175k salary and all gone

[175allgone]

This will ruffle some feathers, but after tax, mortgage , childcare, living expenses….there doesn’t seem much left. SE London, commuting, wrap around care. Whilst I appreciate I’m not having to watch my bills I’m hardly living an extravagant lifestyle.

Not sure about ruffled feathers, mind is definitely blown. Can't comprehend it really.

No, don't move to another area if you are happy in your current house. You just have to stick it out until kids are older.

Yep but let’s all hate on the high earners as usual on MN, even though they are paying for the majority of public services in tax!

It's absolutely insane that someone can be on a salary of £175k (or even half or a quarter of that tbh) and still be told that they should have put off/avoided having kids because of the expenses. 'Move out of London' - commuting time is longer (less time with family), commuting expenses insane (for unreliable transport), further away from family. It shouldn't be impossible for people who are anything other than living in social housing on benefits or millionaires to live in the capital and have kids. This isn't even particularly in response to the OP.

How snobby 🙄

Please suggest how she can pay less on her “extravagent” childcare…which is market rate for London?! You need to get real and understand that things are more expensive in some parts of the country.

Nurseries are private. State nurseries (usually attached to schools) don't care for children prior to pre-school age.

@Bjorkdidit I know. I live here.

When you go to school it’ll get easier. I have friends in Dublin and I look at their childcare and mortgage and I do think ‘is it worth it’ but they can’t understand how I live rurally!! How is your commute so much though, everyone I know who lives in a city does so because it means less commuting?

This is the answer I think unless you're looking for a complete new start somewhere much cheaper. Do your jobs have to be in London? Apart from the temporary childcare problem, do you like living there?

If not, you'd probably have a higher disposable income elsewhere even if you earned less and moving wouldn't cost anywhere near as much, as stamp duty would be much lower - if you're expecting it to cost £50k, that must mean you're looking to downsize to a property costing around £1.1M.

If you spent £500k on a house in another city, the stamp duty would be more like £12k.

Wow the childcare cost is extortionate. This is crazy. Your mortgage is reasonable for your salary and location. Also your mortgage payments should be less of a burden year on year with inflation.

If you don’t want to/need to move then def don’t as fees/stamp duty are insane.

You need to reconsider your childcare options. I don’t have DC and the thought of half of our income going on childcare is definitely not changing my mind on that front!!

We manage by living somewhere cheaper, by not having hair cuts, new clothes or shoes so our children can.. by skipping meals while our children eat.. by literally penny counting and finding free activities for them so they have a decent childhood, by going camping locally for their holidays.
I,m not being horrible, I’m being honest.. I raised two children on just under 23k a year ( after their father did what he did) We managed/manage and they didn’t go without…

How do I manage?

1. My wage was only about £2k per month so I quit and became a sahm. So effectively my childcare cost are half yours. Dc has started pre-school now but gets free hours as over 3 and it's attached to a school so term time only.

1. We threw overpayments at the mortgage for years before having children so now our mortgage is significantly lower than yours.

1. We got rid of our second car. Obviously I don't commute, and DH wfh two days a week.

1. We go on far fewer holidays than pre-children.

We don't live in London but do live in a very expensive part of the SE.

Childcare costs are why many, many people choose to have larger gaps between their children, or stop at one, or one parent takes a career break.

It does seem ridiculous. Your salary would clear my 25 year mortgage and I have one DC in nursery and until recently had a second in wrap around at school. I think the problem often with people with high salaries is that you've never had to budget or think about money. So you don't think logically about problem solving. Just 'waaaah my money has stopped going far enough'. In all honesty, after covid and a second DC I felt this abit too, albeit on a much smaller salary. Could you and DCs Dad compress hours so DC are in childcare less? Or take out a loan to cover the nursery years?

Just be careful op if you decided to move out to the commuter belt. I travel five hours a day. The trains are often late and crowded. My children didn't see me unless I was between contracts. My father did my child care and my DC were in school from 3. A nursery place in Reading was £42 a day 25 years ago!

What I did find was in the school years I got excluded a lot from 'the club' because I didn't live in London. London based executives seemed to do better in their careers at that time. However my country air has saved my youthful looks. I'm one of only a handful still working.

The mortgage thing is crazy though isn’t it? I have a similar mortgage repayment but because I’m in my late forties that mortgage amount sees me living in a house worth over a million. I chose to live in an area where that’s a 3 bed semi with no drive and a courtyard instead of a garden but I’m happy with my choice there. But if I was buying now I’d need to be looking at 1 bed flats in my area.

What this means is that if you are high earning but no family money (this is me) you’ll be unable to ever catch up with people who’ve been gifted or inherited a house deposit. In theory I feel like I should be the sort of person who does well in a Tory run country. I worked hard blah blah and now earn very well. Of course that’s not true though - we fiercely tax income and ignore capital wealth to a great extent. It’s a tax regime designed to protect inter generational wealth and punish plebby upstarts.

But how are you defining 'desirable'? Because your current lifestyle doesn't sound all that desirable to me with so much cost and so little to show for it, and presumably a lot of stress in the mix too. I think the question is how much do you (as a family) enjoy your lives, and is it worth the cost and strain?

Personally in your shoes I'd be having a radical rethink about my life and looking for a way to get off the hamster wheel. But I do realise it's not that simple around jobs and schools etc.

Once they are at school the wrap around care is loads cheaper. You will feel rich! And once they are in secondary you will feel even more rich, have no stressful planning as they get themselves there and back, you will have an interesting career (I assume if it pays well) and you will feel like it was all worth it. Hang in there.
we had ours 3yr apart to avoid the double nursery fees. Worth thinking about if you want another ….

LOL - yes, thank you so much for suffering Islington to help the rest of us….

more seriously, if you have one salary of £175k for a family, you can’t afford Islington and to have lots of spare cash. That’s the choice you have made by living there (and why I moved out from there a long time ago).

if your general point is just that a large salary gets quickly eaten up in London, then I completely agree! It’s crazy!

How people manage.

• move to be near family who help out with childcare
• move to a cheaper area
• change job to wfh so you can move to a cheaper area
• one parent takes a career break to take on the childcare - in your case this would save £48,000pa
• to add, often if one parent stops work or goes part time to manage the children the family will then be eligible for some benefits, depends on income, health status, savings and so on
• having one car
• having no holiday or a cheaper holiday, some invest in holiday schemes, a caravan, timeshare or a home that they rent out the rest of the time for income
• limiting social activities for parents focusing on kids needs
• limiting purchases of clothes, toys and so on or buying on eBay/Vinted
• never buying full price items aside from food
• doing food shopping online so you aren’t tempted by in store advertising and can easily downgrade your brand
• getting a loyalty card for everywhere (boots, tesco, clothing stores) and using topcashback - for instance between boots recycle and boots advantage I get £500 a year which covers my premium beauty, tesco is a few hundred a year, topcashback about £300.
• put any savings in a 5%+ account, preferably ISA
• before a devout follower of Martin Lewis

That’s to start with, there’s so much you can do!

You’re assuming the OP jumped straight out of high school into £175k salary if you think she’s never had to budget. Not sure if this is combined salaries or just one.

£175k seems like a huge number, she/they are clearing £105k, I think between 2 earners. With interest payments, even with no living expenses, I doubt they could clear your mortgage in a year!

Well maybe, if you're bright enough to earn those kinds of salaries between you, you're bright enough to have a spreadsheet to look at to SEE where the money's going?

And then, like everyone else if you need to, you find economies.

Well people shouldn't have kids they can't afford.

So irresponsible.

Right?

It amazes me that someone who supposedly has the intelligence to earn that much relies on lesser mortals who don't to figure out her problems!

The answer is obvious, if you want to change where and how you live, you'll have more disposable income; if you don't, you won't. Simples.