6 figure incomes and can't afford a load of bread?

[LemonyFresh]

Is it just me or has there been a influx of posts about household incomes of over 100k or similar and complaining or wondering how they're skint at the end of the month and struggling? Is it a stealth boast or do these people actually struggle?

Am I really in the minority with a household income of less than half of this?!

I know we tend to spend to our means but even when DP and I are having a flush month I don't see the point in over spending for the sake of it.

On the subject of comparing cost of living inside/outside London: this site is really interesting, where you can compare the cost of living in different UK cities. (Not annoying childcare annoyingly, but does include rent, utilities and a bunch of other stuff.) Warning: slightly addictive.

www.numbeo.com/cost-of-living/compare_countries_result.jsp?country1=United+Kingdom&country2=United+Kingdom

Oh that site is loads of fun!

The thing with London though is that if you dont have massive housing costs, and millions of people there don't, it's not a bad place to be low income. There's more free stuff than there is pretty much anywhere else, and transport costs are actually quite low too. That I presume is also part of the reason why only a third of the children there are in poverty. Obviously that's disgustingly high, but it's also lower than it could be. Because if you can avoid ridiculous housing costs, which some families can because of SH, pre boom purchase or living in multi-generational households, and you don't need childcare, your cost of living may not be that high. Given the choice between being poor in SH in London or in a rural area, I'd probably choose London.

Correct on the first, not so on the second. If you disagree, let's hear how my example couple, in Londony jobs, are able to reduce those costs. If you can't tell us, that means you also can't say whether they would be able to function as a household without that spending.

I actually nearly moved to London with husband/young child a couple of years ago (I do have one of those jobs where your options are either London or a very small number of other quite expensive places), on way less than a £100k/year household income. It would have been tight, but we worked out at the time that we could have managed it. So I can go over what I costed out for us, but I have no idea whether or not it would work for the hypothetical couple in your example because what people are and aren't willing to compromise on are different.

But what I would have done or what your hypothetical family would do doesn't really matter, because the fact remains that it is possible, entirely possible, to live on less than £100k/year in London with a young family. We know this, for sure, because a lot of young families are already doing that. £100K/year isn't the bare minimum necessary to function, not in London or anywhere else.

Thinking back to that near-move to London, actually, it's a nice illustration of just how insane London rental prices have got. We live somewhere that rent is pretty expensive compared to most of the country, but even here, the rent we're paying for a 3-bedroom terraced house with a garden would have just about got us a very small damp-looking 2-bedroom flat in Catford.

But what I would have done or what your hypothetical family would do doesn't really matter, because the fact remains that it is possible, entirely possible, to live on less than £100k/year in London with a young family.

It matters to the issue of whether their fixed living costs are a choice or not, which you've said you think they are.

And nobody has suggested it isn't possible to live on less than 100k a year in London with a young family, have they? It's just that we know a significant minority of those doing so are in poverty (seems reasonable to assume all the 1/3 of DC in poverty are in sub 100k households. Also that as there are households in London with kids and way more than 100k, more than 1/3 of the sub 100k households are in poverty). And that some of those who aren't in poverty are in much cheaper housing than some 100k households have access to. Thus meaning they have more money over after essentials than some people with higher earnings, and are not remotely comparable. Housing costs warp everything.

It matters to the issue of whether their fixed living costs are a choice or not, which you've said you think they are.

Well, they're a 'choice' in that you can live without them, as a large number of families currently are living without them. And I don't think people are wrong or frivolous for wanting to spend what they've got on getting the best housing/childcare/location options available to them - I would do this, if I had £100k of household income! I don't think they're frittering it all away on Faberge eggs or something. But that doesn't mean that people don't have any kind of choice at all on that kind of income.

Also, if your hypothetical couple are bringing home say £2,600 of take-home pay each month, after tax, NI, student loan, etc. - even if they're spending £4000/month just on housing, childcare and commuting, that still leaves £1200 per month for food, bills and everything else. That is a good amount of money.

Well, they're a 'choice' in that you can live without them, as a large number of families currently are living without them.

Again though, this is not evidence that other 100k earning families can. It just isn't. If there's one thing we've seen on this thread, it's that people have very different fixed costs.

But that doesn't mean that people don't have any kind of choice at all on that kind of income.

It also doesn't mean that they do, and my figures in fact left my hypothetical couple with well under 1k for everything else, even with a conservative estimate for childcare. But even if it were £1200, that actually still wouldn't mean what you're saying here, ie that they could choose to reduce their housing, commuting, council tax and childcare costs.

The thing is, we have now established that it's possible to be on 100k and not have much over after essentials. That isn't affected by the fact that there are also people on 100k who do have money to burn. Any more than it's affected by my household, on well under half of that, having a lot more left over after those four bills than £1200.

Are we still trying to argue that rich people are impoverished?? If rich people can't afford bread then they are terrible with money, plain and simple. Even billionaires can go broke if they waste too much money. This thread is beyond stupid.

I always live within my means, if I can't afford a holiday one year I don't have one, likewise xmas, relatives will get a book or a bottle of wine.
I am single, have a lodger to help pay the bills. my mortgage, council tax and savings come first and everything else comes second.
If I couldn't afford this house I'd move into a much cheaper flat.
My ex husband unlike me is a big earner and is stretched to capacity every month which means he can't pay his bills, rent and council tax and spends every extra penny living like a playboy. He is in serious trouble now financially yet earns 6 times my salary.

Again though, this is not evidence that other 100k earning families can. It just isn't. If there's one thing we've seen on this thread, it's that people have very different fixed costs.

I feel like we're going round in circles here.

Of course it's possible for families to live on less than £100k in London. The evidence for this is the families living on less than £100k in London. Your hypothetical couple could live on less than £100k in London by doing what any of those hundreds of thousands of families do.

If one of your hypothetical couple lost their job or had to take a big pay cut or whatever, they would not be suddenly impoverished and unable to cope on say £60k/year. They would change some of their living/work arrangements. Fixed costs aren't fixed for life.

Fixed costs aren't fixed for life, or temporarily. A mortgage can easily be much less if you move somewhere cheaper. Bills can always be lowered by being a bit savvy. Nobody needs to go to private school. Most families could probably halve their food bill if they worked really hard at it. Rich people don't have to do this, so usually they don't. Almost nothing is a fixed cost.

namechanger The point is that for some households £100k doesn't mean they are rich. My family would struggle to live on that in many parts of the UK because we have three young children and we both work.

Truthfully, families have been screwed in the past 20 years as childcare and schooling costs (that includes activities, tutoring and sports for children) have increased in cost at a far higher rate than COL inflation. Not everyone can use a childminder when earning £50-60k a year because hours are 8-6 with required evening events to attend. Add on a commute and hours outside of the home are 6:45am- 7:30pm or later. Primary school children should be heading to their bedrooms by 7:30pm so it's not going to work if you are picking them up from the Childminder.

100k is an eye watering amount of money for most families. Most people regard it as rich. If you spend it all and then have nothing left, that's choice. It's 6.7 times what I earn and we manage just fine.

Oh and you only have an income of £20k to spend right? First of all you don't pay taxes? Do you live in social housing or get housing benefits? Do you get working credits? Do you get child benefits?

You might find your disposable income is higher than a household with £100k income who both work and have 2 or 3 DC. That is the point of this thread.

Now if the household income was £200k then I agree that is plenty and there shouldn't be a need for struggling to make ends meet no matter where you are in the country.

Most families living on well under £100k in London, do not live in social housing. I know families like this. They do not have cheap rents, and they have not bought years ago. They live in places that these families in £100k would not consider. One family I know are buying a tiny flat in a less desirable area in London, some are paying large private rents.

Somebody earning £20k does pay tax.

brasty I have friends like that and they are living in poverty. When you have 3 kids in a bedroom and you and your OH sleep in the living room on a pull out by every definition you are poor. It's sad that this is happening in the UK and goes to show how far standards have fallen in the past 30 years that people who have a good income, work hard and follow the rules live like this.

You might find your disposable income is higher than a household with £100k income who both work and have 2 or 3 DC.

Don't be so ridiculous

Oh and you only have an income of £20k to spend right? First of all you don't pay taxes? Do you live in social housing or get housing benefits? Do you get working credits? Do you get child benefits?

Half the country would be dropping hours or grades to live pampered stress-free lives if they thought £20k meant no tax and lashings of freebies

What planet are you on want? Don't you ever read anything other than the Sunday times magazine?

I know those earning £20k pay tax. My point is that namechanger is saying £100k is over 6 times what they earn so that's rich. We have a progressive tax system and benefits that mean someone with an income of less than £20k and another with an income of £100k don't have those same multiples when you look at disposable income.

Also, when you take into account the range of cost of living, the household income of £100k in a more expensive part of the country isn't a lot.

My friend does not live 3 kids in a bedroom and her and DP in a living room sofa. They are in a 2 bedroom tiny flat. Not ideal, but as they live on a teachers income, that is what they can afford.

"First of all you don't pay tax."

Make your mind up want

Don't pay taxes on £20k?

God above, you are embarrassing yourself now

Agree with dont - quite embarrassing! You pay tax on earnings over 11,000. So if you earn 12,000 (and yes people earn that a year believe it or not!) they will be paying tax.

Can't any of you read my post? I am asking about taxes on an income of £20k because I know you pay taxes. You might earn £20k but that doesn't equate to having £20k to spend. If you take all adjustments (taxes paid and benefits received) into consideration I would expect disposable income isnt far off a family with a household income of £100k where both parents work FT.

brasty I don't know you. I'm talking about friends of mine who have moved into cheaper parts of London which most wouldn't even consider. Friends have done it and have 3 kids to a bedroom and it's not a big bedroom either. We also have 3 kids in one bedroom but that's our choice and it's temporary. When it's your only option to have two boys and a girl share one room that's living in poverty.