To think the problem with wealth inequality is that rich people don't know how rich they are?

[Neeroy]

Article in the Times today saying that people earning six figures 'don't feel rich'.

Because they are surrounded by six figure earning peers they are comparing themselves to people who have more rather than the 90% of the population that have far less. This is why the budget is poorly received in the news, because rich people think they already shoulder too high a burden when in fact compared to everyone else they still have far more disposable income. Even if they have to cut down on the number of holidays they go on. They aren't sitting in the dark under a blanket. Or only making food that doesn't require turning on the oven.

I don't think they realise how so many people have to live.

www.thetimes.com/article/1fb46414-8f65-436f-8f95-451d69626148?shareToken=8061d939633164c0dfbd805240c8e008

in fact compared to everyone else they still have far more disposable income

I disagree, you can't possibly know how much disposable income people have. The COL crisis has hit everyone who buys food and has a mortgage. Those mortgaged up to their eyeballs will have been hit the hardest and disposable income reduced drastically. There is a difference between feeling rich and sitting in the dark because you can't afford to put the lights on.

I guess it depends on what you define as 'feeling rich'.

Not that I am normally in anyway interested in Joan Collins - apart from enjoying an episode of Tales from the Unexpected that she was was rather good in - when I read your thread title she immediately sprang to mind.
She has given a few interviews regarding this very subject. That even though she is a multi millionaire she doesn't consider herself rich.

Yes I think you are right: many rich people don't consider themselves rich. And consider themselves hard done by there is any danger of them actually having to contribute to society.

I guess it depends on what you define as 'feeling rich'

This is the op's point.

I agree, btw, op. Wealth is hoarded by the very few, the rest of us fight over what's left.

The super rich and corporations need to pay proportional tax.

I disagree. People on 6 figures tend to buy bigger houses, have larger mortgages, live in more expensive areas which enable them to earn that 6 figures to start it. Yes it’s a ‘small violin’ situation but if they went round snapping up the 300k/400k houses, what would we buy? And like everyone else their lifestyles have declined in real terms. If you work hard and have high responsibility, like a consultant or surgeon or pilot, why shouldn’t you have a nice lifestyle?

The problem with wealth inequality is that NOBODY should be having to sit in the dark under a blanket, or only making food that doesn't involve turning the oven on.

And equally nobody should be a tax-avoiding billionaire.

The system that enables these things to happen is at fault. The way that six-figure earners "feel" about their financial situation is kind of irrelevant to the actual problem.

I guess it’s because we’ve not updated our idea of what a “rich person” lifestyle looks like to allow for the much lower standards of living across the board in the last 10 years or so.

”rich lifestyle” things feel like - “having a house big enough for each child to have a bedroom plus a guest room”, “can afford overseas holiday a year”, “can run two big cars”, “buy a 2nd home in the country/at the sea.” Except 20 years ago this was more standard middle class lifestyle, not the rich.

My lifestyle is very similar to the one my parents had when they were my age/had teen dcs. Except my dad was a teacher and DH earns about double what a teacher with the same level of responsibility would earn now. Someone with DHs job in the 90s would be living in a much bigger house with a much more luxurious lifestyle. So I’m not surprised that people who are on around £150k-ish don’t feel rich- many will be living a lower lifestyle than their own parents.

Yabu....

And falling for the rhetoric.
Susan and Doug making 130k each working 60 hour weeks and juggling like fuck trying to raise two kids isnt the problem.

This is the problem...
50 families own more more than 50% of the uks total wealth

Because high earners do shoulder most of the burden and it's scathing when you choose not to have a third child because of your finances and you see people in receipt of your money having more

This. So much this.

I think we've already established that feelings matter more than empirical facts.

Large chunks of society feel disempowered or disadvantaged for no real reason. Even the "75p for every pound a man makes" mantra is believed as a blanket truth despite the various reasons that actually identify its cause as time out of the workplace.

I don't see why you think high earners should be more likely to be objective than everyone else.

Also, when you consider that high earners dump most of their money into pensions for later years and pay for things that others get free their day to day disposable income is often not that high. I suspect that most people's definition of rich is never having to think about whether you can afford to buy something. By that measure six figure incomes don't make you anywhere near rich.

And the poverty of others doesn't change that feeling

LOVE tales of the unexpected 😍

A few things going on here:

1. OP your title refers to wealth inequality but your post talks about incomes. They are very different things. A retired teacher couple in a mortgage free house will be much wealthier and have a better standard of living than a 25 year old banker on £120k living in a London flatshare - but the banker obviously has the higher income, and pays much more tax.

2. you talk about high income people feeling they shoulder more of the burden but still having more disposable income than poorer people. This is true but not a contradiction. Our 25 y.o. banker will be paying £53k in tax and student loan, which is probably five times as much as the teachers in a much bigger paid off house. Obviously she’s not on the breadline and can take a holiday or two. But if she feels she’s shouldering a disproportionate burden of tax, then she’s correct.

3. you frame this in a UK only context - rich people don’t realise how rich they are, other people are on much less. This is true - surveys consistently show rich/high income people mostly underestimate how unusual their situation is. But in a global context even the poorest quartile of UK households are much, much wealthier than the global norm - especially if they are UK citizens and so get access to free healthcare and education, and even more so if they are in low cost social housing. You might as well say “The problem is UK low and middle income households don’t realise how lucky they are.” This is simplistic, but just as true as your initial proposition.

Suppose there are two people sat in front of you, one is poor and one is rich. Could you tell them apart? A lot of people that appear rich are actually dirt poor and have indebted themselves after buying things they can't afford, ie flashy car, fancy watch, a huge house (enormous mortgage they can barely service) etc.

The rich don't feel rich when most of their earnings now support the nation. Don't forget, it's 'those damn rich people' that pay more money in tax than anyone in the middle will ever be able to make in their lifetimes.

This entire rich vs poor schtick has always been an exercise in pitting sections of society against each other and projecting envy, ie you have more money than me, it's inappropriate and you should be taxed harder.

It's all so tiresome.

I think the huge problem is wealth hoarding. People who simply don't need money but still are addicted to getting more of it, even if it means underpaying their workers. Or skimping on safety and the quality of their products. Or creating built-in obsolescence, even though they know how damaging that is for our ecology. And dodging taxes they can well afford to pay and should pay, given that their wealth is almost certainly derived from underpaying workers and underinvesting in infrastructure.

The whole 'wealth = success' model we have had shoved down our throats since the Thatcher era has to be challenged by us all. It's clever though because of course the vast majority aspire towards wealth when they don't have enough to live on. It would be healthier to aspire towards building a fair and sustainable society, that prides itself on the health, safety, environment, good education and infrastructure of its nation. If we all admired people who aim for this and despised misers, there might be a shift.

Interesting perspective. Through my work I know and meet many wealthy people and I must say a significant portion do know and appreciate their privilege but there are a fair few multi millionaires and billionaires I have met along the way who simply have no concept about the reality of life without money and just how unimaginable and out of reach their lives are for the vast majority of people.

I think it is too generic a statement to be true for everyone who earns six figures.

Our household earns six figures, and I am acutely aware that we are incredibly fortunate. Some of my friends are also fortunate, others are not. I work in the charity sector, not sure if that makes a difference, but I do understand how other people are struggling and am in favour of a welfare state and paying more to fund this.

I realise I don't worry about money on a day to day basis, I feel very fortunate I can do a food shop without adding up the cost as I go. And I feel fortunate that I can spend my disposable income on supporting DC with additional needs to make life a bit less shit for them. I appreciate daily the difference this makes to their life.

But do I feel rich? No. I still worry about the future, and particularly for DC.

I really think we have to challenge this logic. Those rich who pay more tax... How did they become rich? By employing people on zero hours contracts, at below the cost of living. By cutting worker benefits. Not investing in creches etc so people - usually women, spend their entire wages or salary on childcare.

Can we please stop perpetuating the myth that the saintly superrich subsidise us with their power to employ and their high taxation. Stop and think how they got that way!

Yes.

Six figures is not rich. Rishi Sunak has £640 million, so probably he has at least 50 million a year just from investments. It's not possible to spend that amount of money on consumption, so he just gets richer and richer buying assets that then get rented out to the proles who have to actually work for a living. That's why normal people can't afford houses - multimillionaires out bid us. And he's not even a billionaire.

This.

Yes. This is the problem. And they are NOT supporting us all via their taxation. No one kid yourself on this. We are subsidising their wealth by accepting low pay, zero hours, idolising the vapid pursuits of the superrich and devaluing the work of those who most benefit society.

Absolutely agree with this. The addiction of making more and more money to not even live a lavish lifestyle yet alone help those around you or in need is in my opinion grotesquely ugly.

If I were in a position of super wealth I would absolutely want to better the world around me.

They got that way through hard work. Even those who have inherited money, their parents will have worked their backsides off.

Success is earned. Many risks have been taken. Do you ever roll your eyes when a business owner complains about taxes? You shouldn't, because taxes have increased and many business owners have had to abandon their dreams, or worse, they've ended their lives, bringing major upset and pain to their families.

If you have a job, it's because someone worked their backside off and ploughed through several sleepless nights wondering how the hell they're going to pay their employees.

Don't belittle success, be inspired by it or fail. That's it.

I don’t think this is true for a lot of ‘rich’ people. In london, many bankers and lawyers will be on £1m+ - they’re not business owners so not exploiting zero hour workers.

And they do pay a huge amount of tax. I agree that yes, some wealthy people will have run poor business practices, but it’s student politics to say all rich people got there off the back of exploited workers.

I don’t think people earning six figures are as rich as you think…

I earn six figures (£120k). I’ll be able to buy a very small one bedroom flat in East London so I can be reasonably close to work (I do a four hour return commute at the moment and it’s killing me). I have a big mortgage so no early retirement for me.

I have one 8 year old car, that has very damaged bodywork but I can’t afford to fix as it happened during COVID when I was unemployed and couldn’t afford the excess to claim on insurance.

I go on one very cheap few days away in Europe sharing an AirBnB with friends a year and a couple of overnight stays in AirBnBs in the UK. No big abroad holidays.

£120k is my income but I don’t have a pension or private healthcare because I’m contracting.

I don’t buy any designer anything. I buy at least 50% of my clothes second hand on eBay.

I don’t have a cleaner or anything like that. I have no savings. Like £0.

Is this “rich”? I would have felt really well off on the same salary 10-15 years ago but not anymore at all. And yes, partly because of where I’m choosing to buy but honestly I can’t cope with four hour commutes every day anymore on top of a 10 hour work day.

Your last point is very true. Seen globally, everyone in the UK is very well off. There are large parts of the world where people scrape by on 1 dollar a day.

Which goes to show that comparisons aren't always useful or helpful. Telling someone struggling to put food on the table in the UK that they're actually better off than billions of people worldwide doesn't change the fact that they're struggling.

Likewise, telling someone earning 100k that they're rich doesn't change the fact that they're tied into a 30 year mortgage, can't afford the lifestyle their parents had, are having to check prices in supermarkets etc.

The main issue that's squeezing everyone's budget is housing. Prices should never have been allowed to skyrocket like they did. At the very least they should be maintained at a stable level for the next couple of decades by building loads more to increase supply.