If you are really rich

[sopsmum]

Now, I know this is all subjective, but if you are rich how did you do it. Do you have lots of different income streams. And how much take home makes you rich? Our income is fine (could always have more!) but everything is so expensive.

On paper we are rich. Don't live in London house but have a biggish house with lots of equity. Mortgage is a lot lot less than I see others paying on rent for smaller houses. I'm a professional. Husband owns his own business with largish turnover. I'm lucky to be mid 40's as those younger than me appear to be even more fucked.

But, we don't live extravagantly (no new cars). One child in private school (with a bursary) but state primary for the others. Literally no idea how I'm going to pay their fees when the time comes as I can't really afford the fees for the one that's already there. Have only paid for 1 term so far and am dreading the next payment already.

I haven't been to the supermarket for 2 weeks so just eating through the cupboards. Paying the kids football subs nearly killed me. We never eat out. I'm constantly careful about what I spend and haven't bought myself any new clothes in over a years. We didn't go abroad this year. I had to put the car insurance renewal on a credit card. The roof is leaking.

It isn't just the school fees that have done this by the way. We were fucked before we started shelling out for those. I'm just very interested in how others manage as everywhere I look in my affluent little bubble everyone else is having 3 holidays a year and buying new kitchens from Neptune. A friend of mine spent £11k on 2 weeks in Majorca. Seriously what the fuck.. I'm just wondering if I'm totally out of touch with what is a good salary and starting to think everyone else must be taking home £10k a month.

This isn't a poor me thread. I know I'm privileged. I grew up without much money at all and know for certain that family is more important than money. I just thought as time went on we would be better off. I definitely had more disposable income earning half as much in my 20's.

I think 9 times out of 10, it's more about inheritance and background and is rarely just about one or two household salaries.

Like you, on paper we would be considered well off, based on our salary alone and I often wonder how other people do it. I.e, go on endless holidays, two brand new cars, big house in their 20's and are maybe earning half what we are, when we struggle to go on one holiday a year, have one old car and have only just got on the property ladder in our mid 30's and live in a small semi.

Money breeds money. Neither my dp or me came from money. The ones who do, might have modest incomes, but probably have lots of money pots lying around in property etc.

Sorry OP. I appreciate I've not actually answered your question🤦‍♀️ Just relating.

But if you were already struggling why did you send your kid to private school?

Sounds like you can't afford private school OP.

We have a lot of family help as DH has a very wealthy background. That's what enabled us to buy a house and will pay for university for our DCs.

I agree with @nobigotsallowed, it's largely down to what your parents have & how much help you have. Most people I know have had parental help eg school fees, deposits & have good jobs.

Although i'm in my 30s & know people older who have made a million or so on property simply because they got on the ladder, that's very difficult to do these days particularly without having a load of cash up front.

Take my street for example you have the younger people earning 6 figures paying 1.8k in rent or a massive mortgage, then you have the 40/50 yr olds with ok jobs who bought their property yrs ago or had loads of previous equity & paying £400 mortgages.

I built my business from nothing and have practically zero overhead (online business) with multi 6 figure income. I pay myself a 6 figure salary. I dropped out of school at 17 and worked my arse off to get here. I work 10 to 15 hours a week because I've built my business to be evergreen .. no hard sales. I mainly just do social media and product development (the fun bits) everything else is delegated to subcontractors to do when I need so I don't have staff.

DH dropped out of Uni and went to work at 19. He's worked his way up through the ranks in IT. He's now an international civil servant (think UN, WHO, International Red Cross kind of NGO) so we don't pay tax on his 6 figure income.

Both of us came from working class and it was sheer graft. No handouts, no inheritance, no financial support from anyone.

Don't underestimate how many people have huge debt, especially credit card debt. I could never understand how some family members had 3 DC in private school, SAHM, 2 range rovers, multiple holidays--turns out they have £50k on credit cards.

Sorry meant to add that "really rich" is subjective. I don't consider us rich, we earn around 350-500k a year. To me millions is really rich.

Imo looking at your salary & seeing that it's in the top 5% of salaries doesn't make necessarily mean you're rich as it doesn't take wealth into account.

I have very good career prospects and the house will be paid off before the kids go to uni. So my income should increase considerably which if we can get through the next couple of years which should pay dc's fees. So we are taking a bit of a risk. It's the right school and isn't Eton money.

That's not really what I was getting at though. I'm more trying to understand how others seem to have new everything and constant spending (often off of one salary) whilst we are both working in well paid jobs and then there is nothing left over. If it was just the private school I could understand that as that is a massive commitment we have made but even aside from that we appear to be totally skint compared to our neighbours!!!

£300-500k a year income isn't rich?

Fuck me. The bottom end of that is 10x the average UK salary.

Good for you that you've done it (I mean that genuinely, it's impressive) but if you don't think that's rich, you're deluded.

We aren't really rich, there are plenty of others in our neck of the woods with more than us and we have a 'comfortably off' lifestyle, in a relatively wealthy area). What has really helped us us that one of us, from relatively early in our working lives, had a good understanding (and an instinct for) investment in the capital markets and the magic of compound interest. We don't spend it, of course, and we keep on investing, but it gives us a lot of freedom. We have a good income and now invest about half.

We have had supportive families, in the sense that they've helped out with childcare and other bits and pieces. There may be large inheritances coming our way, but that hopefully won't be for a long while. DFIL's care home, for example, ( it's jolly naice) costs 2000 a week, so I'm glad we decided to make our own financial future.

if People are now in mid-late forties and work in London in the professions they have benefitted from a massive increase in property values since the late 90,s, will have benefited from the huge bonuses (100% of salary plus) and share participation schemes, and are likely to have benefitted from inheritances from now elderly parents.

In our case we have ok jobs (low 6-figure) & probably won't earn more than 150k as I work part time & TTO & I'm not sure I will ever go full time (new career after kids). We had help getting on the ladder (300k gift) & then made about another 200k in equity. Gps have offered to pay for private schooling for 2dc (I wasn't privately educated) but we chose an excellent state primary & will see regarding secondary.

My mum & mil help with childcare, I do have a childminder but it helps keep the cost down.

Literally no idea how I'm going to pay their fees when the time comes as I can't really afford the fees for the one that's already there.

^^

So what's your point? 'On paper we are rich'

OK... That's one thing, but not able to pay for private school and eating through the cupboards to save cash?

How much do you jointly bring home?

I also don't understand the school fees thing if you're skint.

my parents have about 2m in London property as does DH's parents. They both want to downsize in the next 5 yrs but I wouldn't rely on anything. Any inheritance we do get will be a pleasant bonus.
My parents also have a property in the South of France so I can have very cheap & long summer holidays which also reduces our expenditure.

I would say we probably have a fairly 'rich' ish lifestyle for our age but tbh we live very close to the edge in terms of incomings and outgoings! Our kid has just started private school, not sure if I will live to regret it!

What are you spending your money on? We are above average but not ‘rich’ when it comes to income. We made about £100k combined per year (I am salaried but dh is a company director so varies a bit year to year). We don’t pay for private school (older one in state school), but we do pay about £800 a month in nursery fees. I also spend £700 a month on a monthly ticket as I commute to London. We are definitely not struggling. We don’t take 3 holidays a year and we don’t have new cars, but I never need to think about whether we’ll run out of money by the end of the month or to check our joint account before I spend £20 on steaks or a bottle of wine. You must be spending your money on something to be struggling so much on a high income.

Such enough to pay three lots of private school fees after tax) is really, really really rich. Median household disposable income in the UK was £28,400... People are often very deluded about how rich they really are (compared to most people) . Try using this handy tool...www.ifs.org.uk/tools_and_resources/where_do_you_fit_in
We are 'rich' but no way could we afford private school. I think it used to be the case that middle class professionals could expect to do this but times have changed. Both housing, pension and school fee costs have inflated far more rapidly than incomes in the last 20 years... So there you go. You can't afford it OP.
In answer to how we got rich, qualifications, having good skills, some luck and lots of work

I wouldn't class us as rich but just explaining how we afford things above our salary. We wouldn't be able to afford London private schools for 2 dc on our income & it would be quite a compromise for 1.

I actually feel a bit sick that there's someone who thinks £300-£500k per year isn't rich. How out of touch with reality do you have to be.

Why is your DC at private school, OP?

Would it be better to move to an area where there are better schools for all of them?

It's all about living within your means.

I would consider us rich, we both have 6 figure salaries. And in comparison to my family and childhood friends who are all from working class families we are much better off. Other than our home, we live to a similar standard as those people and are very money conscience so have a lot left at the end of the month.

If we were to be comparing ourselves to and trying to live like some people we know with similar income, with new cars every 3 years, private schools, and 5* holidays then we wouldn't has much left at the end of the month and probably wouldn't feel rich.

We are (early) retired now and reasonably asset rich. When we were working I would have considered us absolutely loaded but our income never topped £250k, and was mostly nearer £100k.

We didn't send our kids to private school (and they have done just fine) but we had basically anything we wanted; nice house, nice cars, nice holidays.

I do think our wants were/are fairly modest though; our children were certainly never overindulged and we never got into designer stuff in a big way. We once spent £7k on a holiday, but usually half that.

What are your ins and outs?