Average Salaries + Lifestyle in 30s/40s

[SmallWorldAfterAll]

First time thread poster here. I am always intrigued how people manage their personal finances, especially when it’s people on similar salaries with such variable costs and lifestyles. But as a woman in my early 30s, I’m finding a lot of people on MN are in their 50s and beyond, therefore very progressed in careers and different stage of life so slightly less relatable.

For those in their 30s and perhaps 40s, what is your financial situation looking like? What are your goals? I will of course start.

Salary = £75k, household ~ £105k
Pension = Contribute 15% with an employer match of 10%
Mortgage + essentials = £2,500 per month
1 DC with a plan for another
Currently have what feels like a very comfortable lifestyle but have some ambitious goals for the future
Goals = By 35 achieve a £100k+ salary, be able to save £1,000 per month (amidst childcare costs), 20% pension contributions, continue nice lifestyle (multiple holidays abroad, restaurants, nice family days out, etc.)

The one part of these threads I think is helpful is in relation to pensions. I am constantly shocked by the low level of understanding of pensions both on MN and more broadly, and I think for people to get a sense of the level of contribution and size of pot needed (for a DC pension) to give yourself a decent retirement is a really good thing. There is a huge crisis in pensions on the way which is likely to hit a lot o people hard, especially people around my age (40s) who are too young to have benefited from DB pensions and too old to have been auto-enrolled at a good age. Obviously it can be worrying to learn that you need to up your contributions but it’s better than keeping your head in the sand.

Obviously some people on this thread are probably lying but I’m not sure that really detracts from the general point. I also think it’s probably not the area that attracts the biggest lies because it sounds boring.

Had a much lower household income for many years while developing careers.

Rented as we were moving around the country with work.

Once careers started to take off we saved cash for deposit and then got employers to agree to WFH for the bulk of the time meaning no need to live in London or SE.

Bought a property in a semi rural area with views of farmland rather than housing estates. A far more pleasant area than anywhere we ever lived in SE and of course much lower property prices.

We’ve never received a single penny from parents or inheritance or indeed anything other than salaries from work.

Once we have enough saved up for DC’s schooling we’ll both look at part time and then early retirement.

My main point is regardless of your level of income your standard of living in SE is appalling compared with what you could have for the same money in other nicer parts of the country. The key is to get a role that allows WFH as much as possible as this transforms the options open to you.

Do I get worried about losing my job? A little bit although of course as we get closer to our goals the risk reduces. I’m pretty confident I’d be able to find another similar paid role if needed as I work in a specific regulated industry where competition for roles is limited due to knowledge and experience needed. My main concern is if any new role required significant office based attendance, including overseas travel, as that wouldn’t work with my current living arrangements.

Late 30s/early 40s. Two primary-age DC.

I earn £31k for 0.8FTE (so I think £38/39k FTE). DH earns £42k so household income £73k. In the SE so probably fairly low relatively though probably average amongst friends locally. Both have pretty good public sector pensions (though neither currently pay in anything above the standard, which for me is 6%, DH 9%, plus employer contributions).

Attempt to live fairly frugally but spend too much on food (repeated trips to supermarket and local shop) and impulse purchases (hello Amazon). By frugally, I mean we didn't overstretch on our mortgage when we bought our first house 10 years ago (had a £30k deposit, which we saved ourselves, on a £200k house) nor second, current house. Current mortgage is £915 (up from £830) - quite lucky that mortgage ran out just before the massive hikes so renewed for 10 years at 2.8%. Overpay by £300/month so mortgage should only have about three years left when current one is up if we overpay by same rate.

Also only have one (paid for) car, which is 9 years old. Will probably replace with a new (second hand) one at some point. Usually use some savings, topped up with a two or three year loan.

Neither of us are really extravagant with hobbies for ourselves, beauty or clothes, etc.

We tend to do cheap or free days out with DC, lucky that we live around half an hour from multiple beaches, country parks and other countryside. Have a few year-long memberships to EH, castle, wildlife park. DC do a couple of clubs/lessons each.

Try and save something each month (from £200-700), but the amount depends on what else is due that month (eg we pay TV license, car insurance, etc as one-off payments for the year). Have got £12k saved in a high interest, no access account and £5k in a low interest, free access account.

Goals: DH to get higher-paid job - he wants to progress as has been in current one for many years, save more each month (and cut down on food and impulse buys), work out and undertake best and most cost effective way of doing the house improvements that need doing.

Pensions are a huge issue. Many people significantly underestimate just how much they need to save.

My biggest single investment each year is my pension as it gives me 45% tax relief.

I’ll end up saving more in my last 10 years at work than the rest of my career combined. It’s another reason why I don’t crave an expensive house.

I too was pretty naive to it all in my earlier years. There is little pension support and advice offered and invariably when you are younger you have more pressing concerns. I understand that employers are not FCA regulated and not allowed to advise but I do feel they should do more in conjunction with their pension provider to help educate and inform employees.

It's not showing off (some might but good for them!), it's interesting to see what salary people are on and some people have given great advice for those of us who would like to reach a higher salary too. If you aren't interested then no need to post.

It must be so hard though, I earn double that and I struggle to put food on the table

It always amuses me how quickly well-paid people pile on to these threads to list their incomes!

Thank you for answering this in a very comprehensive way - I imagine people who are viewing this thread and worried about their own situation will find this far more useful (again assuming it's true) than just seeing what people earn.

Your post underscores a number of important issues:

1. For many people the idea of working from home is absolutely awful - many thrive and enjoy being around others and having a "work life" as well as a "home life" - for them the notion of working from home with no separate work place would be awful. True, many like it - but it does encourage that rather nasty crossover of "work" into "life" that can for many mean a massive increase in stress and a lack of "out of work" purpose.
2. You mention you live in a rural area - this is important for underscoring that living in a lower mortgage/no mortgage situation is for most entirely dependent on location: for many the idea of living in a rural area with far more limited social life would be, again, a very negative and isolating experience. It works for you and that's wonderful, but for many it wouldn't work at all. Social isolation is horribly detrimental to many people's lives.
3. You also mention that you can't live in the SE due to financial constraints. Again - this cuts off a large portion of the nicest part of the UK to live in. The part with generally nicer weather and access to Europe etc etc etc. Again, that may work for you but it would be burdensome for many who find access to those kinds of things to be tremendously beneficial to their lives.

Etc etc. All of which underscores that your life as someone who lives in a £350k home with no mortgage may be lovely for you. But might well be absolutely unbearable for someone who thrives on social interaction, having SE contacts, and having a definite line between work and home. Those people may be far far happier having a mortgage and living in a home that is worth far more than yours. Or renting. Or having a smaller home because they love spending time out and about with their work friends etc etc and the other aquaintances they make from living in a more diverse community that inherently will have more options for things to do.

So: to anyone looking at the OP about having a paid off mortgage and feeling inferior hopefully this demonstrates that there are massive trade offs involved with being in this position: these folks work from home in a semi rural environment that isn't in the more desirable place in the UK to live.

(Now; from personal experience as someone who has a paid off mortgage, lives in the SE, and was retired before 40: there are downsides to that too!)

I agree with much of that.

I love WFH but wouldn’t have wanted to do it for my entire career. I still have the option of commuting to the office but rarely do. I have colleagues who hate the prospect of it so I’m quite pleased it suits me.

I guess the same principle applies to location. I never really bonded with the SE. I lived there under sufferance.

I much prefer semi rural areas with easy access to a major city. That way you get the best of both worlds.

Having no family ties in the SE also plays a part. In addition to that many of my work colleagues from there have also moved away for similar reasons so very little to tie me the area.

I can see why others with personal ties may want to live there but for me it is pretty close to the bottom of the regions I’d live in by choice even if prices were uniform across the country.

I’m not going to post all my details here but I think it’s a really good idea to take stock and set some financial resolutions as well as other NY resolutions.

We are trying to decide whether to go for baby 3 and the cost of childcare is what is really putting me off as we’ve only got a year left before DC2 goes to school. Being able to save that money would make a huge difference to our family finances. But then I’m almost 37 so don’t have the luxury of time.

Fortunately have a very good pension pot for my age as have always prioritised it.

You raise a very important point here. I suppose the incredibly simplistic response would be "if they key to your happiness is having another child - and you and your family want that above all things then you just gotta go for it and you'll make it work". That seems to have been what my folks did when they had a third child. They wanted another baby and they made it work. For them that meant putting in some work ahead of time to figure out other families in the area who had kids, and perhaps wanted more, and then figuring out a "book" such that similarly situated people in the village essentially ended up "sharing" the load...at the same time my mum took at home courses (there was no online then) so that she could have a flexible enough job to juggle childcare. What that resulted in was a lovely community of parents who would each spend a day a week not only looking after their own baby but maybe one or two others...meaning that most families could have at least a 4 day work week.

Alas, while the online community has made access to so many opportunities far easier, it has in many ways (in addition to various other social issues) made access to community childcare and community "help" far more difficult or at least less "normal".

One might argue that if one is on the fence about another baby then perhaps the answer - if you have the choice - is that maybe you really would be absolutely content without another one. With the understanding that even if you can't have a biological baby later in life you can for sure foster/adopt etc etc if and when you have more financial resources/time.

On the other hand if that thought fills you with horror and the thought that you would be devastated without another baby...you'll make it work.

We paid off our mortgage for our first property before age 40. We had a 40% deposit (saved from earnings, as we have a high joint income and saved for over 10 years before being FTBs). Then we overpaid as much as possible as we didn't spend most of our income. We have a high household income, but no inheritance or family help at all.

We have taken on an even bigger mortgage a few years later though! It's a large amount but not what I'd consider to be bigger or more expensive than we need - it's in central London though, which suits our lifestyle and work and school locations.

It's not all lies though is it? I'm sure quite a few people are telling the truth. I bought my first property in London with some inheritance because a parent died very young and my partner had a gifted deposit from his grandparents who were trying to avoid inheritance tax. We picked a sensible ex council property, did it up and sold it for a profit. I put that money into my second house deposit and threw every bit of savings into the mortgage.

Around that time my other parent downsized and I got another small gift lump sum which went on the mortgage. When COVID hit we cancelled our wedding and honeymoon and put that into the house. I've always saved half my salary so as my earnings have gone up so has my spending and saving. Lots of my friends prioritise other things particularly travel and for some of them luxury goods and cars. We don't drink and haven't been out anywhere nice or overseas since we had kids.

I took two short maternity leaves and work in a very stressful industry where you are absolutely expected to be available at all times including for travel. I could have a less stressful job and WFH (I do this part time on top of my 4 day a week role for flexibility) but I want to maximise my earnings potential whilst I can. The kids will be in school before we know it and if I've taken 5-7 years out for them or even just reduced my hours massively it's very hard to get back to my previous career path.

@Urgenthelplease - I agree that quite a few people are telling the truth.

The OP said that they thought most of the posters on Mumsnet were in their 50's with established careers so had asked those in their 30s/40s what is their financial situation looking like? What are their goals?

I uploaded my responses to those questions and provided further info as to my employment, as a couple had stated it would be helpful to know what type of work Mumsnet posters were in. Yet it seems that there will still be comments made that posts uploaded are lies because they haven't disclosed their location, if they've received any financial assistance etc when the OP hadn't actually asked for this information in their original post.

I think the problem is the title
of the thread - average salaries and lifestyle in 30s/40s.
nothing about this thread will give you an ‘average’.
if you’re genuinely interested in seeing where you fit in the ‘pecking order’ then there is loads online:
https://www.statista.com/statistics/802183/annual-pay-employees-in-the-uk/

https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/datasets/agegroupashetable6

etc

This one will take into account your housing costs:
https://ifs.org.uk/tools_and_resources/where_do_you_fit_in

....are you ok? This is a very aggressive response in reaction to what I posted.
Firstly YOU jumped in to 'correct' another poster, suggesting the statistics they had used were wrong, so I just explained that they weren't. I didn't even say that you were wrong instead, just you were both just using different metrics.
Then YOU introduced the unnecessary sarky emoji
I've not insulted you and don't think anything I said constituted a "rant...." although your bizarre post certainly does!
Sorry you feel your financial circumstances are unfair but maybe consider therapy if just genera discussion (as I haven't even referred to, let alone criticised any of your personal circumstances or decisions BECAUSE I DIDN'T KNOW (or care) about them until you've reeled them out) gets you this worked up.....