How do people afford to live in London?

[galwithkids]

What it says in the title really..
We live in a 2 bed flat with our 2 DCs (4m 3m) in London zone 3. I love our area, I love London and I don’t want to move away. However I keep wondering if everyone around me is making more money that us to be able to live comfortably? Both me and DH work full time in demanding jobs and we bring home approx £9000 net. Our monthly outgoings are £7300. I have tried everything to bring this number down but I am not able to. This is just family basic living expenses, no extras, no commute or car costs, personal
phone or subscriptions not included. I have worked SO hard to bring myself to a point of earning that much, and yet every month I am left without any spare money, I never spend any money for myself, all my clothes are from Primark or H&M, the kids clothes and toys are all second hand, we don’t order take out, the weekends are usually free activities in the park or museums, I don’t save any because there isn’t any left. I feel like I have worked so hard for so long to bring myself to a decent salary level and yet I am not living the life that should come with it. I don’t want extravagant expenses, I don’t mind shopping at Primark. But I would like to have some
savings for the kids’ future, and I have nothing because money is never enough. What am I doing wrong?

wow, who knew having children was so expensive? creating the future of the country and paying out of the nose to do it - i wonder how sustainable that is?!

I was a single parent with 2 kids in London - I was on a lot less income than you and it was tough but my childcare costs were far far lower than yours and my mortgage was lower. I paid for the nanny but did not pay for nursery (I couldn't have done). The nanny took the youngest to playgroups regularly (free ones or ones with like £2 donation) and then ds started at the school nursery class where dd was at school.

We still live in London now but both kids (now 23 and 22) live with me still as they can't afford to rent on their salaries! They are waiting to find somewhere they can rent together.

and I don't know if this is the case now, but back when mine were small, a lot of families got around the 'nanny' costs by using cheap live in 'au pair's' who were paid 'pocket money' like v little and some of whom had v onerous duties

don't know if the government stopped those visas!

we employed a proper nanny as I couldn't live with myself not doing it properly and my kids were small and I didn't want to take a chance

It frustrates me that your husband is probably not giving as much thought to any of these issues as you are. You say he won't clean - part of your problem is him!

Wfh just gives you more head space I think.

I know you love the flat but considering you commute for a long time and your husband doesn't even work in London, could you perhaps think about selling up and buying a bigger place closer to one of your jobs? We lived in herne hill for six years and I loved it - brockwell park, close to Brixton, lovely market

I think the short answer to your question is - yes, everyone around you is probably making more money or have lower expenditure than you.

I'm not going to wade in on your expenditure, but I think you are underestimating how few people can afford to live in your area. DH and I used to live there and moved out of London when we had DC2 as we couldn't afford the step up to a house and we were both senior associates in magic circle law firms, but we had children comparatively young for very good reasons. I was 31 when DC1 was born and most of my baby group friends were at least 5 if not 10 years older than me.

So the people you see and are comparing yourself to, are probably just that bit older or at least one of the couple has had extra years of comparatively low costs and good incomes. You say to yourself that you earn a lot of money and should be able to do the same, but you have less wealth so you have a higher mortgage and lower savings which makes everything feel more precarious.

Am I reading this right (confused as many are saying you need to cut back)
You have £1700 disposable income AFTER everything is paid)??

what am I missing?

No not everything is paid. In fact as some have suggested I will start to account for all expenses as I do find myself without much left at the end of the month and this is one of the things I am doing wrong

Can't you pay your nanny to work full time and mind your DC who is in nursery ? It does seem like you are paying 2 lots of childcare and I can't think that it would be more to just have 1 person cover it all.
I agree re investment and flat and once you move out of London it's very hard to move back. But your commute is long so perhaps look for something nearer or that gives you some wfh flex. I know you've said you've not see anything yet but I'd just keep looking you never know

We had an Au pair but we were age_ 9-15 and the au pair just had to be around at breakfast and when we got home from school/cook us tea. The rest of the time was her own, and she had a lovely bedroom and my parents gave her decent pocket money and paid for her language course and train pass and took her on holiday/taxi'd her home from nights out. If people treated au pairs well it was a good arrangement - she was from eastern Europe and able to live in a very large house in a nice part of the UK and learn the language with all her costs paid. It's a shame some people took/take advantage

It wouldnt work for the op though as she doesn't have a spare bedroom

You're local to me. The things I would worry about:

You're likely surrounded by people who will be sending their kids to private schools for secondary. You have 2 boys and there isn't good options for them in your area. With the low birth rates maybe fortismeres catchment will stretch to you, but I doubt it. I doubt HWS will improve that much. You're also likely to be surrounded by people who are living in much bigger houses and seem to have more money. The nature of the area. What I think is happening is you have no time to belong to the community and that's really what a lot of people do for childcare in holidays etc. There is a lot of info passed through the grapevine about childminders, parents swapping around etc. Your attitude to the nanny won't change so actually I don't think your childcare costs will change much until your kids are well towards the end of primary. Your nanny will be getting cold feet soon as well, so you need to give her reassurance with a realistic plan as to what she will do once the youngest is in reception. Saying, we will always need you isn't good enough.

Have a look at the Haringey Holiday Fun booklet they release every half term. It'll give you an idea of provision available. Also, look up childminders. There's lots in Crouch end/muswell Hill/Highgate. When I worked at Coldfall there was one company that would pick up about 20 kids at once and run a small walking bus. They'd take them to performing arts and than a generic after school club type of thing.

Does your husband work out towards Hertfordshire? Have you looked into places like Hitchin? Very fast train to Finsbury Park, you are still getting the London life you crave. It honestly doesn't sound like you're able to make the most of London life anyway.

Honestly, it just sounds like the nanny is what has enabled you to function without going crazy and whilst that's good, it's not financially sustainable. There's tons of options where you are, I feel you probably just don't have time to look into it.

Hope things improve. Sending you all the good vibes.

thank you so so much for this reply, it’s super helpful!

Very good input from some posters, you should be well off at the end of each month but the money's just flowing out,even small bits of shopping here & there are expensive in Highgate. All incidental expenses need to be accurately noted,can nanny do a bit more cooking? Emotional as it may seem, nanny may have to go when DS2 hits Reception and a different childcare setup embraced. Also as mentioned, other people are earning well but with higher equity and smaller mortgages they are relatively better off. Reduce cleaners hours, can one of you do morning drop offs and reduce nanny am1.5hrs? it doesn't sound like you can upsize easily in your area but once both boys in school you can move further away;do think about secondaries as mentioned, that time comes round faster than you think.
2 career focussed parents is not sustainable when kids come along unless you're earning mega-salaries and can easily afford the nanny with plenty left over, so most people use different childcare options. Also, you really only have this time with kids now, they'll grow up quickly.

I am also local to OP, though not in Highgate itself. I agree with what you say about having to think ahead to secondary.

OP you should be aware that there are 2 state grammar schools for which your sons would be eligible as they have very wide geographical catchment and good transport- Latymer School in Winchmore Hill and Queen Elizabeth Barnet. However both are extremely academically competitive so no way you could know at this stage if they will be an option.

even small bits of shopping here & there are expensive in Highgate.

Only if you are too lazy to go to the Aldi 10 minutes down the hill at Archway!

You are living in luxury because you have a full time nanny and cleaner . Other people don't have that. That why others have more Money than you.

Latymer is definitely not winchmore hill. It's a very rough part of Edmonton and the area is a reason some turn it down altogether. Latymer whilst not easy to get into, is a lot easier than QE.

But yh, you really need to think about secondary.

Wow. I was making the point more about the availability of a selective grammar within striking distance of Highgate than any comment on the specific location. It’s an excellent school, I was at Cambridge with several pupils from there. More fool the snobs who’d turn it down due to location.

I don't understand while everyone is saying the nanny doesn't work enough. She works until 8pm I think it was. She also gets the kids ready and out in the morning. She will be doing full 12 hour days if OP gives her extra jobs while the youngest is in nursery.

Yh I get you. The journey from Highgate to Latymer would easily be 1hr one way though.

Hi OP,
To me the most striking thing in your thread that I would question is that you don't want to sell your flat because you see it as an investment.

If you had said "I don't want to sell my flat because it is beautiful, I am so attached to it and living in this area is my dream" I would totally understand that, but because it is an investment no I don't get it.

Most people choose where they live because it suits them best - especially when they have a family. You could easily give your kids a room each, a garden, a lifestyle with holidays and more of your or their other parents time so they could go to activities they choose, or have playdates. A theoretical "investing" in your London flat seems the worst reason not to do this.

So your flat might be worth 100k more in a few years, or 200k more or a million more but your children won't get a second childhood, and you won't get a second chance to raise them. You and your partner earn very well - you don't need to live a less nice life on the off chance your equity goes up.

If the equity in your flat does go sky high what is the game plan? To sell up and get out of London with cash to buy your kids properties as well as your own mortgage free? But by that time they will have missed the chance to build connections in a new area and probably won't want to leave. Your flat will only ever be worth the cost of a two bed flat if you stay in the area and your kids are unlikely to be able to buy near you - especially if you can't help them.

It sounds to me (when you talk of your hard work and not wanting to take another job that would reduce the pressure but is less pay) that your goal and driving force has been to earn the most possible, and that the high earnings is important to your self esteem. I think personally that a much more sensible goal, especially when you have kids, is the best quality of life possible.

You and your family might, for example, have a much nicer quality of life on half the household income if you had less work hours, less work stress, more time and more spare cash for activities, days out, holidays etc.

It will be much more likely that your kids will be able to buy their own homes near you and their friends one day (if that's what they want to do) if you don't live in London.

Do what the rest of us do which is use school wraparound care and local holiday clubs. We are in north west London too and our local holiday clubs are £24-£35 a day. It would be mad to keep a nanny on retainer.

I’ve had a similar realisation . Worked hard for a long time and thought it was work towards something and very aspirational and romantic of what my future lifestyle would be. Now with young children and living in a nice part of the south east I feel comfortable but not well off. The truth is no matter how hard I work or better paid jobs I’m not going to become the wealthy bracket .. I don’t have generational wealth. I might build some equity and things will get easier over time as kids are not in nursery but I’m not going to jump into that bracket I aspired to and very very few people have that. Better to make the best of my circumstances and focus on having a great quality of life than pushing for the next £20k . It’s all marginal gains from here . So many people move from London becuase the slog doesn’t bring happiness , maybe you have something to still prove to yourself or your family .. maybe think about why stepping off the gas for a few years would be so bad. Who is it all for ..

I also wondered if you were from another country where hired help is more commonplace and for the middle classes rather than the elite .

really wish you well and sympathise but think your mindset here and climbing and meeting your works ‘expectations ‘ mentality is holding you back from Enjoying your life now and time with your kids . Those work expectations seem unreasonable that you can’t do drop offs and late picks ups etc

Also just thought surely your work colleagues don’t all have nannny’s . Maybe there is more flexibility than you’ve asked for.

I may be wrong but I doubt a two-bed flat in Highgate has the best 'investment' potential. A house in a cheaper up and coming area may be a better investment (and more fun to live in).

I would also have thought a school nursery place would absolutely be your first priority if you are paying for a nanny.

I totally get the feeling of having worked hard and put up with a lot to earn a lot. But you are making some luxurious choices here, ones that that be honest your income just doesn't stretch to. You both earn well, but not megabucks - not multiple hundreds of thousands a year each like many in London do, especially those with full time nannies.

I have pretty successful friends, everyone earns over £100k and some much more (including bonuses). None of them have a full time nanny. (some do nanny shares). None of them pay for a nanny PLUS nursery - take it from me as someone with a specialism in this area, play and socialisation is the best education for under 5s, and your nanny can very easily provide this for your youngest especially by taking them to meet ups and play groups with other nannies, which are very common. The fact your youngest was "jealous" when their older sibling started school is a ridiculous thing to give into.

I also don't know anyone - and to underscore I know couples, both working, with 3 kids, who take home around £3-400k a a year between them - who have a cleaner for 5 hours a week. And they live in much bigger properties than you!

Honestly, you seem to think you can afford a lifestyle that simply isn't reasonable on your income. And then when you feel you've no money left, you wonder why you're feeling strapped.

Cut the nursery out or massively down.
Cut the cleaner back to 3 hours a week.
Figure out a way to not need a nanny once all the kids are in school. There are alternatives and they are alternatives that the vast majority of working parents cope with!

Ask yourself what is more important - ironing, or being able to save for big future goals? Surely the latter??

And you'll have hundreds more a month just from that.

Online shopping from a cheaper grocery store could also reduce your food bill while still being convenient (I get how tiring meal planning and shopping is when you're working and have kids.)