The system the UK government implements will never lead to financial success – it is a road to financial failure.
You've heard it before: go to school, go to university, go to work, buy a house, get a pension and die. The government tricks us into debt by making us give the government enormous amounts of money. We end up living off credit - unless we find a way out of this cycle.
When you go to school, you learn and are examined on what you remember – a system designed for one particular type of brain. As Albert Einstein once said ‘everybody is a genius, but if you judge a fish by its ability to climb a tree it will spend its whole life believing it is stupid. This is a concept our government tricks us into believing - that our grades are a measure of our success. This in turn encourages us not to achieve our full potential and obtain minimum wage jobs, generally working for the government e.g in the NHS or TFL.
Going to university is highly encouraged within schools – it is almost compulsory that you apply and it is frowned upon if you don’t. However, with all things considered there aren’t actually that many benefits of university. The average student debt after leaving university is £45,000 minimum – and if you take extended courses upwards of £150,000 in many cases.It has been proven in recent years that it is not the greatest option for success, with a 658% increase in degree apprenticeship entrants and over 91% of universities involved in degree apprenticeships. This is a new concept as they have only been produced within the last 5 years, but they are proving extremely popular as you can get a degree and work experience without debt. This is part of the new path out of the system.
Over 95% of degree apprentices have secure jobs after, usually within the company they worked for whilst doing the apprenticeship. In contrast, 41% of university graduates end up working in jobs that don’t even require a degree. The average UK wage is £36,000, and the average tax paid to the government is £11,000, leaving the average employee with £25,000 a year. This is barely enough to rent a flat and pay bills – let alone pay a mortgage on a house. This leaves no money for a pension fund either, and this lack of financial security results in low quality of life as people cannot afford to travel or explore life – they will spend the majority of their time working a 9-5, with little chance of promotion.
Pension schemes are heavily unreliable – 3 in 5 people aren’t even aware of how much there is in their pension or even how to access it. The average pension is £536 a month which barely covers basic living costs – it is essential that by this time you have paid off a mortgage on a house as you will have no money to be able to rent. This shows the importance of making savings because following the system will leave you with nothing in the end.
Ways to get out of the cycle are rarely discussed. A degree apprenticeship is a good option, as it minimizes debt and you can make money from doing a degree and work experience. From then, managing your savings is key. Don’t waste money renting unless you are planning to live there short term, and build up your credit rating to get a good mortgage on your house. Make sure you have multiple streams of income and learn how to access and manage all of your money. My next articles will discuss this and how it can be done.
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