Meet the Henry- High Earner not rich yet

[Ontobetterthings]

This was a very interesting read about a man who earns 100k but struggling financially working in London. After doubling his wage to 100k with inflation costs he is only 6k better off a year.

https://www.cityam.com/100k-isnt-a-big-salary-and-we-need-to-talk-about-it/

I can believe 100k salary in London is a struggle. Aibu?

Indeed. I moved out of London but remained working there as my job doesn’t exist elsewhere (to a large extent). My travel costs are £5500 a year – so that sucks up all of Henry’s ‘extra’, so even if he saves elsewhere (housing really is the only real saving), he’ll still be back to square one.

Being on £100k and feeling it's a struggle becomes a problem for society because they quickly resent their taxes being paid out in the form of benefits - younger people (Henrys) are generally big hearted to begin with, appreciating that there are many worse off in society. If they can't earn their way to (what they perceive as) a decent lifestyle, they won't particularly want to be giving others one for free either.
This is why "cry me a river, Henry" etc is spectacularly missing the point.

@Caligirl80 I lived in shared housing till I was close to 30, everyone did. DH and I still shared with 2 others when first dating.

No, I wouldn’t call it living comfortably in the context of that salary. The context matters.

I think this is a badly written article- the issue is less about whether or not 100k is a great salary and more about a downgrade in lifestyle and expectations which applies at almost all levels of society except the genuinely rich.

If I consider my personal circumstances they are this:

• both my partner and I are from ‘middle class’ professional families.
• he’s one of 3, I’m one of 4
• our parents were able to buy large homes, support our uni educations, could take us on regular holidays, my sisters and mum had horses
• both sets of parents were able to afford additional rental properties/holiday homes
• our parents are comfortably retired and have enough for travel and small luxuries

My partner and I:

• also middle class professionals, like our parents, him just under 100k, me 55k.
• live in the SE, commutable to London
• have one child and won’t have more
• live in a pretty modest Victorian semi, albeit an expensive area which we won’t pay off until our 50s.

We have a nice life but the fact remains we don’t have anywhere near the financial security or lifestyle our parents did.

There is a massive cultural psychological shift that needs to happen in order to match our (society’s) living expectations with income expectations. Our living expectations are stuck in the past and the economy has changed so so rapidly.

When I moved to London 20 years ago I earned £18k. I could afford a decent house share and holidays. Even 7 years ago when I moved out of London my room in Balham was £800 p/month- I’ve looked recently out of curiosity and a similar room/house would be £1300 at least.

In 2001 when my parents sold our family home (a rural property they had built on a 6 acre section of land) it sold for 350k - it was sold again 6 years ago for 1.6m, that’s insane. The lifestyle I had growing up as the child of a small town GP and part time nurse is now only affordable for millionaires. I would love to give my son the childhood I had, but that’s never going to happen. It’s not poor me, there’s no violins here, I know I am lucky, but it is a mental and emotional adjustment I’ve had to make.

I don’t think it’s surprising people are struggling with this economical change. Our economy is screwed and it doesn’t support people and families progressing and being better off than the next generation - which until recently was a reasonable expectation regardless of whether you were a teacher or a GP.

I know there will be people on here who can say they’ve managed this and that’s great - but you’ve achieved that against the odds in the context of an economy that’s stacked to make that achievement more difficult and less likely.

It is insane but yes, I can absolutely see that £100k doesn't go far in London. So when you consider how much less than that most people are on, even in London where the average is higher (a quick Google suggests it's around £47k although it's not immediately clear if that's the mean or the median) then you wonder how people manage to live at all.

This is crazy.

Wish I was on 100k a year. Never going to happen though!

I think this is a bad article to represent the ‘Henry’, as the example is a single adult living in a one bedroom flat… on which £100k is still a pretty healthy salary. No you wont be feeling loaded in London, but you will be fine.

There is a Reddit forum for ‘Henry’s’ and it’s interesting reading. The complaints are all the same (and quite London / South East-centric):

• £100k after tax is £5700 or £5000 if you have a student loan.
• £100k wouldn’t get you a mortgage on an average house in the South East, so you still need a dual income household to afford something ordinary.
• Even with two £100k earners… you aren’t getting much house in London / South East. The mortgage might then be £3-4k a month for a terrace / semi in the outer zones.
• The high cost of stamp duty means moving to a nicer house might cost six figures… in tax
• The loss of childcare help. This is the number one issue raised. At £100k you lose free hours and tax free childcare. With the new scheme in September this can be worth £10k per child.

I will have two in nursery next year, and the loss of free hours gives me a 100% tax rate on income between about £100-140k.

It’s a massive disincentive to work and earn more. Most parents I know are working part time or putting up to £60k a year into pensions to keep under the threshold.

It’s completely radicalised a whole group of parents IMO - paying very high tax rates and excluded from the social benefits they pay for, for the other 97%. And it’s not like we are living in mansions and driving porches!

I think £100k has been the benchmark for ‘high income’ for about 30 years.

I disagree high earners resent the tax burden. They resent housing, childcare, travel and fuel costs.

I agree with others. The point of the article is very much that 100k today is not 100k as in years gone by.
If one makes 100k they should reasonably expect a great lifestyle. But they don't have it anymore in London. It's also not the same like 2 people making 100k between themselves (these are actually much better off).

Lots on MN still think of 100k wage like it's still 2010...

I was thinking that the image from the thumbnail is AI

Henry will still be eligible for free hours and tax free childcare on a gross income of £103k. The article is wrong there.

There’s a psychological tag on ‘100’ that needs to be removed, I agree.

But that's the problem. Even at those wages, people don't have access to those things.

With housing costs, there is a shortage of a sense of security. And access to car - free outdoor space is increasingly scarce.

They disclaim the image is AI. I don’t think ‘Henry’ actually exists, it’s meant to be representative.

Cba to read the article, but is that the fictional flat of the fictional man in the background? Looks lush. I once lived in a houseshare where our resident sex worker, used to wash the knickers of her workwear in the communal kitchen sink, and we realised we had rats, when one climbed up on the counter one night and ate a birthday cake which had been left out, with icing drying on it. It also smelt like farts and stale cigarette smoke. Everything's relative, I suppose.

We don’t know what their pension arrangements are, or what their adjusted net income is.

If their adjusted net income is £103k, they aren’t eligible.

And anyway, even if they are currently slightly under inc pension contributions… what if Henry has the opportunity to be promoted and earn £125k? If he had a baby 100% of that extra £25k over £100k would just pay for the childcare help he’s lost (~£10k - £15k is lost in tax and NI).

It doesn’t make sense that promotions, changing jobs and earning prospects should be influenced by keeping your salary low enough to claim for childcare.

This group pay 50% of all tax receipts - we should be encouraging them to earn as much as possible.

The other part of this is that if half of the Henry's followed the advice on this thread (moved out out London; got a lower paying job and lead a more frugal life) the country could not afford it.

We need the tax income from this group, and it feels like they are berated for their choices. This is not a healthy position for our society to be in

I be spoke to a fireman who was also driving an Uber and commuted from…Wales! He said no one at his station lived in London!

My husband is a HENRY, I'm on 55k but get 25% bonus. We are far from rich.
With the cost of house prices we have a small 2 bedroom terraced house with a mortgage of £18000 pm, we have 2 small children and childcare costs are £3000 pm. That's already almost £5k without the cost of utilities, food, savings, spending money.
We are cramped in this house but to moving our mortgage would be around £3000 so we are holding off.
We live in the southeast so I imagine if we lived somewhere else in the UK we might feel better off but he may not be getting a HENRY salary if we didn't live commutable distance to London

Still missing the point spectacularly.

Objectively, inflation and tax have made existing costs go up. Anyone is allowed to moan about that, because even if they can afford it their purchasing ability has significantly reduced since pre-covid. Mine has, yours has, fictional Henry's has. Nobody likes being objectively poorer.

Now to the article! For those getting a salary increase around that 50-100 salary bracket, the marginal gain has reduced even more. Steps in taxation are problematic.

The article did not say Henry needed solutions for cheaper coffee, nobody argued against taxation. It was very very simple. It just said "hey look, £50k extra salary only gives £6k extra in comparative terms to a similar lifestyle 6 years ago."

All this 'in real terms after inflation' stuff annoys me. I know it's correct but DH is a bricklayer who actually earns 10k a year less after housebuilders put prices down last year. What's that in real terms after inflation? People need to shut up making themselves feel worse putting it into those terms all the time. He should think himself lucky he was able to have a job where his salary increases at least surpassed inflation somewhat (given he says he's 6k pa better off). That's more than most of us can say. Be humble and think about the majority of the UK who are actually worse off.

I’m all for what you saying (DH and I are high earners ourselves). I just don’t think an article ever talks about salary as net adjusted income – I would hedge all my bets that it’s a gross salary and the article simply got that bit wrong.

Of course he has .He can move out of London and commute. Many on far less do that.

This is typified in the Nicolas meme that's been very popular for the French right wing- the notion that the social contract has broken down because the tax burden on young people who are trying to make their way is far too high and effectively means it's far too hard to progress in life- work hard and you'll be taxed to the hilt to fund pensions, immigration and foreign aid.