I told him so.
Once I’d calmed down, I tried to put myself in his shoes. He’s not yet 40, has two very young children, a big mortgage and an expensive car. He wants to ensure he’s creating a financial cushion for his lifetime and beyond, so that his children will inherit. For him to give up work now would probably mean a larger financial loss on future earnings than the interest on his million would yield.
But those are his choices. He has aspired to a certain level of lifestyle that’s expensive to maintain. He doesn’t have to drive a top-of-the-range car that cost the equivalent of the price of a modest home when I was his age; he doesn’t have to holiday in the biggest and most expensive villas and only fly Dreamliner.
Setting the expectation bar unrealistically high
It seems to me, one of the big differences between us (baby boomers and late boomers) and many of today’s young is not only their sense that they’ve been cheated in life by not having the same opportunities we had, but also about the choices they make and the level at which they set expectations.
When my generation was looking to buy its first home we looked for modest terraced houses in areas we could afford. Many of today’s first-time buyers want the kind of homes their parents have now but without having to climb the property ladder to get there. The same with cars. When we left Portugal, we offered to give our Fiat Punto to our young, permanently-strapped-for-cash neighbours. They declined. It wasn’t the kind of car that fitted with their self-image, they explained.
I’m not saying people shouldn’t be aspirational, I think every generation should aspire to more. I just think there’s a level beyond which, expectations exceed realism.
Level playing field
On Radio 4’s World at One this week, Sarah Montague and Evan Davis (a respected economist, journalist and broadcaster) discussed the notion that those born in the 1960s are ‘the luckiest generation in history’. Evan presented three bones of contention today’s young level at those born in the sixties; student loans, house prices and pensions.
Looking at those three elements through the eyes of today’s generation, there are unjustifiable chasms between opportunities and entitlement for those born in the 60s and those facing the prospect of student loans, high interest rate mortgages and inadequately funded pensions today. I won’t go into details here (you can read more about the debate for yourself) but it’s not as simple as it appears.
Although university education was free prior to 1990, very few people went on to higher education. Those that did tended to come from middle class families who could afford to continue to support them financially. When I was applying, less than 10% of school leavers went to university compared to 49% now. So yes, you certainly gained from not having to repay a loan, but you were in a very small minority. For most, the opportunity simply wasn’t there.
When it comes to mortgages and house buying, if you bought a house in London, then you really were lucky and have enjoyed the riches of that purchase. But outside the capital, houses didn’t appreciate at anything like the same rate. Mortgages were also smaller and eligibility harder. As a single woman I wasn’t eligible to apply for a mortgage so had to partner with my brother to get one. The most I could borrow was 2.5 times my salary. Today, loans are up to 4.5 times combined salary.
As for pensions, yes, there is no doubt pension schemes for us were much more favourable than for today’s workers.
Evan concludes: ‘So rather than saying that late baby boomers were a lucky generation, I’d suggest the late baby boom was a particularly great generation in which to be lucky.’
You’re so lucky
In 2003 Jack and I both walked away from solid gold pension jobs and good incomes to move abroad to a new life with zero prospects of an income and total savings of £150,000. After we sank most of our money into a house and a car (the Punto), we had to claw our way up from financial rock bottom. We worked hard to create and market our guides to Tenerife which brought us in a bedrock of income while at the same time launching new careers as travel writers.
In time, we became known for the quality of our work which led to opportunities to write for UK broadsheets, staying in posh hotels and travelling to different islands. Then we got noticed by Inntravel which led to travel all over Europe and the sorts of experiences many people can only dream of. But for every trip there was an inordinate amount of behind-the-scenes hard work.
Despite near-constant comments of ‘you’re so lucky’ from friends and even family occasionally, nothing just fell in our laps. Or as a more enlightened friend remarked… ‘and the harder you work, the luckier you get.’
Choices
Had we stayed here and worked in our old jobs until retirement, Jack and I would now have pensions that equate to good salaries, no mortgage and probably a much bigger house. But would I trade a single day of our experiences for those material benefits? Nope. For us, the value of moving abroad, living in a new culture, learning a new language and trying to scratch a living has enriched us far more than bigger pensions or houses could ever have done.
If I won a million today, it would change our lives. We could pay off our mortgage, update our bathrooms, and travel as much as our hearts desire. Would I keep on working? Maybe. But not to accumulate more wealth, simply for the love of writing.
