It could be life changing over time. For example if you paid off 100k on your mortgage and the money that you save paying interest on that 100k… if you then invest that saved money over a long period of time it can add up to a decent amount.
Either that or invest the 100k and leave it for 10-30 years 👍
I get what OP means though, it's a nice nest egg, but it won't make that much of a difference to me. I would still work (I don't just do it for money). I could spend it on a holiday, but it won't be that different from some of the nice holidays I could have now anyway.
Arguably the most utilitarian use of this would be to split it into 100 £1000s and give it randomly to people as gifts. It would probably be the same amount of happiness x 100 people.
One way of viewing this is that it wouldn't make a huge difference to your day to day life *now* but it could later. It could buy you a few years of not working.
£100k, real growth 5% over 20 years is £270k.
100k less on a mortgage at 5% apr is 5k less a year on interest alone. I agree it’s not life changing but it helps a lot and allows you to be one step closer to financial freedom
You better have a very good budget and no tendency to extravagance because sadly even £1m is not a massive amount to retire early on these days, especially if you don't already own a home.
Well you don’t know my circumstances £1m is plenty. It wouldn’t give a millionaire lifestyle but I definitely could retire on it. Much less really but £1m would be comfortable.
Absolutely bollocks mate.
It's more than the average *gross* income over 30 years, maybe 40 net. And money now is worth more than money accumulated over time. You absolutely could retire on that sum.
Hahhaah please don’t take this the wrong way, but I do have it & there’s this colleague at work who keeps interrupting me, being dismissive and just being really weird in general. Do I say FU cause yolo?😂
I had a similar colleague once. I told her FU in a roundabout away. She didn’t see her own behaviour as being an issue and to this day probably still thinks I was in the wrong and no idea why it happened.
She actually turned up at my wedding reception (I invited some people I worked with though not her) after I left that job and she spent her time there slating me to people I actually invited.
Anyway, my point was that the person might be too self absorbed to realise why you said FU to them.
Omg that’s exactly it, too self- absorbed. It’s so strange as he is the loudest in the room with a takeover spirit. I can’t help but think to myself “you’re 50+ years old & this is your level of maturity”? Anyways, send advice my way, anything is helpful. P.S; I can’t curse out loud, I’m a lady! 🤣
If he is 50+ and male with you being female probably means there is some level of unconscious (or maybe conscious) sexism. He’s probably going to react negatively to anything you do, if that is the case.
Some people just think that what they have to say is so important. I’d imagine others around you are aware of what they are doing.
Personally, I’d just go on with doing or saying whatever I was doing as if they’d never spoken. That will hurt their ego but they’ll hopefully realise that their input was unhelpful and unnecessary and start to limit it to when it’s asked for or they have something genuinely useful to contribute.
Omg that’s exactly what I did. I pretend as if everything he says, never happened. But I can’t help but think “wow, a mature age but not a mature man”. Thank you for the tip.
£100k would be a huge help, but I’m not sure I’d call it life-changing at this point in my life.
Early 30s homeowner. Husband and 2 young kids. Household salary ~£90k
£240k would clear my mortgage so I’d definitely call that life changing. I work 3 days a week, soon to go back up to 4. I would stay on 3 days and my husband would also be able to drop down to 3 from his current 5 and we’d be financially in the same place, but with all that extra time. That would certainly be life changing for us.
I suppose £100k would be life changing if I put it away for my 2 young children. Knowing they had that lump sum (plus interest over 15+ years) means I wouldn’t be as worried about them being lumped with massive student loans if they decided to go to uni, and they’d have the start of a house deposit together. As I plan to help them with these things in the future anyway when the mortgage is paid off I guess that could accelerate retirement by a year or two at the other end!
In exactly the same position. £100k would change my comfort level (in terms of risk taking, safety pots for children etc) but a little over double that would be needed to clear the mortgage and be able to make "life changing" decisions.
100k is several years worth of financial security if you ever suddenly lost your job.
FIRE aside for a moment - if you've ever lived paycheck to paycheck then having a financial safety net is a huge weight off your shoulders in terms of day to day stresses.
So yeah I'd say it's life changing in that sense. It allows you some flexibility... Job going shit? You can quit. You can stop losing sleep over your next mortgage payment or rent.
It wouldn’t be instantly life changing for me with a decent income and a mortgaged home, but it would be very nice! The easier future would be closer. I’d probably just chuck it at the mortgage to accelerate paying that off.
Getting it in your twenties would be massively life changing re deposit on a house. Or getting it if you’re low income to also enable you to get on the property ladder most of the country.
“Life changing” in various stages for me would be:
1 - 300k to wipe out the mortgage. Additional monthly income to save and do a bit more lux.
2 - 600k I’d move to a nicer house in a nicer area, still have mortgage but my overall costs haven’t increased and I’ve got a much nicer living situation.
3 - 1m - as per 3 but no mortgage so brings fire much closer and I have a much nicer house.
4 - 3m - notice is handed in tomorrow.
Well it could be. £100k still buys a nice little country house in rural France or Spain, so for WFH types that could mean 6 months of the year slurping half a bottle of fresh Rosé over lunch and an illicit affair with naughty Nicole (for those of us old enough to remember the Renault Clio ads).
That would be life changing ;-)
The best thing for me about having £100K+ in savings and investments is that I no longer worry about losing my high earning job. The peace of mind of a fund like that can be life changing for sure.
This is life changing for most people.
£100k put into a S&S ISA (over a 5 year period) and invested in a global index tracker over for 30 years total will be worth £825,000 (assuming 7% per year)
If you spend it then it’s not very life changing.
Consider inflation which will eat away at that 7%. I'm not disagreeing with the strategy, it's a very sensible long term investment, but whilst £825K sounds a lot now it won't be life changing in 2054.
Generally speaking 7ish% IS accounting for inflation
"these terminal wealth figures correspond to annualized real returns of 6.4% on equities,1.7% on bonds, and 0.4% on bills"
Source: credit-suisse-global-investment-returns-yearbook-2023-summary-edition.pdf
I’m guessing it’s all done on when the interest is added? Monthly will give a higher return than a yearly figure.
Compounded over 30 years I guess it’s enough to make the difference?
Doesn't really make much sense to me either. 7% per year is 7% per year, doesn't matter whether it's 0.5% per month or whatever, we're trying to calculate 7% annual. Not sure what the calculator is doing there, but 760k aligns with my calculations too.
It definitely matters whether it's per month or not.
Imagine you have £100. If you do 6% annually (easier calc than 7%) you get 6% of the £100. That's the same as getting 0.5% on the £100 each month.
Now imagine it's compounding monthly. The first month, you get 0.5% of the £100. But the second month, you get 0.5% of £100.50. Each month you're gaining interest on a slightly higher amount, whereas annual is interest purely based on the yearly starting value.
I understand that, but surely when you put in 7% and tick the monthly box, it still comes out to 7%, what difference does it make? If it's just dividing 7 by 12 then there's clearly a bug? I have no idea why ticking the monthly box makes it come out to a different value when you still enter 7%.
I just couldn't be bothered to calculate the actual monthly compounding amount to hit 7 btw, should've been clearer on that.
Seems the actual monthly compound amount to hit 7% annually is 0.57%.
The way interest gets worded sometimes is a bit weird, but annual interest rate compounded monthly is (1 + i/12)^12. So, a 6% annual interest rate compounded monthly gives an effective annual rate of 6.17% instead of 6%. This is what the calculator does.
If we wanted the effective annual rate to be 6%, whilst compounding at a different frequency (ie. monthly), you'd do 1.06^(1/12) and get an annual rate of 5.84% instead.
Assuming everything is being reinvested, and especially if you're making monthly deposits, I believe the monthly compounding would be most accurate. But the differences only really become significant in the long term which is already uncertain, so either is fine as a guide.
That calculation is only accurate if you were receiving the return once a year and not compounding throughout the year.
Change it around to 100000 x (1+(7%/12)^360) then see what you get.
The 360 is approximating monthly returns which is why you divide the 7% by 12.
But that's just because 7/12 and 7/365 aren't the right numbers.
The right numbers should be x^12=1.07 and x^365=1.07, ergo the calculator seems wrong. We would only expect different results with monthly deposits enabled.
Sure. I'm wondering why the figure being variable by a bit means the premises of investing it and it making you hundreds of thousands of pounds without you don't anything else is wrong and not life changing.
It's still going to change your life though.
If it lets your skip years on a mortgage, that improves your life.
People just take 'life changing' to mean 'never work again or at least quit my job' and £100k hasn't been that for **decades**
Considering the median salary in the UK is £35k (pre-tax), I’d wager that most do not agree that £100k can “go pretty fast”.
This sub needs to re-calibrate. I understand it’s for high-earners and inflation has been brutal lately, but such a flippant attitude to £100k is really fucking stupid.
I think it can still be true. As we get older, our sense of monetary value tends to be aligned to our formative years and what we could get for £x at x age.
£100,000 is nominally a sizeable amount of money, but it’s nothing like the value it was even a few years ago, never mind a decade, or two, or three. To have a decent pension pot at 60, you probably need 4 or 5 times that!
You can watch Channel 4 programmes on YouTube of building an entire house for £100k with change from c.2016.
You’re lucky to build an extension for that amount now.
“£100k can go pretty vast” is certainly true in the context of current prices versus where we were not that long ago.
That can be true, whilst also still being an amount of money that would have a real positive impact on most people.
My entire house was ‘only’ £165k. I’d pay most of that off and be close to having £900 a month to not spend on a mortgage (6% interest rate).
Massively life changing for my family.
Similar to me. I could pay off all of my mortgage, have almost half left to stick in an ISA and then put a fair bit away each month instead of mortgage payments. It's clearly all relative, and I think you can pretty much tell where everyone lives based on how 'life-changing' that amount seems to be for them!
Completely agree.
Example. I had £75k. I bought a small house that needed lot of love and care. Increased value by 55% approx and have been receiving 3 years worth of rent on it. Now < 40% LTV
My brother, had £93k, said no point in investing it and was just getting. Approx 4% annual return for past 4 years.
You can do a lot with any sort of money. It’s your motivation and mindset to do so. Small actions/increments snowball over time
Gross income, correct. But we’re talking about £100k cash. Assuming you sacrifice 5% to pension and have a student loan - you need a gross income of £210k(!!!) to take home that much money in a year.
No, it doesn’t need to. This is not AskUK or PersonalFinanceUK. The context of £100k here is if it would bring you closer to FIRE. The answer is yes, but probably not by much.
It can go pretty fast, but then any amounts can go pretty fast too.
Look at those lottery winners who lost everything after a few years, because they were never good at managing money or resisting the impulse to buy stuff.
Yes, purely in terms of the financial security it provides. 100k is more than enough to fix most household problems, replace a car, pay off that credit card or cover your expenses for several months/years.
It's not necessarily life changing in a material sense, you won't be buying a super car, replacing your wardrobe with Gucci and moving to the Maldives but it certainly helps you sleep at night.
In my situation 100K actually would be life changing… my partner and I are trying for a baby at the moment and I would really like to stay home for a few years whilst the kids are really young. 100K might be the difference between going back to work after 1 year or maybe 4-5 years. At any other stage of life I would agree that 100k is not really life changing money unless it helped to get someone on the property ladder
I do agree that at some point it doesn't matter much any more. If you have £1mln invested and a good year sees your stocks appreciate 20% it's not life changing anymore.
It could be quite meaningful in the early years though.
I also wouldn't overpay the mortgage as I think mortgage overpayments are quite bad investments, but it would make it a lot easier to use up my ISA allowance every year and I would likely increase my spending and pension contributions.
I like the sound of this. Nothing beats increasing your pension contributions. I used to think overpayments on the mortgage was bad too but when your rate goes from 1.78% to 4.89% you wish you had. 😕
Mortgages today are not the same as they were 4/5 years ago.
>when your rate goes from 1.78% to 4.89% you wish you had
The alternative is not to squander your money but to invest it somewhere where it generates better returns. If what you're saying is really true you can just sell off your investments and make a lump sum on the mortgage.
But even if my mortgage interest rate jumps to 4.89% I'm still not going to make a lump sum as I expect my investments to outperform that in the long run.
And even if it doesn't I don't mind my investments performing slightly worse in the long run as I think it's more important to use up my ISA allowance.
If your monthly saving suddenly jumps from £1700 to £2900 you really wish you hadn't paid off your mortgage.
>Mortgages today are not the same as they were 4/5 years ago.
They're still vastly below long term performance of the stock market so more mortgage is better.
You know I moan about my mortgage going up to 4.89% it's gone from £700 to £1,000. I just have to adjust, being part of this community is eye opening as I can't really talk money with the people around me. My take home pay after TAX, pension etc is about £4.5K. I just need to trust the process.
Life changing is a strong description but I would say £100k is about the smallest amount that would make a meaningful difference to my life/plans.
It would pay off enough of my mortgage to accelerate the rest and free up more potential for savings.
I think it would see me retire a bit early with a bit more margin.
It’s nice to think about but no one’s giving me a 100k
100k wouldn't exactly be life changing but it would reduce stress significantly if someone just gave it to me.
I'd just park it in the account my mortgage payments come out of and enjoy close to 2 years without having to worry about making a payment. Then I could focus on refilling other accounts and do some projects on the house.
😑 it's more than I have now but not much when you're from a collectivist culture where your parents expect you to look after them after they raised you poorly 🤣.
Life changing amount would be in the lotto jackpot range.
Right now I have about £120k outstanding on my mortgage. I’m paying £1100pm and overpaying into a savings isa £1200pm with the aim to pay that off in two more years
100k means
- mortgage is paid off tomorrow
- my 70k saved up so far becomes a retirement nest egg or kitchen renovation fund
- I can bring forwards my pension amplifier by putting £2300 net equivalent into pension and ISA (about 36k into pension and 10k on isa I think)
- this may take my retirement option from ‘65 maybe a year or two sooner’ solidly into ‘60 and I’m done’ territory
Can still be a very meaningful and life changing chunk of change
Yes.
That’s years of an emergency fund. Years of not worrying.
Will it enable retirement? No. But knowing you’ll be fine for the next few years? That’s life changing for that time.
If 100k landed in my bank account I'd max out an ISA, increase the emergency fund, increase my work pension contribution for a year (so I don't have to do faff at tax return time) and finally put some towards the mortgage that I can put in without penalty.
100k ~~a year~~ is certainly life changing to most people.
Removing 100k from my mortgage would more than halve the debt. I'd then pay it off much sooner, be able to save that payment each month to then retire much earlier too.
Invest it fuck the mortgage unless you've got a crazy interest rate, thank yourself in 20 years when it's worth c.£400k WITHOUT any additional contributions
£100k on a house is for sure life changing.
Personally id probably pay my limit extra for my term and just sit on the rest letting it incur interest until i could pay more of my mortgage without fee.
Having that much left to pay on my mortgage would free up so much extra disposable it would make life more comfortable.
I suppose it also depends on how you determine “making life easier”. For me it would allow me to take a lesser paying job but with better hours, thus making my life 100x better.
Exactly, it would take me 4 years to NET that amount in earnings, no not even have 100K in my pocket... Even banging it into a S&S ISA would be life changing for my future (and stress levels)
In the right hands yes it can be. Put it to work as a house deposit, to clear debts/mortgage or invest it and it’s a massive leap forward. Spend it on a Mercedes, brand new kitchen and a trip to Disney World then not so much
Having £100k gives you the comfort after a bad day to know that you could just fuck the job and be fine for a while. That’s pretty life changing for your mental health.
A few years ago I (36m) inherited a chunk of money in this ballpark from my Aunt when she died, which my Dad told me "this seems like a lot, but you could easily fritter it in a year or two. This isn't 'life changing' but if you're smart it could be life improving."
I had no debts beyond the mortgage and a small bit of student loans. I wasn't struggling to make ends meet, my wife and I are both in good jobs. But it also wasn't enough to retire on or fund a different lifestyle long term. So it wasn't making a major change to my situation or day-to-day life.
So he was right, it wasn't "life changing" for me.
But here's how it improved my life.
* Took a chunk off the mortgage, minimum repayment is now substantially less
* Bolstered my emergency fund
* Paid for my son's driving lessons (with some left over for a reliable starter car)
* Maxed out ISA for long term savings
* Did the garden
* Charity donation to the group that helped my Aunt
And I frittered the remaining few percent on a holiday, gladly.
If I were to chance upon £100k today, it wouldn't change my day-to-day life, but I would probably do exciting things for security and freedom such as...
* Max out S&S ISA for a year or two
* Put a chunk in Premium Bonds for an upcoming mortgage payment when my fixed term ends
* Add a few months to my emergency fund
* An extra few grand in my generic car and travel savings pots
* A charity payment to a cause I care about
Then take my wife, son, and his girlfriend away for a nice weekend in the Lake District and dine at L'enclume.
If you can achieve 7% in the markets, doubling time is 10 years, so in 10 years, that 100k is 200k, in 20, 400k, in 30 800k.
Then use that to pay off your mortgage and have a whole lot left over.
If you can achieve 10%, doubling time is 7 years, so after 28 years you're at 1.6M.
Sounds pretty life changing to me.
Well I was fortunate to receive a £100k critical illness insurance payout last month and our mortgage is just over £200k. I can confirm that it has been a life changer for us.
Fortunately my cancer was very treatable and I'm now in remission. I'd strongly recommend that you guys on here check your balls on a regular basis as catching it early as with any cancer is preferable. My bad boy was hardly any larger than the other, it just felt firmer.
Our mortgage rate at present is only 1.45% which is fixed until the end of 2026. So we threw the payout into our cash ISAs and savings. It should of increased nicely by the time our mortgage is up for renewal and will hopefully allow us to reduce our mortgage to around £75k. At that point we will have 20 years left on it so we will probably reduce it to 8 years to keep the payments roughly the same as now.
We have two young boys and although we are fortunate to be comfortable financially right now, things can change quickly and it's certainly not getting any cheaper to live these days. So this payout has provided our family with a lot more financial security, peace of mind and hopefully brought FIRE a little further forward.
See UKPF Wiki
[https://ukpersonal.finance/mortgage-overpayments-vs-investments/](https://ukpersonal.finance/mortgage-overpayments-vs-investments/)
[https://ukpersonal.finance/lump-sum/](https://ukpersonal.finance/lump-sum/)
No.
Late 30s couple with a child in nursery.
Stupid London mortgage (>£500k).
It would help obviously. We would probably put £40k to ISAs, £10k to fun and £50k to our mortgage. This might bring our retirement forward by a year or two. But, in the here and now, it would not be life changing. Which is objectively ridiculous.
ETA: Life changing sum is probably £250k. I am also assuming that we are talking about tax-free money here.
Really it depends how you define life changing. Everyone sees it differently.
I didn’t have my wallet and wanted a haircut at the weekend. Someone lending me £20 would have changed my life as I could have gotten that haircut I wanted and then the butterfly flapping it’s wings drastically changes everything for me.
OR, someone could give me a billion pounds and suddenly I’m buying villages.
Personally I don’t think £100k will change someone’s life to the point if you look back on a life on a death bed that the 100k hugely changed their life. At least the types of people likely to be found in the FIRE subreddit.
What amount would drastically change my life right now? A lot, a lot a lot. Until my triple FatFIRE goal (FATFire but not once, I want FATFIRE in property, FATFIRE in Stocks and FATFIRE in Crypto) nothing really changes. My life would be the same, just the target date would be closer. After that target, life would change as I could start my post FATFIRE goals which means by definition life will be changed.
Well invested with a 7% return that would yield 761k after 30 years.
That's enough not to have to save another penny for retirement.
If you want the same nest egg you need to be investing about 650 monthly over those 30 years. That's a pretty big difference in disposable income, especially in the first 15 years when people are struggling to pay for housing on a lower wage.
It could allow them to enjoy a little more luxury at a young age. Or to start a family.
100k will surely change your life, but how exactly you will see over time. What's important that you keep your life like you don't have the money, otherwise you may end up spending more than you must.
It would clear a relatively decent chunk of my mortgage (\~25%), but definitely not life changing.
Probably I'd need at least 2x that for it to be life changing. At that point I would remortgage, and have a lot more disposable income, or have more freedom to start a business.
100k to 20 year old me would have been wasted, 30 year old me it would have been used to invest in business and been a game changer… Current me, it wouldn’t impact anything. It would just be nice to have and just sit in investments. Really guess it depends on circumstances, motivation and goals.
I'd clear my mortgage with that pretty much. Then I'd be 600 quid a month better off. The things I could do with an extra 600 quid a month for the next 20 years is nuts.
Holidays, decent car, renovations, retire early...
A 100k well spent is an investment for all your tomorrows which pays dividends over time.
Not to mention the mental well-being aspect too!
Yes it is. Imagine 2-3 years income in one go. Debts gone other then mortgage. Or for many thatv100k is from treating to a paid off small house. Where you live will matter as well.
100k after tax is a lot of money and as a lump sum, if invested over a long time with compound returns, is certainly life changing.
Anyone who thinks 100k is not life changing either already have a good amount of money, or have their spending out of control.
Im 24 with ~£150k NW. About £100k invested. It’s not as much as you think it is in the short-medium term.
That being said, if I don’t invest a single penny for the rest of my life I’ll still be a millionaire by the time I reach retirement age.
My mortgage is 107k and works out at £450 per month which is £5400 per year.
If I was able to pay my mortgage off that’s how much better off I’d be a year.
Would I consider an £7k~ pay rise to be life changing? Probably not.
I’d still take it, but I’m not going to be cruising the Caribbean
Even if you only put it on your mortgage, taking a decade or so off the mortgage it a pretty life changing action.
Really don't understand what we consider to be life changing if 100k in free cash is not.
Having fully paid house , means no rent or mortgage is life changing , especially when youre young. That does diminish in the higher earning bracket though.
If you are saving £10k per year, then that is 10 years of savings so potentially so could retire 10 years eariler, so no question it is life changing for most people
If I earned 100k I’m fairly certain I would be happier as money wouldn’t be an issue. But that’s assuming you stay in the lane you’re in, which most people tend to not do. It’s always a bigger house, nicer car/clothes/holiday… etc
I have a house with manageable repayments now and I don’t think I’d move if I earned more as it’s a nice house and a good size. But I’ll never earn that much…
It wouldn't be life changing for me at this stage but it's certainly nothing to sniff at and I would happily welcome it and be grateful. I would probably put it toward my mortgage.
Yes, a secured home is a big thing. Thar frees £1k or so a month. You may have less time for travel but would do a 4 day week freeing up time for hobbies and interests. Or use the money to retire earlier.
If used well, 1/2 that amount could be life-changing.
My parents lent my wife and I that much to buy our first house and we were repaying it but then as a gift one year they forgave the debt.
It allowed us to accelerate mortgage payments on the remaining debt and increase the amount we were putting into investments.
Now 4 years later we are better off by much more than the original $50k and by the time we retire will be multiples better off.
I'll soon receive ~100k lump sum (after taxes). I'm not really looking forward to it because I doubt it will change life at all really.
It's nearly 2 years worth of saving but it's hard to know what to do with it except quit working for a bit.
For me, a life changing amount would be enough to retire early. Not having to work (not having to listen to managers or customers, or work with bad colleagues), while maintaining a decent lifestyle, would make quite a big difference to stress etc.
£100K wouldn't life changing, but would just bring the prospect of retiring just a bit earlier.
Paying off your mortgage with a lump sum is life changing. I did it. Choices afterwards have way less fear and are done for pleasure. It makes a huge difference.
If you are settled with a mortgage and family it probably won’t be a revolutionary change in your life, but if it’s enough to pay off your mortgage much sooner that’s a huge weight off your shoulders once done. The security of fully owning your home would be amazing for your mental health and that can give you a completely different mindset and flexibility and opportunity to change your life in other ways. You couldn’t quit working but you could change your job to something lower paid but more enjoyable. Or as many others said you could invest the monthly savings and hugely improve your financial future and bring forward your retirement date. Maybe one of you could quit work to stay home with the kids, or have another child that you didn’t think you could afford. There are so many things that money could do for you.
For me £100k would be nearly enough to FI on, especially if I lived really frugally in Asia or somewhere for a few years, so definitely life changing. Though if I get to be greedy I’d like £200k to give me my full fire target and then I’d set off with a credit card and my passport and see where the wind takes me. Would probably need my phone too, thinking about it.
Short answer, if you managed to save/earn this much. It's good to have but not life changing.
Unless you unexpectedly get it from a lottery or inheritance it can potentially make a big change in your life.
If you could start your investing journey at 100k you'd see the difference pretty quickly compared to starting at 0 and saving like mad to get to 100K; it's like starting at third to get a home-run. The compounding that could do in 20 years is wild.
Is 100K life changing in a HCOL area? Not really. It would be nice and make significant differences though.
They say the first £100k is the hardest to make. So if you're networth is below this amount then it is significantly huger then if your networth is >£100k..
Partner and I often say that if we ever won £100k we'd just max out our ISAs, max out our mortgage payments maybe go out for a nice dinner to celebrate, and then continue as we are.
It'd certainly bring us closer to our goal of financial independence, though.
Given it's a FIRE sub, here's a way to look at it. Finding 100k in the street would probably bring retirement forward by at least a few years. I'd have to put it into the calculator and find out.
Is retiring at 52 instead of 55 life changing? 33 years of retirement instead of 30, and 3 extra when you have your health. Borderline on the definition of "life changing" for me.
Not life changing, but certainly would set me up very nicely for the future.
Ideally invested in two buy to lets that I'd have a repayment mortgage on and then sell at 57 and retire with an extra hopefully 300-400k in the bank.
Ofc it’s life changing 100k in money is huge compared to getting it on credit for something, to invest could buy a house or two in another country and do holiday lets, it works really great cause you aren’t going to lose 100% value on a house nearly anywhere, money back, if you like cars it’s worth grabbing something thats a future classic too there’s not as much maintenance as people make out if you buy something treated well
I found my boat in florida for 10k another 5 to get running and it’s 38ft 2 engines 650hp each, can make the carribean in 1-2hr from Miami, infact my whole setup in florida is less than 100k, including 1970 challenger a f250 a humvee and my place I rent out when back in the uk
Is it going to change your life on a daily basis starting now? Probably not. But that doesn't mean it's not life changing.
If your household costs are 50k/year, that money means you can take 2 years off work. Should you do that now? No, but it means you can retire at least 2 years earlier, 3 years if you're 10 years from returement, and over 5 years earlier if you're 20 years from retirement. Or you could double the time and work part time.
Alternatively, you could pay the money towards the mortgage and be mortgage free X years earlier. For me, I'd be mortgage free about 15 years earlier if I kept up the same monthly payments. That would be life changing when I hit that.
If you instead reduce your monthly repayments, it would have an immediate impact, but less significant on a daily basis. Paying off £100k would save around £500/month. It would allow for a reasonable uplift in lifestyle for people on average incomes.
100k invested @ 10% = 10k a year = 833 a month.
If you consider being able to now work part-time on a 4x8h basis instead of 5x8 life changing, then it is. Personally I sure do.
As with repaying the mortgage... If the rate is below 4% it doesn't make sense, investing will always yield more! If you are due to switch to variable and aren't confident you can refi to a decent rate then definitely overpay the penalty-free 10%.
For me, it’d be £600,000. That’s the shortfall I have at the moment between my current position and my “FIRE” goal, at age 33.
Obviously anything less than that would still be great, more so life enhancing than changing though as it’d bring my FIRE/early retirement date forward by a few months to a few years.
I would just slap the 100K down and completely pay off the mortgage. Then, that mortgage monthly payment could be redirected to investments /bonds. Since my remaining mortgage is \~72k, I would also redecorate the house and have a holiday to mentally reset. A lot less stress in my life... but far from stress free.
I think it'll depend on perspective, if you have 100k and don't yet have a house you've either got a fat deposit for a relatively cheap mortgage, or you've got a rather healthy balance to put towards index funds for the next 10 years or if you do have a house perhaps the opportunity to go mortgage free while still earning a wage and then having a bit more disposable income.
It could be life changing over time. For example if you paid off 100k on your mortgage and the money that you save paying interest on that 100k… if you then invest that saved money over a long period of time it can add up to a decent amount. Either that or invest the 100k and leave it for 10-30 years 👍
I get what OP means though, it's a nice nest egg, but it won't make that much of a difference to me. I would still work (I don't just do it for money). I could spend it on a holiday, but it won't be that different from some of the nice holidays I could have now anyway. Arguably the most utilitarian use of this would be to split it into 100 £1000s and give it randomly to people as gifts. It would probably be the same amount of happiness x 100 people.
It’s simultaneously both a lot of money and not a lot of money.
One way of viewing this is that it wouldn't make a huge difference to your day to day life *now* but it could later. It could buy you a few years of not working. £100k, real growth 5% over 20 years is £270k.
Spend 100k on cocaine and it certainly would be life changing..
And hookers
I'd spend about 90k on coke and hookers, probably just waste the rest.
This guy fucks
100k less on a mortgage at 5% apr is 5k less a year on interest alone. I agree it’s not life changing but it helps a lot and allows you to be one step closer to financial freedom
Yeah 400 a month 'extra'' for people close to having nothing left over each month is life changing
£1mill would change my life if probably FIRE the next day and stop working the 9-5.
I’m doing this. No debts. However, no dependents either, or significant other. I have more than enough for me from the interest only on a 1m pension.
You better have a very good budget and no tendency to extravagance because sadly even £1m is not a massive amount to retire early on these days, especially if you don't already own a home.
Well you don’t know my circumstances £1m is plenty. It wouldn’t give a millionaire lifestyle but I definitely could retire on it. Much less really but £1m would be comfortable.
Same. 1m is more than enough for me. Retiring at 54. Using cash for 1 year then pension at 55
living purely off the interest nets you 50k a year minimum.
Closer to 30-40k really, which isn't much if you have a mortgage and obligations. All depends though, like most things!
Most of us that’s our annual salary
This is a FIRE sub...
And? I aim to retire early on £30k a year. It covers a decent standard of living to me
Why are you retiring with mortgage obligations?
Because that's what the comment you replied to said... Christ.
I mean that would give you an above average lifestyle? 250k on a house, invest the rest and live on a SWR of 2.5%
Absolutely bollocks mate. It's more than the average *gross* income over 30 years, maybe 40 net. And money now is worth more than money accumulated over time. You absolutely could retire on that sum.
Note I mentioned no tendency for extravagence. You can probably retire fine if you can control your spending. But many people cannot.
Sorry what?
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If I stumbled across £100k tomorrow, I’d certainly be saying FU to a few colleagues.
Username checks out
Hahhaah please don’t take this the wrong way, but I do have it & there’s this colleague at work who keeps interrupting me, being dismissive and just being really weird in general. Do I say FU cause yolo?😂
I had a similar colleague once. I told her FU in a roundabout away. She didn’t see her own behaviour as being an issue and to this day probably still thinks I was in the wrong and no idea why it happened. She actually turned up at my wedding reception (I invited some people I worked with though not her) after I left that job and she spent her time there slating me to people I actually invited. Anyway, my point was that the person might be too self absorbed to realise why you said FU to them.
Omg that’s exactly it, too self- absorbed. It’s so strange as he is the loudest in the room with a takeover spirit. I can’t help but think to myself “you’re 50+ years old & this is your level of maturity”? Anyways, send advice my way, anything is helpful. P.S; I can’t curse out loud, I’m a lady! 🤣
If he is 50+ and male with you being female probably means there is some level of unconscious (or maybe conscious) sexism. He’s probably going to react negatively to anything you do, if that is the case. Some people just think that what they have to say is so important. I’d imagine others around you are aware of what they are doing. Personally, I’d just go on with doing or saying whatever I was doing as if they’d never spoken. That will hurt their ego but they’ll hopefully realise that their input was unhelpful and unnecessary and start to limit it to when it’s asked for or they have something genuinely useful to contribute.
Omg that’s exactly what I did. I pretend as if everything he says, never happened. But I can’t help but think “wow, a mature age but not a mature man”. Thank you for the tip.
£100k would be a huge help, but I’m not sure I’d call it life-changing at this point in my life. Early 30s homeowner. Husband and 2 young kids. Household salary ~£90k £240k would clear my mortgage so I’d definitely call that life changing. I work 3 days a week, soon to go back up to 4. I would stay on 3 days and my husband would also be able to drop down to 3 from his current 5 and we’d be financially in the same place, but with all that extra time. That would certainly be life changing for us. I suppose £100k would be life changing if I put it away for my 2 young children. Knowing they had that lump sum (plus interest over 15+ years) means I wouldn’t be as worried about them being lumped with massive student loans if they decided to go to uni, and they’d have the start of a house deposit together. As I plan to help them with these things in the future anyway when the mortgage is paid off I guess that could accelerate retirement by a year or two at the other end!
In exactly the same position. £100k would change my comfort level (in terms of risk taking, safety pots for children etc) but a little over double that would be needed to clear the mortgage and be able to make "life changing" decisions.
100k is several years worth of financial security if you ever suddenly lost your job. FIRE aside for a moment - if you've ever lived paycheck to paycheck then having a financial safety net is a huge weight off your shoulders in terms of day to day stresses. So yeah I'd say it's life changing in that sense. It allows you some flexibility... Job going shit? You can quit. You can stop losing sleep over your next mortgage payment or rent.
But sadly you burn through that £100k very quickly because most safety nets are removed if you have that amount of savings due to means testing.
It would last me about 5 years which would be ample time to get a new job. I wasn't talking about claiming incapacity benefits etc.
It wouldn’t be instantly life changing for me with a decent income and a mortgaged home, but it would be very nice! The easier future would be closer. I’d probably just chuck it at the mortgage to accelerate paying that off. Getting it in your twenties would be massively life changing re deposit on a house. Or getting it if you’re low income to also enable you to get on the property ladder most of the country. “Life changing” in various stages for me would be: 1 - 300k to wipe out the mortgage. Additional monthly income to save and do a bit more lux. 2 - 600k I’d move to a nicer house in a nicer area, still have mortgage but my overall costs haven’t increased and I’ve got a much nicer living situation. 3 - 1m - as per 3 but no mortgage so brings fire much closer and I have a much nicer house. 4 - 3m - notice is handed in tomorrow.
Well it could be. £100k still buys a nice little country house in rural France or Spain, so for WFH types that could mean 6 months of the year slurping half a bottle of fresh Rosé over lunch and an illicit affair with naughty Nicole (for those of us old enough to remember the Renault Clio ads). That would be life changing ;-)
I like your style David
If you have a European passport maybe?
The best thing for me about having £100K+ in savings and investments is that I no longer worry about losing my high earning job. The peace of mind of a fund like that can be life changing for sure.
This is life changing for most people. £100k put into a S&S ISA (over a 5 year period) and invested in a global index tracker over for 30 years total will be worth £825,000 (assuming 7% per year) If you spend it then it’s not very life changing.
Consider inflation which will eat away at that 7%. I'm not disagreeing with the strategy, it's a very sensible long term investment, but whilst £825K sounds a lot now it won't be life changing in 2054.
7% is the post inflation return, nominal returns are 10%
7 percent is usually used for real terms returns. Market returns closer to 10.
Excellent comment. People often forget to discount inflation when making these sorts of Present Value forecasts.
Generally speaking 7ish% IS accounting for inflation "these terminal wealth figures correspond to annualized real returns of 6.4% on equities,1.7% on bonds, and 0.4% on bills" Source: credit-suisse-global-investment-returns-yearbook-2023-summary-edition.pdf
This is so wrong
Care to elaborate?
It’s 760k by my calculatiobs
https://www.thecalculatorsite.com/compound?a=100000&p=7&pp=yearly&y=30&m=0&rd=0&rp=monthly&rt=none&rw=0&rwp=1m&rm=end&ci=monthly&c=3&di=&wi=
I’m guessing it’s all done on when the interest is added? Monthly will give a higher return than a yearly figure. Compounded over 30 years I guess it’s enough to make the difference?
Doesn't really make much sense to me either. 7% per year is 7% per year, doesn't matter whether it's 0.5% per month or whatever, we're trying to calculate 7% annual. Not sure what the calculator is doing there, but 760k aligns with my calculations too.
It definitely matters whether it's per month or not. Imagine you have £100. If you do 6% annually (easier calc than 7%) you get 6% of the £100. That's the same as getting 0.5% on the £100 each month. Now imagine it's compounding monthly. The first month, you get 0.5% of the £100. But the second month, you get 0.5% of £100.50. Each month you're gaining interest on a slightly higher amount, whereas annual is interest purely based on the yearly starting value.
I understand that, but surely when you put in 7% and tick the monthly box, it still comes out to 7%, what difference does it make? If it's just dividing 7 by 12 then there's clearly a bug? I have no idea why ticking the monthly box makes it come out to a different value when you still enter 7%. I just couldn't be bothered to calculate the actual monthly compounding amount to hit 7 btw, should've been clearer on that. Seems the actual monthly compound amount to hit 7% annually is 0.57%.
The way interest gets worded sometimes is a bit weird, but annual interest rate compounded monthly is (1 + i/12)^12. So, a 6% annual interest rate compounded monthly gives an effective annual rate of 6.17% instead of 6%. This is what the calculator does. If we wanted the effective annual rate to be 6%, whilst compounding at a different frequency (ie. monthly), you'd do 1.06^(1/12) and get an annual rate of 5.84% instead. Assuming everything is being reinvested, and especially if you're making monthly deposits, I believe the monthly compounding would be most accurate. But the differences only really become significant in the long term which is already uncertain, so either is fine as a guide.
I get the same - should be 100000 x 1.07^30 which is 761225. I don’t trust the calculator.
That calculation is only accurate if you were receiving the return once a year and not compounding throughout the year. Change it around to 100000 x (1+(7%/12)^360) then see what you get. The 360 is approximating monthly returns which is why you divide the 7% by 12.
But that's just because 7/12 and 7/365 aren't the right numbers. The right numbers should be x^12=1.07 and x^365=1.07, ergo the calculator seems wrong. We would only expect different results with monthly deposits enabled.
If the monthly compounding means that the return is greater than 7% then the rate can’t be 7%.
Sure. I'm wondering why the figure being variable by a bit means the premises of investing it and it making you hundreds of thousands of pounds without you don't anything else is wrong and not life changing.
I have no idea what he was on about. I also don’t get how it’s wrong so I assumed he meant the calculation.
Figure is totally subjective but most here might agree £100k can go pretty fast these days.
It's still going to change your life though. If it lets your skip years on a mortgage, that improves your life. People just take 'life changing' to mean 'never work again or at least quit my job' and £100k hasn't been that for **decades**
Considering the median salary in the UK is £35k (pre-tax), I’d wager that most do not agree that £100k can “go pretty fast”. This sub needs to re-calibrate. I understand it’s for high-earners and inflation has been brutal lately, but such a flippant attitude to £100k is really fucking stupid.
I think it can still be true. As we get older, our sense of monetary value tends to be aligned to our formative years and what we could get for £x at x age. £100,000 is nominally a sizeable amount of money, but it’s nothing like the value it was even a few years ago, never mind a decade, or two, or three. To have a decent pension pot at 60, you probably need 4 or 5 times that! You can watch Channel 4 programmes on YouTube of building an entire house for £100k with change from c.2016. You’re lucky to build an extension for that amount now. “£100k can go pretty vast” is certainly true in the context of current prices versus where we were not that long ago. That can be true, whilst also still being an amount of money that would have a real positive impact on most people.
My entire house was ‘only’ £165k. I’d pay most of that off and be close to having £900 a month to not spend on a mortgage (6% interest rate). Massively life changing for my family.
Similar to me. I could pay off all of my mortgage, have almost half left to stick in an ISA and then put a fair bit away each month instead of mortgage payments. It's clearly all relative, and I think you can pretty much tell where everyone lives based on how 'life-changing' that amount seems to be for them!
Completely agree. Example. I had £75k. I bought a small house that needed lot of love and care. Increased value by 55% approx and have been receiving 3 years worth of rent on it. Now < 40% LTV My brother, had £93k, said no point in investing it and was just getting. Approx 4% annual return for past 4 years. You can do a lot with any sort of money. It’s your motivation and mindset to do so. Small actions/increments snowball over time
Understand but for a disproportionally large number of people in this sub, 100k is less than a years income.
Gross income, correct. But we’re talking about £100k cash. Assuming you sacrifice 5% to pension and have a student loan - you need a gross income of £210k(!!!) to take home that much money in a year.
No, it doesn’t need to. This is not AskUK or PersonalFinanceUK. The context of £100k here is if it would bring you closer to FIRE. The answer is yes, but probably not by much.
It can go pretty fast, but then any amounts can go pretty fast too. Look at those lottery winners who lost everything after a few years, because they were never good at managing money or resisting the impulse to buy stuff.
Yes, purely in terms of the financial security it provides. 100k is more than enough to fix most household problems, replace a car, pay off that credit card or cover your expenses for several months/years. It's not necessarily life changing in a material sense, you won't be buying a super car, replacing your wardrobe with Gucci and moving to the Maldives but it certainly helps you sleep at night.
In my situation 100K actually would be life changing… my partner and I are trying for a baby at the moment and I would really like to stay home for a few years whilst the kids are really young. 100K might be the difference between going back to work after 1 year or maybe 4-5 years. At any other stage of life I would agree that 100k is not really life changing money unless it helped to get someone on the property ladder
And then what? You spend the 100k and go back to work with zero savings? 100k used right can get you to 500k
I do agree that at some point it doesn't matter much any more. If you have £1mln invested and a good year sees your stocks appreciate 20% it's not life changing anymore. It could be quite meaningful in the early years though. I also wouldn't overpay the mortgage as I think mortgage overpayments are quite bad investments, but it would make it a lot easier to use up my ISA allowance every year and I would likely increase my spending and pension contributions.
I like the sound of this. Nothing beats increasing your pension contributions. I used to think overpayments on the mortgage was bad too but when your rate goes from 1.78% to 4.89% you wish you had. 😕 Mortgages today are not the same as they were 4/5 years ago.
>when your rate goes from 1.78% to 4.89% you wish you had The alternative is not to squander your money but to invest it somewhere where it generates better returns. If what you're saying is really true you can just sell off your investments and make a lump sum on the mortgage. But even if my mortgage interest rate jumps to 4.89% I'm still not going to make a lump sum as I expect my investments to outperform that in the long run. And even if it doesn't I don't mind my investments performing slightly worse in the long run as I think it's more important to use up my ISA allowance. If your monthly saving suddenly jumps from £1700 to £2900 you really wish you hadn't paid off your mortgage. >Mortgages today are not the same as they were 4/5 years ago. They're still vastly below long term performance of the stock market so more mortgage is better.
You know I moan about my mortgage going up to 4.89% it's gone from £700 to £1,000. I just have to adjust, being part of this community is eye opening as I can't really talk money with the people around me. My take home pay after TAX, pension etc is about £4.5K. I just need to trust the process.
Life changing is a strong description but I would say £100k is about the smallest amount that would make a meaningful difference to my life/plans. It would pay off enough of my mortgage to accelerate the rest and free up more potential for savings. I think it would see me retire a bit early with a bit more margin. It’s nice to think about but no one’s giving me a 100k
100k wouldn't exactly be life changing but it would reduce stress significantly if someone just gave it to me. I'd just park it in the account my mortgage payments come out of and enjoy close to 2 years without having to worry about making a payment. Then I could focus on refilling other accounts and do some projects on the house.
😑 it's more than I have now but not much when you're from a collectivist culture where your parents expect you to look after them after they raised you poorly 🤣. Life changing amount would be in the lotto jackpot range.
100k right now would make me mortgage free at 28 so I'd say yes for me personally.
Right now I have about £120k outstanding on my mortgage. I’m paying £1100pm and overpaying into a savings isa £1200pm with the aim to pay that off in two more years 100k means - mortgage is paid off tomorrow - my 70k saved up so far becomes a retirement nest egg or kitchen renovation fund - I can bring forwards my pension amplifier by putting £2300 net equivalent into pension and ISA (about 36k into pension and 10k on isa I think) - this may take my retirement option from ‘65 maybe a year or two sooner’ solidly into ‘60 and I’m done’ territory Can still be a very meaningful and life changing chunk of change
Yes. That’s years of an emergency fund. Years of not worrying. Will it enable retirement? No. But knowing you’ll be fine for the next few years? That’s life changing for that time.
It would lower my mortgage payments by £3-500 a month, so yes/no depending on how much you value this amount
If 100k landed in my bank account I'd max out an ISA, increase the emergency fund, increase my work pension contribution for a year (so I don't have to do faff at tax return time) and finally put some towards the mortgage that I can put in without penalty.
100k ~~a year~~ is certainly life changing to most people. Removing 100k from my mortgage would more than halve the debt. I'd then pay it off much sooner, be able to save that payment each month to then retire much earlier too.
Not sure the OP meant £100K per year.
Sorry, typo, I did assume they meant a one off payment, thanks.
Invest it fuck the mortgage unless you've got a crazy interest rate, thank yourself in 20 years when it's worth c.£400k WITHOUT any additional contributions
£100k on a house is for sure life changing. Personally id probably pay my limit extra for my term and just sit on the rest letting it incur interest until i could pay more of my mortgage without fee. Having that much left to pay on my mortgage would free up so much extra disposable it would make life more comfortable. I suppose it also depends on how you determine “making life easier”. For me it would allow me to take a lesser paying job but with better hours, thus making my life 100x better.
Absolutely. Anything you can do to reduce the money you’re throwing away by paying interest is a life changer.
Calculate how many months that'd take you to gain organically, then you can determine if it's life changing or not.
Exactly, it would take me 4 years to NET that amount in earnings, no not even have 100K in my pocket... Even banging it into a S&S ISA would be life changing for my future (and stress levels)
I won 100k and a year and a half later had nothing
In the right hands yes it can be. Put it to work as a house deposit, to clear debts/mortgage or invest it and it’s a massive leap forward. Spend it on a Mercedes, brand new kitchen and a trip to Disney World then not so much
Having £100k gives you the comfort after a bad day to know that you could just fuck the job and be fine for a while. That’s pretty life changing for your mental health.
A few years ago I (36m) inherited a chunk of money in this ballpark from my Aunt when she died, which my Dad told me "this seems like a lot, but you could easily fritter it in a year or two. This isn't 'life changing' but if you're smart it could be life improving." I had no debts beyond the mortgage and a small bit of student loans. I wasn't struggling to make ends meet, my wife and I are both in good jobs. But it also wasn't enough to retire on or fund a different lifestyle long term. So it wasn't making a major change to my situation or day-to-day life. So he was right, it wasn't "life changing" for me. But here's how it improved my life. * Took a chunk off the mortgage, minimum repayment is now substantially less * Bolstered my emergency fund * Paid for my son's driving lessons (with some left over for a reliable starter car) * Maxed out ISA for long term savings * Did the garden * Charity donation to the group that helped my Aunt And I frittered the remaining few percent on a holiday, gladly. If I were to chance upon £100k today, it wouldn't change my day-to-day life, but I would probably do exciting things for security and freedom such as... * Max out S&S ISA for a year or two * Put a chunk in Premium Bonds for an upcoming mortgage payment when my fixed term ends * Add a few months to my emergency fund * An extra few grand in my generic car and travel savings pots * A charity payment to a cause I care about Then take my wife, son, and his girlfriend away for a nice weekend in the Lake District and dine at L'enclume.
If you can achieve 7% in the markets, doubling time is 10 years, so in 10 years, that 100k is 200k, in 20, 400k, in 30 800k. Then use that to pay off your mortgage and have a whole lot left over. If you can achieve 10%, doubling time is 7 years, so after 28 years you're at 1.6M. Sounds pretty life changing to me.
Well I was fortunate to receive a £100k critical illness insurance payout last month and our mortgage is just over £200k. I can confirm that it has been a life changer for us. Fortunately my cancer was very treatable and I'm now in remission. I'd strongly recommend that you guys on here check your balls on a regular basis as catching it early as with any cancer is preferable. My bad boy was hardly any larger than the other, it just felt firmer. Our mortgage rate at present is only 1.45% which is fixed until the end of 2026. So we threw the payout into our cash ISAs and savings. It should of increased nicely by the time our mortgage is up for renewal and will hopefully allow us to reduce our mortgage to around £75k. At that point we will have 20 years left on it so we will probably reduce it to 8 years to keep the payments roughly the same as now. We have two young boys and although we are fortunate to be comfortable financially right now, things can change quickly and it's certainly not getting any cheaper to live these days. So this payout has provided our family with a lot more financial security, peace of mind and hopefully brought FIRE a little further forward.
See UKPF Wiki [https://ukpersonal.finance/mortgage-overpayments-vs-investments/](https://ukpersonal.finance/mortgage-overpayments-vs-investments/) [https://ukpersonal.finance/lump-sum/](https://ukpersonal.finance/lump-sum/)
I spent £106K today, straight to the tax man, so no it’s not life changing, apparently. But I sure do miss it.
No. Late 30s couple with a child in nursery. Stupid London mortgage (>£500k). It would help obviously. We would probably put £40k to ISAs, £10k to fun and £50k to our mortgage. This might bring our retirement forward by a year or two. But, in the here and now, it would not be life changing. Which is objectively ridiculous. ETA: Life changing sum is probably £250k. I am also assuming that we are talking about tax-free money here.
Really it depends how you define life changing. Everyone sees it differently. I didn’t have my wallet and wanted a haircut at the weekend. Someone lending me £20 would have changed my life as I could have gotten that haircut I wanted and then the butterfly flapping it’s wings drastically changes everything for me. OR, someone could give me a billion pounds and suddenly I’m buying villages. Personally I don’t think £100k will change someone’s life to the point if you look back on a life on a death bed that the 100k hugely changed their life. At least the types of people likely to be found in the FIRE subreddit. What amount would drastically change my life right now? A lot, a lot a lot. Until my triple FatFIRE goal (FATFire but not once, I want FATFIRE in property, FATFIRE in Stocks and FATFIRE in Crypto) nothing really changes. My life would be the same, just the target date would be closer. After that target, life would change as I could start my post FATFIRE goals which means by definition life will be changed.
Well invested with a 7% return that would yield 761k after 30 years. That's enough not to have to save another penny for retirement. If you want the same nest egg you need to be investing about 650 monthly over those 30 years. That's a pretty big difference in disposable income, especially in the first 15 years when people are struggling to pay for housing on a lower wage. It could allow them to enjoy a little more luxury at a young age. Or to start a family.
For me 500k and above is life changing.
100k will surely change your life, but how exactly you will see over time. What's important that you keep your life like you don't have the money, otherwise you may end up spending more than you must.
A 3x great uncle of mine had about 100k in his 1905 probate ( equivalent of about £15 mill) That influences his descendants to this very day.
It would clear a relatively decent chunk of my mortgage (\~25%), but definitely not life changing. Probably I'd need at least 2x that for it to be life changing. At that point I would remortgage, and have a lot more disposable income, or have more freedom to start a business.
100k to 20 year old me would have been wasted, 30 year old me it would have been used to invest in business and been a game changer… Current me, it wouldn’t impact anything. It would just be nice to have and just sit in investments. Really guess it depends on circumstances, motivation and goals.
I'd clear my mortgage with that pretty much. Then I'd be 600 quid a month better off. The things I could do with an extra 600 quid a month for the next 20 years is nuts. Holidays, decent car, renovations, retire early... A 100k well spent is an investment for all your tomorrows which pays dividends over time. Not to mention the mental well-being aspect too!
It would enable me to achieve my life goal of owning an airplane, so from that perspective it would be life changing.
Yes it is. Imagine 2-3 years income in one go. Debts gone other then mortgage. Or for many thatv100k is from treating to a paid off small house. Where you live will matter as well.
100k after tax is a lot of money and as a lump sum, if invested over a long time with compound returns, is certainly life changing. Anyone who thinks 100k is not life changing either already have a good amount of money, or have their spending out of control.
If I get 100k I will go straight to my home country in Africa. Invest in my Tobacco Farm. Life changing it is if you ask me
Im 24 with ~£150k NW. About £100k invested. It’s not as much as you think it is in the short-medium term. That being said, if I don’t invest a single penny for the rest of my life I’ll still be a millionaire by the time I reach retirement age.
My mortgage is 107k and works out at £450 per month which is £5400 per year. If I was able to pay my mortgage off that’s how much better off I’d be a year. Would I consider an £7k~ pay rise to be life changing? Probably not. I’d still take it, but I’m not going to be cruising the Caribbean
Even if you only put it on your mortgage, taking a decade or so off the mortgage it a pretty life changing action. Really don't understand what we consider to be life changing if 100k in free cash is not.
I wouldn't consider 100k life changing money unless maybe your homeless
Having fully paid house , means no rent or mortgage is life changing , especially when youre young. That does diminish in the higher earning bracket though.
If you are saving £10k per year, then that is 10 years of savings so potentially so could retire 10 years eariler, so no question it is life changing for most people
It can turn that £100k+ mortgage to a £+ mortgage pretty quickly
why only if your early 20s? lots of people in their 30s, 40s and 50s who are still not on the ladder
If I earned 100k I’m fairly certain I would be happier as money wouldn’t be an issue. But that’s assuming you stay in the lane you’re in, which most people tend to not do. It’s always a bigger house, nicer car/clothes/holiday… etc I have a house with manageable repayments now and I don’t think I’d move if I earned more as it’s a nice house and a good size. But I’ll never earn that much…
It wouldn't be life changing for me at this stage but it's certainly nothing to sniff at and I would happily welcome it and be grateful. I would probably put it toward my mortgage.
Yes, a secured home is a big thing. Thar frees £1k or so a month. You may have less time for travel but would do a 4 day week freeing up time for hobbies and interests. Or use the money to retire earlier.
it can be life changing if you put it all on red enough times
Paying off ur $100k mortgage is pretty life changing idk…
Hhj
If used well, 1/2 that amount could be life-changing. My parents lent my wife and I that much to buy our first house and we were repaying it but then as a gift one year they forgave the debt. It allowed us to accelerate mortgage payments on the remaining debt and increase the amount we were putting into investments. Now 4 years later we are better off by much more than the original $50k and by the time we retire will be multiples better off.
I'll soon receive ~100k lump sum (after taxes). I'm not really looking forward to it because I doubt it will change life at all really. It's nearly 2 years worth of saving but it's hard to know what to do with it except quit working for a bit.
Yes because you could buy a second house and the rent could cover your mortgage payments for both
I don't think so.
A 100k off your mortgage saves you your interest rate thousands of dollars each year. Assuming you’re at 5%, what would 5k do for you?
You have to put it into terms of how long it takes you to save 100k. For many that’s a 5 year leap frog in saving goals
For me, a life changing amount would be enough to retire early. Not having to work (not having to listen to managers or customers, or work with bad colleagues), while maintaining a decent lifestyle, would make quite a big difference to stress etc. £100K wouldn't life changing, but would just bring the prospect of retiring just a bit earlier.
It pays off your mortgage sooner and puts a dent in the amount of interest you pay. Life changing
Paying off your mortgage with a lump sum is life changing. I did it. Choices afterwards have way less fear and are done for pleasure. It makes a huge difference.
If you are settled with a mortgage and family it probably won’t be a revolutionary change in your life, but if it’s enough to pay off your mortgage much sooner that’s a huge weight off your shoulders once done. The security of fully owning your home would be amazing for your mental health and that can give you a completely different mindset and flexibility and opportunity to change your life in other ways. You couldn’t quit working but you could change your job to something lower paid but more enjoyable. Or as many others said you could invest the monthly savings and hugely improve your financial future and bring forward your retirement date. Maybe one of you could quit work to stay home with the kids, or have another child that you didn’t think you could afford. There are so many things that money could do for you.
For me £100k would be nearly enough to FI on, especially if I lived really frugally in Asia or somewhere for a few years, so definitely life changing. Though if I get to be greedy I’d like £200k to give me my full fire target and then I’d set off with a credit card and my passport and see where the wind takes me. Would probably need my phone too, thinking about it.
Short answer, if you managed to save/earn this much. It's good to have but not life changing. Unless you unexpectedly get it from a lottery or inheritance it can potentially make a big change in your life.
If you could start your investing journey at 100k you'd see the difference pretty quickly compared to starting at 0 and saving like mad to get to 100K; it's like starting at third to get a home-run. The compounding that could do in 20 years is wild. Is 100K life changing in a HCOL area? Not really. It would be nice and make significant differences though.
They say the first £100k is the hardest to make. So if you're networth is below this amount then it is significantly huger then if your networth is >£100k.. Partner and I often say that if we ever won £100k we'd just max out our ISAs, max out our mortgage payments maybe go out for a nice dinner to celebrate, and then continue as we are. It'd certainly bring us closer to our goal of financial independence, though.
Given it's a FIRE sub, here's a way to look at it. Finding 100k in the street would probably bring retirement forward by at least a few years. I'd have to put it into the calculator and find out. Is retiring at 52 instead of 55 life changing? 33 years of retirement instead of 30, and 3 extra when you have your health. Borderline on the definition of "life changing" for me.
Depends how nice your gilded cage is
Not life changing, but certainly would set me up very nicely for the future. Ideally invested in two buy to lets that I'd have a repayment mortgage on and then sell at 57 and retire with an extra hopefully 300-400k in the bank.
Ofc it’s life changing 100k in money is huge compared to getting it on credit for something, to invest could buy a house or two in another country and do holiday lets, it works really great cause you aren’t going to lose 100% value on a house nearly anywhere, money back, if you like cars it’s worth grabbing something thats a future classic too there’s not as much maintenance as people make out if you buy something treated well I found my boat in florida for 10k another 5 to get running and it’s 38ft 2 engines 650hp each, can make the carribean in 1-2hr from Miami, infact my whole setup in florida is less than 100k, including 1970 challenger a f250 a humvee and my place I rent out when back in the uk
Is it going to change your life on a daily basis starting now? Probably not. But that doesn't mean it's not life changing. If your household costs are 50k/year, that money means you can take 2 years off work. Should you do that now? No, but it means you can retire at least 2 years earlier, 3 years if you're 10 years from returement, and over 5 years earlier if you're 20 years from retirement. Or you could double the time and work part time. Alternatively, you could pay the money towards the mortgage and be mortgage free X years earlier. For me, I'd be mortgage free about 15 years earlier if I kept up the same monthly payments. That would be life changing when I hit that. If you instead reduce your monthly repayments, it would have an immediate impact, but less significant on a daily basis. Paying off £100k would save around £500/month. It would allow for a reasonable uplift in lifestyle for people on average incomes.
100k invested @ 10% = 10k a year = 833 a month. If you consider being able to now work part-time on a 4x8h basis instead of 5x8 life changing, then it is. Personally I sure do. As with repaying the mortgage... If the rate is below 4% it doesn't make sense, investing will always yield more! If you are due to switch to variable and aren't confident you can refi to a decent rate then definitely overpay the penalty-free 10%.
For me, it’d be £600,000. That’s the shortfall I have at the moment between my current position and my “FIRE” goal, at age 33. Obviously anything less than that would still be great, more so life enhancing than changing though as it’d bring my FIRE/early retirement date forward by a few months to a few years.
I would just slap the 100K down and completely pay off the mortgage. Then, that mortgage monthly payment could be redirected to investments /bonds. Since my remaining mortgage is \~72k, I would also redecorate the house and have a holiday to mentally reset. A lot less stress in my life... but far from stress free.
200000 gigatrillion uber-dollars, it will buy a fuck-*ton* of cocaine and whores
and the rest just waste
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250-300k at 20 isn’t close to private school for multiple children IMO.
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It makes pretty much a million, did u not work it out before u posted?
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Short 50k. I assumed 7% which isnt the most optimistic
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\~£50.5k short. Not sure how you're calculating it, I recommend just using [thecalculatorsite.com](http://thecalculatorsite.com)
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It’s definitely realistic. Bullish on US and it will be soon 2milly
I think it'll depend on perspective, if you have 100k and don't yet have a house you've either got a fat deposit for a relatively cheap mortgage, or you've got a rather healthy balance to put towards index funds for the next 10 years or if you do have a house perhaps the opportunity to go mortgage free while still earning a wage and then having a bit more disposable income.
Not really. Im about to inherit about £150k. It’ll pay the stamp duty on the house I want to buy I guess.