Sorry, but £80k a year in London ^really is^ a large salary

[nickymanchester]

So I was just reading the "Unpopular Opinions" threads and I noticed more than one poster saying that £80k a year really isn't a lot of money in London or the SE.

What with being locked down again and not having much to do I thought I'd have a look at the actual figures as I had no idea which side of that argument is correct.

For full time workers who work in London, the median (average) pay is £39,500 (men £42,700, women £35,800).

If a person is earning £80k a year in London then they are on the 87th percentile. Although, if you're a woman that places you in the top 95%

(87th percentile means that you earn more than 87% of all people - ie you're in the top 13%).

Of course, areas of London are very different so I split London down as shown below.

The practical upshot is that, well, if you work in the City of London then I guess you could argue that £80k isn't necessarily a large salary.

You might even be able to get away with this if you work in Tower Hamlets. But elsewhere - not really.

.............................................75th.......Gender

Area......................Median...Prcnt......Pay Gap
City of London.....57,361....89,492....27.9%
Tower Hamlets.... 49,728....72,254....20.6%
Westminster.........43,597....64,038....15.7%
Southwark............41,948....59,816....11.4%
Camden................39,837....53,950....20.9%
Hammersmith......39,676....54,132....14.9%
Islington................39,312....59,587....8.1%
Lambeth...............37,866....55,458....15.3%
Hackney................36,748....46,540....9.4%
Waltham Forest....35,651....45,552....23.5%
Hillingdon.............35,183....52,390....5.5%
Lewisham.............34,913....46,608....-2.5%
Brent.....................34,866....48,064....8.5%
Hounslow.............34,809....50,528....5.2%
Richmond.............34,726....47,070....25.4%
Kensington...........34,445....47,242....4.4%
Croydon................34,086....45,146....18.8%
Havering...............33,821....46,249....-15.0%
Greenwich............33,181....45,427....6.0%
Kingston...............33,030....49,150....18.7%
Haringey...............32,812....44,840....-11.8%
Newham...............32,292....49,618....-1.8%
Sutton...................32,167....43,898....-2.4%
Wandsworth.........31,938....45,786....7.0%
Bromley................31,777....44,824....10.7%
Ealing....................31,418....45,001....-6.0%
Merton..................30,607....48,381....-11.0%
Barking.................30,482....39,988....13.5%
Redbridge.............30,306....45,157....-5.7%
Barnet...................30,092....47,362....9.3%
Enfield...................29,895....40,586....11.8%
Bexley....................28,174....39,614....11.3%
Harrow...................26,998....43,077....17.3%

And for comparison with people outside of London:-

London.................39,556....57,975
South East............31,647...44,704
Scotland...............30,820....41,855
East.......................29,895....41,449
North West...........29,099....40,820
West Midlands.....28,730....40,186
East Midlands......28,704....40,004
South West...........28,605....39,645
Yorkshire...............28,023....38,865
Wales....................27,966....38,392
Northern Ireland...27,487....37,903
North East............27,113....37,872

All figures are ONS latest 2020 figures extracted from NOMIS. Gender pay gap is for full time employees only.

I moved out of London to a county approx 40 miles west of London. Enquired about a job that had a really low salary and asked if there was potential to offer more. Employer said no, but that the cost of living 'out here' would be much lower. Total load of rubbish! Houses are approx 20% less than London however nothing else is cheaper. Spend more on petrol (and if commuting by train would spend 5k a year on trains). There is a myth that London is more expensive than everywhere else. 80k IS a big salary BTW.

@LisaD76

Well my oh and I only have about 60 between us (before tax) and we have a 5 bed detached in a London borough... so 80 for one salary would be us living it up

Depend when and where you bought the 5 bed.house. We live in Wandsworth and there is no way that on £80.000 you will be able to get a mortgage for a house ....maybe a small 1 bed.flat .

[quote winniestone37]@partyatthepalace bah ha hah you won’t eat your kids to private school on 80 grand a year 😂[/quote]
You want to eat them??

But in London, no, you couldn’t pay school school fees and the mortgage on a small family house on that. If you didn’t have a mortgage then you could. It’s the housing costs that are the trouble.

But it’s not £80k take home, it actually equates to about £55k after tax and assuming no student loan. Agree it is a lot of money however London is expensive to live in.

Personally, I did hold off on going back to work after my 2nd DD due to child care costs as we would’ve been looking at circa £2.5k per month in childcare costs alone and that was then, it’s even more expensive now.

After rent, utilities, food shopping, car/travel costs and any other essential items if the total household income of £80k pre deductions, doesn’t leave a lot left living in London.

@Twobecomingthreeplusthedog

Unpopular opinion, I live in Reading and earn just over £80k and even with a partner on £60k it doesn’t go as far as you might think.

Yes we will be paying for a private school (cheapest is £11k a year from 3 years old..).

I think people forget how much you lose in tax every month so what you take home isn’t actually all that much.

If your DC went to a state school instead of private school, how much money would you and DH have every month after paying your mortgage and bills? £140k a year is hardly living on the breadline. Starting salary for teachers and nurses is around £25k outside of London.

I think it’s useful to look at those average salaries by region against average family house price per region. I’m Earning substantially more than £80k and I wouldn’t be able to avoid a decent family house in London. That’s not to say I couldn’t survive or I don’t think £80k is a large salary, but it’s not enough to achieve the same standard of living as say £60k would be in the north (I’m in the north).

@jessstan1

fridgepants: "...we can't afford to buy". You are not paying a mortgage so obviously you'll have more disposable income.

I agree raising the deposit is the big difficulty for young or even not so young people. It's a pain nowadays.

I live in London. Just to point out that most people I know who are renting (including me) are pay a LOT more than the mortgage would be on the house they're trying to save up for. The problem in London is a) landlords and b) not being able to save for a deposit.

@Manal82

But it’s not £80k take home, it actually equates to about £55k after tax and assuming no student loan. Agree it is a lot of money however London is expensive to live in.

Personally, I did hold off on going back to work after my 2nd DD due to child care costs as we would’ve been looking at circa £2.5k per month in childcare costs alone and that was then, it’s even more expensive now.

After rent, utilities, food shopping, car/travel costs and any other essential items if the total household income of £80k pre deductions, doesn’t leave a lot left living in London.

I don’t understand why people keep talking about ‘but after tax it’s less’. Isn’t that how everyone who is PAYE/not self employed is paid. You get an agreed salary and then you get what’s left after tax and NI deductions. It’s the same everywhere. The after tax salary is what is being discussed and at over £4K per month (after tax) it is pretty whopping by most people’s standards.

I live in London. Just to point out that most people I know who are renting (including me) are pay a LOT more than the mortgage would be on the house they're trying to save up for. The problem in London is a) landlords and b) not being able to save for a deposit

My experience is you can rent properties in the SE and London for a lot less than the mortgage would be on the same property were you to buy it then. This is because a lot of the owners bought when it was much cheaper and possibly don’t have a mortgage. I remember the flats I rented in London and the mortgage on the same tiny flat would have been double - even if I could have got a mortgage on it but it would have been way more than 3 times my salary. I rented a flat in Brentford with exH for £800 per month when we both earned £13k. The flat was valued at £230k (2003). Even if we’d had 23k deposit, no bank would have loaned the rest on our salary and if they did a £207k mortgage would have been more than £800 per month.

It’s why a lot of people can rent a bigger place in much nicer areas than they can buy and then are reluctant to move to a smaller place in the less salubrious areas because it feels like a step backwards.

I live in London. I rent a one bedroomed flat for just over £1000, have a commute of an hour to get to work in central London. Commute costs £200 a month. Council tax is £85 (I live alone so get the 25% discount). I don't earn £80,000. For a family to rent a 3 bedroomed flat where I live it would be £2,000 at least, for a house more like £2,500 to £3,000 a month. So £80,000 doesn't go far.

@NoIDontWatchLoveIsland

The thing is, many many people are insulated from the true cost of housing in london, the south east (and the whole UK really) relative to wages, due to housing benefit or the UC equivalent. 1 in 4 households in London receive it.

If you earn £80k in London, it could easily go like this:
£24.3k - tax and NI
£4k - pension
£12k - childcare for one child

So that's over half gone.

Rent (2 bed flat, modest area): £18k
Council tax £2k
Utilities: £3k
Transport (eg a travel card for zones 1-4) £2k
Food: £6k

That's another £31k gone just on your basic minimum expenditure - no clothes, no socialising etc, no gym membership, no mobile phone bill, no internet.

So you have £9k left, which is £750 a month. If you limit yourself to £500 a month for phone, internet, clothes, shoes, an odd night out, gifts, christmas etc, maybe you can save £250 a month for say, a flat deposit.

You would probably need around £50,000 deposit for a small flat in outer zones in london..... so on £80k on the budget above you would be saving for 16 years and 8 months just for the deposit on a small flat.

That's why people don't feel like it's a huge salary in London.

You have got to be kidding me.

It's an OK salary for London - definitely not large particularly if that's the only income supporting a family

@Twobecomingthreeplusthedog

Unpopular opinion, I live in Reading and earn just over £80k and even with a partner on £60k it doesn’t go as far as you might think.

Yes we will be paying for a private school (cheapest is £11k a year from 3 years old..).

I think people forget how much you lose in tax every month so what you take home isn’t actually all that much.

So you have nearly £8000 coming in after tax every single month but apparently other people need educating on how far money can go?

I am absolutely stunned at this thread and am going to hide it.

The things I love about living in the north are: not paying high rate tax no matter how much you earn, no nursery fees, no council tax, cheaper utilities, free public transport, and chips cheese and gravy.

Earning more than 80+% of the population is a high salary even if you live somewhere with higher house prices and sadly lacking all the benefits of the north.

@DedlyMedally

Depends on circumstances, surely? I earn £60k in London but I live alone, with no kids in one the lowest earning areas on that list. I feel quite fortunate, financially. If I had two kids and a SAHP to support, even an extra 20k minus tax would still have me feeling pretty precarious.

This doesn’t relate to OP does it? Some of these comments are ridiculous. Facts is you can go on and on. The more you have the more you will spend.

People have childcare costs in what ever city you live in unless you are childless or a SAHP.

You cut your cloth accordingly. If your use to living on 60k I’m not surprised you have completely missed OPs point.

I'm a single parent in London with a mortgage and putting my kid through private school. My daughter is also a mad equestrian, so I spend a lot of money on her riding lessons and she is twisting my arm to buy her her own horse. I earn a good wage on paper, but in practice it disappears and I'm left with nothing. I do realise that what I'm spending it on are unnecessary luxuries though, as I would have a good life if not for private school and horse-related fees.

@Mandatorymongoose

The things I love about living in the north are: not paying high rate tax no matter how much you earn, no nursery fees, no council tax, cheaper utilities, free public transport, and chips cheese and gravy.

Earning more than 80+% of the population is a high salary even if you live somewhere with higher house prices and sadly lacking all the benefits of the north.

Why no nursery fees? Family?

My son was offered an interview for a job in Central London and was weighing up if it was worth him going for it.
He would have to move from "up norf" and find himself a flat or room down there.
The salary was 22k gross. For full time work that he needs qualifications to do.
We just couldn't make the figures work or find somewhere cheap enough for him to rent and still have enough to live on after commuting costs.
80k sounds like a very very good salary in comparison!!

@XelaM

I'm a single parent in London with a mortgage and putting my kid through private school. My daughter is also a mad equestrian, so I spend a lot of money on her riding lessons and she is twisting my arm to buy her her own horse. I earn a good wage on paper, but in practice it disappears and I'm left with nothing. I do realise that what I'm spending it on are unnecessary luxuries though, as I would have a good life if not for private school and horse-related fees.

I was a mad equestrian as a kid. I mocked the stables and got to ride for free as a thank you. A bit if work won't hurt her, I promise. And you know, just because she wants a horse doesn't mean you have to buy one...

Ok, I live in a nice part of Reading. There are some absolute dives here.

It’s all relative. By the time I have paid into my pension, private healthcare, car lease etc I take home around 3.5k a month. My bills are around 2k of that.

Now add nursery and school fees and it’s not a huge amount of expendable income. But as I said, it’s relative AND what you’re used to. For me, after everything that comes out expendable income isn’t huge but that’s because I enjoy a nice car and am saving for private school fees. But I’m not rolling in it.

Sure there’ll be plenty of jealous comments ridiculing it

@MustardMitt this is exactly my point. People can’t work out basic maths.

We take home around 6k a month not 8k. We pay into pensions and various other share schemes etc.

So yeah, 6k a month doesn’t go far in my opinion when you have a mortgage, two cars and school fees. Doesn’t leave to rolling around in wads of cash which jealous people seem to think we do.

We get by and enjoy some luxuries but we work hard for that.

@Twobecomingthreeplusthedog

Unpopular opinion, I live in Reading and earn just over £80k and even with a partner on £60k it doesn’t go as far as you might think.

Yes we will be paying for a private school (cheapest is £11k a year from 3 years old..).

I think people forget how much you lose in tax every month so what you take home isn’t actually all that much.

I live in Reading too, I’m on £35k and my partner is on £15k and we still managed to buy a house here (not in Whitley either, I imagine you’re in Caversham!) and don’t have to scrimp even with the £5k+ commute to London and student loan & postgrad loan coming out of my salary. I agree private schools around here are extortionate though and was wondering who on earth was paying for them!

I live in a "shit" part of Reading. I wouldn't move back to Caversham if you paid me! Its much nicer here.

Can you honestly not see that having the option to live in a naice house in a naice part of the town, run 2 cars and pay for private school/health care/pension means you have a huge income when compared to a lot of people
And I'm not for a minute saying you shouldn't be able to do all of those things, I'm sure you and your DH work very hard for your money (unlike the feckless poor who work insanely long hours, often in care, but as long as we clap for them tomorrow they'll be OK). But paying for all of that and then claiming you aren't "rolling" in it when some of us have less than your disposal income before we've paid any bills is rather shortsighted of you.

Yes it’s a very good salary and you can live well on this.

We have a family member earning £80K
The wife doesn’t work and they have 2 young girls not at private schools.
They don’t save and just increase their mortgage if they want improvements to their modest home or buy a car. The mum has lunch out at least twice per week and coffees out daily. The children eat out often too. It’s such a pity the mum doesn’t save or budget, she’s pound foolish and penny wise. The husband does have a decent London salary but the wife wastes his hard earned wage on meals out, coffee out. She doesn’t safe and if her husband looses his job their home would be lost and they have no savings. I just don’t understand.

@Twobecomingthreeplusthedog so you have enough money to pay extra into your pensions and share schemes, are considering private school - but still everyone is jealous and it’s not at all that they’re pointing out you are completely detached from the reality of the other nearly 90% of the population?!

I can work our basic maths thanks, but I don’t know you so I didn’t guess at the extras you pay out. I used a salary calculator - this one in case you want to take another pop at me and my calculation skills.

Your money doesn’t go far because of your choices, the choices you are able to make because you make so much money.

‘We get by’ - give me strength.