To think if you are a family of 4 and struggling on £100k…

[LetMeSpeak]

That it is purely down to mismanagement.

I saw a debate on social media and I also know a few people on 6 figure salaries, have extremely nice houses and cars. Yet complain that they are stuggling the same way others with less money. Aibu to think if you are really struggling even in this economy, a lot of it is due to mismanagement with your money?

We are a family of 4 on 100k. Up until recently we were comfortable. Would you like to know how much our mortgage and bills are increasing ? Mortgage is going up by £900 per month and energy by £350 per month. We live quite frugally but we are definitely feeling the pinch!

To not go into too much detail. The family I’m talking about have a large 5 bedroom house, kids go to independent schools and have 2 german SUVs for a family of 4.

DH's job is relatively high paying, but it is very niche located in a very expensive part of the country. He commutes an hour to work because we can't afford to live in the city where he works, so we can't really go any further out. In a terraced rental. Our car is 10+ years old. We don't have Sky. Nursery is expensive and no subsidies or benefits. No holidays for the past 2 years. Our outgoings are as low as we can realistically make them. Not our fault it's expensive here!

@LetMeSpeak I have a 3 bed semi. 2 rooms downstairs, 2 doubles a box room and a bathroom downstairs. About 90sqm. House prices and interest rate rises mean we’d be paying the same amount each month for a 2 bed terrace now. We will have to consider it when our mortgage ends. It’s not as simple as saying downsize. Especially not in the SE.

Because that's what they see and hear

Go on property here abs suggest making do with a small , cheap estate , north facing semi when you could buy a large expensive detached period property with south facing grounds. - you would be usually told you are nuts to consider the semi

If someone has a SAHP and a £2k mortgage and a £100k salary as the original tweet says that doesn’t make them not wealthy. They ARE wealthy because they can afford those things in the first place! My partner can’t stop working and no one would give me a mortgage that high becsuse I am NOT wealthy.

You can’t choose the cost of childcare for example and as a high earner don’t get any help towards this or child benefit. With 2 in nursery you can easily be paying £2.5-3k per month in London and the same on a mortgage to live in a run down terrace in a not very nice area (speaking from experience here!).

Our joint income is similar, well it will be when my husbands adoption leave ends. We live in North London, we don’t have to budget carefully, we generally buy what we like and holiday where we like, we have a cleaner, we still have enough left to put into our savings each month. If we lived somewhere cheaper we would most definitely be able to live a life of luxury.

What you’ve done there is picked the opposite stereotype of the “all people on benefits have sky tv and smoke” and assumed all high earners are like that. It’s not how life works for either end of the pay scale.

50k income per person means 3k per month after tax. If you have to pay for childcare and half the mortgage, that's really very little money. I could make more money in my home country in central Europe where my living costs would be a fifth of what they are in the UK. That's really not a good income for the UK, sorry to disappoint you there.

I never said all. I was giving an example of a family I know.

Someone I used to work with went to run a foodbank- she told me that a good half of people coming to her were those that drove brand new cars and lived in big houses. Their outgoings were just so much larger than other people so all it needed was one "hiccup" (ie wife off sick from work on no pay for a few weeks) and they would be massively struggling. (This is going back a few years now but I'm using that anecdote as an example)

Tbf for anyone who didn't buy years ago/doesn't have family help, housing costs & childcare can eat into a decent income.

But pulling the kids out of a fee paying school (when the penalty can be paying for the rest of the year anyway), trading in a car (that could be in negative equity depending on finance routes) or selling up a house (paying for stamp duty / movers / fees etc) aren't quick or easy solutions to cut their expenses?

They've got those things because they could afford them at the time. Now that interest rates are skyrocketing, bills are too and life is just getting way more expensive it takes time for people to be able to make adjustments to help themselves out. It's easy to judge from the outside, but making decisions when you can afford something vs a global recession impacting everyone is hardly gross mismanagement of finances imo.

We earn around £70K a year between us, live in a VERY cheap area (our mortgage is £450 a month for example) and both have a short commute to work. Childcare bill is less than £150 a month..
We are really counting the pennies and we are worried about putting the heating etc on this winter… I can’t imagine having a mortgage 3 or 4x what ours is even on 100K a year.

True, there are some fixed costs that can’t be reduced. The point I am trying to make is that lifestyle creep as salaries rise can be avoided.

Only on MN would £6k a month be considered a poor income.

Also, a mortgage is paying for a fixed asset. It’s wealth converting into more wealth.

If you have made choices you can't afford, you can be "struggling" on any income.

Can't help but to feel "struggling" on £100k must be a lot nicer than struggling on £29k, the UK's median household income.

My neighbour to the left is a retired nurse, bought over 40 yrs ago for less than 30k, mortgage free has 2 BTL.

Neighbour to the right, doctor & midwife with 2 dc, paying nearly 3k in rent.

We have a joint income of just over £100k and we are incredibly lucky to have expendable income. But that's all it is luck and timing.

DD is at school now so no childcare fees.

We bought our property in 2014. It cost £270k... that same house now cost over £400,000

We remortgaged last year before the rates really started to increase and have a mortgage rate of 1.39%
Some one moving now is paying over 3%

We looked at moving to a slightly bigger house recently. We both WFH and I'm currently working in the kitchen so would love to have a 4th bedroom for an office. But a property with 4 beds would almost double our monthly mortgage! And that's not for some fancy mini mansion.
That's for a 4 bed semi detached property.

So yes I could see how someone on £100k salary could struggle. If you have a couple of kids in child care, and a higher mortgage rate it all adds up!

I also think there needs to be more talk about student loan payments in this cost of living crisis. and pension deductions

I really hate this on Mumsnet where people suggest those with big mortgages should just downsize. It’s not that easy is it?? We are in the bracket you’re talking about, our mortgage is about to triple % interest wise by the sound of it, our energy has doubled. Am I supposed to just sell up because we’re feeling the pinch more?
I think you should mind your own business and let us tackle ours. It’s the same as richer people suggesting those on lower incomes just “get a better paid job”

People living to their income to the extent that you can't absorb cost increases at 100k ARE mismanaging their income though.

Whenever I got I pay rise, I increased my discretionary budget by 25% of the increase, and my savings and pension by 75% of the increase.

If you fart away every pay increase with lifestyle changes, then yeah, you'll end up as pinched on 100k as you were at 40k.

Well no because at the beginning you are mostly paying interest rather than capital. But also people need a roof over their heads and they can’t eat their house or burn it for warmth. What do you suggest? People rent to pay even higher rent payments to increase someone else’s wealth? I am not sure of your point at all.