Five minutes a week that makes you smarter and calmer about your own money — plus a look at what I’m actually doing with mine…
Morning. Ever wondered how you're doing compared with everyone else? Not just the neighbours with the new car — everyone. The Office for National Statistics counts it, by age, and this week I've got the numbers:
THIS WEEK IN 30 SECONDS
The typical British household is worth £293,700 — but barely £10,000 of it is actual money.
The FTSE 100 hit another all-time high this week.
This week's myth: the fastest way to invest well is to copy someone else's portfolio. (It isn't — not even mine.)
THIS WEEK IN MONEY
How rich should you be by now?
The ONS counts the nation's wealth — everything: house, pension, savings, investments, even the furniture. Its latest count (2020–22; they're slow, and even they admit it's imperfect, but it's the best official picture there is) says the typical British household is worth £293,700.
By age of the head of the household, the median weath is:
Age | Median household wealth |
|---|---|
Under 25 | £15,200 |
25–34 | £109,800 |
35–44 | £209,600 |
45–54 | £301,900 |
55–64 | £496,500 |
65–74 | £502,500 |
75+ | £373,100 |
Then it falls, to £373,100 past 75, as people start spending it.
What it means for you: before you panic about your number, look at what the wealth is made of. Property is 40% of it and pensions another 35%. The typical household's financial wealth — money in savings and investments — is just £10,400. So if you feel behind, you're comparing yourself with people whose wealth is mostly a house they live in and a pension they forgot they had. Two things follow. Your pension counts — and it's already invested, quietly doing what this letter keeps banging on about. And the bit you actually control, the £10,400 bit, is exactly where most people never get started. That's fixable at any age on these tables.
The FTSE 100 hit another record high
London's index topped 10,750 this week — another all-time high, helped by an easing in the Middle East and cheaper oil.
What it means for you: if you've been waiting for a dip before you start, this is what waiting looks like: the market going up without you. Record highs aren't a warning sign — they're what a rising market does repeatedly, for decades. The record high isn't the risk. Waiting before you invest — that's the real risk.
WHAT I’M DOING
My portfolio's on the site, updated this week — every holding and how it's doing: see the full portfolio →
No changes in my portfolio this week, as is very often the case. These are long-term investments and I don't react to short-term noise — that is a deliberate strategy. It's nice to see some of the long term holdings picking up, but none of them have reached our exit level yet.
The specific picks — which ETFs, which stocks, what I paid, and why — sit on the paid side. Free readers get my thinking. Paid members get my actual investments and my numbers.
ONE THING WORTH UNDERSTANDING
Why invest in America when I'm British?
A fair question this week of all weeks, with the FTSE at a record high. Credit where due — London's had a good year (for once).
But the core of my portfolio is still a low-cost S&P 500 tracker, and it's not even a close decision. The S&P 500 holds America's 500 biggest companies — which increasingly means the world's biggest companies. Apple, Microsoft, Amazon: businesses that earn their money everywhere, including from you. Over the long run that index has returned around 10% a year. The FTSE 100 is a fine collection of banks, miners and oil companies — solid, dividend-paying, and mostly yesterday's giants. When I buy the S&P 500 I'm not betting on America over Britain; I'm buying the five hundred most valuable companies on Earth, which happen to be listed there.
Nobody knows which market wins the next decade — anyone who claims to is selling something. But I'd rather own the companies the world can't stop using.
You don't have to invest somewhere just because you happen to live there — invest where you get the best performance.
MONEY MYTH OF THE WEEK
"I'll just copy your portfolio"
Flattering — and readers do ask. But copying anyone's portfolio wholesale, mine included, is a mistake, for a simple reason: you'd be copying my past. I bought those holdings at different prices, at different times, for a situation that isn't yours. Buying them today isn't the same trade — it's a different trade at today's prices wearing my labels.
What is worth copying is the method: a low-cost index fund, bought regularly, left alone. That's the part that made the money. Copy the boring bit. It's the bit that works.
JARGON, DECODED
Currency risk — when you own American shares from Britain, your return has two moving parts: what the shares do, and what the pound does against the dollar. A strong pound trims your gains; a weak one pads them. Over months it matters; over decades it has mattered far less than the growth of the companies themselves. It's a reason to understand what you own — not a reason to stay in cash.
WORTH YOUR TIME
Where the numbers come from. MoneyWeek's walk-through of average net worth by age, with the regional gaps spelled out — the South East's median household net worth is £489,800; the North East's is £179,900.
BEFORE YOU GO
If this was useful, forward it to one person who's been quietly wondering how they compare.
See you next week.
Tim
P.S. The Bank of England announces interest rates on Thursday lunchtime. They'll probably do nothing. If they do something, I'll tell you what it means next week.