It’s like a parallel universe

[Imustbemad00]

Inspired by a few threads recently about money. Specifically money in London. I’m shocked at how many people seem to think you need to be rich to live in London (£100k per year is rich to me) and how many people think £100k is not a lot in London.
Why is this specific to London?Other than house prices?
Just to put it into perspective, I’m a single parent with 2 children living in zone 1 London. I take home £22000.
Admittedly, cheap rent at £650pcm. But we manage. Obviously we’re not well off, can’t afford fancy holidays, buying clothes for summer at the moment is a struggle, have no savings, can’t afford to decorate. But we have what we need, the occasional treat, short break
Most people I know locally are in similar positions. But I suppose people have a tendency to mix with their own kind.
I just find this ‘other london’ bizarre. The London where you need 100k to barely get by

100k is a decent amount in my opinion and makes you pretty well off. However 600 quid rent in zone 1 and lifetime relief from losing your home with 2 months notice makes you pretty well off too!

Social housing in London also isn’t as “rare” as everyone seems to think. Yes it’s impossible to get now if you don’t have it already but there is a lot of social housing all over London. I’m in a 4 bed in zone 2, £700 p/m. My friend has a similar place, also zone 2. We live in “private” streets, so no one seeing it would know it’s social housing, but it is. Social housing in London isn’t all high rises. A quick google search tells me that my borough alone has 17,000 social housing tenants, 40% of all homes in the borough. Nearly half is not “rare”.

Ellenbirough, that poster has made up a scenario with maximum benefit entitlement that does not apply to most people.

If I’d have wanted to make up a scenario with maximum benefit entitlement I’d have had the families have two kids in nursery!

My little one has only just started school so the situation I used was just “mine” up until a few months ago. (Except I live hundreds of miles from London, don’t work full time, am not a single parent and neither earn £22k nor £100k!)

I don’t have a horse either way in this race - I was just interested in the numbers.

Yes - the difference will be more when both kids are in school (although not that much once you allow for the cost of breakfast club, after school club and holiday club) but it will be less when the families had two kids in nursery. I also didn’t allow for the fact that the £100k mum might have to work much longer hours than £22k mum and so need to pay more childcare. I gather I was also quite conservative with the market rent I charged family 1 - some people were quoting £3k for a 2 bed flat in Zone 1. I also didn’t allow anything for the secure tenancy vs the cost of maybe having to move every 6 months.

Like I said - no horse in this race - I just like the numbers!

The thread that started it though was also a complete failure to manage and budget (particularly expenses)

This is why more social housing at affordable rents is needed - so people earning the average (median) wage can afford to live in the cities where they work.

Everyone always thinks those on the next step up the ladder up are 'rich'.

Maybe she's fed up of seeing posts from people who live on 5 times her salary, who complain because they have no money left at the end of the month.

Oh for crying out loud, here we go again. In which universe do they have 5 times her salary in their pocket? for a start, how many people on 100k and needing space for 2 children can afford to live in zone 1 at all - let alone for 625 quid a month?

Whether she earns 22k gross or net, either way, the parent/s on 100k do not have anything like 5 times that amount in their pocket after tax and NI and probably pension contributions. And that's before any extras she will be entitled to (CB at the very least) and any child maintenance we don't know about.

I'm not saying they are not better off to some degree (you'd have to flipping hope they were - otherwise what's the point in striving to do well at work at all?) but to suggest they are 5 times better off, all things considered, is just ridiculous.

@Asta19
Cost of Nursery and gym higher is you look at chains it’s easy to see the disparity.
I’m sure there’s more examples

I just think it's funny that some posters think that someone on 22k (not far off the national average wage) gets £1900 a month in benefits!! It'd be more like £300.

100k is an awful lot of money. Far far more than the vast majority of people in the country live on. Yes you may not be able to afford a private jet, or your own island. But when you're factoring in nannies, cleaners and posh hair cuts as necessities, it does say something about your financial situation, ...spoiler..... you're very wealthy.

It's all relative, if in your circle everyone earns vast sums of money and has a nanny, cleaner and have multiple foreign holidays a year, and send Tarquin and Darcie to private school, you'd feel like these things are necessities and that if you can't afford them then you are poor.

However for some people these things are so far removed from their lives, that if you can afford any of them, you much be very well off indeed.

Anyone with household income of over £70k is in the top 5% of income so naturally there in the UK there is a parallel universe where 95% of households have no where near that income level and therefore manage on what they have, and the other 5% have significantly more. With £100k of income gives you the opportunity to live a different lifestyle to the vast majority of the country. And that's where the parallel universe plays out.

So yes, £100k is a huge amount of money and anyone with that kind of income (about the top 2% of households in the UK) needs to give their heads a giant a wobble before they moan about being cash strapped. The reality is that at that kind of money, many of the things that lead to families being cash strapped are choices that available to 98% of the population.

Having said that, the biggest drain on that kind of income are housing costs and childcare. Someone on £100k isn't going to have access to a zone 1 2 bed flat with rent of £650pcm rent. So anyone who in that kind of situation needs to also give their heads a wobble and recognise that they also have access to something that most of population don't have access to.

This is why more social housing at affordable rents is needed - so people earning the average (median) wage can afford to live in the cities where they work.

The subsidy implicit in for social housing and affordable rents comes out of everyone else's pocket. Waving a political wand to make these happen does not magic up resources out of thin air.

If you want to lower the cost of housing in a non-magical way, you have to either increase the number of houses or decrease the number of people.

I don’t believe in magic. More housing could be built, funded from the public purse. It’s a political decision as to where money is spent.

I'm sure she was comparing £22k take home to £100k take home, which is nearly 5x the amount. Take home. Not salary.

I agree OP I’m in London and on a rediculously low wage but we cope financially really well, never go without and pay a mortgage myself (single mum). Those earning 100k+ complaining they struggle need to look at their outgoings because that’s not normal. If you’re trying to live the high life as a celebrity but struggling then reign it in. That kind of wage would have me booking monthly holidays!

I think the OP implied her take home is £22k, not her salary. Also that she doesn't get benefits

I've not see the OP say she doesn't claim benefits.

I'd say most people on £22k claim something, even child benefit falls under benefits.

It's not comparing like for like if indeed befits are added so not just the salary. Someone on a higher salary isn't likely to be in social housing or claiming benefits. Therefore they have to cover all the costs themselves. That's very different to being in social or council housing and claiming top ups from the state. If you add up the costs of help plus the saving in rent it's way more than £22k needed to live in that area.

@Ellenborough that's your opinion.

As someone who earns less than 20k a year and manages a perfectly comfortable existence I do think complaining of not feeling "rich" when you earn a six figure salary is pretty fucking ridiculous, all things considered.

As far as I recall, the OP’s income is around about the level of the poverty line according to the Joseph Rowntree Foundation figures.

It reminds me of the post from the woman with one pair of shoes who couldn't afford to replace them until next pay day who didn't think she was in poverty because everyone around her was in the same boat.

I'm sure she was comparing £22k take home to £100k take home, which is nearly 5x the amount. Take home. Not salary

I don't think she was because almost no-one talks like that. Most people will know their annual gross salary and probably net per month but people simply don't talk in terms of actual income per year.

I think it’s maonl down to housing. My DH earns, IMO, a decent wage, (not £100k!) we live just outside London in a modest house. He works for a big company and when he goes up North on conferences he can see the difference of what the same wage will get you, his Northern colleagues have big houses, brand new nice cars, expensive watches etc. A good chunk of our wages go on the mortgage,’if we lived up north we’d have a spare £500+ a month. I like it here but I sometimes get the feeling people are taking the piss when they charge for stuff, just because Millionaires live here doesn’t mean everyone is rolling in it! It’s like that saying about weddings, if you’re booking/buying something for a wedding stick another 0 on the end of the price. London and the SE is one big wedding!

Your rent is not typical. We're in zone 3 paying £1,500 for a tiny 2 bed flat.

Of course 100k is rich no matter where you live!
What I get from mumsnet is that people on 100k have bigger houses so a large mortgage, pay school fees, extra curricular activities, car payments, etc. So they have a lot of outgoings so therefore don’t feel so rich. What they don’t seem to realise is those things are luxuries and choices they have made!

Average monthly rent in London is now £2k. So you need to be earning significantly more than £24k to live.

If you live in subsidised, secure housing in z1 with access to outstanding schools, for 650pcm, you have what to me seems like a unicorn life! Do you have any idea what catchment for outstanding schools does to prices in the private sector?!

Also for all these £2000pcm z1 flats - our old flat in z1, which is nice but quite inconvenient with multiple flights of stairs, just rented at £2800 a month.

Our dilapidated old house (built as a ‘labourers cottage, on the edge of a huge council estate with many issues) that had someone stabbed to death 150m away a few weeks ago has a rentable value of £2750 pcm.

When I enquired about double nursery for two kids under 4s, the perfectly good but ordinary chain nursery round the corner was £3500 pcm. The nice state-subsidised ones weren’t open long enough hours or in holidays, so weren’t an option.

The first thing my job with not nearly 100k but getting towards that wanted on return from mat leave was for me to go to a conference for two nights- dp also travelling at that time so had I kept that job and salary, we’d have needed au pair or similar to do back up since we have zero family support and weirdly those well paid jobs demanded 50-60 hours a week.

We did change our lives because of all these things, but I have huge respect for ordinary professional people trying to make it work, because it is hard.

A broad definition of low household income, as suggested by the Government, applies to annual earnings less than 60% of the median UK household income. For London, this cut-off point is approximately £21,000

I had a look after seeing the poverty line post and wondered what it was. Op is on about £28k

“I just find this ‘other london’ bizarre. The London where you need 100k to barely get by.”

OP - if you’re in zone 1, it can hardly come as a shocker to you that you can barely buy a tiny studio flat for less than 500-600 k. How else do you think people are getting mortgages? There’s no “other London” - either people are in social housing or high earners. Often living alongside each other.