Should I stay or should I go now…?

To re-answer the “why Sheffield”.
This has been my Friday afternoon, so far. This is why Sheffield

@Kryton57
“It appears you have the nice position of not be tied to a financial income by debt to support you whilst finding something you love to do.”
But I have no idea of what I want to do. I never really have. I was expecting to be an engineer until I discovered the hard way I wasn’t good enough at maths and got chucked out of uni. I took a hobby quite seriously and through that, fell into the job I’ve managed to make a career out of. I happen to be bloody good at it, but its incredibly niche. What I WANT to be doing is riding bikes, skiing, climbing mountains, maybe looking after a few trails, making my house as nice as possible.

@intheborders.
You’ve just given me more financial advice than I’ve had in the last 25 years. I HAD been quite proud of the fact that we’d managed to own our own house outright in 16 years, but you’re now telling me that clearing debts is all wrong? Where were you 19 years ago?
“Will give you a pension of about £2.5k per YEAR…”
While you’re there, as £25k a year seems a reasonable PA sum to live on, do you want to tell me where to find the other £900k I obviously need? Fagpacket maths says that to have a pot of £1m, over 40 years is £25k a year. That’s STILL the vast majority of my take-home pay.

Sorry, I know I’m being snippy, but why the blistering **** do they not teach this in schools? Why is there not a government standard spreadsheet that says “if you want a pension of £x/month, you need to save £y/month for z/years???

 Fagpacket maths says that to have a pot of £1m, over 40 years is £25k a year. That’s STILL the vast majority of my take-home pay

Well it is if you ignore interest / inflation

…and for most of my life it feels like inflation has outstripped interest. I look at the interest payments on a 5 figure bank balance and its barely enough to buy a first class stamp theses days. So if I haven’t actually earned it myself and saved it myself, I don’t expect it to exist.

Most of my paranoia about money comes down to this: I don’t comprehend at a very basic, granular, level how it works. As soon as we get to the point of money being able to magically make more money – banks lending out more than they actually have on their balance sheet, I switch off. You cannot make something out of nothing. Therefore its all a confidence trick, gambling, and I want nothing to do with it. I’d honesty much rather have MY money in a box under MY bed, where I know exactly where it is and what its doing. But as you say “interest/inflation”…

and what its doing

Well its eroding with inflation, that’s what it’s doing.

You should make every £1 be working some way against it, at least shove it into tax free ISA’s and anything left into Premium bonds while you learn about the safe-ish and low cost investment vehicles to help it grow further should you not be needing it for a few years.

IANAFA

OP you sound like you have a very set world view (which is good, most people don’t, but it probably means you won’t get much advice you find relevant from us lot).

Can you use your past experiences with decision making to help with this? You’ve obviously made big and risky decisions in the past (marriage, house, car, kids/no kids etc) so you are capable of weighing up risk and taking action.

On a related note, and without wanting to sound harsh, your attitude to money is quite childish, especially given how important you realise it is. Yes, it should be taught in schools but it wasn’t, so you need to get good at it some other way, much like many other life skills. It can seem/sound like gambling when you read about different investment types, but really, like most important things in life, money choices are risk based. And the more you understand, the more informed your decisions will be rather than just a gamble on whether to put it all on black or red.

p.s. if you at 50, with a decent paid job (for your industry) + partner also working + paid off mortgage + no kids, is still working at 70 because you have to, then the rest of us are screwed.

@thebunk
“Can you use your past experiences with decision making to help with this”
When I’ve made decisions, its usually been a snap one from a point of view of there not really being any other option, and there’s many more where I’ve simply avoided a decision for decades. This whole work thing being one of them. I’m a very black and white person. Anything that needs a decision is binary. Up/down; left/right; right/wrong; red/green; stay/go. There’s no shades of grey and there’s no going back.

Getting this back on track, professionally I’ve learnt over the last 30 year what are good decisions. A big part of my problem is not being allowed to make good decisions and being forced to put up with what I know from the start are bad ones and which are then proved in practice to be bad ones. Historically where I am, I could make, or at least influence, those good decisions – going freelance would put me much more at the mercy of other peoples decisions.

“your attitude to money is quite childish”
I wouldn’t disagree, but its an absolute blind spot and the more I think about it, the more it sends me into a flat spin. I just Do Not Trust the system. I can stare at webpages to try and learn stuff all I like, but I just glaze over. Anything that has the caveat “the value of your investment may fall as well as rise” I just can’t grasp. If you have “spare” money you can chuck away at it, great, I’m happy for you. I don’t understand the concept of “spare” money. It feels like a trap. If you don’t invest your money becomes worthless. If you do, you could lose it all.

@Kryton57
I’ve got ISAs. they’re doing SFA. My dad had premium bonds – they never generated a penny; the missus has some and is doing quite well with them. Which is correct? Its luck – so gambling again.

“make every £1 be working some way”
On which point. A pound coin is a pound coin is a pound coin. Its the same small goldish thing with a silver middle its every been. It hasn’t got smaller, it hasn’t worn out, its still worth 100 pennies. So how come 5 years ago it bought 2/3 of a loaf but now it only buys 1/3 of one?? Its just an accepted token of exchange so why does it need to change value? How can it “work”?

“then the rest of us are screwed.”

But what are you doing to make sure you’re not? Where’s the guidebook, the manual? If there’s a way to do it, why isn’t everyone doing it the same way?

There’s no manual for what the best thing to do is because we all have unique circumstances.

Much like there are shades of grey areas all through the interesting bits of life. You might not see them, but you are capable of navigating them. But enough philosophising:

“I don’t understand the concept of “spare” money.”

Well, once you stopped paying monthly mortgage instalments, what did you do with that very obviously spare money?

I’m hoping that you put it into a pension. Even a low risk one. At the very least you’d not be paying tax on the contributions.

And with the work thing, can’t you have an honest chat/email with your boss about how the way he is managing you and the business is really affecting you mentally, and seems destructive to his business?

I’ll try:

a) Move the money in ISAs to current ISA’s at 5%, your money is getting “more” year on year, have a read about compound interest.

B) Premium bonds: yes unlikely to win much, but if you do it’s tax free.   Interest/gains earned outside of ISA’s or PB’s are taxed at varying levels depending on your income.

These two are not gambling. You cannot lose your original investment only gain.  Now:

5 years ago it bought 2/3 of a loaf but now it only buys 1/3 of one??

You explained it yourself, left on it’s own your £1 under the mattress bought less bread today than it did 5 years ago, becuase the price of bread went up but your £1 stayed the same.   Invested in a 5% ISA 5 years ago your £1 would today be worth £1.28, so you get more bread than you would without the growth.  Make sense?

OP do you understand the concept/benefit of compounding interest? Not a sarcy comment, plenty don’t….I didn’t until my late twenties.

Yes I understand the concept of compound interest.
I’ve also had the practical experience of dealing with it in the mortgage when you’re working against it, and it’s one of the reasons I will never borrow money again.
It doesn’t seem to work quite as well when you’re hoping it’ll work in your favour, even though the maths is identical.

@Kryton57

”r £1 would today be worth £1.28”.
but why does it need to be worth £1.28. To get all Spinal Tap on it, couldn’t the £1 just be louder? It doesn’t need to go up to 11, it’s just a convenient means of exchanging labour for goods.

…and to carry on the bread analogy…

The loaf used to be £1.50. It’s now £3 – but the pound I’ve saved in the ISA is only worth £1.28, not £2. So I’m still losing, not by as much, but loss is loss.

This is a VERY odd conversation. Whatever you feel and whether you understand it or not, the world is not gonna adapt to a zero inflation concept just because certain people can’t get a grip on some basic economic principals! 😉

My apologies on the double salary thing. I thought you meant you’d doubled your previous professional salary, at company A I think it was.

I sympathise over your choices there seen to be no obvious answers

PS I’m not sure paying off the mortgage was setting. Although I’m no financial whizz

PPS if they had taught pension and mortgages when you were at school they may have taught things that are no longer true

Generally speaking you invest in the one with the highest interest rate e.g.

If the mortgage rate is higher than the savings rate, you are saving more money by paying off the mortgage.

If the savings rate is higher than the mortgage rate (test if you pay interest on the savings to see if that still holds true) then put the money in the savings.

There are many nuances to the above…

Forget what you earn now, what is the minimum freelance days you need to survive, and what’s the maximum you want to do? If those figures are achievable and it will be more fun than working as you are, go for it.
Can you go part time and dip a toe in the freelance water?

I was made redundant in 2017 and was going to find a job. It never happened because I was too busy working on projects as a freelance.  I have had to get used to the worries of freelance but it has allowed me a lot of freedom to live out of London. A couple of bits of advice:

Pay yourself the same amount every month and build up a bit of a reserve – that cushions the cash flow and chasing money.

Treat the admin as an actual bit of the job and remember that your rate has to cover you for that admin time as well. It means you have to set aside time for admin too.

The other thing is money and marriage. We have a ‘team money’ approach since we got married. Our contributions to the joint budget fluctuate a bit but we talk about how we make enough between us to afford the things we do. It makes it clear and feels pretty supportive.

I think without any of us knowing any of the ‘numbers’ involved, it’s difficult to offer too much advice.

From the outside, it looks like you’re pretty well set-up – no mortgage, no/minimal debt, frugal life, 2 half-decent salaries coming in. Ok, the pension might not be massive, but that’s ok… Obvs we’ve no idea how much you’ve got ‘under the mattress’, but overall you sound comfortably off, or at least in a solid position.

I don’t understand money stuff at all, either, but while my situation is different (live alone, no kids, mid-rate tax payer, mid-30s), I also realised that I needed to get more smart with my money if I’m to be comfortable down the line.

I went and got some proper financial advice/guidance/management – perhaps this would be a good idea for you too. A good one will break down what you have, what’s coming and what you’ll need, and will be able to explain what to do, why to do it, and if you go down a certain path, might even do it for you (though I get the impression you might not want someone else managing your money for you).

One thing I notice from the long original post.  Any alternative job is 1/2 the pay.  I’ve been a consultant/contractor before , and one ‘rule’ that I’ve heard is that you charge twice the rate per hour to make up for the uncertainty, lack of perks… well in that case you’re on contractor rate, with benefits, security, perks etc.

If you go to contract – how much work is there in the medium and long term?

Will you get it?

If you stay, and the company goes pop , what happens then? As the work will presumably still exist? Who’ll get it

If you’re very overpaid at staff rate compared to the market contracting might not be the golden ticket it’s often touted as.  FWIW I have a staff job now and prefer it that way

One thing about changing jobs after very long time at same employer – it seems that first new job might work similarly to first new relationship after divorce. Some people will get lucky immediately after jump and some don’t.

That is my interpretation based on friends recent  career moves – l am about to get personal experience on that next week as I’m starting at new company. Spent +25 years at current company with 10 titles and dozens of projects.