To think there is very little benefit in earning more than 50k

[ReallyTired]

Loss of child benefit and now reduction in pension tax relief makes hardly worth bursting a gut to earn over 50k. People who earn just over 50k are generally the work horses in skilled jobs that ecomony needs to grow. Given that such people will be saddled with high student loans in the future, what will senior teachers, doctors gain from all their hard work?

They never go well these threads.... those on low inxcomes thinkg the £50k earns keep 100% of their gross income and live like kings and cannot understand that marginal rates at certain points of highish income are up to 70% these days (because you lose 100% of your single person allowance at a particular level etc etc)

As Want says and I have often quoted here your 50Ker family can have less cash than your benefits family because the 50ker is spending about £14k per child on full time childcare, has a massive mortgage and no housing benefits etc etc

However the bottom line is that if as a woman you can earn over £100k and more than good fo you and go for it. You are bound longer term to be more protected if you aim high rather than not working or working part time or putting your eggs all in your husband's earnings basket or hoping the almightly state will always be there to provide for you.

And yes those of us who earn a lot probably do things others who earn less aren't prepared to do - I worked until I went into labour with twins at 40 weeks and was taking business calls the next day. We all make choices in life and tend to reap what we sow. You are all masters of your own fates so seize the day and go forth and out earn all the men. It rocks.

Given the nature of the tax and benefits system, there will always be disproportionate increases in tax and loss of benefits around the different pay bands.

However, I would still be better off on £1 million a year.

Also, once you can cover basic costs (admittedly basic costs are subjective) you have money left over to spend on yachts and invest to make more money.

I think I could get by on a few million a year to finance my super yacht and staff my luxury ski chalet.

You are all masters of your own fates

Well... To some extent... It would be foolish to think that luck and society and circumstance don't play any part.

As DeoGratias touches on, it is really important to bear in mind that gross income and free cash flow are wildly different things and that they do not follow a parallel upward curve. Two FT working parents with responsible jobs on reasonable incomes can incur a lot of costs to keep their show on the road. A single mother friend of mine (3 DC) has childcare costs of €48,000 per year.

If your income is significantly over 50k then you are definitely better off. The marginal tax rates like between 50 and 60k or 100 and 120k can harm the ecomony. If earnings rise then more and more people will be earning over 50k in ten years time.

Trills It also helps if you make the effort. I'm always putting myself out there and taking risks as has DH. Those risks have paid off for DH sooner than they will for me. That's ok. I believe I will get there eventually. If you don't try you won't ever get ahead and IME if you have a negative attitude about work the day will be longer and less lucrative.

Joplin there are plenty of reasons for turning down a job for a huge pay increase. I've turned down jobs that have paid much much more because the employer wasn't financially stable.

Sometimes a person is blessed with the freedom to make choices about their working arrangements and can trade money for time.

Some people would reflect on this and their comfortable income and count their blessings. Others would present it as a "Woe! Look how unfair life is to me!" pity-fest.

I didn't say effort makes no difference, just that it is insufficient on its own.

The experience and understanding to be able to know where to put that effort is also required, at a minimum.

I don't think anyone believes that effort isn't necessary - but it's certainly not sufficient, and rewards are rarely proportional to effort as anyone working in a large organisation must see every day of their lives.

One of the hardest working people I know is my nephew, who works many hours in a variety of NMW, zero hour type jobs. He was born to two substance-addicted parents, had a chaotic upbringing which involved long periods in care, and left school functionally illiterate. He had had to make superhuman efforts to take up opportunities for training and to provide himself with a reasonable standard of living, but I would be confident that he will never get anywhere close to earning £50k a year however hard he works.

A bit of humility, and an acknowledgment that luck plays a big role, goes a long way.

"Two FT working parents with responsible jobs on reasonable incomes can incur a lot of costs "

I think it would be more accurate to say that however much money people have, they can find essential things to spend it on.

Why "more accurate"?

piglet In Feb I was working 5 days a week until very late at night (10pm was the earliest I got home and that was to keep childcare costs down as I logged back in and worked until midnight). DH had to travel overnight for 2 weeks of the month. Childcare costs alone were over $4500 (£3k) all paid for from after tax earnings. That doesn't include the additional money spent buying food online for delivery, buying lunch at work, coffee because the machine broke and no one was home to accept Amazon delivery of new machine and buying in services such as cleaning and help with the laundry.

It's not a case of 'finding' 'essential' things to spend money on, more like needing childcare to cover long hours or travel away from home that is usually not necessary in jobs with less responsibility, or needing to get shopping delivered because you aren't around when Aldi is open or whatever.

Cross posted supermum

I really don't understand this point at all. Children don't stay children anyway. The aim surely should be to keep moving on upwards.
Child benefit isn't going to make anyone rich ever.
I do understand earning 51 or 52 might be a pain, but no one would expect to be on that salary forever. I would play the long game in these circumstances.
It is like paying much of your salary on childcare - they are only small and v expensive for a few years.

Misti, but my grandfather left school at 12, spent all his spare time reading, reading, self educating and built up a business. It is not impossible to do well from a poor home. Could the nephew not teach himself? There are brilliant websites these days which are free which are educating people some to university level from poor villages all over the planet, much easier than in my grandfather's day. (He was the youngest of about ten children and they had very little money, alcoholic father etc and in 1901 he was living in a boarding house with 26 other young men in the NE of England). Of course I am not saying it's just as easy for someone who leaves school with few qualifications to do well in life compared to someone who gets the best exam results in the school but certainly there is no need for anyone to feel it's hopeless to improve themselves in the UK today.

If earnings rise then more and more people will be earning over 50k in ten years time UNless Earnings rise on avergae by significantly more than general inflation it won;t matter, tax allowances and bands are increased each year by roughly the rate of inflation.

The marginal tax rates like between 50 and 60k or 100 and 120k can harm the economy - I understand you think this, but there really isn't any evidence of it. Your DH turning down a job earning £9k more because of the travel involved doesn't harm the economy unless the company recruiting can't find someone to take on the job solely because they incremental say £4,500 isn't enough. In reality there will probably be people who live closer or whose personal position is that it is enough and the position will be filled.

I have been a single parent earning more than £50,000 in London.

The only incremental "essentials" are travel and childcare (both of which cost a lot admittedly).

Internet shopping, a cleaner, coffee machine etc are by no stretch of the imagination essential - I managed without them all.

This isn't really about London vs non-london though (I do think that those who think £50,000 is loads hasn't seen the eye-watering costs of houses!) and as someone else said there are still a majority of people (even in London) who earn less than £50,000.

The OP was positing that the incremental tax around £50,000 is damaging to the economy because people won;t bother doing the extra work for an incremental return of 50% or less.

But I still say that enough people will always do the "extra" because:

1 - the extra is often managerial/stress rather than extra hours or distance at that level and whether you take it on is more down to whether you want that extra responsibility
2 - it's a stepping stone to something else
3 - because £100+ per month take home pay extra is worth it to them even if it isn;t to you.

Just because you choose not to do something doesn't mean that it is damaging to the economy. Not everyone thinks like you do or has your personal circumstances.

kew I couldn't keep my job if I didn't buy in help when DH is away. Also discount supermarket shopping is not possible if you are getting things delivered and you plan meals using semi prepared foods. It does increase the cost quite a bit.

There are some rather stupid comments on here, choosing not to earn more because itr effects a benefit of £20 a week, wow.

The comment on needing 100k at least to afford a 1 bed flat in London? Nah, that one is just idiotic.

It is worth earning more, the tax rates are fairly progressive and reward hard work, mumsnet is the strangest place because people who are relatively well off keep showing jealousy for those that have lower incomes. Well boo fucking hoo.

"I didn't say effort makes no difference, just that it is insufficient on its own."

THis a thousand times over. The mantra of many who have done well is: " I worked hard to get where I am today" and they fail to recognise any of the benefits and priviliges they had that gave them a boost or helped them out. Also pointing out exceptions to the rule is unhelpful, just cause one person made millions having started from nothing doesn't mean the rest of the population who didn't are lazy, just as it doesn't mean that the many privately educated multi millionaires in the cabinet are hard working and more talented than everyone else because of what they have achieved. I've seen one current minister whose Father was a minister and whose Grandfather was a minister deny the fact that having connections helps. Yes because you would have been given a safe seat to run for, after only 2 years involvement in politics if you hadn't.

"long hours or travel away from home that is usually not necessary in jobs with less responsibility, or needing to get shopping delivered because you aren't around when Aldi is open or whatever."

I don't agree with the idea that poor working people work short hours. That's not the reason they don't employ nannies, cleaners and laundrymaids.

Agreed piglejohn, a very blinkered comment that, many poorly paid people travel far to work and work long hours.

Deo the example you give of your grandfather is a century old...

Agree PigletJohn.