To ask what you think a reasonable lifestyle is for this income?

[Momeymoney]

They have a DS (11) and a DD (8). Mum and Dad both work full time and when combined their income is £155,000 before taxes. What is a reasonable lifestyle for them to live? How much can they afford to spend on cars, can they afford private school, holidays, etc?

We have a similar income, perhaps fractionally more but it varies as DH is self employed. Before the cost of living crisis we were relatively comfortable (paying approx £2300 for mortgage & childcare every month) and had talked about private school for our girls (not until secondary though). But there is no way we’d consider it now. I’d say even we’re not that comfortable at the moment so I really feel hugely for others on smaller incomes

We have enough to go on an abroad holiday a year & a few weekends here and there but have almost entirely stopped going out for meals, buying new clothes (I buy everything on Vinted) and I dare say that if / when our energy bills go up & our mortgage is up for renewal, we will actually borderline start to struggle. It’s terrifying

This!

Exactly this

a 5k holiday can be done on a low income, we got around 35k a year coming in and having 3/4 holidays abroad a year and we also have a few local holidays a year, our abroad holidays are around 4/5k depending where we go

Really?? On an income of 35k a year you are spending 12-20k on foreign holidays??

Or did you mean 4/5k total on 3-4 foreign holidays? Which is pretty cheap.

@Aserena Your answer made me laugh out loud! It is so utterly spot on for a number of people I know! (not too far out for us, if I'm honest)

I don't understand that. We have 1 car, at least 2 holidays, takeaways, local restaurants and a 3 bed semi. Our combined household income after tax is around £30k :P What I could do with 155k.....

This made me laugh. We are similar (earn around £100k between us) and feel we are pretty well off all told. It’ll all come down to disposable income though. If I knock our housing costs, utilities including phone/internet, car running costs & basic food/consumables shopping off our income we still have about £3k/month that we can spend as we please. Doubtless some people with the same income will have a lot more and others a lot less.

do you save into private pension?
location is also important and when a property was purchased (eg 30K after tax would not be sufficient for mortgage for a 3 bed house in London and most parts of London commuter belt at prices of last 7 years)

They can't afford private school for both if in South East , its good up massively last few years. About 30k Mey per child do 60k per year after tax and rising year on year. 55k if boarding.

Who’s they? And why is their income anyone business but their own?

DH and I earn similar, take home pay around £7200 after student loan, pensions, etc. We haven’t been earning this amount for very long, have two small children and moved house in the last year so don’t have any savings at the moment.

If you’d have asked me a few years ago I would have thought this level of income afforded a much more luxurious lifestyle than it does in reality, for us at least. Although I do appreciate that we are very fortunate to not have to worry about money.

A good proportion of our expenditure goes on the things that enable us to both work busy, stressful jobs e.g. childcare (one child in full time nursery and the other in out of hours school clubs), a cleaner to help with the house, and easy food options like hello fresh, takeaways, eating out.

And then as others have said you can’t have it all, it’s about what you choose to spend your money on. We considered private school but it would have been a big stretch, particularly for two and we didn’t want that level of financial burden. We have a nice house with a big mortgage and spent a fair chunk of our disposable income at the moment on furnishing and decorating it. The rest goes on ‘fun’, kids activities, health club membership, weekend trips, family days out.

Other than that we aren’t particularly flash, rarely spend money on clothes or things for ourselves, one foreign holiday every few years, only have one small second hand car and don’t really go out other than with the children.

I don't think you know what 'squeezed middle' means.

Depends on how it is distributed and other things. People forget that on that income; you’ll be paying about 60k in deductions to the government before you start! That’s a rough guess as again - depends how it’s distributed. I’ll give you an example. 23k bonus - saw 7k after tax! Bonuses now go into pensions.

We are roughly at that ballpark before any bonuses. I am deliberately not counting this because they go all into pensions. Frankly the tax is so prohibitive it makes sense. £8k take home ish.

£1.9k in mortgage. Nice 4 bed detached. However it’s not out of the ordinary on some country pile. Lovely all the same but a new ish housing estate. New cars on PCP but nothing flash - just normal cars.

Not massive amounts in savings as we are relatively new home owners. No deposits stashed away for the children just yet. The children don’t really get any student loan - so that’s another outgoing.

The biggest expense we’ve seen rise is food and fuel. However, we do eat nicely. That’s our luxury I’d say. Big family - about 1k on food. We don’t eat out much.

We aren’t ‘rolling in it though.’ Paying for things like uni and day to day living expenses pretty much just plodding along. A foreign holiday every few years.

I think what it buys you is choice. To have a nice food shop, a house in a good catchment etc. However, nothing in your face ‘money’. I think people do forget the eye watering tax at this level. I don’t think private school is comfortable - not if you’ve bought a house in recent times. Certainly no where near a nice 4 bed in London kind of earnings nowadays.

I don’t think people forget about income
tax and national insurance? There has been no one that I have seen on this thread that has confused take home pay before and after tax?

the vast majority of people are aware that people pay tax on income, and that tax is progressive.

I saw a post or two “what I’d do with £155k.” You don’t have 155k. That is what I’m referencing.

I get an annual bonus, perhaps half of what you get and after this years tax I've decided from next year it goes into pension! I'm also putting a significant amount into my pension monthly (40%) to reduce tax liability but the flip side is that DH pays shed loads of tax as we can't both afford to do that.

It grates on me how there's so many loop holes for non PAYE employees (tradesmen getting paid in cash etc) and we pay so much. We're in Scotland too.
We still have a decent take home though, we're quite frugal, so private school is on the horizon for secondary.

It is interesting to see in real time. A 23k bonus sounds a lot - it is. However, by the time tax was taken at source and then self assessment. We got 7k and the government got about 16k. Never again - all in a pension now.

People say we have a progressive tax system but we don’t. That’s for another thread though! The cliff edges in the PAYE system are actively reducing tax take. It just goes in the pension now for many of us!

I agree people all know tax exists but I also think those who pay basic rate tax don't quite internalise how much higher rate is - I think a lot of people hear "salary of 100k" and think "that's three times my 33k salary" but the way tax works it's nothing like three X that and you lose things like tax free childcare at 100k too.

Similar income to my family, and children are of similar age. Their lifestyle depends on their taste and priority. For us, we don't have expensive taste, we eat well but rarely eat out. We manage about 4 holidays per year: 1 long haul , 1 camping and a few city breaks. Children go to outstanding state school. We save about 2/3 of our take home pay, hoping to retire within 10 years

This post is cheering me up! We are on a similar income and do have 2 in private secondary who do lots of extra-curricular activities.We have abroad holidays 2 /3 years but can’t afford to ski and have 2( cliched ageing volvos) I always feel a bit skint despite earning a lot so it’s good to hear that others think 2 in private would mean other choices are restricted, I’ve chosen to prioritise education and children’s activities over new cars and lifestyle but am aware it’s only for a few more years.

You have no idea how your mortgage costs compare to op's. Or anyone else's who've commented either 🤷🏻‍♀️
In fact your post is just as ludicrous as op's, really, in the absence of where you live and how much it costs you to live there.

You don’t know any teachers, social workers or nurses? Even in managerial roles in London, they won’t all be pushing £50k. My close relative who manages an entire social work team of 25 people earns around £48k and she’s at the top of her pay scale.

I know I don’t nor do you need to but it cheers me up that my impression of finding 2 private fees on this income is a stretch and that I’m not being particularly bad with money.

Most of my crowd are graduates over 20 years into a career and very few earn 50k
I don’t know any earning under 50k.
You don’t know any teachers, social workers or nurses? Even in managerial roles in London, they won’t all be pushing £50k. My close relative who manages an entire social work team of 25 people earns around £48k and she’s at the top of her pay scale
No I don’t, I do however have four teaching assistant friends who haven’t been to university. Out of the graduates I know most work in banking, IT, one is a solicitor, another is a clinical psychologist who earns a lot. I live in the South East so a lot of people I know work in London.

If your mortgage is £2k or under private school is doable with 2 children.