The price of stuff and the cost of living

For my 15th birthday, I received a bicycle - a Raleigh Sportsman 10. I remember the price - £33. This was 1972, so according to the Bank of England's Inflation Calculator, the value of that money today would be £364.63. An entry-level road bike retailing today in the UK for between £350-£370 is vastly superior to my old Raleigh, with its gas-pipe mild-steel tubing and crappy gears that would quickly go out of alignment, throwing the chain into the spokes. It was so carelessly prepared that riding it home from the shop, the brakes wore a groove into the amber sidewalls of the rear tyre. It was replaced in 1986 by a vastly better bike - a Saracen Kili Flyer, 531 alloy frame, Suntour groupset, Brooks saddle.

Once upon a time, things were more expensive and of poorer quality than what we have now. Globalisation (ie getting poor people from poor countries to make things for poor people in rich countries) and technology (computer-aided design and manufacturing) have made bicycles and pretty much everything else cheaper, better, lighter and more durable. 

Result? We are awash with stuff. We want want want, our wants driven by manipulative advertising that hooks onto our whims and desires. Learning to say 'no' to the blandishments of consumerism isn't easy, but not saying 'no' leads to debt and a lifestyle predicated by paying off loans.

Stuffocation affects us all; even with my highly ascetic lifestyle, the disposal of stuff is still an issue for me. In away, technology has streamlined our stock of possessions. Here is a list of things I no longer need because they are in my smartphone: fixed-line telephone, watch, stopwatch, step-counter, portable radio/Walkman/iPod, pocket torch, compass, snapshot camera, calculator, dictaphone, a whole drawer-full of maps, and a new pocket diary every year. 

But not only things - the digital revolution has dramatically cut the amount of money I spend on media. Other than my subscription to The Economist, I no longer buy newspapers. I don't own a TV, so no TV licence fee. I don't buy or process several rolls of film a month, nor do I buy CDs or DVDs or LPs or music cassettes. I once estimated that back in the late 1980s/early 1990s, I'd be spending up to one quarter of my disposable income on media. Today, it's all rolled into my YouTube Premium and Adobe Creative Cloud subscriptions and the plethora of free online services available through my laptop and smartphone.

The costs of things in proportion to food and shelter is shifting. Once, humanity did nothing but hunt and gather. Agriculture and civilisation led to increased specialisation; today, only 2% of people in the rich world make a living growing and processing food. And as food and clothing became cheaper, housing has become more expensive. So we're living in smaller premises with more things, and disposing of them becomes an issue. Selling them online is time-consuming; precise description of the state of wear of a given item, answering emails from time-wasters, meeting potential buyers for whom the goods are not quite right, puts many people off. Charity shops are an answer, but Poland still has only a tiny handful.

The real answer is to scale back one's purchases. Buy less. Separate needs from wants. Cutting out junk food, salt snacks, confectionery, biscuits and cakes is not only good for your health - it saves money that over time becomes significant in scale. Impulse buying is unwise. And it tends to end up in landfill sites, having wasted precious natural resources. Below: the Buyerarchy of Needs, by Sarah Lazarovich

I'd attribute my current financial comfort to the fact that I jumped off the treadmill of consumerism a long time ago. Where one lives is vastly more important that what one drives or what one wears. Car ownership and clothes are a massive waste of money. My mother used to say, "Nie ważna miarka, tylko szafarka", roughly meaning that it's not how much you have of anything that counts, but how you use it. The person who earns £80,000 a year (averaged across the span of their career) and spends £75,000 a year ends up after 40 years' work ends up much less wealthy than the person who earns £60,000 and spends only £40,000. Look after the pennies and the pounds look after themselves.

This time last year:
Post-Lenten photo catch-up

This time two years ago:
Qualia memories - Edwardian railways

This time seven years ago:

The great taste of Polish India Pale Ales

This time eight years ago:
Lublin - pearl of Poland's East

This time ten years ago:
70th anniversary of the Warsaw Ghetto Uprising

This time 11 years ago:
Tarkovsky's Stalker: a zone of my own

This time 12 years ago:
Warsaw's big billboards

This time 14 years ago:
Pace of development falters

Money and Metaphysics - Lent 2023: Day 36

 "Money is the root of all evil" - well, not quite. Dig deeper and you'll find that actually the root of all evil is the Ego - which money and power feed. Money buys power, which is used to buy more power, which is used to extract more money... Once you're a billionaire, the only egos you are interesting in impressing are those belonging to your peers. To them, there's no bigger trophy with which to flaunt your ego than human minds. I refer here to Elon Musk who spent $44 billion buying Twitter to shape it to his will, as well as nonagenarian media owner Rupert Murdoch and their like. Once you have so much money that another private jet, another Caribbean island or another 300ft yacht brings you no more incremental pleasure, then warping the minds of millions becomes a goal. Egos that don't know where to stop - the root of so much evil. Putin - maybe the richest of them all - is destroying hundreds of thousands of human lives to create a legacy for himself among Russians.

To avoid a world distorted by out-of-control egos, I'd propose the motto, "Aim to live in comfort; aim not to live in luxury". 

Money is in essence a call on other people. You have money, you can get people to do what you want them to do. Work in your factory, write you some code, sell you some land, create some art for you.

Back in the days of the first dot-com boom, there emerged the notion among start-up founders of 'fuck-you money' - then said to be around $10m - the net amount of cash you needed on your account to be able to say 'fuck you' to anyone. You're made; you're financially independent for the rest of your life (and your children and grandchildren will never have to work a hand's turn).

Today's Egos will demand much more than that $10m. I, however, require much less. Being financially independent as early on in life as possible is a sound financial goal to aim for. Owing money to banks for the home in which you live (which in theory they can repossess should you lose income) is not comfortable. Living in your own place (ideally without monthly service charges) is comfortable. Worse still is owing banks and credit-card corporations money for consumer loans taken out to buy all manner of needless fripperies and assorted bollocks that all too soon break down and end up in landfill.

The road to financial independence will be much shorter if you don't piss money away on unnecessary things. Not owning a car, for example, is a massive, whole-life, financial boost. Not flying off on a holiday or two every year is another. Thousands of consumer baubles can easily be foregone over a lifetime, your wallet fuller and your home less cluttered as a result. I do, however, aim to eat well, healthily and tastily; I'd happily pay three or four times more per kilo of a decent artisan cheese than something mass-produced, bland and rubbery.

The pursuit of money which is ultimately frittered away on unnecessary things gets you onto a treadmill of over-work, anxiety and stress. You are still uncomfortable, even though you're surrounded by material goodies. New car, new furniture, new clothes, new household electronics and appliances - and mounting debt.

"I work in a job I don't like to buy things I don't need to impress people I don't know" is where this ends up. And mindless consumption is endangering the ecosystem that civilisation requires to survive. Look at the lifelong greenhouse-gas emissions generated by the manufacture, use and disposal of items that you bought that weren't really necessary but you just wanted on a whim. Now multiply that by eight billion, plus the number of all the people now dead who've lived since the Industrial Revolution, and there we have the cause of man-made climate change. Our mammalian impulse to rise up the status hierarchy might prove our undoing.

But this must be a life in balance. 

I don't believe that you can focus on the Eternal and Infinite if you are living in discomfort - in pain, in hunger, in poverty, in stress. Money is needed to lift one out of discomfort, into a life of ease - and then, having attained material comfort, the mind should focus on the numinous and on the metaphysical questions - seeking purpose, and in that find human fulfilment. You need time to focus on what's most important in life, time to meditate, walk, exercise and contemplate in the search for meaning.

Not on chasing the next million bucks, or flaunting one's Ego with ostentatious displays of wealth.

"But Jesus answereth again, and saith unto them; Children, how hard is it for them that trust in riches to enter into the kingdom of God! It is easier for a camel to go through the eye of a needle, than for a rich man to enter into the kingdom of God." [Mark 10:25] Jesus was on to something there.

Lent 2022: Day 36
Losing sight of God

Lent 2021: Day 36
One life is not enough

Lent 2020: Day 36
Accounting for talent

Professional advice

Following the death of my mother, administrative matters were straightforward - her will essentially said 'all to husband'. This time the situation is only slightly more complicated - my father's estate is left to my brother and me. The bulk is the house, the three-bedroom detached house in West Ealing into which our family moved nearly half a century ago. The cash in the bank and other assets will probably cover the inheritance tax due. Leaving us with a house.

Sell or rent? Develop or leave as is? If develop - how? Split into two self-contained maisonettes? If so, how? Can the garden be developed? Can the loft be turned into living space? If so, how big?

How much is the house worth? Really difficult, as this may be one of tiny handful of three-bedroom detached houses in Ealing. Almost all detached houses have four or five bedrooms. And almost all three-bedroom houses in Ealing are semi-detached or terraced/end-terrace. There's a big garden - but what about that access?

How much can the whole house be rented for? Families rarely rent. Most want to buy. Expats rent, but the steady flow of EU-nationals moving to London to work in the City or in European HQs is drying up because of Brexit uncertainty. Renting each floor separately brings in much more money than renting the whole house. But the downstairs would need a new bathroom installing, the upstairs a new kitchen, self-contained gas, water and electricity would be needed.

How much would this cost to do? How quickly would that investment pay off?

I live in Warsaw, my brother in Derbyshire. Family members need a London pied a terre for work purposes. Could we keep one part of the house and rent the ground floor (with new bathroom) as a garden flat? Would than pay enough to keep the whole thing together (and pay off any loans for the conversion work)? And the garden - should we divide it and sell it to a developer - or develop it ourselves?

One thing is certain - my brother and I are very attached to the property, to the area, and we don't want to sell. To keep the house, it needs to earn money.

The local authority is very happy to see large properties divided into smaller units, easing the housing shortage. Ealing is a popular place - the parklands, proximity to good schools, excellent public transport, close (but not too close) to Heathrow. So permission to divide and expand outward into the back garden patio and upward into the attic should be easy. But the garden will be harder - especially the issue of access.

This is all mind-boggling stuff. This all needs careful analysis, spreadsheet models which look at building costs and rental income with long-term projections. I intend to retire (or at least slow down) in four years, so having a UK basic state pension, a tiny bit of a Polish state pension, a modest UK private pension plus revenue from rental will all add up to a comfortable if not rich old age in Poland.

The value of the pound expressed in zloty terms will be crucial; hence the UK's future relationship with the EU is of intense interest to me.

All these variables are incredibly complex and yet important to me. It seems bewildering at first.

But help is at hand - Britain has very good professional advisers. One phone call to our solicitors and two visits from estate agents has reassured me immensely. I can see many people with the knowledge and experience to offer first-class advice. Obviously, one has to pay for advice, but before that stage, there's much to be learned including the questions that need answering. I feel in good hands.

A bad decision at this stage is the difference between an old age living from month to month to one in which I feel financially secure.

This time two years ago:
Gliwice's new station

This time four years ago:
Reanimated - my father's car 
[Anyone want to buy it? 63K on the clock, one driver from new...]

This time five years ago:
Defending Poland against hybrid warfare 

This time six years ago:
Another office move

This time eight years ago:
PiS splits again - Solidarna Polska formed 

This time nine years ago:
Tesco vs. Auchan

This time 12 years ago:
My father's house

The day I found a million zlotys

This post is for all UK expats who've been living in Poland for some years and who've paid into a British occupational pension fund. This... is good news. 

Today I picked up from the post office the Certificate of my new personal pension plan. I left England for Poland in 1997 having worked for one employer for 16 years. Over that time, I'd been paying into the employee pension scheme, my contributions being topped up by my employer. 

Since 1997, the UK economy has hit two recessions, so I thought that my pension fund was worth not a whole lot. The way my former colleagues put it - they'd have to work to 85 to get anything meaningful out of their pension fund. So imagine my surprise and delight when I discovered* it was worth much, much more (like ten times more than I thought) - and that I could take it out of the UK - and that I wouldn't be taxed on it - and the annuity wouldn't disappear after my death! The trick, O fellow expats, is a thing called QROPS, which allows you to move offshore what money or monies you have locked into pension funds back in the UK. 

The funds will then be administered on your behalf so they can grow and grow - and when you retire (not in the UK - that's the point of QROPS) you can do with the pot of money as you please. 

Another meaningful piece of advice to expats from the UK is not to let your National Insurance Contributions lapse. You can skip up to seven years' worth of NICs, and providing you make up the shortfall, you'll still have the right to a full basic state pension (currently worth around 2,000 zloties a month when spent in Poland). 

Well, I'm paid up - full stamp - so no worries here. So I am delighted to learn that my old age is financially secure (assuming of course that I stay in Poland, and that no unknown unknowns pop up along the way).

[UPDATE - IT DID. FUCKING BREXIT. IF YOU VOTED FOR IT, I FUCKING HATE YOU, CUNT.]

* Thanks to a certain financial adviser who I can put you in touch with if you are in the same boat as me, ie a UK expat with pension funds left in the UK, who's got no intention of retiring there. 

This time last year: Making the most of winter 

This time two years ago: Progress on ul. Baletowa 

This time three years ago: Shortest, mildest winter?