with apologies to George and Weedon Grossmith!I'm Mr Average, aged 42, 2.2 kids, aged 14 and 17, wife, average job in small manufacturing company, been there since the big engineering works closed down, wife works a call centre. I live in a very nice three bed semi on what the wife likes to think of as the smarter side of town. Apart from the usual ups and downs of family life with two teenage kids things were going along very nicely....until a couple of weeks ago!I got talking to this chap in the local and he said a few things that worried me, all on his own he was, looked like a bit of a Fool. So I felt sorry for him and started talking to him. He asked how things were and I told him that I have been doing rather well lately, never felt richer, been living the good life. I told him about our nice four year old Range Rover, bit thirsty and expensive to run but it is fully loaded and impresses the hell out of the other mums when the wife drops off Jimmy and Jane at the local school. I tell him how well the kids are doing, Jimmy is keen to get the the University of NewPrestonville, somewhere in the South to do Architecture ( he's been watching all those TV programmes) and Jane is keen to become a vet, specialising in small animals ( no money in farming stuff anymore!) I also told him about my little sporty number, brand new Audi TT, lovely car and did he know they don't actually lose their value.He then asked if I had been on holiday. Oh yes I said, two weeks in the Caribbean, very nice, shame about the hurricane! And of course me and Mrs Average had a short break to Barcelona at easter, to have some time to ourselves. Oh, and I had a weekend in Prague with the boys from the footy club and Mrs Average went on a hen weekend to Dublin with a group from the call centre. Not forgetting the skiing trip to Val D'Isere with the kids, I think it is so important to show your kids a bit of the world , don't you? I also told him about the apartment in the Costa del Sol we'd just put down a deposit on, apparently if a sell it next year when it's finished I'll make £25k on the deal.I could see this guy was very impressed with my "lifestyle" so I got to boasting a bit. "You should see what Mrs Average and I have done with our house" I dropped in the name of our street and I could see he was impressed. Nice new kitchen and bathroom this year, top of the range, no rubbish, all new stainless steel appliances and everything, the wife insisted. Double glazing and conservatory the year before, UPVC of course, low maintenance, we've had the house for ten years so it was beginning to look a bit tired. Mrs Average is great with soft furnishings as well, gets all her ideas off the TV ( 42" plasma of course) and she's picked up a load of furniture recommended by the nice Linda Barker woman off the tele. It's all added loads of money to the house of course.I told him then how clever we had been. We bought the house for £50k in 1990 and one just down the road went earlier this year for £250k, only it wasn't as nice as ours. "Fantastic" said this bloke "so you must be really pleased to have over £200k in equity, especially with house prices falling a bit, you've got a nice cushion there and of course with all these interest rate rises, it must be nice to have a low mortgage"I then explained quite slowly the this Fool how modern economics works, he seemed so out of touch. I explained that I had increased our mortgage a couple of times in the last three or four years and we actually didn't quite have 200k equity any more but it made sense to take some money out of the house while interest rates were so low."How much?" he askedI wasn't sure why I told him but he seemed so harmless I gave him a complete run down on how clever we had been with financing.We had a £40k endowment mortgage originally but my IFA told me that it wasn't going to pay off the mortgage and I would be better to change it to a repayment and with the deals on offer I would be able to get more money out and pay less per month. So I took out an extra 25k which seemed a bit scary at the time but the monthly payments were about the same as before so I didn't mind. And the house needed a bit of work and my car had failed its MOT so we got a new one. Then the wife started buying stuff on store cards and we got a bit behind, so with the house going up in value we took out some more money. They came and valued it at 150k and said we could have another 50k on the mortgage, and with interest rates coming down, and me doing a bit of overtime it seemed a good idea. We paid off the credit cards (it's silly paying those high interest rates if you don't have to) and we spent the extra money on a fanatstic holiday to see my brother in Oz and the Range Rover.I was on a roll then, we had suddenly become middle class, I now understood how the neighbours could afford those holidays and cars when they didn't earn any more then me. I had seen the light, I had become financially savvy. All my mates were buying up these cheap terraced houses down the wrong end of town and putting DSS tenants in. They showed me how I could buy a run down house for £60k, do it up and put tenants in and it would cover the mortgage payments so I would be buying the house for free! So I borrowed another £80k earlier this year and I am am now a landlord and then I got a BTL interest only loan loan against the value of the new property and I was suddenly a landlord. I haven't actually got a tenant in yet but it is a really lovely property I'm sure it will be let soon, if not I can always sell it.Then this man got out a piece of paper and asked me to add up all my debts and look at my income. So it seems as if I now have two houses worth £300k plus and mortgages of £260k, that's not so bad is it. He then asked about credit cards and I was able to tell him how clever we had been again and how we were "stoozing" with about £50k on 6 credit cards. He seemed to know the term and asked where we were saving the money. Saving? How did he think we had bought the new car and all the furniture and the holidays. He looked worried. But I told him that it was OK, didn't he realise that it was all at 0% and we just get a new 0% deal when the old ones run out. He still didn't look convinced though. He then asked about savings, "What savings?" I said, didn't he realise that at these low interest rates it wasn't worth it. He then asked about pensions, "Ha" I said, "my properties are my new pension. I stopped paying into my company pension and my last one was lost when the big company went bust. It's a mug's game". "So the think you are doing OK then?" he asked"Haven't you been listening" I replied, so a listed it all out again for him."Two houses, apartment in Spain, two nice cars, nice holidays every year, we are actually thinking about a swimming pool in the garden next year, we'll just take another 25k on the mortgage. We are living the high life mate, we have made it. If my old dad could see me now, he worked all his life for peanuts, never had a new car or a foreign holiday, ever. He never understood about money and credit and stuff like that, poor sod."The Fool just shook his head, downed his pint and said goodbye. Strange thing, he wished me luck! Why do I need luck? I'm doing better than ever. aren't I?John
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