'I bought the land for my house for £5,000. It's worth £10m now'

Stirling Moss: 'I bought the land for my house for £5,000. It's worth £10m now'

Sir Stirling Moss is said to be in good spirits as he recovers in hospital after falling down a lift shaft at his London home. Sir Stirling, 80, is still reckoned to be the greatest racing driver Britain has ever produced. He lives with his third wife Susie, 57.

 

By Mark Anstead
Published: 11:19AM GMT 09 Mar 2010

Sir Stirling Moss: 'Do I bank online? Good lord no'

How do you invest?

I endeavour to use money to my advantage by investing it in property. My father used to say there is no better hedge against inflation than bricks and mortar and I believe he was right. At the moment I have 45 tenants spread across 10 rented properties, some in bedsits accommodating eight or nine people and some in flats with just three or four sharing.

What's been your investment strategy?

If I'm going to buy a new property I go to see it and work out how much I might need to spend on basic improvements and then what level of rent I think I can get. I am usually looking for at least a 7pc return, but I always buy within scooter distance of my office so if someone calls to say the washing machine is broken I can get on my bike and go over myself to try and fix it. I have properties in West Kensington, Maida Vale, Pimlico and Battersea – all within a 10-minute scooter ride of my home in Mayfair.

 

Have you ever borrowed against the value of your properties to buy more?

No, I have never done that. 'Gearing up' seems to me a foolhardy thing to do. It may sound like a good on idea on paper, but borrowing against one property to buy another seems to me like building up a house of cards – it will only come crashing down later.

How do you separate responsibility for finance with Susie?

We share everything – we don't have joint accounts, but we might as well. I can't think of an occasion when I have ever bought anything for her without her knowing what it cost. I bring the money in and she can spend it as far as I'm concerned (I'm lucky because she's more frugal than I am). Anything she wants she just gives me a cheque and I sign it.

How do you feel about the proposal to phase out the use of chequebooks?

Excuse me? I'm shocked … somehow that little piece of news had passed me by. I hate the idea – cheques are how Susie and I conduct all our affairs. I don't know what I would do without them. You've ruined my day now…

How did your childhood experience influence your attitude to money?

My father was a dentist and we lived in a small house in London until I was seven or eight, at which point we moved to a farmhouse in the country where my parents kept chickens, cows and ducks. It wasn't a working farm, more of a gentleman's retreat, but my father would commute from there and stay overnight in a flat in London during the week.
He ran 16 different surgeries in different locations around the city and he just didn't like wasting time talking to patients about the weather, he only wanted to come in at the last minute, administer the anaesthetic and do the drilling, leaving all the aftercare to the nurses.
He was very successful, so I grew up well provided for, but he taught me if there was anything I wanted in life I had to work for it. I had either to wash his car or sell something I already owned. That attitude has stayed with me – I don't like being careless with money.

How do you show your caution with it?

I don't think I live nearly as high on the hog as I could if I wanted to. When I travel, for example, I always fly club class because even though I can afford first class I can't see any benefit in it. I'm just not a wasteful person – I'm pound wise and penny foolish.

Have you learned any difficult lessons about money through mistakes?

I lost quite a lot on Australian dollars 20 years ago. I used to visit Australia quite often and I converted a lot of English pounds when the rate was about two Australian dollars per pound sterling. I thought I was getting a good deal and I put it into a bank account over there, but soon afterwards the pound strengthened. When I wanted to convert some money back it was a total disaster – I got less than 40p a dollar.

Do you have many credit cards?

I use my Coutts Visa card and that's about it. When credit cards were first introduced they sent them to everybody with a bank account and I'll never forget the way my father took out a pair of scissors and cut his up. I use them, but I am careful with them – I make sure I pay off the balance every month.

How do you tip? Are you an easy tipper or do they have to work hard with you?

I do tip, but I find it difficult to understand why it's now 15pc when it used to be 10pc for most of my life. The only difference between then and now is that the cost of food has gone up – the service hasn't got any better. If I receive exceptional service I'll add a bit more, but I refuse to use 15pc as my starting point.

What's been your greatest extravagance?

We go on long cruises every now and again, but I feel they are a deserved extravagance because I have always worked very hard. We're about to go and cruise in Singapore for our 30th anniversary and it will cost about £4,000 plus the flights.

How much did your home cost when you bought it?

It was 1961 and I bought a plot in Mayfair and built a six-storey 2,500 sq ft house on it. It was a site that had been bombed out during the war and the council originally offered me the whole corner including a derelict hotel for £40,000.
I didn't want the hotel so I asked how much they wanted for just the two plots on the end and that was just £5,000. The build cost was £25,000 – I had to tank the bottom because there was a river running under it and I installed a lot of luxury items. I have a table, for example, that goes up into the kitchen where it can be laid for dinner and then descends into the dining room below.

What has been your best buy?

My house. Even if it was still a bomb site the plot alone would be worth £10m today. But the whole thing is out of date and needs modernising this year – I want a new kitchen and air conditioning in every room.

And your worst buy?

I once won a 12-hour race in America in 1953 and as part of the prize I was given a homestead in a little place called Avon Park, Florida. The trouble was every year I had to pay tax, $107 annually. I should have defaulted and they would have confiscated it, but I kept hold of it until thankfully a friend of mine bought it from me a year or two ago for $8,000.
By then I was glad to see the back of it – $107 was worth a lot more when I started paying it and I would say if you add it up over the years it probably cost me a lot more than I sold it for.

Have you ever invested in shares?

I'm very cautious about things like that I don't understand, but when I was racing abroad after the war a friend of mine borrowed some money from me and paid me back in shares – £5,000 in Western Mining. I've still got them although I don't know what company name they are now. They've actually done quite well despite the crash because I've had them for so long.

Do you use deposit accounts?

I do. The low interest rates are a lark, but I understand why we aren't getting very good rates at the moment and in any case I think America has always had it worse. I tend to just stay with the accounts that my bank Coutts can offer because in the end any difference gained by switching would be paltry anyway.

Do you bank online?

Good lord no. I can just about get on the internet to send email and look a few things up. I'm very old fashioned when it comes to managing my money and I keep all my old printed bank statements.

How are you dealing with the increasing cost of living?

Susie looks after our energy bills and I think she has made sure we are paying the cheapest rate. When I renovate my house next year I will fill it with auto-sensing lights that come on as soon as you enter a room and go off again after you have left, so that should save energy.

Have your pension returns been disappointing for you?

I have saved into a pension most of my life and I had to buy an annuity at 75. Actually for me it has worked out fine, but I wasn't trying to buy an annuity at a time of crisis so I think I'm lucky.
Sir Stirling Moss is supporting Prostate UK to raise awareness of prostate diseases. Join the 5k run 'Pants in the Park 2010' (www.pantsinthepark.org) 

http://www.telegraph.co.uk/finance/personalfinance/fameandfortune/7404777/Stirling-Moss-I-bought-the-land-for-my-house-for-5000.-Its-worth-10m-now.html