..to struggle to comprehend huge salaries?

[missbunnyrabbit]

I was reading the thread about how much people earn having been to grammar/private schools and I just cannot get my head around how much lots of people earn. My head just cannot imagine such huge salaries. People earning over 100k, what on earth do they even do with that money? Do they buy everything gold-plated? That's a joke BUT I have no idea what anyone does with that sort of money or what it could be needed for. This isn't a bashing thread or anything like that. I'm just a bit stunned.

Does anyone else's brain struggle to imagine such huge amounts of money?

@CSJobseeker

I earn a lot more than £100k. Only thing to add to what others have already said is that my job, if I make a mistake, can result in significant (hundreds of thousands) personal fines and reputational damage so significant that I could never work again in my industry. Even jail in an extreme scenario if I’m found to be negligent. So for me some of it is danger money, it isn’t something I want to do until I’m too old to enjoy the fruits of it and the majority of my earnings goes into savings to cover pension/worst case scenarios where I suffer a major fine and can’t work again. Several people who do my job suffer mental and physical health issues as a result of stress so great that they cannot continue working. So that’s also a possibility and if I ever find myself starting to feel that way, I will quit (with savings making that possible).

A nurse who makes a mistake can kill someone.

Earnings are not determined by the consequences of your potential mistakes.

If you are self employed and you price your work based on the risk to which it exposes you then yes they are

@TractorAndHeadphones the median household income in the UK is £30k. And I’d argue the median is a better number to use as it is more reflective of the real state of incomes rather than distorted by some very high earners at the top.

“In financial year ending (FYE) 2020 (April 2019 to March 2020), the period leading up to the coronavirus (COVID-19) pandemic, median household income in the UK was £29,900, based on estimates from the Office for National Statistics (ONS) Household Finances Survey.”

Even if your household earnt £45k combined - so much higher than most - you’d struggle to pay nursery fees for four days a week and rent in the commuter town we live in. Let alone other bills.

@alldaimbarsatemydogsbone

I don’t earn a £100k salary but I’ve seen positions advertised at my organisation for that amount and how hard it can be to attract applicants. I earn around half that amount. No way would I apply for one of the £100k positions - it would be far too stressful and demanding. Yes some people in those positions make mistakes but that doesn’t mean the job should be on a lower pay scale.

Also if carer makes a mistake giving out medication on minimum wage what abt them.
Lots of us do very responsible jobs for shit money

If you are self employed and you price your work based on the risk to which it exposes you then yes they are

My point has sailed over your head, hasn't it? You personally get paid a lot because if you mess up there will be consequences.

For most people, that doesn't apply.

[quote twoofusburningmatches]@TractorAndHeadphones the median household income in the UK is £30k. And I’d argue the median is a better number to use as it is more reflective of the real state of incomes rather than distorted by some very high earners at the top.

“In financial year ending (FYE) 2020 (April 2019 to March 2020), the period leading up to the coronavirus (COVID-19) pandemic, median household income in the UK was £29,900, based on estimates from the Office for National Statistics (ONS) Household Finances Survey.”

Even if your household earnt £45k combined - so much higher than most - you’d struggle to pay nursery fees for four days a week and rent in the commuter town we live in. Let alone other bills.[/quote]
That proves the point though - higher earners can cover these bills, there isn’t a load of ‘extra’ left like what the OP is thinking.

@ThePoisonousMushroom

A better question is whether these people can imagine what it like to live off average earnings

Yes, because we have lived off completely average earnings. I’m fact very low earnings at one point. It has taken a lot of years to get to the £100k income.

I've lived off way less than that: I've lived in poverty with no food or light or heating sometimes. But I also know that to be able to earn my salary now I have to live in a place where my mortgage and childcare costs take up most of what is left of my salary after tax. As a PP said, considering salary without the cost of living is irrelevant. People generally don't earn Luxembourg wages while living in rural India.

I earn over $100,000, WFH four days a week and one day in the office in a 9 to 5 job. No need for fancy clothes or a second car. Low stress, regular hours. It's fab and it would be much more stressful being low-paid and trying to juggle childcare, long hours etc. I also live outside the UK in a country with sensible childcare policies so we never paid much for nursery.

All the people listing their high salaries, all the things they do with it and then saying '... but we don't feel rich' - don't you see how rich you are?! The activities, holidays, eating out, private schooling, savings, etc - that IS being rich. I don't understand how you can't 'feel' it when you're living it!!

@CSJobseeker

super rich is having yachts, private jets, multiple homes across continents and never needing to actually work

Being super rich may mean that someone can afford those things, but it doesn't make them mandatory. Warren Buffet still lives in the same house that he bought in 1958 for $31,500.

It's all about choices - no-one is forced to spend just because they are wealthy.

Lol! Any ideas how big that house is? Property prices were pretty low back then.... not like he's struggling for space.

That money goes fast in London.......

Yes, totally agree that the real question is why the cost of living, including early years childcare, is so out of sync with earnings.

It’s only about a decade ago that I used to earn less than £1k a month. I know I am lucky to earn what I do now and that we are a two-income family. But we had to get the speadsheet out and triple check our sums to make sure we could afford one child. We got some nice pay rises which has meant we can afford childcare for a second child. But it will be very tight for a few years. That seems like a pretty crazy situation for two professionals with good jobs and good incomes. I don’t know how say two nurses could afford it at all, let alone anyone on a minimum wage job (unless family cover childcare, which sadly isn’t an option for us)

May I ask where you live? (just vaguely!) I'm interested as that's not HUGE amounts AFAIC (I'm in London and I know how it – and other big cities –can swallow up money)

I’m in Dublin.

Property is eye-wateringly expensive here, and in short supply so even affordability isn’t the main blocker. We’re lucky that we got on the property ladder very early (albeit when property prices were exceptionally high, and our salaries were much, much lower than they are now).

Just as an example, it would cost three times more to rent our city property than we were paying in a mortgage. It’s just nuts.

First-time buyers need a 10% deposit, and after that, it’s 20% for non-FTBs. Where I live, a nice-but-small three bed terrace with a postage stamp-sized garden is about €750k, so a €150k deposit is needed. It’s so very tough on young families.

Our combined income is just under €295k (I posted using sterling equivalent) and we feel really well off on that.

In terms of taxes, I’m not a tax expert so may be out on figures and am open to corrections, but we don’t pay tax on something like the first €8k (combined), about 28% on everything thing between that and €67k and then 52% (PAYE at max rate of 40%, USC at max rate of 12%) on everything above that. Pension here is deducted from gross so there are tax benefits. But again, things like this are geared towards the wealthy- the more you can afford to put into a pension, the more you save.

I think the single biggest thing for us is not having children. I have friends who are paying €2k+ a month to have two children in childcare. There’s no government help for middle income people so it’s a huge drain on people who are earning in the median level. Once a child turns three, they’re entitled to 15 hours of pre-school hours each week but, from speaking with friends, that seems fraught with adding charges and conditions. I think it’s capped at two years too.

Compared to the UK, Ireland is generally much more expensive for things like food, entertainment, cars, healthcare (we have a public health system but, again, most average earners are not eligible for free GP visits so it’s €45-55 each time, plus prescriptions are paid in full- think it can be capped at €120/month), transport, utilities, insurance… pretty much everything.

Wages here do tend to be higher, though. Also, we don’t pay council tax (we have a Local Property Tax but it’s much lower than CT, from what I’ve seen of it on Mumsnet) or water charges.

If you look at % of children who go to top tier universities from private schools compared to state schools, that might explain some of the fascination.

75% of Oxbridge entrants come from state schools.

My children went to high-demand courses in top-tier universities with the (untutored) exam results and social skills gained at their rural state comprehensive.

75% of Oxbridge entrants come from state schools.

Not really. They likely have bigger/nicer houses, better quality furniture, more expensive holidays, better quality food etc. Or they live in more expensive parts of the UK and/or have massive mortgages. So they probably don't feel their salary is that high and in terms of percentages probably it's about the same percentage of income goes on the same range of things. Oh, probably they pay more into pensions and stuff like that. Isn't there a saying along the lines of expenditure rises to meet income?

I’m a high earner. Relatively.

This year my salary is 130k and I’ve got a 50k bonus. This is my top earning year ever, by a long way.

Next year bonus would not be so high as some of that was a sign on so I would expect to earn 130 + 20-30 bonus next year.

For the past 5 years my salary has been 85-95k and bonus amounts of around £25k but last year was zero because I left my role for a new job before bonus payment. Before that it was 65k for 2 years with a 10-20k bonus.

It’s nice. I don’t ever think about if I can afford to go out for dinner, or to book a holiday.

I have some savings, but not loads because I put everything into my house purchase 5 years ago.

I’m 36 and I have about 200k in my pension, which does not feel like enough, but this year I will contribute at least 40k. My new employer does 12% contributions and my old employer only did 4% so I was very happy with this move. I’ve always contributed at least 10% and generally pensioned half my bonus.

I have no dependents. I am not linked financially with my partner. I own my own house (300k mortgage, 600k value) and it’s a 3 bed ex council semi in a non fashionable part of zone 3. I expect to pay it back over the next 20 years.

I actually have a lodger who is with me Monday to Friday but I don’t feel like I need the money about more. If she left I wouldn’t get another one. The £500/month tax free is very nice tho!

My car is 13 years old. I give about £250 a month to charity. I obviously pay a fuck-ton to tax

I don’t see myself as ‘rich’. To me rich would be flying business class, buying designer clothes all the time, living in a much more expensive and nicer house, having a new car. Having fancy furniture and a new kitchen.

However, I do know that objectively I am very well off compared to most people.

I know that it is a huge privilege not to worry about needing to spend £1k+ on dental treatment. It’s not a problem when the car needs work. I don’t worry about the boiler breaking. If for example, I see and like a work dress I buy it.

Basically I spend a shit ton on holidays. Really big adventure sport holidays. Not luxury at all (think more expedition) but expensive. Probably run at 6k a year on holidays. 2022 might end up being nearer 10k as I have a big trip booked.

I know I could be more mindful with my spending. Like, I know it’s not financially savvy to spend £10 in pret when I’m at work. But I do.

I do work long hours but I also have a lot of flexibility and freedom to manage my own diary and time. The flip side is that if I am needed, I’m needed. I do frequently work 7am to 11pm.

I enjoy my work and feel valued. I’m head of department in finance (report to CFO) in a FTSE 250 company. ACA qualified. First class degree. Mix of private and state educated.

My work is not harder than being a nurse or teacher IMO. Maybe more intellectual (than eg nurse) or strategic (teacher) but 100% not harder.

I know I have a very nice life. I am super lucky to be living this way. Some of getting to where I am at work IS luck. Some of it is a result of planning, hard work and IQ.

My friends generally earn similar or more.

I don’t know what it is like to try and bring a family up on MWM grinding day in day out. And frankly that is not something I would ever have chosen to do.

I have chosen not to have children now - I like my job and life too much to (in my opinion) complicate it with children.

If I did have eg 2 kids my financial situation would not feel great at all - childcare is so expensive.

I would like to live in a nicer house in a nicer area but don’t have another income to share and have decided to prioritise life and pension over a 4K mortgage payment. I currently pay 2k mortgage.

I’m worried that if I got a bigger mortgage and I lost this job, I wouldn’t be able to find one at the same salary. My current mortgage was sized on my 65k salary so I feel comfortable with it.

100k isn't crazy money, its a lot and certainly comfortable but not insane. Not "gold plated" anything money.

What i find hard to comprehend are people who get 2 million pound bonuses.

Oh, and obviously I live in London. My role is highly specialised and is not available outside of a few world cities.

I'm just shy of the amount you mention OP, and DH is on a lot less than that but our combined household income looks very comfortable. We have two children - no private schooling for them as we would honestly really struggle to afford it. Nursery fees for the youngest of course, but that's pretty standard for any working family. We have two cars - one is 8yrs old Fiesta and a 2yr old bigger family car. We are lucky not to have car finance on them. Commute costs for me are quite expensive (petrol, train). We also have the usual after school club fees (childcare club) and our eldest has swimming lessons too.

We don't live in a big flash house. We have a very average 3bd semi with a £1,200pcm mortgage, and we prioritise overpaying it so we pay an extra £200 towards it each month. We live in the area we grew up in, but it is in SE so houses aren't cheap here at all. We'd love to get a bigger 4bd home so I could have an office as I WFH more now, but we can't easily afford it at the moment and we are always conscious of overstretching ourselves. We don't have a cleaner.

I guess I'm saying that whilst it sounds a lot of money... it's not always obvious and it doesn't always go too far. You wouldn't think we had much really. We try to save a few hundred a month and I'm extremely grateful to be able to do that and we'd always prioritise that (plus paying mortgage, debts) above buying flash cars and stuff. It's just not us.

The thing is it depends a lot on where you live and your lifestyle. DH and I went from earning £18k combined 15 years ago to £155k combined. We live inside the M25 so even in a 3 bed semi our mortgage is just under 20% of our take home pay and we overpay each month. We save/invest a fair amount too. We don't send our kids to private school and doubt we could afford it as it is £15k a year minimum per child. Cars are always second hand and holidays are usually in UK. We also pay a lot of tax! We are very comfortably off but not 'rich'. Nothing gold plated here!

75% of Oxbridge entrants come from state schools.

But 93% of children in the UK attend state schools.

So your odds of getting into Oxbridge are higher if you go to private school.

If mumsnet was 'dadsnet' the question would be 'how can I earn a huge salary'? Why are women expected to be non aspirational and have to apologise for / justify what they earn?

We have a high joint income (varies but last year over £300k) and significant assets. We recognise we're very fortunate and don't underestimate our privilege (especially me as I have been on benefits as a single mum in the past). We don't live a flashy lifestyle, but we can afford to live in zone 1 in London and we were able to clear the mortgage on our flat in less than a decade, and we can send DD to an expensive Montessori nursery even though we don't need the childcare. We don't have high outgoings as we don't need a car in central London, and running costs on our small flat are low. We don't spend much on clothes or grooming, but we can pay for expensive days out (and holidays, although in the past 2 years they've been simple UK hols) without thinking about it. We never have to budget for repairs or replacement household items, there's always enough in the pot. So we're able to squirrel away a lot of money into investments, we max out pensions and ISAs and still have lots left to save/invest. A lot of our income is just excess and we don't really hang out with other high earners, so no pressure to keep up a certain lifestyle. Our dcs will be going to private school though and we'll be moving to a bigger house so our outgoings will increase, but we realise that's a choice and not a necessity. I don't think we'd have opted for private if it meant having to sacrifice other aspects of our lifestyle.

Im on 25K and run a part time food bank voluntarily. I make good of the money I earn and don't splash it around, mainly because I can't but if I could I would give more to the needy, god bless

@CSJobseeker

If you are self employed and you price your work based on the risk to which it exposes you then yes they are

My point has sailed over your head, hasn't it? You personally get paid a lot because if you mess up there will be consequences.

For most people, that doesn't apply.

No it hasn’t at all but thanks for patronising. Implications of mistakes can be death indirectly or directly. For example if a FTSE100 company collapses and that means millions of people’s invested pensions are worthless, thousands of people lose their jobs and 100 of those people commit suicide as a result of their financial and emotional distress, is that more or less risk than a nurse injecting an incorrect dose and killing one person? Does a CEO of a global pharma business that produces a drug that turns out in time to have serious side effects leading to hundreds of thousands of deaths have less risk than a nurse?

The nurse or doctor or lorry driver or outward bounds instructor are the easy examples because the jobs are reasonably well understood by the general public and the mistakes of individuals usually have immediate consequences - but typically on a small number of people.

I personally earn (not an employee, am self employed so 100% of my income is variable and I also have capital at risk) in line with the risks I take on, yes. Does everybody, no. But in my view your analogy is naïve.