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?

Okay, this is fun.

I don’t earn that much so no actual experience or sums have gone i to this, but this is how I would imagine the lifestyle of a family on £150k in my area:

They have a large detached 4 bedroomed house. Either modern or newly refurbished. Spacious garden and drive space for 3 cars. Property is either secluded and private, or has a nice view.

They drive a large Volvo and medium size Toyota, which they bought from new and trade in every time the warranties runs out.

Not privately educated (no indy schools near me) but their children do all the hobbies: ballet, horseriding, rugby, theatre-school, instruments etc.

They have at least 2 holidays a year, one of which is renting a UK holiday cottage somewhere picturesque, and the other is abroad, like skiing in winter or summering in Southern France or Italy. Every alternative year or so, they do something really special, like a fortnight in Disneyworld Florida, or a December trip to see Father Christmas in Lapland.

They are members of things like the National Trust, local Zoo and subscribers of Which?, National Geographic, Aquila, and all the streaming services.

They don’t spend ostentatiously on day-to-day stuff (they often shop in Tesco, as well as M&S and John Lewis) which has enabled them to save very well. When their children go to university they will live off mum & dad and invest their student loan. The interest they will make on that will be added to the considerable deposit that their parents will give them for a starter home.

They own a labradoodle, a tortoise and have hens at the bottom of the garden.

Hope that answers your question 😁

If you want to privately educate your kids, it isn't that much. Of course most people don't do that, but if you're after that sort of lifestyle you need to be on more.

Large detached 4 bed house is what, 1.5 million - much more in some areas of the S East. You can borrow as a couple maybe 4 times your income, so £600k. So they'll have needed a £900k deposit or equity in a previous house..........

"than those who try to earn as little money as possible".

1. How many actually do that? 2) How snobby is that attitude! Who says those on benefits aren't trying to work hard? Personally just get perspective that you earn significantly more than most of the country.

@newtablet That is a choice though. You can't complain it isn't a lot if you choose that option.

Not where I live! my imagined house would prob cost £500k- £700k.

Anyway it doesn’t really matter how accurate I may be: this is what I imagine life to be like on that income. Obviously it depends massively on where you live and all sorts of other variables. These are my imaginings, impressions and beliefs… if they differ from the reality, that just makes it all the more interesting!

its hard to build wealth from scratch without a good income!

It's hard to build wealth with a good income these days because of the gulf between prices vs salaries. Someone 45 plus with a 150k household income is not comparable to a 30 yr old with that as things as very different now.

They’d live in houses like this:

https://www.rightmove.co.uk/property-for-sale/find.html?locationIdentifier=REGION%5E61321&maxBedrooms=5&minBedrooms=4&maxPrice=700000&minPrice=600000&propertyTypes=detached&mustHave=garden%2Cparking&dontShow=retirement%2CsharedOwnership&furnishTypes=&keywords=#prop138459356

I'm a Londoner & a millennial & I don't actually know anyone who managed to buy without help either cash gift or living at home to save or both.

You can buy a large 4 bed detached house in the north for far less than 1.5 million

www.rightmove.co.uk/properties/139662059#/?channel=RES_BUY

Some of these replies are incredibly southern

Very well said

There's a vast number of households (most of the country) between free school meals and £120k. And somewhere in the middle of that lies the squeezed middle. And they're not the ones overpaying the mortgage to the tune of £1.2k/month. They're the ones plodding away managing their bills, just about.

My large four bedroom house is worth just over 700k, I live in the South East with a quick commute into London.

I am not saying that there are many people like that, I am saying that this is why DH who was on free school meals doesn't think that his income is very high. Cos many of those on benefits have really good reasons why they can't earn more and also our nurses, teachers and essential workers are badly paid.

Most of the country earns little because with the exception of London and Edinburgh and the SE, the majority of the the country are poorer than the poorest state in the USA, Mississippi. It's actually outrageous really. And it means that anyone who isn't working for a globally aligned company is massively short-changed. We have had 13 years of stagnating wages and this is the result.

They are the new poor. We are facing the biggest fall in living standards in 60 years and these are the casualties.

I think we would have an unequal society where the top 0.1% are obscenely wealthy, 5% are rich, the next 4% (top 10%) have vaguely middling lifestyles (I would probably fall in this category but will fall into the poor category unless we incrrease our incomes). The bottom 90% would be poor. Plain and simple.

What we achieved between the 1950s and 1990s was a historical blip. Unless we have radical action, we will revert to historic norms. Which is anywhere between 70%-90% of people barely scraping by

Home ownership rates in Britain over time:
1800s: 10% (50% poorhouse, 40% private or social rent)
1915: 15% (20% poorhouse, 30% private, 35% social)
1939: 35% (40% Social, 25% Private)
1950: 45% (40% social, 15% private)
1970: 60% (35% social, 5% Private)
1990: 80% (15% social, 5% private)
2010: 70% (20% social, 10% private)
2020: 60% (20% social, 20% private)

Using historic home ownership rates as a guide, my feeling is we will go back to 1920s level of inequality which is around 10%-15% being anything between obscenely wealthy to moderate and the rest being poor or just scraping by.

But why do you feel poor with that much disposable income? What do you feel you're lacking?

My flat (the price, including the deposit) should only be 4 times combined salary max, preferably 3. My current flat is currently roughly 3.5 times combined salary but if I buy a bigger flat with 3 bedrooms, it would be 5 times combined salary at current prices.. so unless house prices fall or our combined income increases by £80k, this is not an acceptable house price affordability ratio for me.

That is actually the sign that our salaries are bad because £120k combined means only a £480k house is affordable assuming no parental gifts. And we didn't have any parental gifts. £480k is far below the London median of £530k

*3.2 times.

So it's housing, which I get; we started with a flat of a similar value to yours, on lower salaries.

But with overpayments / further savings from your disposable, then in your situation it's just a question of time rather than a need for a vastly higher salary (although of course that would help).

Honestly lavender you’ve clearly got a particular perspective on this but if you can afford to invest £500 in shares and overpay a mortgage by £1200 a month you are not stretched and it’s disingenuous to say you are.

and surely the house price is dependent on the equity too so it’s not just a ‘it should be a simple 3.2 multiple’ because that’s your borrowing requirements?

Our family income is slightly less than the OP (and only 1 earner so high tax bill) but this is pretty accurate! Nice detached 5 bed in desirable SE suburb, similar cars, childrens hobbys, nice lifestyle. Not lavish day-to-day but could afford big hols if we weren’t saving to do up the house and we’re all aiming to support them at uni and give them house deposits (doing large pension contributions resulting in a tax free lump sum for them)

My deposit was accumulated due to sheer dumb luck, I married a native Londoner and so we managed to save £90k over 3 years of not paying rent. So I didn't need to earn so much to buy it and so do the many people I know who have gotten cash gifts from their parents or even had house paid for in full.

But that isn't representative of what my earnings should be. My earnings should be earmarked to how much it costs someone without family connections to buy a similar place.

Also, it does depend how old you are and how long you have had the high income, if you’ve had help with house deposits etc. we’ve only had a high income for a few years and wiped savings for a house deposit, and did minimal pension contributions to pay for this. There is no way we would be mortgage free yet for example.

Oh good! This isn’t my income at all, so I’m glad my guess was pretty accurate 😁