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?

London zone 4, renting 3 bedroom house that is very basic in not great are: 3000 pounds accounting for Council tax. That is more than my net salary of 55,000 and cannot even start with bills and food.
Nothing to fall back on. Only thing to do is to downsize but rents are going up like mad and not much available. Depending on housing and childcare some people can be struggling in quite big salaries. Which should give us an idea of how desperate it must be for so many

The example she gave said that the family had a mortgage of 2K. If you’re on 100K and your mortgage is 2K a month then that’s definitely a choice.

Do you know what 2k rent would get you?

This. Unless people are complaining that they have it worse than those in poverty (which of course isn’t true) they are allowed to complain.
We have a household income of around £75k and are really feeling the pinch. We have a massive mortgage, pay a fortune for childcare (both of which we could easily afford before covid/war/cost of living crisis). We don’t have an expensive car and we don’t go on fancy holidays. Life is still expensive!

Is that £100k take home or pre tax?

It all depends.

I've seen people on here say that they are comfortable on 20k but it turns out that they have free childcare for their 3 kids which can be worth 10k+ per child per year if they aren't school aged.

Or the people who wonder how you spend more than £50per week at Aldi and it turns out they go to a butcher and have a fruit and veg box which brings up the good spend up to a more typical level.

Some people on here have tiny mortgages by my SE England standards but I have a small mortgage compared to people who haven't been homeowners long because I bought my first property 20 years ago so it's swings and roundabouts.

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.

Agree with this. My DH earns a very very high salary now - but hasn't always. I earn 18k / year part time and am super frugal - I grew up in a trailer (not in the UK), some periods with no food etc, so am a bit traumatised by this.

When we married 25 years ago DH had a $15k credit card debt and a dodgy job, yet my fear of poverty put us on the straight and narrow and we locked it down while his income increased skywards.

We are now late 40s and very comfortable as we didn't fall victim to lifestyle creep. This is the key!!! We have a paid off mortgage, zero debt, own a car outright, I have always shopped at Aldi, we have healthy investments. We save 70% of our monthly income - some for investments, some for hols, some for doing up our house.

Our only real luxury is my 2 DC go to independent school.

I have to say it has been a bone of contention a few times in my marriage. My DH understandably wants to have a big blow out every now and then. But we have always been happy with the basics - focus on the mortgage, don't spend more than you earn, don't fall victim to keeping up with the Joneses.

I say all this not to brag or go on all "look at me" in a Mumsnet way, but to demonstrate that a life of sensible choices can pay off and allow you to sleep at night in rough seas like this. Lots of people we know would be shocked if they knew how wealthy we actually are. I am grateful for the security every single day, in particular at the moment.

I still worry about putting the heating on however, ha ha! Old habits die hard.

This x 100^^

I would say no to mismanagement but yes to a lack of being risk adverse.
When you save for your first property, you cut back for a few years and save a big chunk up before taking on a mortgage you can afford.
When people's wage packet goes up, I believe it is risky to then jump to a higher monthly mortgage for a bigger property. You should cut back for a couple of years and save another chunk for the difference in price between a two bed and a three bed. The same with upgrading cars to flashier or newer versions. Taking on more debt, just because you have a higher income is unwise, in my opinion. A higher income should result in putting more away, so that you can pay off mortgages and car repayments earlier. Only then, are you really secure with your higher wage.

My question is why did why take such a huge mortgage?

Everyone I know who took out a mortgage included myself found it was cheaper & more secure than renting.

It depends how far you are stretching your budget so if you take home £100k after tax but are are down to £200 left over with the cost of everything rising of course you will struggle. The issue is how far you stretch yourself. We are on much less than that after tax and are a family of 5. We aren't struggling yet but we aren't overstretched, we deliberately went for a mortgage we could afford to pay on one wage and we run one car.

I can easily see how someone with a much higher take home pay may have higher outgoings than I do.

You're obviously not listening to all of the posters explaining why people on £100k household incomes might be struggling.

You are totally right that having money means that you have choices that others do not though.

100k after tax is not massive money. It's like 5.5k per month. I earn this and have three kids plus 1 flat, a mortgage. After school care for 2 kids. 300 in travel a month. It all goes and I don't have massive spending habits. I literally haven't bought myself clothes except a pack of knickers from H&M for over a year. We never have take aways. Never. honestly don't know how people survive on low wages.

erm yes it is

The average salary is 26k.

@BernadetteRostankowskiWolowitz how much do you take home?

Much cheaper than renting.

Also due to the insane cost of housing mortgages for most young people are high. Arguably it is a choice to live in a decent house in a decent area but most people especially those with children don’t want to leave in a super cheap (and usually rough and unsafe) area.

Oh well that is it. You are not in London. Try to buy a house for four people or to rent in London with that a year. That salary does not get very far at all.

If on £100k a year may have larger house and larger mortgage, plus may have 2 kids in nursery. They could also have debt to service too. Don't judge other people.

if the average is £31.5k for a household.

@LetMeSpeak where did you get that info?

I’ve been in the position where outgoings in London would exceed a 100k salary (particularly childcare and rent are very expensive and not optional). It absolutely depends on circumstances whether 100k is manageable.

@LetMeSpeak

Wrong

'According to the ONS, in 2021 the average UK salary was £38,131 for a full-time role'

www.findcourses.co.uk/inspiration/average-salaries-uk/average-uk-salary-2021-2022-21600

So that's a bedroom each and a car each for the adults. Doesn't sound extravagant to me. Independent school fees can vary wildly from 5-6k a year to 14-15k for non-boarding so 4 kids will be a significant chunk of cash even at the lower end. I'm not really sure what you are getting at?

From her arse

You are only not able to go to the chip shop because you are spending your money on something else.

kitchen loan (interest free) £136
after school clubs are £81
cleaner is £60 (comes once a fortnight)
Audible/Prime/netflix £27 total
window cleaner £26
Half of this: Food + clothing is £625 + £182
and then this: In theory that leaves us £388
= £1121 that you have free choice over how you spend.

People who are choosing to spend this much money do have loads of options.

It’s not that simple. I know people on very low incomes who are comfortable because they live in social housing, have no childcare costs and receive various benefits. When you earn more money you are taxed more and you have to pay more for things like childcare and rent. It’s not as simple as “they earn three times what I do so they have three times more money”.

I earn double what my MIL earns yet take home only £600 more a month, the other £1000 extra is taken off me in pension, student loan, tax and NI.