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Earn over £70,000 and you are rich(901 Posts)
"Are you rich if you earn £70,000? According to the Labour MP John McDonnell, you are. And that contention made some people very angry.
In an interview on the Today programme (from 1:15:30) on BBC Radio 4, McDonnell set out his vision of a “fair taxation system”. He said Labour would be “looking to the corporations and to the rich to pay their share”.
When pressed to define who the rich are, McDonnell put a figure on it: “We believe … the rich will be above £70,000 to £80,000 a year and that’s roughly defined as what people feel is an earning whereby people feel they can pay more.”
Twitter quickly took up the question of whether or not people earning more than this were rich. Unsurprisingly opinions diverged wildly.
The reality is that relatively few people earn more than £70,000 a year. Data from HMRC shows that just over 5% of taxpayers earned at least this amount in 2014-15."
Yes, I think that is rich. But it's all relative isn't it?
If my salary suddenly hoiked itself up to £70k pa my outgoings would still be the same (until I changed them!). If my salary was more than that and suddenly went down to £70k I'd likely struggle.
The difference is, a reduction to £70k is a lot different and lot easier to work round than a reduction from my current salary, as it would literally take us to the breadline.
I suspect none of that makes sense as I'm tired so I'm going to bed now!
It's relative. £70k is a lot of money. But if you consider it from the point of view of home ownership, you can generally borrow 5 x your salary.
70k x 5 = 350k which will buy a one bed flat if you live in London.
If you live in London 70k is nothing in terms of affording a home.
I was going to agree that it is rich, but FreeNiki's point made me pause for a moment.
Having thought about it, I reckon that property is in a league of its own as a living expense. We need to make societal changes to reduce the expense of that rather than inflate our ideas of wealth to match it.
After all, if we use the ability to buy a house, especially in expensive areas like London, as our guide, and therefore say that £70,000 pa isn't rich, then we have to adjust our ideas of being truly poor upwards as well, in order to keep them relative to people's long-term prospects of buying a house.
Which I'm guessing not many people would be on board with, for reasons that would vary depending on where they are on the political spectrum.
Of course £70k is rich. Being able to afford property in the capital city is not a measure of whether you are rich.
The average rental value across the uk is currently c.£900pcm. In Greater London it is c.£1500pcm.
An income of £70,000 is nearly 4 times the average greater London rental value and 6.5 times the average UK rental value.
Rightmove has 4000+ 2 bed homes and 500+ 3 bed homes available to rent for £1500pcm or less in the greater London area. Obviously these are not the loveliest homes in the naicest areas - those are the preserve of the super-rich, not the rich.
That means that it is eminently possible for a family to live within London on an annual income of less than £40,000 pa without suffering from any deprivation of basic necessities. A family with £70,000 might well choose to spend that £30,000 excess on having a nicer home in a more central location than the £1500pcm average - that is their choice but there subsequent reduction in disposable income does not stop them being rich when they could revert to a more average lifestyle any time they like.
Those claiming not to be rich whilst having an income so far above the average are just simply ignorant of how much better off they are than the majority.
I swear the "there" which should be "their" was an autocorrect fail.
I earned a lot more than £70k before I stopped work (children), but I first felt rich on £45,000 p/a in central London. As in zone 1 (renting). So £70,000 felt very rich and what I finally earned crazily rich.
Anyone who thinks differently (and in my line of work I met plenty of people who couldn't understand how anyone could live in London on less than [insert ludicrous figure here]) has lost touch with reality.
The problem with this quote is that it's all relative. A family with an income of £70k and one person working is not what what I consider to be well off. It's the equivalent to two people making £35k from a top line perspective. Throw in London property prices, being a single parent and ling working hours that gobble up childcare, I can see how for some this is not a lot.
The big issue is why say something so decisive.
It's just not possible to define an amount though when there are so many variables in lifestyle costs.
A single person, no DC earning 70k is very different to a person who has a stay at home partner and 5 kids at home earning 70k. Add in different areas of the country and the disparity would become massive...... Some would be rich, some would have enough to cover essentials with not much spare
If the top 5% of earners in the country aren't rich then who on earth is rich?
If you have a 70k salary but choose to have 70k of outgoings it doesn't make you struggling or poor. It makes you someone who has chosen a lifestyle that takes up all of their income. Which is fine, entirely your choice. But it doesn't mean you are struggling or just getting by.
I have a rather soft spot for John McDonnell. But he is a trot and, along with JC and his podium shouting, makes Labour entirely unelectable.
We have a joint income of about this (I know it's taxed differently) and I feel very lucky. How far your outgoings go, whilst very important to your quality of life, is a different thing to whether your income is high - think about the people around you earning less and how they cope. Totally agree with treaclesoda top 5% of earners surely should get classed as rich. Think it depends on who you compare yourself too as well, I work with people who live off less than half my family income so consider myself lucky, DH works with people on twice his so is looking upwards.
As has been previously said, it does depend on how far that salary has to stretch. We have a household income of approx 60k but only 1 earner and 3 dc, 1 of whom is still under 3. I would never dream of suggesting we're poor but I do make sure our grocery bill is under £100 per week and the children get £100 spent on each of them at birthdays and Christmas max so we can afford our holiday in the UK. I think the issue is the continuing dividing us all into rich and poor. We are not poor, yes we could pay some more tax without hitting the breadline but everyone's aspirations shouldn't be about being just above the breadline. We are somewhere in between and I think on 70k we would be definitely be closer to rich but i'm still not sure we could spend without thought which, to me, is what 'rich' is. May be if the tax allowance system changed to take into consideration who the money was supporting it would be a fairer system.
Currently living comfortably on less than £20k. £70k is rich IMO.
I think there's a difference in who a government thinks could pay more tax without going below the poverty line, and spending without thought. There are two totally different definitions of rich there.
I also think you'd have to be super-duper rich to fit a lot of people's definition of rich.
DH earns over 70k. I'm a sahm. We certainly don't feel rich!
depends where and how you live. A singleton who owns their own property can live very well anywhere in the country on £4k a month (after tax and NI). A single parent living in London paying the average rent quoted above is going to be down to around £250 a week after paying rent and childcare of £1500 each per month.
Take out council tax, heat and power at an average of £100 each per month and she'd be down to £200 per week. Add in other bills like water, insurance, TV license, broadband etc, and I guess she has less than £150 per week for food, clothes etc. I don't think that is a rich lifestyle by any stretch of the imagination.
How the hell is one person on 70k rich if they are running a family with a sham when two people on 35k each aren't?
It's utterly ridiculous and labour really seem to live in cloud cuckoo land in their definitions.
Sorry it's not "rich" in my opinion. It maybe comfortable for some, but I certainly would not describe a family on a joint income of this as rich or wealthy not even close. Being able to live semi comfortably and within your means doesn't mean you are wealthy. Two teachers living together will earn this. I doubt they would agree they are wealthy.
We earn a lot more than this, I would neither describe us as rich or wealthy. Never mind crazy rich. For me rich means I can quit work tomorrow and do as I please for the rest of my life. Holidays whatever. I have enough savings and income streams to insulate me. For me that's rich. Not earning 70k a year.
Exactly what noeuf said. You are definitely penalised by being a SAHP now. They would much rather both parents worked and kids were in nursery 8-6, 5 days a week from 9 months.
Of course it's not super rich, but it's rich. If you can earn that much and not see how well off you are compared to the majority of the citizens of the earth it must be hard to have much compassion for people struggling in this country - if you think you're poor, were on earth would you place people using food banks?
If you have an income of 70000 from one part of a couple and the other is a sahp, you are lucky as you have the potential to increase your earnings if the other person worked - if you both earn 35000 you can't.
I think it was poor phrasing, and as a result the wrong question is being considered.
I don't think seventy K is rich for some people. I'm on the fence about whether those who earn that amount should pay more tax.
MrsGB2225, don't forget that providing all that childcare employs 450,000 people. From a government POV, pushing both couples into work increases the employment levels in two ways. Plus they can tax them!
One person earning £70k won't have as much money as two people earning £35k each. One person earning £35k will have net pay of £27,080 so £54,160 for two people. One person earning £70k will bring home £47,379.
If you have small DC and have childcare costs then those could well be eaten up by the difference so it's not as straightforward as that but it's interesting the perception of £70k being rich when the actual net pay is quite a bit less than two people on £35k
If you earn 70k in the south east, travel in to London to make said amount, have two children, a modest house and are prudently making modest provision for your old age, there will be very little left to give to the government.
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