To think many working/middle class are now ‘poor’?

[WorldsOnFire]

Inspired by the ‘People are terrible Scrooge’s who clearly don’t want to help the poor’ explosion on MN recently I read an article about a single mother on UC ‘left in tears’ as she ‘only’ had £60 left for Christmas. (Many similar threads recently about tight Christmas budgets so a lot of people in similar boats).

What shocked me was the hundreds of comments from FT working professionals - nurses, teachers, tradesmen, IT professionals, social workers... the list goes on. All jobs earning £20K+ and many with two adults in one home, all saying they were in the same (some even worse) situations. They receive no help as they earn too much but the cost of living is so high they can’t afford to heat their homes and pay their mortgages/childcare 😦. I find this shocking!

It sounds like those who don’t work/work PT (for whatever reason- not here to debate right/wrong of UC 🙄) are topped up by UC whilst those working FT aren’t and actually there’s not much difference at the end of the month.

AIBU to think that the whole country maybe aren’t terrible Scrooge’s and in reality the working/lower middle class who used to give to ‘the poor’ are now becoming The Poor and therefore are less compassionate/willing to help?

It is how you spend your money though.

We rarely have take always or drink in the pub. We were not well off when my dc were younger and the thriftiness has stuck. We could do this now

I tend to make a sandwich for work or if we go away I'll pack a lunch and make a flask of tea.

It is how you spend your money though

Yes and no.

I budget very carefully. I havent been to the hairdressers in years, don't buy take aways, rarely buy myself clothes unless I have to, I don't drink, don't smoke, rarely go out. Because of this, it means I always have enough for food shopping, kids clothes and their extra curricular activities.

However, not everyone can budget. Not because they're bad with money but because if your income doesn't cover the essentials, you're totally screwed.

There are various factors.

Fiscal drag is one of them, as tax bands haven't moved significantly in line with wage inflation so people are paying proportionately more tax than they used to. Being taxed on 12k a year is wrong imo, which is why those on 18k still feel poor. Boris obviously tried to change the 40% tax band up to 80k but was shouted down by the left wing media. But £50k in my parents generation was a very high salary whereas now its really only 'ok', especially in the South East, and when you take childcare costs into consideration, even someone on that salary could be no better off working.

New Labour / Gordon Brown introduced tax credits as a bribe to Labour voters and knew that a Conservative govt will eventually have to get rid of them, which will be hugely unpopular. Osborne tried, and swiftly had to retract this policy.

But if those only working 16 hours + tax credits had to work full time instead, then it would probably mean that tax bands for everyone could be raised (eg 20% band only kicking in after earning 18k) which means everyone would feel richer, including those who were formerly on tax credits but are now working FT.

A big factor is childcare costs. No one should be no better off / worse off from working versus staying at home. I am literally trapped at home at the moment as I would be worse off working.

Wages are the same here but house prices have doubled. That's why people feel poorer

May be wrong about that but it was something along those lines. It was introduced by the Thatcher government and served the same purpose as tax credits.
No, working tax credits pre 2003 were very low and for the very poor. Nothing like modern day credits.

@rhubarbcrumbles I don’t know where you live but if we were sending our children to the local non church (wouldn’t get in because we’re the wrong religion) state school we might as well not bother sending them to school at all. Regardless I did separate out both nursery and school fees as not strictly speaking essential, merely regular.

Danger- if you can, salary sacrifice the £4K into your pension and you will get it all again.

The system just seems broken all the way through - minimum wage workers can’t survive, professions struggle and higher end professions do ‘ok’.

This resonates with me, it's true. I'm one of the minimum wage can't survive people. I just about do - with tax credits, and some robbing Peter to pay Paul most months.
What really is annoying though is that you're assumed to be part time, a lot simply cannot believe that you can't earn enough to meet the cost of living on ft NMW.
It's been like that for years and people like me are told it's because of our choices (smoking, drinking, drugs, tattoos and wide-screen TVs being a favourite alongside children you can't afford - regardless of the actual truth) but it's started to bite the middle class and professionals now, but their choices in life are not questioned. They're not told to get a better job, or move (without any money) or work more hours. They're not told to downsize their home, or move miles away from a job, family. Or to downgrade to one car, or a cheaper car. Nope, they point the finger at those with less, being topped up to a figure lower than what they earn anyway and scream it's not fair they don't get any help and feel the answer is to remove what help the lowest end of the spectrum has, because they don't get it.
Call me crazy but maybe removing a supporting lifeline from families like mine who already work full time, isn't the answer? How about making the lifeline not needed in the first place? Shift everything on a bit so the lowest end can survive, and the middle class and professionals can live?
I don't get this culture of wanting to remove things from people that already have less anyway.
Perhaps the middle class professionals should look at their choices and take some responsibility? Like poor people are told to.

cokehoke

@SympatheticSwanthere most be loads of people not realising they can qualify for benefits?

There is. Which is why I am attracted to these kind of threads. I really want to help others out.

I think the media is to blame in trying to make people think than benefits are only for tge very very poor - they are not.

@Verily1

A few years ago our income jumped from £18k to £31k because of a career change/ new job. But our disposable income went down! We got well over £100pwk in tax credits before but when the income jumped this dropped. Then after tax NI, pension, student loan deductions, travel to work costs for longer commute we were no better off! So it annoys me when people on low incomes see high incomes and think they must be better off- we thought that too but it’s not how it works!

Absolutely perfect example of what I’m taking about!!!!
I’m not saying that someone on £18k shouldn’t get the support they do, I’m just saying that society should stop looking at the £31k earners as incredibly better off!!

For families with children it’s actually rarely the case!

We’re in this odd gap. We both work. DH 37 hrs, me 30-33. He’s not a high earner, I’m minimum wage and studying for a degree. We don’t get any help and have to pay school lunches, trips, nursery fees.....there’s nothing left over. Nothing. We save so carefully and plan so carefully for Christmas it’s like a military operation. I had a week off sick (employer doesn’t pay sick) in November and it will take 3/4 months to recover. It’s hard.

CaptainCallisto

Did you apply for DLA and was rejected? If so that is extraordinarily common. My own asd/adhd child was declined at first application. I did a mandatory reconsideration and low and behold, he was entitled to the highest rate. That gave me £330 a month, plus increased my tax credits by the same amount (this was 2 years ago). That difference was incredible for us. It meant I could continue to work PT to be available to my son as he needed, and to be able to provide extra curricular activities for him and his sibling to help in all aspects of his life.

I would urge you to apply again. You've given up your career to be able to care for your son. If your child has extra care needs, which with asd is extremely likely - then you should be able to get DLA for him.

PM me if you want any advice

IvyKaty remember when swathes of libraries were shut ?? Well ours was one of them........meaning that the nearest library to the very deprived, isolated town I live in is over 10 miles away.

I looked at child minding. The things that put me off were my total lack of qualifications in that area, I would need first aid training, DBS, early years foundation training, and a basic child minding course. I would also need liability insurance, to update my house insurance, update my mortgage provider, register with Ofsted, child proof my house, overhaul my garden which is steeply terraced at present, and figure out what to do with my dogs all day as it would be very difficult to keep them separate in the house, which would be necessary for safety. On top of that there is activity planning, buying resources and safety equipment, food and drink, advertising, managing the business admin and accounts, and invoicing. Possibly a new car if doing school runs. All before you've even looked after a child. And all while charging £9 per hour max, (average rate round here) for a maximum of 6 kids depending on age, well 4 really as I have my own 2. It just isn't worth it.

rhubarbcrumbles

It does make a difference

It shouldn’t do but once you have over 16k in equity you are not entitled to working tax credits (I don’t need housing benefit but when they calculated what I would get they automatically included housing benefit). If I wasn’t working I would be entitled to housing benefit full amount , that plus my council tax isn’t much lower the my wage. Thankfully I don’t have child maintenance issues (that isn’t taken into account when working out benefits)

I appealed and asked for just working tax credits to be considered but no luck. I would get help with childcare but I don’t need that anymore

I don’t need over 1350 a month handout and it’s ludicrous I would receive that but that 225 just made me comfortable not making ends meet and when I work full time I expect that

I have friends who are better off working three days a week and getting TC to ups how can that be right

@rhubarbcrumbles It shouldn’t do but once you have over 16k in equity you are not entitled to working tax credits this is completely false! You could have £16k sat in the bank and it would make to difference to a tax credit claim.

no difference

@enthusiasmisdisturbed

Is it the house you live in?

It shouldn’t do but once you have over 16k in equity you are not entitled to working tax credits (I don’t need housing benefit but when they calculated what I would get they automatically included housing benefit). If I wasn’t working I would be entitled to housing benefit full amount

Sorry I'm really confused. Do you rent or own? Do you mean 16k in savings in the bank or 16k actual equity in a house you own and live in? Surely if equity in your home was taken into account for working tax credits, theyd need to go round valuing everyone's house?

And yep to what DC said.

@formerbabe £16k in the bank is also irrelevant.

Wages have stagnated, while costs have increased markedly. The wages on offer are ridiculous, I have recently had to decline interviews based on the fact, that I simply would not be able to afford to make ends meet.

The biggest cost for most people is housing, particularly in London. As an example, my rent is 57% of my take home pay and thats in Zone 3 and is no luxury home. By the time, I've paid the basic bills, there really is not too much left over. I'm on a decent salary but I am certainly pinching the pennies as a single income household

@MyDcAreMarvel

Yes I thought that, it was when I had to claim.

I don't think equity in your main and only home is taken into account for tax credits.

It was the case I mean not that it was taken into account iyswim

If you have £16k + equity in a house that you do not live in - then it would make a difference to means tested HB paying a proportion of your rent