..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?

We do and certainly don’t feel rich!
None of our 4 children are in private education either.
2 eldest now work at McDonald’s to earn their own money and pay for their own driving lessons too.
We do have a large 5 bedroom house in east of England with beautiful views, but mortgage is £1700 pcm and of course costs a fair bit each year to maintain also.
Nothing inside is ultra fancy, just modern.
We both have new cars every 3years and go on 1/2 holidays a year but nothing extravagant at all.
Our tax payments to HMRC each year are huge!
I would say though, if a large purchase needed to be made such as car broke down or boiler needed replacing we would just go ahead and do it. Wouldn’t need to worry about where money was coming from in order to pay for it.
My husband is a snob with food shop though, whereas I couldn’t give two hoots.
I know people who earn less than half of our income who seem to splash cash like no tomorrow, perhaps it’s all for show, inherited or all on tick. We are not like that at all.
I hate being flash.

Trust me…most of that will go on the mortgage!

My wife and I are both on that sort of salary and we earn it. At that level, the responsibilities are huge and transcend evenings, weekends, and even holidays…very few (if anyone) is on that sort of salary for sitting around stress-free.

Of course we are madly privileged. However, we don’t have the security of inherited housing/inherited wealth/ family connections to cushion us.

People really do overlook this, a friend works very p/t as a music teacher. Lives in a mortgage free 1m pound property through early help from parents.

I think if you earn a lot above average you ought to give some thought to ensuring it doesnt all stop straight away! There must be a point where you can turn earned cash into assets as well and build some actual wealth.

Dont high earners pay loads of tax and therefore by implication subsidise/give to those less fortunate than them? Once you get into the 100+k income bracket I cant imagine you are using up that level of taxation as benefits.

@ibblebibbledibble

Lol at people explaining tax to the paupers like it’s a completely unknown thing 🤣🤣

No, but it is very surprising how much of a difference it makes which may not be so apparent to a lower earner. I once took a career break and earnt £25k a year which was pro rated as I only worked 4 days. I took home about £1750. I then went on to get another job earning £43k full time and I took home about £2500 a month, I now earn approx £60k and my take home is £3400 full time. The amount of take home home pay in all those instances does not seem to jump in the same way the salary level does due to the higher tax bracket.

@CSJobseeker

I fully agree re: income vs wealth - the truly rich in this country (e.g. Dukes who own half of London through inheritance) pay very little tax as the wealth is in trusts etc.

But this:

But when DH stops working it all stops.

You know that's normal, don't you? If you work for a living, the income stops when you no longer work, whether you earned £20k or £200k.

@CSJobseeker - of course I know its normal for income to stop when you stop work.

I’m pushing back against ‘othering’ people on top tax bands.

Of course money matters - but still more unites us than divides us in terms of worries and pressures.

The ‘us and them’ mindset is damaging in both directions. People on low incomes thinking that high income people are invulnerable - and people on high incomes feeling separate from wider society.

We’re on six figures.

We don’t ever spend what we earn. I literally live on the smallest amount possible and put the lot in savings.

Our mortgage is tiny. Much smaller I’m sure than most peoples. We don’t have New cars. We don’t have two cars even. We don’t send our kids to private school. We have cheapest phones. Bills. Outgoings.

Occasionally we go on holiday. But we don’t splurge.

I grew up homeless. With no food. So I can’t justify spending it all for no reason. I give lots away to charities and I also help many homeless charities and domestic woman’s charities.

If it wasn’t for someone helping me at my lowest. I wouldn’t be here. So I made it my life’s goal to help others like that person helped me.

I don't think anyone has been 'othering' those on higher tax bands. I certainly haven't felt that, and I've said upthread we're a high income household.

I went to private school and earn a much lower amount than my husband who went to a state school the one doesn’t necessarily flow from the other. Bit of a derail though. Extra money we have goes into paying a mortgage on a small second property we bought to support a family member and pension contributions.

@Libertaire

You do realise that the government takes 40% of everything you earn over £50k in income tax, and that a gross salary of £100k equates to take-home pay of around £5500 per month, don’t you?

That’s a decent salary, particularly if your other half also works and you don’t live in London, but it’s by no means rich.

I love the way you imply 'it's only £5500'!

Seriously, that's still loads.

My boss a builder. On big salary according to his PA. I would imagine alot goes on tax though. It would be lovely not having worry about a mechanic bill or a broken wash machine. I remember my car needed big work one xmas I could have cried. 600 euros

Absolutely know what you're saying, and I say that as someone who posted in that thread and fits the 6 figure benchmark. Coming from a family that really struggled I feel grateful nearly every bloody day and on those I don't I try to focus on gratitude when I can.

What does it go on? More expensive house, more expensive holidays/hobbies and (for some) school fees or childcare help given you're needed in the office for such long hours... well, not "needed" as covid has shown with WFH working but working for senior mostly men you need to be present all the time to show off just how big your bollocks (or tits in our case) are and "justify" the salary etc etc . Honestly though I don't personally want the mega house and over the top holidays so I'm trying trying take a middle ground wirh nice enough life and then saving as much as I can from my pension so I can get out or towards something more fulfilling early.

There's also always another level. We live in London and there's billionaires and inherited trust fund kids swanning around everywhere with way more without ever working... all relative. Best not to compare too much or I try to remind myself!

As I said in my other post it doesn't fix everything though, some serious shit has gone on in both our lives that will never be fixed with money. It isn't everything. But it's nice and I'm very grateful for that part of my life.

There must be a point where you can turn earned cash into assets as well and build some actual wealth.

It's pretty difficult for someone who has no help onto the property ladder & has childcare costs to build wealth. My inlaws home was 60k in the 80s, would sell for 1.8m today. Those days are gone.

We are in this category, husband earns c100k and I earn c60k. We live in South East London in a nice victorian terrace. It's a decent size but shabby (gradually decorating over the last 11 years but not got far as we're quite lazy). Our car is 14 years old and we will keep it for another year or two I think (bought second hand 8 years ago). Pre pandemic we'd have 1 foreign hol per year, pre term-time hols we'd have 2. Rarely buy clothes, shop in sainsburys. We save a lot. We have a cleaner. And we have zero debt except for mortgage. I think nowadays being debt free is quite a luxury - we are able to save up for things we want relatively quickly so no need to borrow, ever. If the boiler breaks we can get a new one, if we want to go on holiday we don't have to pay in installments or pay it off later. We could live a much more lavish lifestyle if we used credit cards but we're fairly sensible and boring with our money. But very fortunate.

I think that often people who are on very high incomes have seen an increase over a number of years. They might have always been decently paid, but a couple of breaks led their incomes to jump. It rarely all happens in one go.

People start as 20 somethings probably renting and being a bit strapped for cash. Yes, some 20s are in a much stronger position….their families have money and have supported them and the individuals have good qualifications and earning potential, but most 20s start in rented and watching their cash.

And they the gap develops. It can be that people tea, up and make a couple…..2 earning potentials. They get professional qualifications and see promotions. They buy a flat or a small house. They go out and eat and holiday to reflect their income.

And then there are a couple of promotions. So they can borrow more and get a bigger house. And they go out and eat and holiday to reflect their income.

And then there’s another promotion and house prices have risen boosting the equity in their property. So they borrow more and get a bigger house and go out and eat and holiday to reflect their income…and spend on a couple of other things too.

Most people with bigger incomes are spending on the same things as those in low incomes. It’s just they spend much more. They spend huge amounts on housing, on food, on going out, on holidays. They might have some extra expenses they choose like school fees or an expensive hobby, but most of it is just spending more on the things everyone buys.

So many well off people don’t feel well off. They still have housing to pay for and food and leisure. Their choices cost more and many are as skint at the end of the month as those much poorer. Some will also be saving lots or adding to their pensions. Lots of high earners out surprisingly little into these.

On one level,yes it’s another world. On another level, it’s exactly the same world of paying for housing and food and leisure….but spending far more on each thing.

@bumbleymummy

Tax, NI, Student loan repayments, mortgage, school fees, childcare, cars - tax, insurance, diesel, transport costs, food, utilities. It all adds up.

You realise that, other than the school fees, those of us on £30k have to pay all those things too? And yes, it DOES all add up.

@ittakes2

I am guessing you don't have children. Just take a look at the cost of childcare, or braces or therapy fees if your child needs these - that will tell you where all the money goes.

People on low wages have to pay childcare too. And their kids might also need braces or therapy. How do you imagine they pay for it?

@WombatChocolate

I think that often people who are on very high incomes have seen an increase over a number of years. They might have always been decently paid, but a couple of breaks led their incomes to jump. It rarely all happens in one go.

People start as 20 somethings probably renting and being a bit strapped for cash. Yes, some 20s are in a much stronger position….their families have money and have supported them and the individuals have good qualifications and earning potential, but most 20s start in rented and watching their cash.

And they the gap develops. It can be that people tea, up and make a couple…..2 earning potentials. They get professional qualifications and see promotions. They buy a flat or a small house. They go out and eat and holiday to reflect their income.

And then there are a couple of promotions. So they can borrow more and get a bigger house. And they go out and eat and holiday to reflect their income.

And then there’s another promotion and house prices have risen boosting the equity in their property. So they borrow more and get a bigger house and go out and eat and holiday to reflect their income…and spend on a couple of other things too.

Most people with bigger incomes are spending on the same things as those in low incomes. It’s just they spend much more. They spend huge amounts on housing, on food, on going out, on holidays. They might have some extra expenses they choose like school fees or an expensive hobby, but most of it is just spending more on the things everyone buys.

So many well off people don’t feel well off. They still have housing to pay for and food and leisure. Their choices cost more and many are as skint at the end of the month as those much poorer. Some will also be saving lots or adding to their pensions. Lots of high earners out surprisingly little into these.

On one level,yes it’s another world. On another level, it’s exactly the same world of paying for housing and food and leisure….but spending far more on each thing.

I never thought of it like that but breaking it down into its simplest form it really makes a lot of sense

@InSpaceNooneCanHearYouScream

I've read most of the thread, and the thing I'm most shocked by is that out of ALL the posters who admit to earning huge salaries, NOT ONE mentions using any of it to help those less fortunate than themselves. No wonder society is fucked and the rich just keep getting richer

Several have, actually. You can't have read carefully. One of them clearly extremely generous, explains that it's because she grew up in very different circumstances and wants to help others reach their potential.

Some of these replies leave me speechless. Saying how little money they have when actually they have incredible amounts of money and are choosing to spend it.
We have income of less than £2k per month (by quite a lot). By the time the bills have gone out, we really have very little left over. To the point of me doing the weekly shop and comparing prices of everything, keeping a running total to make sure we don't go over the weekly budget for food etc.
And I still wouldn't say we were poor. We live in a lovely house, the children do a couple of activities a week, they get new clothes when required. We just budget carefully.
People complaining that they get taxed, well yeah, coz you have so much more money than you need! We get taxed too 🙄 on another planet.

As Wombat says income increases tend to come over time. I started on £6250 a year as a trainee lawyer in 1983 (which £20k in today's money and those in that job today are paid about double what I was paid in real terms). I have not had a break from full time work even for babies since 1983. So a lot of us with a fairly high income now have in the past not always had that high an income although I accept that even £20k, the equivalent of my starting salary, is above the minimum wage (although only just).

Earning a lot gives women choices and I would much rather have the occasional mumsnetter being jealous of higher earners than not have the money.,

I will agree that not having any debt (apart from mortgage) & having savings is a privileged position.

@balonsz but even my MIL who has never earned more than 16k has savings and no debt apart from mortgage.... Even my SIL who was on UC and is in her 20s has savings (she used to get housing benefit to pay for her room) and she has no debt apart from student loan debt.

It's a funny thing that people will fall over themselves to say that £100k isn't a huge salary and it's really quite standard, nothing to write home about, whilst simultaneously saying that it takes a special type of graft to earn that much and not many people have it in them. It really can't be both.

In any case, I think it's a fantastic salary and whilst I'm unlikely to earn it myself, I really couldn't care less if someone else does. I've been told on mumsnet before that we're a low earning household (about 50k at that stage, although it's quite a bit more now). But I certainly don't feel poor, I have disposable income and savings. If I started comparing myself with massively high earners though, of course I'd feel poor.