To Q why many high earners still live paycheque to paycheque?

I don't want to give away where we live but it's an hour by train to zone 1 and a 2 bed flat cost around £250k. Dp does also have the option of working from home a fair bit which saves a lot on train fair. I changed jobs when we moved here so that I could work more locally to be around for the kids. The point is we have cut our cloth as needed and it's worked out OK.

Age and when you could buy is a huge thing too.

You aren’t buying anywhere commutable to zone 1 on a 50k household income. It’s literally not possible in the current climate.

Yup, this is the case for us. We were going to finally be doing well last year as we were finally going to be getting 15 free nursery hours but then our mortgage increased by £700 a month and nursery fees increased by 20% at the same time. So that was fun! We also have to pay a lot of money for security at our other child's school which also increased. So now it's £1600 per child per year, which didn't help.

We're not quite paycheck to paycheck though, we just don't really see any change in our savings from month to month, unless it's a month with a bonus. So we're very lucky that we have those!

It is very hard to generalise as people differ. I had our first child at age 22. Plenty of people wait until nearly 40 so have had 20 years of buying a house and paying off a mortgage before the child even arrives. We spent 50% of each of our net full time salaries (teacher, trainee solicitor) when we had our first child and I went back to work full time when she was 2 weeks (weeks not months) old.

Childcare costs are more expensive here in London (we live in zone 5 London - so outer London - as even when I was 22 a good while back we could not afford to live more centrally) than the NE of England which was my original home.

I certainly agree people tend to spend a bit more as their earnings go up even if just to feel they are getting some kind of reward for working all night without over time (as some lawyers do) or for working whole weekends without extra pay and that kind of thing. We never bought hair conditioner and anything other than squash rather than proper orange juice etc back in the day and even disposable nappies were beyond reach. As we got to higher incomes and older we did eventually have a cleaner. I don't now as happy just to do it myself and I have a fair old non ulez compliant car (ie I have to pay £12.50 if I do by a ulez camera) so I do not think have particularly got too extravagant as I got older with a higher income but I do know exactly what is more than others might do. I put the heating on for 2 hours last night. I would not have done that had I been poor. I pop out to Waitrose quite often and can buy whatever I fancy - a big luxury for most people. I paid for 6 weeks of external house works this summer which was a big job just to paint outside paint work) which I would not have done had I not had much money. Even things like buying chemical to clean my patio myself I know full well is a luxury.

I think I could cut back and live on a lot less if I wanted as most material things other than my house are not particularly important to me.

It might be an unpopular opinion but I do think there is an element of choice involved. We earn approx £50k per year between us, we live in a home county and DP's job is based in zone 1, we have two kids. We manage fine. Yes I do get child benefit and yes we did get funding for nursery but even so, but I don't think that would equate to another £50k per year. The main thing is we have chosen to move further out and as a result our mortgage isn't crippling.

Their expectations are higher so they spend more. They move in different circles where they 'need' to wear designer clothes, rent or buy a fancy house, go on luxurious holidays.

It depends on what you classify be choice though. I know several couples paying £3k on their mortgage for a 2 bed house in London. Their kids either share or 1.5 year old is still with their parents. Another bedroom is about £80k for a loft conversion with London labour these days.
Its hardly a luxury lifestyle having a family of 4 in a 2 bed house.

We're not true high earners but we earn about £120k between us (I work part time) and we can run out of money by the end of the month. I suspect it was the same if I earned £100k (I earn about £60k) because when we get paid we put money in the joint bills account first then money in the family account and then pay off any credit card bills, money in savings, and whatever else is left is to spend. It is rare that I get to the end of the month and have no money but it happens because I've already moved my savings out.

For big purchases I try to pay out of my income and not use savings.

Also the more you earn the more you tend to spend on mortgage, save, spend...

We earn less that that but security has always been important to me. So we tried not live paycheck to paycheck and save some each month and live within our means.

But there was so much luck in being able to live like this to so I can't give advice. Luck from buying at a good time, luck from both being made redundant which sounds crap but we both found better work and had these lump sums to save.

I mean it only takes for both of us to be out if work for a while and it's all gone anyway so that's luck too.

I think childcare is the killer for most people. Those years were very tough.

I do not have much in my current account by the end of the month but that's because any extra has been either put in savings or used to pay something off. It's also relative. Some jobs I do I earn a lot then the next job is paid more modestly. When I earn more money I spend more on fripperies, can't help myself. When I earn less I spend less if that makes sense.

Why do you think that?

I’m a lawyer on more than that and on PAYE

This is a niche part of the world - south west London but when a modestly lavish lifestyle was suggested to be £400k plus then I’m not surprised by lower earners struggling.

nappyvalleynet.com/community/viewtopic.php?t=132547

Most people live within their means regardless of income. Higher earner may spend it on bigger houses, bigger cars private schools holidays etc...lower earner don't have that stuff but both end up with little at end of month. I speak as a daughter of a higher earner. Parents were always skint despite a large income. They squandered it. Simple.

It's the "oh I'll treat myself" mentality. And 100k isn't as big as it sounds after taxes.

The trick is to automatically shove half (for example) into a savings account, isa, whatever the day you're paid. That way, it's out of sight.

I have a business account. I take 1000 and stick it in my normal bank account, and use that. I don't even look at my business account (I should, I should stick it in something that gains interest, but still...), so it's 'easy' for that money to build up and not be squandered on crap.

The original poster’s household income is £120k pre tax. Not a hope of spending £60k post tax on school fees on that income in London!

I have 2 kids and they don’t go to private school!

We have a little debt from house renovations but other than that, I’d say our next biggest outgoings is food. I buy most food at Aldi/Lidl and then I go to Sainsbury’s to buy anything else I can’t get from there. I’ve had some unpleasant experiences with meat from the cheaper supermarkets so I buy the better quality chicken etc from Sainsbury’s but that really bumps the bill up.

We have a 3 year old car - not a flash one- and the insurance on that just climbs every year despite no claims. Tax on it is ridiculous too.

High council tax area.

High energy bills.

All the money just gets swallowed up.

We put nothing in savings. I’m amazed by the PPs saying they put £1500 away a month!

Childcare costs. Housing. Commuting lots of jobs still require it.

We are comfortable because we scrimped in our younger years and had a house before our first child. Having a second child meant we had to move - it was difficult access up lots of steps - and we took on a larger mortgage to afford it. We prioritised paying off the mortgage asap. Our furniture, toys and clothes were secondhand. Our Christmas presents were not the huge extravaganzas of today and eventually my husband's family instituted a policy of presents only for young children. (Our wedding for the time was considered expensive but would be considered cut-rate by today's standards with no over the top hen's parties etc.) We drove ancient but reliable and economical cars. We paid off our credit cards in full every month. We also sacrificed on holidays.

It's really important not to say to yourself, "I work hard and I deserve this". We always had good quality food and private medical insurance though. We did splurge on some activities for the children and had pets which luckily were on the whole blessedly healthy (and we wouldn't have done any really aggressive treatment for an older animal like chemotherapy though we never had to make this decision). We were also able to support one child who got into medicine as a postgraduate in another city for what seemed like an eternity and both our children had nannies for the first year.

My retirement savings are very well funded and we are doing up our house which I have to admit was looking very dated indeed. I think I have avoided the expense of following various trends over the year and am now sticking to a fairly classic look for the house. (It is quite illuminating to look at old magazines on interior decorating and consider which styles are still timeless rather than dated.)

Private schools, cleaners, holidays and eating out, shopping?

People very often take on more financial responsibilities and upgrade. It starts with the tesla instead of a hatchback. Then one in the couple is probably a lower earner, so becomes a stay at home parent. Holidays are at nicer places. The house is larger and in a nicer area. The kids move from nursery to private school. I can see how it all creeps up on them just by way they upgrade each individual thing. Then you have to keep working the high stress, long hours job to keep funding it all.

We earn over that combined and live in a very modest 3 bed terrace in an expensive area (where our jobs are). Add on a 2 year old in nursery (£1400 per month) and there is not much left after bills. Shop in Sainsburys mostly and don’t spend much on clothes.

Obviously helpful for you but this is very simple to do yourself I’d suggest. Or is that the point, people can’t do what to me seems very simple.

You would be lucky if it is Americans coming or staying here.

paycheck /pā′chĕk″/

noun
A check issued to an employee in payment of salary or wages.
Salary or wages.
"The new appropriations bill could mean a larger paycheck for state employees."
Money received on payday as payment for work performed.

No help with childcare costs at all here.

I have to earn about £20,000 before tax to recoup the equivalent income to the childcare support im not eligible for.

And that’s just for one child.

Some other ways I save money -

• no cleaner (tiny 3 bed house, one bathroom, don’t feel I need one)
• haircut once a year
• don’t get nails done or any beauty treatments at all, not interested in that stuff
• hobby is exercise class once a week, costs about £40 a month
• taking a packed lunch for us all on days out with the kids