In not having much sympathy with a couple on £45k plus per year having some benefits cut?

[ssd]

There is loads of this on the news just now about how "middle income" families will be having some child tax credits cut and might be paying more tax. They news are showing what to me looks like comfortable off families having to do with a bit less. Is this really so bad? I know an income of £45-£50k per year might not be much in central London but will keep you in style in parts of the north, but how bad will it be? So people might have to change jobs/give up the second car/holiday at home instead of Spain every year? SO WHAT? There are plenty of us living on less than £25k a year who have had to cut back since having kids and take this as a fact of life.

I know MN is made up of mostly middle earners and I'll get pelters for this, but I don't really care. Anyone I know on a middle income can afford to give up some things _ its called life.

Well it's all relative and the Conservatives will certainly look after everyone much better than Labour did.

www.telegraph.co.uk/finance/personalfinance/consumertips/tax/7727656/Coalition-government-tak e-cover-for-the-3000-tax-bombshell.html

Those earning £50k will be worse off, those earning £25k will be better off.

FioFio, the point you made about the middle income families on TV is very relevant. I started this thread early on Sat morning as I was fed up seeing news footage of a comfortably off couple with one baby and their nice house on tv and thinking so what if they have to go without something, they look like they've got too much anyway. But as you say, a lot of families in the south east on £40-50k must find it hard esp. if they pay childcare.

MN has opened my eyes again.

I was what you would call a high earner - salary over £45k and DH under. I paid 11% in NI, however I had never ever claimed any benefits. I also paid 50% tax and have never ever had a problem with this.

I paid for private medical and dental care, so I didn't cost the country 1 sick day, prescription or operation.

I was made redundant 16 months ago. I haven't claimed any Unemployment Benefits, however I did claim Child Benefit and Tax Credits (£10 a week paid for school dinners).

As I wasn't working I took my ds out of childcare and the Childminder lost 1/2 of his earnings. He then had to claim more tax credit. I also had a cleaner (I worked 8-5.30 with a 90 mile commute each way) - I had to let her go, so she would have claimed extra bens too.

So, I was directly responsible for keeping two people off extra benefits. Simply because I decided to work hard and do my best in life. I paid myself through Uni and I worked my tush off to get up the ladder.

Like most high earners I didn't claim any money, so please don't make assumptions. I do save money - this will be so that I don't end up sponging sheltered housing or a place in an old people's home off state, and so my son can gain independance on the housing ladder and particpate in keeping the the cogs turning in life.

I will assume then, as you are happy to sit in a low paid job and claim benefits that you do not own a tv, smoke, drink, only use public transport and only buy Asda Smart price food...? Infact...how can you waste time on a computer you can barely afford using wasteful electricity to post this message? You could be using this time constructively to get a part time job surely?

Xenia - I wish I had your confidence viz "the Conservatives will certainly look after everyone much better than Labour did."

Coming from an area where the Tories decimated what industry we had when they were last in power, and where we now live with the consequences - generations out of work, huge drug abuse problems, underfunded state education - I'm not so sure.

But the next few years will tell. And I'm not buying the Conservatives' mantra that they're having to deal with the financial mess left deliberately by Labour for them - there was really no guarantee the Tories would win power and they've really only scraped in by the skin of their teeth.

I always feel sympathetic to people whose circumstances change as however that change might be it will still be a difficult adjustment whether that's from £13k a year to benefits (although that may not be a change in terms of income I suppose) or £30k to £20k or whatever. It's still a difficult adjustment.

We did used to have a 33% basic rate of tax in the uK plus NI. It came down to 30% in 1979 Donw to 29% in 1986 etc People forget how much lower the Tories got tax down to our benefit. Might have to go back up though now to pay for labour's mistakes etc. In 1979 the top rate came down from 83% on earned income to 60%.www.ifs.org.uk/fiscalFacts/taxTables

(fireup I think you mean 40% tax as it has only just gone up to 50% and if you were redundant 16 months ago and in the UK it would be 40%)

If it wasn't for my mortgage, I'd definitely feel well off.
We have a combined income which probably catergorises us as high earners (well DH really) If we didn't have a 3k mortgage, thinks would be great. But we bought at the peak of the market and we couldnt move now even if we wanted to.

Yes, we have chosen to live in a stupidly expensive area (neither London nor the SE)but we have very little disposible income.

I'm afraid I haven't read the entire thread, but it's clear that the majority of people in this country have yet to wake up and smell the cappuccino coffee.

Any family earning £45k - £50k whose finances are organised so badly that they can't afford to lose £10 a week are in much bigger trouble than any small amount of TCs is solving. And there is much bigger trouble to come, regardless what decisions are made about CTC etc.

But, as always, most people can't see past the ends of their noses.

Well we don't get CTC or WTC or whatever it is so it doesn't effect us. I just posted to show that with a high mortgage and high childcare costs (about £50perday here) what seems like a decent amount to live on doesn't always leave much left at the end.

GS, we're not financially disarganised, we just have a high mortgage and until very recently, very high childcare costs.

As I said I haven't read the whole thread, so I definitely wasn't aiming my post at any individuals. But honestly £10 a week is such a drop in the ocean compared with what's probably coming - I do think people need to realise that.

i'm with gaelic sheep.
DH and I have been on a variety of income levels since we got married and i would say that people should take cuts in proportion. earning combined salary of 45K two children £800 per month mortgage lots of childcare costs we could have afforded cut of £10 per week without going under. of course some people at this level are going to feel the pinch more than others depending on their circumstances. but those on 25K are going to feel it alot more.
also people in london / south east please stop whinging. As someone who grew up in the southeast, but will probably never live there again as i wouldn't be able to afford to, can i say, you don't have to stay there, no one is forcing you to!
And to whoever moaned that cleaners and meals out are more expensive in london, i'm sure they are but i suspect that they are classed as luxuries.

I think there is some unecessary bitterness towards people on this income
BUT
I don't understand why people who have chosen to tie their income into a house and mortgage (i.e a completely unecessary status symbol,) are complaining that this is the reason they won't have any extra money left over. Sell it. Get a flat. Or a smaller house. That will free up your income considerably and you'll be able to afford the holidays and cappucinos.
There is a huge rich-poor divide. Lots of people, through no fault of their own, will never be able to make the choice between mortgage or lifestyle. It sounds rather silly to hear people complain about having their considerable income tied up in a home.

I remember paying 12% interest on our first mortgage. YOu used to get tax relief without limit (before my time) on mortgage interset payments and then that as limited to £30k of mortgage (called mIRAS) but that went but even so 12% was high. IN some ways because I had to pay so much to my exhusband on our divorce and have a large mortgage as I chose to keep the children in their home rather than move us to a flat I have never had it so good as interest rates are so low. I do appreciate that but accept it will not last.

Yes, lots will happen. People as old as I am will remember previous cuts and recessions. It is the natrue of life and economies that we have cycles. You could almost call it female in that way live in monthly cycles and the adjustment up and down doesn't always do people harm.

So it looks like we have the second highest deficit in the EU at about £415m. This is fairly simple stuff - any of us who run a household and household budget know you should try not to spend more than you earn.

Definition:
"A budget deficit occurs when an entity spends more money than it takes in.[1] The opposite of a budget deficit is a budget surplus.

An accumulated governmental deficit over several years (or decades) is referred to as the government debt. Government debt is usually financed by borrowing, although if a government's debt is denominated in its own currency it can print new currency to pay debts. Monetizing debts, however, can cause rapid inflation (but does not necessarily do so) if done on a large scale. Governments can also sell assets to pay off debt. Most governments finance their debts by issuing long-term government bonds or shorter term notes and bills. Many governments use auctions to sell government bonds.

Governments usually must pay interest on what they have borrowed. Governments reduce debt when their revenues exceed their current expenditures and interest costs. Otherwise, government debt increases, requiring the issue of new government bonds or other means of financing debt, such as asset sales.

According to Keynesian economic theories, running a fiscal deficit and increasing government debt can stimulate economic activity when a country's output (GDP) is below its potential output. When an economy is running near or at its potential level of output, fiscal deficits can cause inflation."

I think if you are on 45K it depends what you had before. If you were brought up in a household of 100K then it is not much, if you were brought in a household of 10K it is fine.

But calling 45K 'high' it gives you a false sense i think. It should be ok to live but it is no high if you have mortgage and childcare.
Our generation was told that if you go to university and get a degree, any degree, you will never have to iron your shirt. Then they got a proffesional job and started paying for dry cleaning, gardening, painting and decorating, removal company etc. They were told that you 'have' to pay for these. This lifestyle is for a 80K plus not for 45K. You dont pay someone £500 to pack your books when you move house if you are on 45K. Easy to get into debts.

Look how well the service providers industry does. It relies on the delusion that a proffessional job leads you to a high lifestyle. Our parents wouuldn't dream of paying silly money for silly jobs.

I agree with the poster who says that people who are struggling with their huge mortgage should start looking for a smaller property (without the ensuite and dressing room) to free up some of their money - or move to a different part of the country where the housing is alot cheaper (ie Scotland). You can't have it all.

There is a huge influx of English people moving to Scottish towns where there are huge housing developments. There's obviously an attraction here - housing is much much cheaper.

I think there is a stigma in this country re flats. 'I have a degree and only own a flat'!
In other european cities people with good jobs live in flats.

The CGT will affect the better off - who have been trying to recategorise income as capital - perhaps self employed, or investors or perhap executives getting company shares.

It will also affect those selling shares not in ISA wrappers / second homes or BTL properties etc.

It will not affect Joe Average.

Riven - of course option d is optional - that's why I called it luxuries. But these all cost more too.

We live in London (not an expensive part - comparatively speaking)Easy to say move to another area but when you have grown up in an area and have family/friend networks there and your dc are at school/nursery in that area - it's not that straightforward is it. We don't claim any CTC but are not well off by any means. No holiday for past 3 years, no luxuries.