..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?

It’s very easily spent. I’m on over $125k but pay less than 9% tax as taxes are lower here and I live in a state with no income tax. So I clear around $10k s month. My first job after university paid £8500k a year.

I’ve been in the same industry for 22 years and not taken a break (was not able to have children) and I feel my hard work at university and in my career has been rewarded.

It is all relative. We currently get about 5,500 per.month. mortgage of 1400 (small 3 bed in city) childcare of 1200, bills of 700 per month (gas elec tv insurance tax etc) food bill for family of 5 prob 600 per month. Car loan 250 per month. Pension to be paid etc. Not that much left over at end of month. And that goes towards a holiday, Christmas , car service, boiler service, meals out etc

@hemhem

Being a high earner doesn't happen overnight and often comes through experiencing poverty or low income in childhood which drives you relentlessly to break out of that.

I feel thankful that I could get out of the trap my mother fell into. She gave up her job as soon as she fell pregnant back in the 70s and relied on my dad's modest income for the whole family. We got by growing up but nothing more. She has hardly any state pension now.

As a result money has been a big motivating factor in my choice of job. I've worked 50-60hour weeks for 20+ years and did 7 years worth of professional exams to get where I am now. If I hadn't been motivated by money I might have chosen a different path, who knows.

@hemhem I could have written exactly this about my childhood and my mum. Earning good money was a big career driver for me as a result. Not because of a desire to live a life of luxury but because growing up only just surviving financially, getting no parental support and not having any kind of safety net at all was not what I wanted for my future or my children. Seeing my mum struggle in later life having never had any financial independence is awful.

Most people I know have household incomes of over £100k so I think we have a tendency to normalise it and feel we live a pretty ordinary life, Oddly my kids didn’t realise we were well off till we bought a Tesla - before that we had to driving a 10 year old Polo. All their friends parents had very flashy cars, we never felt the need.

Sure the taxman takes a lot of what we earn - we’re very aware of how lucky we are to be in that position and would not be so crass as to complain about it. In fact I have never heard any of my friends complain about having to pay tax, it just seems wrong.

Due to a specific set of circumstances we are probably on the equivalent of about 300k in the UK for a few years. I used to be very worried about money at home, but have definitely noticed my habits creeping up in terms of spending more and thinking less about spending decisions.

Income on assets (especially inherited) is the secret hidden factor.

Those asking if higher earners know what it's like to earn MW.

Yes some of us do. I grew up poor and got a job straight from school but realised after many years struggling with three jobs that the only way to be comfortable financially was to retrain in a field where I could make more money.

Not struggling financially was a big motivator for me in the early days. I am now happy with what I have and haven't chased promotions or more money as I didn't want the extra stress. Looking to retire in the next 4 years early because of the choice I made to go to university as a mature adult which many people tried to put me off saying I was too stupid or wouldn't earn any money doing that type of job. Fortunately I was too stubborn to listen to them.

Btw I am not complaining about paying tax, but this post asked what happened to the money and the answer is that a large chunk of it goes to the tax man!

Again, I ask the Q of what people would need to feel well-off.

Another person has said their take home pay if £6.5k doesn’t put them in ‘rich’ territory. I understand their point that they might not have loads left at the end of the month, but they are in the top 7% of the country. Do people need to be in the top 1% before they are going to be able to say they are well -off, and to know that 99% have less than them? Is it simply that everyone always feels they need more, and most are unable to develop a relative sense of how they are doing, or appreciate the fact that over 90% have less than them, so that must say something, about how well off they actually are, even if it feels it all goes.

Lots of people seem to miss the point that although their money is gone by the end of the month, it has gone on things which are choices and thinks which are building them wealth for the future….property assets as wealth, and things like holidays and eating out which are lovely but not essentials. It’s very different from having no money at the end the end of the month and the little you had which has been spent has all gone onto things which will not financially benefit you in future (property assets, savings, pensions) and where there was pretty much zero choice about spending, oerhaos beyond the fuel poverty choices of whether to have food OR heat some days. It’s not the same ‘run out of money at the end of the month’ at all.

I know I’m bloody fortunate. I have enough money to pay for my housing, to load my trolley without calculating the total, to have some leisure and to out some into savings and pensions. Yes, I’ve worked hard and made some sacrifices along the way, and I don’t have amounts of money so I can buy expensive new cars every year or go on extensive long haul holidays multiple times a year…but I don’t expect to do those things or need to, in order to feel rich. I know I’m very comfortable and that I have more money than the vast vast majority of people in this country and in itself, regardless of whether I feel I can afford everything I like, I objectively am very well off.

@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.

5500 a MONTH??!!!! WOW. That is very rich to me and millions of others. Most people can only dream of earning that amount of money.

@Sciurus83

There are lots of rich people on here with massive salaries who think they're "average", can all be a bit of a self fulfilling prophecy when they get together. I would guess big houses in expensive areas and school fees. Only 7% of people are privately educated, but there are a lot of private parents on here.

Yes, this is true.. MN is full of them.

DH and I earn over £300k p/a between us. We started out pretty "normal" with him being on a £40k salary and me on a £22k salary. That was 12 years ago. When all the children were in school
We started our own business as a specialist in the construction industry.
We have been very successful but it hasn't been without it's bad times. We have a very large old house, with land. We drive great cars and all 4 kids go to private school.
However it's like a massive gamble all the time keeping it going and often we wonder if it will all come crashing down one day. It would only take someone to have an accident at work and we could lose everything. So we make hay while the sun shines as they say.
Oldest kids are now at uni and once they've all gone I think we might sell the big family home and downsize to something more manageable.

We were definitely happiest about 10 years ago, living in a little cottage when the kids were small and the stress levels not so high. I sometimes feel like we've created a monster. We don't even get to go on holiday much as we have to take care of the business the whole time.

@FitAt50

Some really well paid people don't have it that hard. I book locum consultants for the nhs and have some are on £6000 a week and that's mon-fri 8-4 with a paid lunch hour. Many of them also get £1000 a month on top of that towards accomodation cost. Money goes to money.

The thing is if their job was that easy we would all be able to do it, which would bring down the rate of pay. To become a locum consultant they will have had to go through seven years of medical school, been a junior doctor working 80+ hours a week, then maybe another decade or two of additional training and experience to finally get there. In that role they are paid that level of renumeration because there is a finite pool of highly skilled, highly capable people.

This is what I don't get about the resentment on this thread, so many people do not realise that high income usually results from hard work, making the right, but sometimes hard choices and yes some element of luck. Some of the resentful seem to have the opinion that high earning just somehow happens, with no effort or planning by the high earner. Those roles are not assigned by lottery, they seem to hold an attitude that we were somehow gifted those jobs to spite them and are somehow holding them back from doing the same.

@inawe

It's all relative. As PPs have said, higher income, higher outgoings. A friend of mine who is a solicitor worked for a large firm that during the 2008/9 financial crisis made 80 admin staff and 20 solicitors redundant. They then asked for senior staff to take six weeks unpaid leave staggered over the next year, to avoid more redundancies. My friend said it was staggering the number of highly paid staff who could not cope with any sort of pay cut because of the high month-on-month cost of financing their lifestyle - huge mortgage, school fees, extra-curricular activities, expensive leased cars. They were spending every penny of their high salaries - a surprising number had no savings.

Hmm I'd suspect many of the senior staff WOULDN'T take unpaid leave, not COULDN'T

Why take a pay cut if you have staff lower than you in the pecking order. Let them suffer instead.

I'm on nearly 100k and future trajectory suggests that will increase in time. Tbh it feels like a lot to me as I had a very modest upbringing but I'm not living what I would call a rich life (and I'm not ignoring my privilege I just mean compared to my working class background). I live in a smaller house, I drive a 10 year old car, I dont go on lavish holidays and I dont wear designer clothes.

I do get my hair done relatively regularly which costs £50 and I overpay my mortgage. So those are huge privileges to me. I also put a lot into my pension - mainly because I'm catching up from the days I couldn't afford to put anything in at all. Though I dont take lavish holidays, I am able to take quite a few weeks off work and do caravan breaks or hotel weekends away. I dont have to look at prices in the supermarket and I can have nice coffee from coffee shops.

I also try to do good things. I support local businesses (in the sense I will get food or buy items i wouldn't actually get but I'm doing it to support), I pay quite a bit to charities throughout the year and in random acts of kindness. I guess quite a bit goes on that if I added it up.

I also save - I am self employed so constantly worried that I could lose it all especially with covid. And my husband doesn't earn anywhere near the same and has been ill so I'm also being cautious incase he needed to cut hours or retire early. So that is a privilege in that I'm able to prepare better for the possibility of things like that so we wouldn't necessarily lose our home.

I think we DO know a lot of money goes on choices such as a choice to live in a specific place or with more bed rooms than needed. I know my needs rather than wants and I have done remote camping abroad in jungles and know you need water first, then food, then shelter. There are few needs more than that.

Like many on the thread I have worked full time since 1983 (38 years) without a break even for babies (I took 2 weeks of annual leave for those and went back full time) and I started on £6250. I don't disclose my current income. I work for myself as a lawyer in London and will work until I die (I hope).

I don't think the less well off do think it is all down to luck if you do well. It is also informed choices too. We were not poor as children but my pocket money in the sixth form was 35 pence (much less than anyone I knew in the class) and I did all sorts as a teen to try to earn money including teaching myself to type from a library book and typing a 50,000 book each year (none were ever published nor made any money in my teens) and tried to get paid writing. I worked as a domestic assistant in sixth form and then some university holidays (ie cleaning and food preparation) and was very focussed on how to make a career in law from age 14. I graduated a teetotal virgin but had won a scholarship to university to read law (3 x 3 hours of competitive examinations sat which the school and my family did not tell me about - I looked it up - very hard in days before the internet and put myself in for). I didn't get drunk in year 1 and was top of year etc etc. I applied to 139 law firms in my last year and had 25 interviews before getting my first law job. Many people would give up after 10 applications, not 139. It was 1982 - the worst year for unemployment in FIFTY years - 3 m out of work much worse than now.

Loads of people who do not earn much work very hard of course. However if you want your daughters to be high earners do make sure they make informed choices as some careers now and even in the 1890s were low paid and some high and even if an idealistic teenager hates the idea of earning a lot of money when they come to be buying clothes for their children and their teenagers want nice trainers they might wish that at age 15 they had made different choices about careers.

@WombatChocolate

Again, I ask the Q of what people would need to feel well-off.

Another person has said their take home pay if £6.5k doesn’t put them in ‘rich’ territory. I understand their point that they might not have loads left at the end of the month, but they are in the top 7% of the country. Do people need to be in the top 1% before they are going to be able to say they are well -off, and to know that 99% have less than them? Is it simply that everyone always feels they need more, and most are unable to develop a relative sense of how they are doing, or appreciate the fact that over 90% have less than them, so that must say something, about how well off they actually are, even if it feels it all goes.

Lots of people seem to miss the point that although their money is gone by the end of the month, it has gone on things which are choices and thinks which are building them wealth for the future….property assets as wealth, and things like holidays and eating out which are lovely but not essentials. It’s very different from having no money at the end the end of the month and the little you had which has been spent has all gone onto things which will not financially benefit you in future (property assets, savings, pensions) and where there was pretty much zero choice about spending, oerhaos beyond the fuel poverty choices of whether to have food OR heat some days. It’s not the same ‘run out of money at the end of the month’ at all.

I know I’m bloody fortunate. I have enough money to pay for my housing, to load my trolley without calculating the total, to have some leisure and to out some into savings and pensions. Yes, I’ve worked hard and made some sacrifices along the way, and I don’t have amounts of money so I can buy expensive new cars every year or go on extensive long haul holidays multiple times a year…but I don’t expect to do those things or need to, in order to feel rich. I know I’m very comfortable and that I have more money than the vast vast majority of people in this country and in itself, regardless of whether I feel I can afford everything I like, I objectively am very well off.

For comparative purposes how well off they are nationally is largely an irrelevance, if they live in Virginia Water they are not comparing themselves to people in Staines, if they live in Aldley Edge they are not comparing themselves to people in Knowsly. They will be comparing themselves to people they live near to and people they work with, possibly comparing themselves to people in the media who we are told are rich, Bezos, Musk, Gates etc. Also I don't think that any of those on £100k have said that they are not well off, but they disagree that they are rich, many see rich as not needing to work, jets, yachts, multiple homes on multiple continents etc.

I think most people get that a large amount of their spending is elective, but the other side of that seems to be that some lower earners do not understand how that money is spent without buying things that are "gold plated", or by deliberately wasting it. Having a high income dose give one a lot of choices, it does provide a safety net and it does make some things easier, but it is not a limitless resource.

I realise that my husband and I are in a great position, but we did not get to 18 and suddenly earn six figures, we studied, worked minimum wage jobs to fund ourselves, worked lower paid jobs to gain experience and worked evenings and weekends to keep a roof over our heads, only in our thirties did we go from average incomes to good incomes. We worked hard, made good decisions and yes, we were also lucky, with the element of luck being our health.

I recognise that I have an income most will never reach, but I don't understand why people would resent someone for doing well in life either.

This thread is so frustrating, the Op said she couldn't imagine what it would be like. So people came and explained what it was like. And now they are being criticized for being honest that whilst lots of options are open (bigger houses, school fees, savings) on 100-200k it isn't a life of endless gold plated luxury.

I don't think anyone is in doubt that it is the higher salary that enabled them to make decisions like bigger house/lots of hobbies/private school. They are just answering the question the op posed.

It also doesn't mean people saying the options arent boundless are bad with money, quite the contrary I would have thought. Most people on 100-200k are clearly quite aware that one choice precludes another choice

@MatildaIThink also a lot of people are again comparing high earning to NMW as though only two categories exist.

@KeyboardWorriers

This thread is so frustrating, the Op said she couldn't imagine what it would be like. So people came and explained what it was like. And now they are being criticized for being honest that whilst lots of options are open (bigger houses, school fees, savings) on 100-200k it isn't a life of endless gold plated luxury.

I don't think anyone is in doubt that it is the higher salary that enabled them to make decisions like bigger house/lots of hobbies/private school. They are just answering the question the op posed.

I think the OP hates high earners actually and started the thread for a bun fight. She hasn’t been back. Congratulations OP

@WombatChocolate

Again, I ask the Q of what people would need to feel well-off.

Another person has said their take home pay if £6.5k doesn’t put them in ‘rich’ territory. I understand their point that they might not have loads left at the end of the month, but they are in the top 7% of the country. Do people need to be in the top 1% before they are going to be able to say they are well -off, and to know that 99% have less than them? Is it simply that everyone always feels they need more, and most are unable to develop a relative sense of how they are doing, or appreciate the fact that over 90% have less than them, so that must say something, about how well off they actually are, even if it feels it all goes.

Lots of people seem to miss the point that although their money is gone by the end of the month, it has gone on things which are choices and thinks which are building them wealth for the future….property assets as wealth, and things like holidays and eating out which are lovely but not essentials. It’s very different from having no money at the end the end of the month and the little you had which has been spent has all gone onto things which will not financially benefit you in future (property assets, savings, pensions) and where there was pretty much zero choice about spending, oerhaos beyond the fuel poverty choices of whether to have food OR heat some days. It’s not the same ‘run out of money at the end of the month’ at all.

I know I’m bloody fortunate. I have enough money to pay for my housing, to load my trolley without calculating the total, to have some leisure and to out some into savings and pensions. Yes, I’ve worked hard and made some sacrifices along the way, and I don’t have amounts of money so I can buy expensive new cars every year or go on extensive long haul holidays multiple times a year…but I don’t expect to do those things or need to, in order to feel rich. I know I’m very comfortable and that I have more money than the vast vast majority of people in this country and in itself, regardless of whether I feel I can afford everything I like, I objectively am very well off.

To me well off and rich are different things. Well off is me. I am well off. I am very very privileged. I never ever dreamed of earning 40k let alone more. I remember saying to someone I would be thrilled and feel very successful and comfortable if I reached 50k and no more in my profession (but person I was speaking to who was from very privileged background genuinely said they'd be devastated which shows how its all relative). I have friends who are or have been on benefits and most who work have very average or below national average salaries. So by no means do I not recognise how lucky I am.

However rich for me would be being able to fly business or first class, buy designer clothes exclusively if you wanted to, dine in the most expensive places, have a brand new car paid for not leased, have a very large house, afford private schooling for children and all that jazz. I am nowhere near that. Though my income is in the top %s I am nowhere near that bracket. And to be fair what I consider to be rich is the same as what I would've considered rich as a young working class state school kid too so I don't think that's changed. What has changed is that since I've gotten more access into my profession and seen what people earn I've realised just what sort of income is accessible to people who aren't rich. I hadnt really realised just how much is available or how many people attained it in the middle classes. I was considered posh as a kid because I lived in a very modest semi detached and went on holidays (by booking last minute through teletext room on allocation whatever was cheapest)

I understand their point that they might not have loads left at the end of the month, but they are in the top 7% of the country

Is that top 7% of income tax payers?

@BarbaraofSeville

People earning over 100k, what on earth do they even do with that money

Well if this thread is anything to go by, you spend all of it on the gold plated version of everything, convince yourself that you aren't taking the expensive option at every turn and remain oblivious that you lead a life that is completely unattainable to the majority and fail to realise that massive mortgages, nannies, £50 a night babysitters, pension overpayments, buying property in London, school fees etc etc are massive luxuries to the majority not normal things that have no choice but to spend your money on.

Absolutely. What I have realised is that MN is full of rich smug people who rationalise why they can't possibly be rich smug people. It is like a private club. It is quite depressing and illustrates perfectly the huge chasm in our society between the rich ( oh sorry, you're not rich, you have a large mortgage/fuel bills on your period House and your kids private schools fees, not forgetting their various activities/clubs and childminders fees to pay and all the rest..) and the rest of us ( probably about 1% of MN users ) that probably will not be able to afford to even have a Family despite working hard, achieving all manner of qualifications from excellent universities and struggling just to get by. What I can't stand is all the denying and constant justification of privilege and wealth. All the 'Yes, but blah blah blah..." Just horrible.

@MatildaIThink That's not always the case though. I've worked with plenty of high earning senior managers who are at best average at their jobs but they can talk the talk, have the right accent (posh) and the confidence. They're seen as "right for the job" because of that, even though they've made terrible decisions that have put the company in disarray. It genuinely baffles me how they've got to where they are, and got ahead of others who are much more skilled than them but don't have the "polished" private school confidence.

It boggles my mind too. I just started a new job on around £50k and I’m pinching myself. However I’m early forties, grew up skint and have wirked bloody hard; so much so that I imagine anyone earning over £100k has a lot of stress and works their butt off. Its not for everyone. However I’m a single mum and terrified of being poor so its worth it for me! Can I ask at what age people got to earning £100k per year?