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What income do you consider rich?

267 replies

Believer99 · 17/11/2021 21:27

Interested to know what household income is considered rich.
When I was younger (19) I remember telling my BF when he earns over 30k il be a SAHM 😳 because I considered that to be an awful lot of money

Now we are older & earning more of course my perspective has changed, I would probably consider a household income of over 120k rich now we live in the north of England.

OP posts:
Lovinglife45 · 20/11/2021 10:31

felulagelar
I am amazed that you can afford to send your dc to private school and pay for expensive hobbies on household income of under £60k. Am I right in assuming your mortgage is paid off or only a few hundred a month?

Lovinglife45 · 20/11/2021 10:37

wholeclass
One person's normal is flying economy and another person's is flying business class. Different worlds!

I believe we all view our life as being the norm. A child who lives on a council estate will see this as totally normal until he/she joins a grammar school and becomes friends with someone who lives in a huge home with pool. At this point they will realise others live differently.

WholeClassKeptIn · 20/11/2021 10:45

Yep I think that is what happens. So those on over 100k see their life as "normal" as surrounded by others in a similar position.

But that why this thread is important as most 10%ers or even 1%ers seem to have no clue that their normal is so far removed from average lifestyle!

MatildaIThink · 20/11/2021 11:10

@BertieBotts
The thing is as you say, some high earners did not work their way up, but many did and there are a lot of people on here who dismiss those of us who did work our way up. As an example I was the first person in my family to go to university, my husband was the second in his (one of his uncles had gone to university), we both come from modest backgrounds, parents who were low earners throughout their lives etc but we worked out way up over time, gaining qualifications and experience to get to high pay. Throughout our twenties we were low paid, working bar jobs in the evenings to keep things afloat when I was studying my PhD, I accept that we are now very fortunate to both earn six figures. My brother who left school with only GCSEs and spent the next nine years working in bars and restaurants has now gone onto earn more than both my husband and I combined, he still worked in bars and restaurants when he got his first office job as he had to, to keep his head above water.

I don't think (or pretend) that we are classless now, but I think that class is much more about outlook than income.

Elon Musk now wipes the floor with Bezos, he is expected to finish the year worth $300 billion, money at that level is pretty much limitless, I mean he has his own space program!

I agree your point about people feeling that it is a struggle to survive, it can be tough on a low income, I agree that the choice between whether you can turn the heating on in winter, or whether you can avoid the winter weather by going to the Bahamas for a month is of course not a comparable choice. That is what I mean by the two sides not listening to each other though, the high earners are saying that they still have to make choices when it comes to what they can afford and not understanding that those choices are those that the low earners would love to be able to have to choose between, but also some of the low earners not seeming to understand that it is still a choice between, not both.

I think most of life is a choice between things, financial or otherwise, despite being high earners we do not have a luxurious live, we are not flash at all, my husband and I would rather pay the mortgage off fully first (then maybe go bigger once we have that security behind us), pay into our pensions etc. I accept those are all choices we have the luxury of making. There are also the choices we make which actively benefit us, we don't drink at home, we don't smoke, we don't get takeaways, still take lunch to work etc. because it seems crazy to us to waste money.

The thing I don't understand about how some people think it feels limitless, I have been a low earner, I am lucky to now be a high earner, when I was a low earner I never felt that £100k+ pa would be limitless and now I earn in that category I do not feel that £1 million+ or even £10 million+ pa would be limitless.

I guess I am just a little disappointed that throughout this whole thread (and the many hundreds of pages of other threads on the same subject) that many, on both sides, seem to want to attack the other group rather than understand. I am also somewhat saddened by the seeming resentment and hatred towards high earners on here.

MatildaIThink · 20/11/2021 11:21

@WholeClassKeptIn

Very well expressed. And as this thread shows many on high salaries are quite out of touch with how much more than the average person they earn, and how much choice that has bought them . It isn't "all relative". Wondering whether to do 2 foreign holidays that year isn't the same as wondering about coats or shoes.

Most of my family are very well off. We aren't due to a number of factors and I can see this play out first hand. Often they just don't get that we cant afford xyz that they see as basic.

People do have a perspective from their life experience, having been a low earner and a high earner I hope mine is reasonably broad enough to have some understanding on both sides.

I still remember working 60-80 hours a week (or a combination of work and studying) during my twenties to just keep my head above water, not wanting to put the heating on for more than an hour a day because everything felt so expensive, buying from the out of date section in supermarkets, being a kid and in winter seeing ice inside of the window in winter etc. I am lucky that now I am in a position that I could leave the heating on all day with the windows open and it would not matter, so I can also see that some people have less financial constraints than others.

I think when people's circumstances are very different from those of their wider family then that does make things different as most families tend to think that they have similar reference points, I know that has been the case in my wider family, although luckily not with my mum/in-laws, my brother and my husbands sisters.

Xenia · 20/11/2021 11:31

I don't agree they don't have a clue. I have earned a lot for decades but I know perfectly well how most people live (and indeed had times without much money).

The problem however for those who are very badly off or quite well off is how to ensure our children understand how others live - that is one reason talking to people online and otherwise is good. My sons shared a bed room to age 18 and yet some children seem to think no one has to share bed rooms. When we moved to this house the girls and I had chilblains as we kept the heating down so low and even used the children's savings never mind 100% of ours to buy it with a massive mortgage - of course even with that very privileged i the sense I could afford to buy a property at all. Working 2 weeks after having a baby including commuting and trying to find somewhere to express breast milk at work in the 1980s and with 3 children under 4 working full time with in the 1984 50% of each of our net salaries going on full time childcare and things like drinking orange juice or buhying hair conditioner were pie in the sky or my 35p a week only pocketmoney in NE England in the 1970s aged 17 (which of course is better off than all those who never got a penny in pocket money).

I think reading helps - I read a lot of books over hundreds of years of ages describing poverty (and well off people) for hours and hours and hours month after month from the library and that gave me a very good understanding of how people's lives are. Never mind just the bible which has a lot in it about these topics too.

BertieBotts · 20/11/2021 11:31

I think Matilda, with respect, you are unusual in both factors (having worked your way up without family support, and also having a concept of much higher incomes than your own not being limitless). That kind of financial literacy is rare and possibly a part of what helped you become successful? (Maybe not! I don't know :))

I certainly feel that the factor of 4 rule that I talked about before is accurate for me. Trying to imagine living on a quarter of our income (this would be a few hundred a month) feels impossible, yet imagining having 4x our current income feels like so much money I could never possibly spend it all.

I expect if I sat down with pen and paper and worked out what specific lifestyle improvements we could make with 4x our income and what they actually cost, including taxes etc, then it would fill up quicker than I expected, and I would see that indeed it would be easily possible to spend it, but that does not change the fact that my initial reaction to that kind of figure is an emotional one.

In fact, we just got a backpayment of 66% of DH's wage over 4 months which was a lump sum, and my initial reaction to it was "Ooooh! We have loads of spare money now! We can do X, Y and Z!"

Actually, it just pays our bills until January (when he next gets paid) and then it runs out. I admit, I was disappointed. I'm not unintelligent. I'm not even bad at maths - I got an A at GCSE. But I actually have to go through that physical process of portioning it out over the next 2 months to compute that that is what it represents.

I think money is highly emotional and that's even for me who has enough knowledge to know how to budget and a decent understanding of numbers. If somebody struggles with numbers, has never learned budgeting etc it would be even harder for them. But the emotion involved is what leads to things like resentment or blocking to the idea that someone's situation could ever change.

BertieBotts · 20/11/2021 11:49

Since you do have experience of both, can I ask, if you felt genuinely that you were trapped in that existence with ice on the windows, discount section of supermarket and so on and had absolutely no option to change that, none at all, would you not also feel resentful towards people who did have a less fraught existence and even seemed to take it for granted?

I don't resent higher earners, because I have a better understanding of money as a resource (which makes it less emotional somehow) and it doesn't feel quite so out of reach, but I can see where it comes from, it feels completely unfair and a lottery if you personally feel you have no possible way to get to that level of living/lifestyle, and it's not like you sat there at 16 and decided yeah, I want to be poor. Even if somebody else made a decision to pursue a high earning career, nobody makes a choice to be badly off. (I don't mean someone who is able but chooses not to work much/at all of course).

And in some ways it is unfair - some people have to support their parents in old age whereas others recieve financial support from their parents. That kind of thing is not something you choose. Neither is disability or mental health issues.

I think the UK has a real problem with endemic generational poverty and mental health issues and supporting those issues would go a long way.

NotBabiesForLong · 20/11/2021 15:52

Rich, is having enough available money to meet your needs fulfil your wants each month without having to think or plan or worry. So a couple of rungs up on Maslow's Hierarchy.

Wealthy, is being able to fulfil your needs and wants using money from income generating assets, so investment income, without eroding the asset value.

To put a £ figure on what is rich or wealthy is subjective as this will always vary person to person depending upon different locations, different needs and wants, different family dynamics, different times of your life.

Dindundundundeeer · 20/11/2021 15:59

@Spacerader

A big salary doesn't make you rich, people live within thier means and larger salaries tend to have larger bills which doesn't always leave endless amounts of disposable income. Me and dp earn around 80k + between us. I in no way feel well off. I dont stress about bills but we dont really have enough to have nice holidays and dont spend money on nice stuff endlessly.
If the salary is big enough it bloody does Grin

I have clients that earn £2M+ a year. I have quite a few on £600k who are getting by just fine too. They all manage to save!

FitAt50 · 20/11/2021 16:34

@RosieGuacamosie

Our household income is well over 120k in the north and we don’t feel particularly rich and that’s with no kids and a small mortgage at the moment! We’re obviously comfortable but not to the extent we’re splashing out on first class flights or expensive champagne every weekend.
What on earth are you spending your money on then as thats £7000 a month? Our household income is £90,000 in the north with a £1400 a month on mortage and we fly first class and feel very well off.
shivawn · 20/11/2021 16:34

For me, I'd associate the word rich with the mega wealthy Kardashian types! I'd consider my husband and I to be high earners with a joint income of €142k and feel really lucky to have a fantastic lifestyle. We spent most of our 20's on minimum wage or close to it (also had a year during the recession where we were both unemployed and living on benefits) so really appreciate where we are now and know that we are more fortunate than most.

Dindundundundeeer · 20/11/2021 16:58

Flying First on £90k?! Blimey we earn 3 times that and no mortgage, but don’t even fly business.

… how big is your pension?

FitAt50 · 20/11/2021 17:19

@Dindundundundeeer

Flying First on £90k?! Blimey we earn 3 times that and no mortgage, but don’t even fly business.

… how big is your pension?

Husband is a deputy head so gets great teachers pension. I work at University so also have a great pension scheme with them. You just need to look for the sales and time it right. We are off to Singapore in April and flying 1st class with BA with actually cheaper than flying Business. Cost is just under £4k for the 2 of us and proper bargain.
felulageller · 20/11/2021 17:39

Lovinglife45, yes low mortgage, no debt, what we used to spend on childcare is now on fees.

WowIlikereallyhateyou · 20/11/2021 17:43

Sorry, but you are not rich if you earn £200/300/1m per annum if your outgoings are the same or more.
Wealth is surely found in accumulated £££’s. If you have no debt/mortgage and plenty of cash/assets/income and freedom to do what you want personally, then you are rich.

MiddleParking · 20/11/2021 18:56

@WowIlikereallyhateyou

Sorry, but you are not rich if you earn £200/300/1m per annum if your outgoings are the same or more. Wealth is surely found in accumulated £££’s. If you have no debt/mortgage and plenty of cash/assets/income and freedom to do what you want personally, then you are rich.
😂 really, there’s no need to apologise!
Bouledeneige · 20/11/2021 20:06

The 'its all relative' comment is interesting. Of course it depends on region - there are huge disparities - but what the rich crowd are forgetting is that they spend and have certain commitments - private schooling, car finance, mortgages, 2 x £10k holidays a year - are at that level because of the choices they were able to make due to their income. They are not 'saddled' with a huge school fees bill and mortgage(s) they chose them.

So for reference around where I live in an affluent part of north London, the 'average' public school costs £21K a year per child. If you buy a £3m house then I guess your mortgage could be pretty pricey. These are choices that people makes because they can.

MatildaIThink · 20/11/2021 20:41

@BertieBotts
Since you do have experience of both, can I ask, if you felt genuinely that you were trapped in that existence with ice on the windows, discount section of supermarket and so on and had absolutely no option to change that, none at all, would you not also feel resentful towards people who did have a less fraught existence and even seemed to take it for granted?

I don't think I can ever see myself being in that situation with no way out, as children it was difficult but it was not exactly unusual in the 80s to have single glazing and ice inside windows in winter, although it did not happen in wealthier households. As a younger adult, student, and during my 20s there was always a way out, working more hours, retraining, moving to somewhere cheaper, maybe that is the difference in outlook, unless I lost my lost my faculties an/or both my arms I don't see a situation where there would not be a way out.

In answer to the question I don't think I would be resentful though, it is not their fault if I were to be in that position.

I don't resent higher earners, because I have a better understanding of money as a resource (which makes it less emotional somehow) and it doesn't feel quite so out of reach, but I can see where it comes from, it feels completely unfair and a lottery if you personally feel you have no possible way to get to that level of living/lifestyle, and it's not like you sat there at 16 and decided yeah, I want to be poor. Even if somebody else made a decision to pursue a high earning career, nobody makes a choice to be badly off. (I don't mean someone who is able but chooses not to work much/at all of course).

The thing that I think some of those who have become high or even average earners struggle with is very often low earning and poverty can look like a choice. People choosing to work only 16 hours a week, I know the UC taper can seem a bit steep but almost always (unless childcare kicks in) working more makes one better off, having children early in life negatively impacts career options, many people have more children than they can afford to support, smoking and drinking when you have little money seems insane, buying expensive items (conspicuous consumption) doesn't make sense at any level of income, but even less so when you are struggling to keep the heating on.

Those who are higher earners are usually driven, they can push themselves to work 80 hours a week, or to not drink, not smoke, cook everything from scratch because they see all that as part of the way out. When I was doing my PhD I studied for 30-50 hours a week, I worked full time on top of that. When my husband started his own business he worked 50-60 hours a week at his business and 40 hours a week in a bar to get extra cash to keep things going in the initial stages (16 months). Sometimes the part that people struggle to understand is why when they were in poverty/low income they worked their way out of it, so why doesn't everyone, I can see both sides of that though. I think in some cases the way ambition is stripped from people is tragic.

And in some ways it is unfair - some people have to support their parents in old age whereas others recieve financial support from their parents. That kind of thing is not something you choose. Neither is disability or mental health issues.
Some do, some don't, I never expected life to be fair and perhaps that is the difference, most of the successful people I know have no expectation of fairness, but they are driven so that they don't ever have to try and rely on something being fair.

I think the UK has a real problem with endemic generational poverty and mental health issues and supporting those issues would go a long way.

I agree, but it is really hard to tackle. There is a poverty of aspiration which is endemic in some families, groups or even communities. Children not encouraged to study hard, told not to go to university, told not to apply for top universities, also told not to pursue apprenticeships, to not try to build a career. Those who just seem to stumble through life without making a plan, or who make bad choice after bad choice. We need to both support those who need help better and encourage those who could do better to do so, societal responsibility is a huge part of that, as is personal responsibility.

blackcoffeeplant · 21/11/2021 12:35

@DaisyWaldron

There have been a lot of descriptions of what people consider a rich person's lifestyle to be, but I'm curious about what posters think is an average lifestyle, or what counts as poverty.
I think poverty for me would be classed as running out of money every month when you aren't living beyond your means.

For me that would be bills, mortgage etc. we do have debt but manage it monthly and have it paid on time with minimal/no interest incurred. We have enough food in our cupboards and have enough money to treat ourselves monthly. Treats are classed as cinema, bowling, special outing for the 4 year old. We eat out or get takeaway a few times and I might buy us some new clothes from primark/supermarkets nothing too expensive. I feel like we live comfortably but I'm conscious we have no real savings and would like to be in a position where we can have good savings as well as live comfortably but that's not doable for our wages at the moment.

However I'm happy to be living in the moment for now with a young family and one on the way. We have a plan for Maternity pay and will get through the next year before having to pay childcare again.

We started from scratch with debt each, we made bad choices as teenagers and needed up with debt from previous relationships so we needed to clear that while also renting - no chance of saving money. We wanted to enjoy our 20s and chose to go on holidays as often as we could which I'm so glad we did now. We didn't get any help from parents or hand outs. We have bought everything ourselves from cars, our first home, paid for our wedding all ourselves. Yes with the help of loans which are now mostly paid back but I'm proud of the way we have worked things out. Neither of us went to uni but we have found half decent jobs with decent pay and have both managed to get a promotion and will have more opposite further promotion in the future.

While I don't ever advocate getting in to debt for anything. Sometimes it is necessary to have a life providing you manage it well.

Whatiswrongwithmyknee · 21/11/2021 12:47

@WowIlikereallyhateyou

Sorry, but you are not rich if you earn £200/300/1m per annum if your outgoings are the same or more. Wealth is surely found in accumulated £££’s. If you have no debt/mortgage and plenty of cash/assets/income and freedom to do what you want personally, then you are rich.
I don't agree. When people are earning in the top centiles of comparable income, they are rich regardless of how they are spending their money or whether they are accumulating any. Rich, to me, is about the choices you can make. If you choose to run a big house, send 3 kids to private school, keep a couple of horses, pay a butler, eat smoked salmon and truffles every day, fly by private jet to 3 long-haul holiday destinations every year and only buy cashmere jumpers and the effect of that is that at the end of a year you have spent everything you made, it is bonkers not to consider this rich. On a more modest level, if you can choose to live in Chiswick rather than have to spend an hour commuting in from Croydon, this is a choice many others don't have. It's irrelevant whether your house has 7 bedrooms or not if it's allowing a much improved lifestyle as compared to most others. Rich does not mean you have big assets, it means you can make financial choices which most others can't.
Santastuckincustoms · 21/11/2021 16:22

I guess it's true I could afford salmon and lamb if I really wanted to and shop for clothes all the time but I just feel so wasteful doing it. In answer to pps questions we don't have school fees, although we do pay a lot for extra curriculars, we have nursery and a commute that costs a lot (over £12k). But a lot of it is I don't feel comfortable spending after so many years as students and cutting back. Neither of us work for the money, we've taken jobs that are less well paid so we can work flexibly and we are more driven by the content of our roles so it feels extravagant to spend.

Oneforthemoneytwo · 21/11/2021 17:56

@Santastuckincustoms well that’s it isn’t it. It’s not you can’t afford it, you don’t want to spend it. That’s totally different and entirely up to you but to say you can’t afford salmon or lamb on a £170k income is absolutely not the case

lawnotorder · 21/11/2021 18:09

Flying First on £90k?! Blimey we earn 3 times that and no mortgage, but don’t even fly business.

What are you spending all your money? Your pension? I think it's useful to have a balance as no one know when they will die.

Nesbo · 21/11/2021 18:20

First class is almost always insanely expensive. A large part of the purpose of First Class is to make the still incredibly expensive Business Class seem more reasonable. It’s a psychological ploy!

If you can look past business class and are willing to drop a few thousand more for first class for a few hoirs of your life at most then you either have huge amounts of disposable income or some interesting priorities!