Average incomes

[flabbergastedfinances]

Found out that the average family income is around £30,000 a year and I can not believe it. I don't know a single family on anywhere near this low, lowest is possibly 70k mark between two teachers but majority have two earners pulling in 40+ each or one higher earner on 80/90k+

How on earth is 30,000 even possible in light of minimum wage and benefits/tax credits etc? What is even more shocking is that I used the where do you fit in calculator and we are apparently in top 98% of families in the uk. No chance, absolutely no chance.

We might have a high ish mortgage (still only £1000 so not outrageous) and have slipped into bad spending habits (Uber's, eating lunch out every day, new clothes now and then) but we are hardly excessive. We can't afford to run two cars, can't afford foreign holidays, can't afford the posher shops like Boden or northface new and yet this chart tells me we have it better than nearly everyone else in the country?! What am I missing?!

We have a child in childcare a few days a week, so that and mortgage are biggest expenses but combined that's only £1500 and I see everyone else buying £300 coats, spending 1000s on holidays, children in private schools and I am utterly stumped.

How can the average family income be £30,000? Which families are surviving on that? None I know that's for sure and I just refuse to believe that's an actual reality

Are you a real person! Bloody hell. Disgusting.

Over here op ...waving
We manage ,and pay a mortgage ( we bought years ago so it’s not huge )
4 kids one wage
No benefits as kids are over 18
No expensive holidays ,14 year old car .
Camping ,no eating out
£100 ish per child at Christmas and birthday

OP

Maybe take a few of your friends to see Ken Loach's new film to give you an idea of life on minimum wage/zero hour contracts?

www.theguardian.com/film/2019/jun/19/sorry-we-missed-you-first-trailer-ken-loach-gig-economy-drama

we live in the south east

Which explains a lot. Have you never heard of the North/South divide?

I understand minimum wage might give an annual salary of around £17,000 but you don't stay on that for very long do you?

I'm a nursery nurse with 13 years experience. I earn a little more than minimum wage. My manager doesn't earn much more.

Our household income is just under 40k- less than most of our friends and family in similar situations- but I still feel really grateful/ lucky. We manage just fine. We don't have lots of luxuries like holidays etc but we don't struggle at all with basics like bills, food, essentials for the children.

Since having dd, I chose to move from a very high hours/high stress £30k job to an easy, part-time £10k job. My dh moved from a £10k job to a £20k job. This reduced our household income to a combined £30k!

It is hard, we no longer have a car and our only way of holidaying is camping not far from where we live. But we both get to spend quality time with our dd and when she goes to school I'll get another 'proper job'.

One thing that stands out to me OP is that you say you can't afford foreign holidays but I bet your 'little spends' are massively adding up more than you realise. For example if both you and your DH are buying yourself lunch out "most days" (so lets say 5 days a week). Presuming you both spend say £6 each a day on a sandwich and hot drink (which doesn't in itself sound excessive), then it's worth bearing in mind that works out £60 a week for you both to buy said lunch out 5 days a week. If you were to save that money instead over a year that would give you 60 x 52 = £3120 per annum which would easily get you a foreign holiday. It's really easy to not realise how much this little spending habits are costing you a year.

There may be some people comparing apples with pears here.

The OP has presumably seen the ONS statement. The relevant parts are:
"Median household disposable income in the UK was £29,400 in the financial year ending (FYE) 2019"
"Disposable income is the amount of money that households have available for spending and saving after direct taxes (such as Income Tax and Council Tax) have been accounted for. It includes earnings from employment, private pensions and investments, as well as cash benefits provided by the state."

So it is after income tax, (presumably NI) and council tax but before deducting anything for mortgage/rent, utilties etc.

If you had a household with one earner on uk median employee earnings (£30,500) and one on 50% of that (£15,250) then the higher earner would pay income tax of £3,600 and £2,614.56 NI, taking home £24,285.44/year or £2023.79/month, and the lower would pay £550 income tax and £789.56 NI, taking home £13,910/year or £1159.20/month.

The average Band D council tax in England is currently £1719, so the ONS method household income would be £36,476/year (as against a gross income of £45,750) or £3039.67 a month.

Obviously these are medians, which means that there are equal numbers above and below these figures.

[Feel free to tell me I've worked this out wrong!]

I have to ask, when you say you 'struggle' is it to pay for extras like out of school classes and holidays, new clothes, stuff like that?
I have never been able to afford to buy a school photo, its a simple thing but it really bothers me, we have lots of great pictures of the kids, but lots of parents wouldn't give a second thought to how much it costs.
For us its food and essentials first, everything else after.

I understand minimum wage might give an annual salary of around £17,000 but you don't stay on that for very long do you?

Lol.
Are you aware that you don't just get your pay increased by virtue of being employed for x amount of time?
Do you think folk just get given pay rises and promotions??

In a NMW role, there might be 10-15 folk reporting into one supervisor who is on NMW+1. What chance do you think a person has for being promoted to supervisor if those are the ratios?

Why on earth would you assume that if you start on NMW, you will make more over time? Those roles are designed not to be ones that you promote out of.

Have you ever worked??

Which explains a lot. Have you never heard of the North/South divide?

Yes but the fact is in the south we pay over the odds for everything.
Our modest house is worth around £650K. In the north you could buy one the same size for around £175K.

Fuel is cheaper, food is cheaper, beer is cheaper...(I have family in the north.)

A lot of people in the north complain about low incomes but they frankly have no idea of the cost of housing in the south.

I understand minimum wage might give an annual salary of around £17,000 but you don't stay on that for very long do you?

so what do you think what happens after people have been in their NMW job in e.g. retail or care for a bit???

I used to work there. Let me tell you a secret. Nothing. it just stays at the same low level. Your only real hope of a pay rise is a rise in NMW.

Fwiw, I had to give to work to care for my severely disabled child (and no, the state does not provide accessible childcare so I can work). In order to receive carers allowance, I have to care at least 35h a week to qualify (though it is a lot more). And my weekly pay for that is £66.15 a week. Yes.

In a way I envy you. You and your children clearly never experienced hardship, hunger or the choice between heating or eating let alone not being able to pay for any kind of luxuries (hols, days or meals out, haircuts etc).

good on you. but no need for such. goaty post.

How do you know what all your friends earn?

I earn less than that and live reasonably well, not 'survive'. I work full time and have 4 children.

Location, location, location! I'm in Cumbria in a pretty holiday town, but it's my home town so I get Local Occupancy clause houses which means I own my own home (with a mortgage of course!).

Fuel is cheaper, food is cheaper, beer is cheaper.

Yes, simple economics. Demand pull inflation. There's more money floating around the SE so prices will inevitably be higher as people have more money to spend.

Less money floating around in the north due to few decent employment options, so prices/costs are held back down due to lack of demand.

Public sector pay is the anomaly. Nurses, teachers, police etc in the SE are very poorly paid and struggle. Due to national pay bargaining, they're the "rich" in run down Northern towns as they earn relatively high wages compared to other locals.

I think I desperately hoped single parents families would get extra help, that tends to be the assumption so it's interesting to hear people saying they don't?

They do, just not the vast amounts that most people believe they do. Like I said £25,000 a year. That includes TC and CB. Basically until I learn to live without sleep and work almost constantly, or my employer has an attack of conscience and increases my wages dramatically, I won't rise above that and in fact will drop to £20,000 when TC and CB stop when DD turns 18. I could take on another shift in a year when DD leaves school, that'll be 50 hours a week, and I'll be £25,000 with wages paying a higher proportion of income. That's 5 night shifts, which takes 6 days away as it were. One day a week where I'm not working. But the assumption from most of society is that as a single mum I do the bare minimum and get 'massive' handouts from the government.

I understand minimum wage might give an annual salary of around £17,000 but you don't stay on that for very long do you?

Don't you? I work with people who range from 25 to 55 on minimum wage, hospitality, retail and care pay minimum wage as standard. Promotion is worth maybe 50p an hour more. I've had 2 and still under £10 an hour. When you're unemployed you have to go for anything you can get. Employers know this and pay as low as possible, combine that with 0 hours contracts and you have where we are today. These jobs need to be done though don't they? And you need some people with experience and knowledge that can only be built over time to make sure these things run smoothly. Plus with low wages, high rent and childcare, training or studying and the time needed for that isn't an option for many people like me, and not just because I'm a single mum, I know couples in the same situation. Society relies on these jobs, but the 'get a better job' stance conveniently ignores all that. And tbh that's what that comment comes over like, to me anyway.

The average wage is per person not household - maybe it’s £30K now though not long ago it was £23K
Hence lots of people and households earn much less than that....

You're at home with the children yet you have lunch out every day? Wow! As many others have said you truly live in a bubble. However your subsequent posts suggest you are open minded and have listened to comments. Perhaps you could read The Guardian for a week rather than The Telegraph....

To your credit @flabbergastedfinances, you have been gracious in your later posts, but this level of ignorance among so many of the politicians, media, and decision makers in the London-centric country, explains why there is such a great divide.
I genuinely don't think the OP was meaning to be goady and I think she actually thinks that.
Same as so many politicians

And well said @Gottagetout

How on earth is 30,000 even possible in light of minimum wage and benefits/tax credits etc?

Maybe stop believing all the guff about the generous benefit system?

I desperately hoped single parents families would get extra help

In what way extra? Single parents should receive maintenance but statistics suggest the majority don’t. Not all single parents would be eligible anyway. Other than that, income is means assessed in the same way as a couple’s income is assessed. There is no such thing as ‘single parent benefit’. Also worth pointing out that two people earning, say, £30k each, would be marginally better off than a single parent earning £60k given personal tax allowances and higher rate taxes. And also consider the removal of child benefit and the impact that has on single parents - two parents earning £45k each get it, one parent earning £60k doesn’t. Single parents are screwed from all sides.

I'd have been shocked if that figure was any higher. I don't know anyone on what I'd class as a high salary. I feel like I'm doing pretty well for myself on £24k it's more than I've ever earned before. DH is a chef and has been for many many years, he earns £9.40ph before tax I guess he'll get about £27k a year? He'll work at least 55 hours a week for that. That gives us a combined income of about £51k and I feel so fortunate to have that.
My mum was a single parent so I've seen the other side, our earnings mean that I can continue to work after my maternity leave rather than having to live on benefits, mum had to as there wasn't a job she could do that would pay enough for full time child care. When my little sister went into school nursery she immediately started working part time. I'm also in a position to own my small home with a small mortgage, meaning I don't need to worry about a landlord deciding to sell my house from under me. We can go on holiday, usually the UK but it's a week we get to spend together.
It's all about perspective OP, I feel so fortunate to have what I have where as others may struggle.

Bloody hell Haha! The difference between the haves and have nots... me and my partner both work. Our hh income is pretty much bang on 30k. And we do struggle. But. I feel pretty rich a lot of the time... we have a (rented) roof over our heads. Food in our bellies. A happy kid. We do not have many takeaways and hardly ever eat out. We go on holiday to Wales every year. We dont have savings at all. We have 3k debt instead. But honestly, its doable. There's a lot less well off people than us. I find it hilarious that people might pity us Haha!

We live on £37,000, we have a house, a decent car and are ok. However I wear clothes from outlets, supermarkets or primark. We both work full time.

I assumed minimum wage increased yearly like a progress review or how teachers pay goes up. I didn't realise it was set and stayed that level for good.
My husband buys lunch every day, I often eat what's in the house but admit I probably do top up shops to ensure there's something I like in?

We use childcare so one of our children gets to socialise with others before starting school. I realise this is fortunate we can afford to do so