I am a 24-year old that lives in London. I still live at home but have high hopes of moving out to gain that all-expected holy grail of independence. However, I will just repeat, I am a 24-year old that lives in LONDON. The Guardian released an article in October revealing that average rent prices in London hit £816 per month! Now that is a hefty chunk out of my paycheck in itself.
Now, I believe that I am paid a good wage but with the Financial Times releasing a statement about how much we need to save for a retirement fund, well I am seriously questioning that. They have called us 20-something year-olds out to put £800 a month away so we can retire at 65. That is a lot. Take my rent with this retirement top-up and I will be left with near to nothing of my wage. But that’s fine, because I will be living in London and I will be able to retire comfortably when I am 65, right?
Let’s crunch some numbers. If you put £800 away every month from the day you turned 25 until that ripe old age of 65, assuming it’s going into a saving account with an interest rate of 0.25% APR*, you would have compiled a total of £403,873. So that is the figure you need to hang those worker boots up and sit back comfortably in that armchair with a glass of rouge. Happy times. So how about if there was a way to get to that value but put away no where near as much each month? I’d take that and I am taking that.
QuidCycle is a financial services company that presents an easy and secure way for us millennials to put a small amount away each month and start building that fund. The RegularInvest product offers a 5.2% APR (Capital is at risk with Peer-to-peer investment) on each and every monthly investment. So using that rate, how much would you need to invest each month to reach £403,873? You won’t believe it - £259…. 259 whole pounds each month. That certainly leaves a nice handful of my wage to feed my London stomach. I might even be able to take the tube to a night out!
Just to put the FT’s £800 a month into perspective, if you decided to seriously go for it and put that £800 month into QuidCycle, you would be left with £1,252,170 by the time you are 65! That comfy chair has just been upgraded to a seat on a private jet and you might even find yourself knocking on the door of one of Forbes’ lists. However, always remember that your capital is at risk with Peer-to-peer investments.
This is not a post ridiculing anything FT-related but it is a wake up call to all the millennial members. It is worth thinking about your retirement now because your older self will give you a massive hug for it. But instead of leaving these monthly deposits sitting idle in a bank account, there is a much better way. Invest into QuidCycle and watch it grow whilst also making the most of your youthful years. The February Friday sun is out and the weekend is calling, have a great weekend!
As with all Peer-to-peer investments, your capital is at risk. Be sure to understand all of the risks before investing. Please see our Understanding the Risks page.
*This is the rate of Barclays Everyday Saver Account as of September 2015
Disclaimer: The above information does not replace financial advice. Please ensure you seek independent financial advice before making any decisions regarding your finances. We also recommend that you carry out your own research to ensure that this is right for your own unique circumstances. Please note that we sometimes link to other websites but we cannot be held responsible for their content.
Article by Olly Hiscocks.
Image by Sira Anamwong at FreeDigitalPhotos.net.