UKH

I see that Plaid Cymru want to tax at 50p those earning £50k upwards, I think the quote "soak the rich" was used - Even though hell is more likely to freeze over before they form a government, my questions is....Is £50k rich ? - Personally I do not think so, £150k+ maybe but not £50k

For example I spotted job in the Metro in London today for the NHS doing something in Social Care - It paid £24995 !!! - So in other words that person is HALF WAY TO BEING classed as rich ??????

What do U lot think ?

In reply to Kevin Livingstone: £50k is a lot in Wales.

In reply to Kevin Livingstone: 50k isnt rich but its certainly well off! and i know i wouldnt say no!

In reply to Kevin Livingstone: I think £50,000p/a is a lot of money, yes.

I would consider someone on £50,000 to be very well off indeed.

In reply to Kevin Livingstone:

£50000, thats about 10000 times more money than i have...

In reply to Kevin Livingstone:
I wouldn't say rich, but I would say extremely comfortable. (Mind you, apparently you can pull in 30k in benefits by dropping a few sprogs and watching Tricia all day, so maybe it's not so much money after all..)
Wish I got 50k a year...

In reply to Kevin Livingstone:

To be honest I wouldn't count it as 'rich', but comfortable. Seeing as some of my friends off my course who are heading into the city have just received details of their starting salleries (~£35k), I think for someone of reasonable education £50k isn't too hard a target to attain.

On the other hand, it depends on what you want - I have no inclination of becoming a city bitch, and as such immediatly close that particular door to high earning / no free time. What a shame.

In reply to Kevin Livingstone: I think the top rate of tax only applies to the earnings over 50k, doesnt it? so you would pay lower rate on the first 49k, then the higher rate on the rest. In which case it seems fair enough to me. £50k is a lot of money.

In reply to Kevin Livingstone:

I agree, I don't think £50K is that much any more, well I certainly don't feel rich.

I hear the Lib Dems are looking at increasing council tax by upto £500 a month for families earning over £80k in the household.

These things need to be regional for start, as £50k is wales is lot better than £50k in London. Also I agree with a higher tax band for people earning over say, £120-150K pa. there are many many people out there on these kind of salaries.

In reply to Kevin Livingstone:

Not really.

Its only a bit more than twice the average salary.

£50k is a good springboard for later richness, though.

James

In reply to Kevin Livingstone:

£50k in London is not rich at all, comfortable, but not rich

In reply to Kevin Livingstone: not rich, possible comfortable depends on the bills like morgage, student loans etc etc

In reply to Kevin Livingstone:

50 grand alot? Not really if you live in London where a bog standard shoe box sized flat somewhere reasonable (not nice but reasonable), would set you back about 250 large. At 5 times salary you wouldnt feel quite so well off then me thinks.

Concise Goose

In reply to Eskdale massive:
When you say family, does this mean that Lib Dems are looking at doing tax per family rather than person?

BKB...

In reply to Bob kate bob:

more per household from what I understood

In reply to Goose: but you would be considerably better off than the majority of people also living in london. So if you would be finding life difficult on £50k at 50% tax, what about all the poor sods living in london on lower salaries?

In reply to Rothermere:

'only'? I'm finding this all a little surreal. Wish i was in wales so i could vote plaid cymru.

In reply to Kevin Livingstone:

Compared to what we live on atm 50k is not just rich its a f*cking fortune!

Uri(the poor one)

In reply to Kevin Livingstone: as said where?
50K in caenaerfon yes you are rich,

50 K in london, and life will be not so easy.

In reply to Kevin Livingstone:

Isn't 'rich' the point at which additional income is a luxury rather than a direct impact on your standard of living?

I can believe in most parts of Wales, £50k is maybe over than threshold, whereas in London, I'd say you could have a household income of £120k+ and still be struggling.

Makes sense if they're talking about doing it as a local income tax *in Wales*, but as an across-the-board income tax, it's pretty ridiculous.

In reply to Psychopathic_Barbie:

Average national salary.

Living costs are different around the country.

James

In reply to Eskdale massive:
all tax? even income tax?

This would have a great impact on single earner households.
Would be more in line with places like Canada.
bkb...

In reply to Goose:

Yep, but if you're on a salary in london that is in the teens you can imagine how much fun it is.
£50 grand would be great, but i can't see myself ever earning that much. And every owning more living accomadation than a tent (or maybe a caravan if i get lucky). What else do you do.

I thin there shoud be more tax paid. After all its not an all the earnings, only on those over £50k.

In reply to Goose:

Yep, but if you're on a salary in london that is in the teens you can imagine how much fun it is.
£50 grand would be great, but i can't see myself ever earning that much. And every owning more living accomadation than a tent (or maybe a caravan if i get lucky). What else do you do.

I thin there shoud be more tax paid. After all its not an all the earnings, only on those over £50k.

In reply to Helen R: wealth is not something that sits idly in a treasure chest tho, it exists as a a dynamic and flowing medium

In reply to Bob kate bob:

not I think it was more council tax only

In reply to Kevin Livingstone:
in london i dont see how a familly could aford to live on 50k a year.

the girlfriend and myself earn about this much beteen us and could only just afford to buy a flat. The mortgage and bills exc take over half of our income so if we ever decided to produce small doz generales we would need lots more money or live a hard life eating no frills beans.

its a sad state of affairs that you would need to be on at least 50k a year if you wantted to buy a small flat on your own in london.

In reply to all:

the leader in this week's economist is about flat taxes. I haven't read it yet, but at face value it sounds like a good idea.

If tax is a % then why does it need to increase with the amount you earn? And the simpler the system, the easier to collect.

Anyone know anything about this?

In reply to doz generale: its not a household income, its an individual income. Most individuals - even in London - earn substantially less than £50k pa.

In reply to doz generale:

it's about time politicians tackled this economic divide ebtween the South East and the rest of the UK. For years now the countries economic growth has been centred in this area and people have got fat off investments and inflated property prices. When things start to get tight and the property stops rising people start claiming that they need more money to live in London. You can't have this both ways! London and the South East have been operating a different economy to the rest og the UK for years now, subsidised by the rest of the population. Do people in London get a London weightin on their phone bill, on their electricity charges, on their car tax (ignore the congestion charge for a minute ;-0), insurance, food etc... No they don't, so why should they get a weighting on their salaries. Government needs to encourage companies to base themselves outside of this region to spread the wealth more evenly across the country, moving public service jobs out would be a good start, the BBC will follow suit too - maybe then other companies will follow, the money will too and London can then become slightly more equal to the rest of the UK.

Rant over.....

Average salary (national average is £22,411)

·South-east: £25,221
·Scotland: £22,230
·East Midlands: £22,528
·West Midlands: £22,529
·North West: £22,102
·Yorkshire and Humber: £21,085
·East of England: £21,936
·Wales: £20,391
·South-west: £22,205
·North-east: £20,353
·Northern Ireland: £17,366

Related cost of living

·South-east: 5.3%
·Scotland: -5.5%
·East Midlands: -2.6%
·West Midlands: -2.2%
·North West: -3.1%
·Yorkshire and Humber: -5.8%
·East of England: -1.1%
·Wales: -6.9%
·South-west: 1.3%
·North-east: -5.8%
·Northern Ireland: -4.8%

In reply to doz generale:


A very small flat. Assuming a vaguely sane multiple (x3) you need to have over 80kpa to buy the average London property (about 250k) and that's not even thinking about lawyers, stamp duty, decorating, furnishing, removals costs etc.

In reply to Bob Hughes: Logically it needs to increase with the amount you earn because at the lower income level you could not manage to pay very much tax and still pay rent, bills, food etc, even in the cheapest housing. Therefore if everyone is taxed at only the highest flat rate that the lowest earners can feasibly sustain, total national tax will be very low. Therefore every government, no matter how free market conservative, imposes progressive taxation in some form, where those on higher incomes pay a higher percentage of their earnings into the treasury, as it allows them to collect a greater overall amount of tax.

In reply to Psychopathic_Barbie:

I dint say I found it difficult, just that 50grand wont buy a flat near the city (to earn the 50 large), and thats before a family etc.

50 large for a single bloke in the lakes - now thats maybe more like rich.

Receptive Goose

In reply to Route Adjuster: You have a point.

In reply to Bob Hughes:

can't possibly allow this. the govt. would never contemplate getting rid of the civil service jobs it has had to create to replace private sector ones.

In reply to Helen R:

I can do more than imagine, I know people for who this is a reality. They are at least single and without depends currently, but adding those in could be alot worse.

G

In reply to Kevin Livingstone:

Relate it to property and I'd say probably not...

In reply to Route Adjuster:

I agree. I would much rather live and work in the lakes than in London.

Is this really likely though?

Think about geographic and economic thoery though. Clusters of expertise and nodes of development. Thats why companies cluster. Its not a govt issue.

Contemplating Goose

In reply to Route Adjuster:
i know what your saying here but i don't think that its strictly true. I lived in Nottingham for five years before moving to london and i had a much higher standard of living. my wages were lower but my rent was much much lower people could afford to buy houses yes houses! on moderate wages. i had far more disposable income and much more living space. My mates that still live up there all have bought proper houses in nice areas and are starting famillies, which is something i cant afford to do even though i earn more than i did when i lived up north.

Also just a side piont here i used to be able to cycle to open country side in ten minutes but now i can't.

In reply to Route Adjuster:

But capital growth is strongest outside the south east and in many parts of London there has been a fall in the value of homes.

As to whether the south east is subsidised, well, the cost of food, petrol etc is all directly related to the cost of supply, so with higher staff and property costs then the asnwer is yes.

In terms of car tax etc - that is a fixed tax, but I would proffer that taxation as a multiple on salary and costs i.e. income tax and VAT is higher in the south east, since the de facto wage and living costs are higher.

In reply to Goose: the answer is that property prices in london need to be dealt with. special pleading for those on high salaries just emphasises that people on average salaries are totally priced out of the market - its this that needs to be dealt with. Part of the problem was the buy to let market, which took off because when pension schemes started going tits up, a lot of people with funds available to invest in pensions saw property investment as a more reliable long term bet.

I'd like to see the parties belt up about immigration, terrorism scares etc and start talking about practical stuff like what they are going to do about housing and pensions.

In reply to doz generale:

What you are saying underlies my whole point. London in itself is not an attractive prospect - too expensive, too populated, too 'urban', too damn busy. To attract people there companies (including the public sector, which I believe is inherently wrong) have to offer above the going rate for salaries - i.e pay people to motivate them to move to the area. My whole point is that it would make much more sense to distribute the jobs and subsequent 'wealth' to other geographical locations. Given the opportunity I bet a fair proportion of London based people would move. Take the mountain to Mohammed if you like.

In reply to Psychopathic_Barbie:

I agree property prices need to be dealt with, but my suede has no answers of how you protect those who have struggled to buy in the past and yet provide for those who cant buy.

You cant help both easily.

I think people sometimes forget the other side of house price rises....

50K is rich.

And for the people bleating "oh, but I can barely afford a penthouse" on that, i've got two things to say -

A) commute.
B) the office cleaners seem to manage, and they're not on 50K..

In reply to Ian Munro:

Certainly, but if you suppose for a moment one would actually have to work for this 50 grand - to the tune of 14 hours per day, how far, and for how long would Mr Munro suggest commuting?

Does Mr Munro like to sleep at all, or make it home in time to see his kids/wife/gf before they are all asleep?

Cleaners maybe do not wish to buy a house, and they may have the luxury of time to commute.

Goose

In reply to Ian Munro:

in london 50k a year is not enough to buy a small flat in a decent area anywhere within comutable distance of the centre. FACT

Office cleaners are an example of an underclass of people that will never have the oppotunity to buy property in london unless something is done. Its a shame and a real issue that politicians should be addressing.

In reply to Ian Munro:

No it's not. Rich is (remember dictionaries?) 'possesing great material wealth'.

Firstly you're confusing wealth with income. Easy mistake. Secondly having 2x average income is scarely 'great' (ie: very large in size). Think. Then type.

In reply to Goose:

"Cleaners maybe do not wish to buy a house, and they may have the luxury of time to commute"

/shakes head sadly and walks away.

In reply to Kevin Livingstone:

What is the statistic for the number of people in the country earning over 30K? At the last time I looked it was a rather shocking 10% of the population. If you earn £50k+ p/a you are rich, or it at least puts you well into the top 10%.

In reply to Ian Munro:

"50K is rich.

And for the people bleating "oh, but I can barely afford a penthouse" on that, i've got two things to say -

A) commute.
B) the office cleaners seem to manage, and they're not on 50K"

Erm...nobody is bleating about not being able to afford a penthouse....they are stating the harsh financial reality of being able to afford a modest one bed flat.

With regards to commuting, any savings made by living in cheaper accommodation outside London are immediately swallowed up by the cost of commuting, it is not uncommon for people to be paying £1500 + a year on travel cards etc. Couple that with the fact that people might want to spend some quality time with their family/wife/husband etc instead sitting on a delayed train for 2 hours makes the commuting option even less desirable.

In reply to Goose:

In Barrow people would think you were Bill Gates if you earned £50K a year, but nice parts of the lakes are not cheap at all.

In reply to doz generale:
"in london 50k a year is not enough to buy a small flat in a decent area anywhere within comutable distance of the centre."

Funny, I live in Hertfordshire and know plenty of people who commute into the city everyday.

Judging by how crowded the trains are, they are not unique.

FACT!

In reply to Enoch Root: My father in law is a self made millionaire. At the age of 60 what ever he is, his salary for last year got over £40k for the first time. £50k per year is rich. If you choose to live in a ridiculously expensive area then that is another issue entirely.

In reply to Kevin Livingstone: In reply to ALL

Very interesting comments so far.....for my own part I'm obviously not going say what I earn, but lets just say its middle income - Not £50k yet but it may be in a few short yrs.....
I live in the south East and I acknowledge that If I lived in Cardiff etc on my salary I'd be very happy, but living where I do I cannot afford a new car (Mine is 10yrs old ) we certainly cannot afford a sunny holiday as we've kids and the prices shoot up in school holiday time, we're going camping AGAIN this year and do not eat out in Curry houses every night - The point is is if the NHS are paying £25k for a social worker then £50k is NOT rich - I do agree that those on £120k upwards for example should pay more - How big do their houses have to be after all - Do what I did and get a smaller house and mortgage

The problem with any tax, not just higher rate tax, is that it should be based on the HOUSEHOLD income to mskre it fair as Child Tax Credit is - ie Family ONE has One earner getting say £60k but his partner stays at home to bring up kids - Family TWO has two earners on £35k each (so £70k) but each pays less tax - how is that right !!! - Child tax credit was like this, but thankfully it got changed to household income !!

In reply to Lbos:

as someone else has said, earnings and "richness" do not go hand in hand. You could have inherited some money and be very rich on 15k pa.

we live in decent 2 bed flat, worth about £210-220, earning about £80K between us both. I do not feel in any way other than in "love" (ahhhhhh . . .) feel rich

In reply to Iain Ridgway:

depends on your lifestyle too, if you are have dependants and need a family home in London 50k isn't that much. But then, that's not really the point of living in London.

I think another tax band for the top 5-10% earners makes sense.

In reply to Ian Munro: funny i live in hertfordshire too and still can only afford the mortgadge on a 1 bed flat at best!

In reply to Minka: I think its switzerland where you are taxed where you live, not where you work? or something like that, so its very variable around the country, not a bad idea.

In reply to Kevin Livingstone:

No I dont think 50k is rich. Still skint at end of month. Dont eat out, don't have holidays, dont have flash cars, modest 3 bedroom house (falling to bits), dont drink that much, dont smoke but have 3 kids...

In reply to D Berry:

that not a very informed statement really?


so your father in law is a self made millionare, so he is likely to have lots of money tidy up in very valuable assets?

He is also likely to be able to continue to pay himself that salary into retirement?

his salary is probably one of many income sources

In reply to Kevin Livingstone:

50k a year gives a take home pay of c. £2,900 a month

Based on single person, no other benifits

http://money.msn.co.uk/tax/Calculate_4_/Income/remuneration/default.asp

So 50k would be well paid, but hardly rich.

In reply to Derbyshire Ben:

So the cost of living in London is +5.3% and the wages are over 10% higher than average.

In reply to djviper:

Me too
Though luckily as I bought about 10 years ago, I can probably afford to get a small house now.

I think the people who don't think 50k is rich, have lost a bit of perspective on what real poverty is.

Also people just don't like thinking of themselves as 'rich'. Just look at the amount of people who choose the word 'comfortable' instead to describe themselves. Rich is a word people prefer to use describe people who are richer than themselves irrespective of what there current income is.

In reply to Kevin Livingstone:

The average earnings in my borough are apparently £1,252 per week, so £50k could be considered a bit on the poor side.

In reply to Minka:

I think those stats are for the south east rather than specifically London.

In reply to Goose:

why would cleaners be different to anyone else? and why are they more likely to have the luxury of time than c=someone on a higher wage. If I were to play devils advocate I could argue that their lower wages make them highly likely to have second jobs or work overtime.

In reply to Jo Macleod:

Is not Aberdeen a very expensive place to live, because of the oil money?

In reply to Route Adjuster:

companies pay what the have to, to attract employees. Obviously, in London they have to pay extra.

In reply to Minka:

If you sit back and think this situation for a while the reality is quire worrying. £50,000 is one hell of a lot of dosh, what many people are saying is that simply isn't enough money to buy a house and live in London or infact many other areas of the UK. This boils down to inflated property prices which bear no resemblance to the true value of what you own. Do people really think that the bricks and mortor they live in are worth several hundreds of thousands of pounds - where does that money come from? This happened in Japan in the late 80's, property prices became so inflated that Japan was the strongest economy in the World, until some bright spark realised that they were valuing square metres of land at huge prices which in reality bore no resemblance to the real value. What followed was a monumental crash in Japans economy which it is only recovering from decades later.

People need to become less focussed on the perceived value of their homes and don't borrow on the 'equity' they think they have. This would mean salaries could be kept sensible and not have to be unrealistically high to buy a place to live.

Where does all of the money people 'borrow' on their properties go? Back to banks...the very same banks whcih have jointly reported profits of well over £20bn for the last year alone.

Get out now while you can...the crash is going to be ugly.

In reply to Ian Munro:


Lol! That's exactly what I was thinking reading this thread.

Take a trip to India, we're all bloody rich.

In reply to Route Adjuster:

Dunno, property in central london is different because it's aimed at the young professional market rather than the family home.

In reply to Goose:

Yes, you have a valid point there, (though I have no idea what your 'suede' is!), its all a mess and a crock of shite and the longer it goes unsorted the worse it will get. But dealing with the lack of affordable housing does not require a price crash that will trap people who have already bought - a drive to provide affordable rented housing might bring about a 'soft landing' for house prices while providing an attractive alternative to buying which would allow people to save to buy in the long term if they wanted. Its not impossible to organise - its similar to the task governments faced after WW2 when they had to replace the thousands of bombed out homes.

In reply to Ian Munro:

Soap box tosser.

How about it could be that people who earn lots more than 50k a year wouldn't want people who earn a mere 50k to be called rich.

Defintion of rich in this context is: "Well supplied with wealth, property, etc".

The Queen is rich, Bill Gates is Rich, fat-cat directors on >1M/year are rich.

People who take home £2900 a month are not rich. They are reasonably well paid.

In reply to Route Adjuster: nobody gains from high house prices except the banks or people moving from an area of high prices to a lower priced area. If youre not planning to relocate you dont gain when your house value increases, because if you move house the price of the house you want to buy will also have increased.

In reply to Kevin Livingstone:

It's all relative. Makes me laugh when the media talk about someone living in a "quarter of a million £ house" as though its in some way unusual. Most of the houses in or around London seem to be way in excess of that.

In reply to Ian Munro:

I have plenty of perspective on what "poverty" is, just as much as you I am sure?

It's all about perspective as you have said yourself, just because you see £50K as rich doesn't mean in anyway that it is "rich" . . .

In reply to ChrisJD:

so the definition of rich is now ppl earning more than £1million/year?

In reply to Psychopathic_Barbie:

People in many cases don't move but they do extend their mortgage to take advantage of the new (perceived) value of their properties - this is where I think it becomes a problem, people are effectively generating money out of thin air - it has to come from somewhere or ultimately return to nothing. Given that we cannot just create money - if we did then inflation would be ridiculous - that money doesn't really exist at all. This hole or gap is the massive debt that many people are in in this country. the UK is the 4th (or 5th) largest economy in the world, the country is massively in debt - who are we borrowing off? (can't be the yanks as they are in debt too).

In reply to ChrisJD:

How about it could be that people who earn lots more than 50k a year wouldn't want people who earn a mere 50k to be called rich.

This is no argument whatsoever. Personally I imagine most people earning 'lots more than £50k a year' could not give a toss if people on £50k think they are rich too. But neither of us actually have the faintest clue if this is true or not, and it really doesnt matter whether or not the super rich are worried about the merely wealthy. Or do you think Posh and Becks are not rich because Bill gates is even richer?

In reply to Route Adjuster:

Also, lots of people in London work here for a few years and then move on, and don't particularly want to buy property in the capital.

In reply to Psychopathic_Barbie:

Read the post I was replying to before you have a go. The guy was making to many assumptions for my liking.

In reply to Minka:

or they do buy property so when they do leave london they are in a position to buy a decent house.

In reply to Stormmagnet:

True, but then I was from Barrow so was basing it on that.

In reply to Minka:

Emotive subject!

I agree with the various posters who see it as all relative - if you're on £10k then £50k is rich, if you're on £250k then it's not.

Being brutally honest with myself, my definitions have shifted over the time I've worked - earn more money, but change my benchmark. However, clearing the mortgage was a big psychological step, so perhaps it's harder to feel rich when you have a very obvious big debt like mortgage or student loan.

There's always someone paid more and often lifestyle just creeps up to fill the gap. I remember once whining to my sister over dinner about being short of cash for a holiday and her pointing out that anyone really hard up doesn't put avocado in the salad.

So perhaps rich is defined by things you don't have to do more than those you can - not having to eat rubbish, not having to manage cash flow to the penny in the last week of the month, not having a huge debt (or being able to pay it ok), not having to check the balance before a cash point withdrawal, not having to save up/budget for that CD you want.

JMHO

John

In reply to Minka:

Rich is a subjective term we apply to a small percentage of the population who have wealth & property far in excess of the the "average" person.

Go look up "Rich" in a dictionary.

It is a grey area.

To be rich in my book, I would say you'd have to have real assets (paid for) or cash/accessible-shares in excess of £1M

In reply to Route Adjuster:

Comparing the UK property marklet with the Japanese property marekt, or even most european is like comparing trad with sport. they are both uniquely differant.

The pacific rim crash was brought about by a number of events, ranging from the Kobe earthquake which devastated the computer chip industries through to the inherent lack of developable space within Tokyo.

House price growt has been driven by a number of factosr, low borrowing costs, restrictive planning policies, increased labour costs on new build / conversions , general economic growth, increased affluence of single / co habitees and short memories.


As for the crash, it wont happen, the econometrics are wholly differant. In 1987 we had a base rate of 14%, now it is 4.75%, so serviceability of debt is much stonger.

what I would say is that in part a slow down is likely to be driven by secondary retail debt eg credit cards.

and before decrying the rise in the value of land and property, remember, if you have a pension, it is probably reliant on the commercial property sector for growth and has been for the laast 4 years.

In reply to iceaxejuggler:


Tower Hamlets?

In reply to Kevin Livingstone:

Do your NHS employ Social Workers? Round here, it's the County Council. But that's rather beside the point - it is a salary level an experienced nurse, for example, might receive.


Alternatively, exploit tax law to avoid this. Family ONE sets up the main earner as self employed in addition to his/her job, and then employs their partner as secretary/pa or similar, paying them enough to make full use of their tax allowance. This certainly used to be possible 10 or 15 years ago, and I don't know that anything has changed.

In reply to Psychopathic_Barbie:

Ok, but I still doubt they work as many hours as I do.

In reply to John Rushby:
you've swallowed far more vested interest spin or are wishful thinking, "it's different this time, a new paradigm".
arbitrary interest figure not important i.e. your comparison of 14% to 4.75%. in terms of interst payments it is the change that matters 3.5% --> 4.75% is a big jump in payments. in a low inflation environment (arguable given goverment influence on official figures) debt is eroded very slowly.
the crash has already started. latest snippet:
http://www.thisismoney.co.uk/mortgages/house-prices/article.html?in_article...

problem is most people expect a "strong" economy to prevent a crash, but despite positive govt. posturing, is it that strong??? see massive consumer and government debt, rising unemployment and economic malaise of trading partners. this could get very nasty.

In reply to ChrisJD:

Papa i'ma Milionaire,
But sex and abs don't sale affection
{Sex and abs don't sale affection.
Papa i'ma Millionaire but i ain't movin in the right direction,
Somethin ain't right, I know.

I am rich, to he is rich, she is rich, to we is rich

In reply to Carolyn:

Not sure that this will work, or I may have misunderstood you? If main earner is paid £50k (does that make them rich?) they'll get taxed through PAYE. If separately they employ their partner they can't recover this tax, only get retaxed if they pay him/her more than £4500 (or whatever the personal allowance is)?

John

In reply to Carolyn:

>Do your NHS employ Social Workers? Round here, it's the County Council

Increasingly common. Point is that 'patching folk up' is only part of the solution for many of those in medical care and co-ordinated approach between local govt and various care agencies is needed.

In reply to Minka:

You lost me on that one....

In reply to Minka:


But if Lbos is correct, that would start at somewhere around the £30k mark!

I don't really care whether people think £50k is 'rich' or not, but I am shocked by how many people seem to think it's common to earn that much...

In reply to erikb56:

A slow down does not equate to a crash, and one thing that accelerated the crash in the late 80's was the overheating of the commercial property sector, which is not the case here.

I accept in part your point regarding inflation against borrowing costs, but we are seeing a base rate held after a small creep, not the constant rise we saw in the 80's which panicked borrowers and lenders.

Believe me, I don't buy into the spin

In reply to tmh:

common? it's positively vulgar dear boy....

In reply to Kevin Livingstone: To stick to a simple pattern, I'd look at what house I could buy with my money. £50k x 3 would get me up to a £150,000 mortgage. Looking at what you'd get for £150k wouldn't make me feel 'rich'. A lot richer than I am, yes, but 'rich' to me would be someone living in a detached house or a large semi, with a nice garden that isn't overlooked. You'd be doing well to find that with 150k.

In reply to ChrisJD:

y'know, the Kelis song Millionaire

In reply to John Rushby:
fair points.

however many things can accelerate the crash or boom. sentiment is obviously important, especially when investment is involved. and investment in domestic property has risen dramatically. personally feel that loose credit, and having hit the buffers of affordability the only way is down. and even then who wants to buy something that's falling value.

think when general public sentiment changes, late summer probably imo when most preice surveys will be showing year on year falls the speed will pick up.

In reply to helen taylor:

I elected to buy a smaller house and spend an outrageous amount of cash each week on hookers.

In reply to Carolyn:
the employing your partner tax loop hole has been shut for many due to it being harder to be classed as self employed. you really have to mwork for more than one firm (unlike contractors) to do this, otherwise you get forced into going the IR35 route.

Only good thing about the IR35 is that you can get maternity pay as though you are an employee of the IR35 company.

bkb...

In reply to erikb56:

Nothing wrong with buying something that is falliong in value, if you have the confidence it will rise again. The equities market depends on it.

I agree, secondary consumer debt is more worrying.

As for surveys, everyone that lands in my intray seems to come to differant conclusion, or if 2 agree they are based on widely differing assumptions. I think we are in a unique situation, the 72/3 crash and 88/89 crash were very differant.

I still think we will get a soft landing but we have , with the exception of certain geoagraphical pockets, seen the peak of the house price increases.

In reply to John Rushby: Each to their own. I don't choose to pay for sex. And the hookers aren't going to provide you with any chance of security, possibly quite the opposite in fact if you're not 'careful' :oP.

In reply to helen taylor:

really

http://www.radox.co.uk/

In reply to John Rushby: I don't *think* I understand.. but please don't explain in case I do...

Anyway, richness...

In reply to Kevin Livingstone:

You're very unlikely to become 'rich' in the true meaning of the word by having a salaried job. £100k/year? That's like two weeks for a professional footballer. £100k/year is a good salary. £50k/year is a reasonable salary. Neither will make you rich. Comfortable, sure. Wealth is about ownership -- money in the bank, invested in shares, property etc. Or having loaded parents.

In reply to tmh:


I suppose it depends on your background and progression, really. I know that realistically I'm worth in excess of £50k per annum, considering that full time contracted summer work I've done in the past (when aged 16) has paid the per annum equivalent of £30k, for my freelance work I do I charge between £25 and £35 per hour (That earning full time would be a salary of £45-60k), and now I've (nearly) got a decent degree, experience in a field etc etc it all adds up in salary terms.

My parents combined salary is well over £100k, but I wouldn't count our family as 'rich' at all, having put two through uni, I've got one younger brother with that still to go, etc, money isn't flowing out of taps in the house (which is, of course, where a lot of peoples' earnings are tied up). That said, we're by no means 'poor'. As people have said, it's all relative.

In reply to Stefan Kruger:

At last, someone else who understands the difference between being "rich" and being "well paid".

In reply to John Rushby:
>Nothing wrong with buying something that is falling in value, if you have the confidence it will rise again. The equities market depends on it.

agree, but the general masses are a lot more fickle and don't necessarilly see things that way. especially if they're increasingly overstretched.

i just can't get over the fact that consumer spending is taking a BIG hit and the knock on effects of this tend to snowball. I see it as an even longer term problem then previous cyclical downturns this time given the unprecedented scale of debt.

In reply to ChrisJD:

I'm with you on that one too!

In reply to John Rushby: And there was me thinking you spent it on cat food for Nevis, and fixing the Alfa...

In reply to Derbyshire Ben:

Rememebr the averege wage in london is pulled up by rich city fu**ers! if you took the middle entry it would give you a better idea of what real people are getting by on. so it's ridiculous to say plenty of people earn over 50K.

In reply to RobLovatt: "rich city fu**ers!"

I think that sums up the prejudices perfectly.

In reply to Stefan Kruger:>

that leaves us in the ludicrous position of saying that someone on £45k does not earn a reasonable salary. Tell you what - If I can have your definition of a "reasonable salary" I will happily pay 50% of the excess over 50k on it in tax.

Goose: obviously you work long hours. but it is a baseless assumption that someone on low wages must work shorter hours than you. its not only the well paid who work long a hours - they just get better rewards for it.

In reply to Iain Ridgway: When the drinks industry talks of 'million pound bonus day' in London you can understand why the prejudices exist. These people blow thousands in one night to celebrate their immense success.

I wonder how many think of all those they stomped on to get to where they are?

In reply to RobLovatt:

http://www.statistics.gov.uk/cci/nugget.asp?id=285

This should shut you up:

"Top of the earnings league in 2004 were 'Health professionals' (median pay of full-time employees of £993 a week), followed by 'Corporate managers' (£643) and 'Science and technology professionals' (£605). The lowest paid of all full-time employees were 'Sales occupations', at £246 a week.

The monetary difference between the median level of full-time earnings in the public sector (£453 per week in April 2004) and the private sector (£408 per week) has widened over the year to April 2004; in 2003 the figures were £431 and £393 respectively.

The top 10 per cent of the earnings distribution earned more than £825 per week, while the bottom 10 per cent earned less than £230."


So accroding to that last paragraph, 10% of the full-time working population earn more than £43k.

That's plenty of people in my book.

In reply to Kevin Livingstone:

I advise the "rich" on tax planning. I don't consider someone rich unless they have a net worth of more than £1m (and that hardly counts nowadays) or such high levels of income that they don't know what to do with it - maybe £500k pa and above. Normally, though with a few exceptions (entertainment/sports/city bonuses etc) you don't get such high levels of income without also being worth a lot in a capital sense eg shares in private companies, property interests etc.

So, no, £50k doesn't come close to making someone rich. I was surprised to see recently just how many people earn more than £100k pa.

Personally, I do think £100k is highly paid and I would not object to a higher rate tax band at that level. The ridiculous thing, of course, is that National Insurance is simply another form of income tax. NI is now paid at 1% by the higher paid anyway (another "stealth tax") and I would not be the least surprised if this were increased. It has been noted that Labour have declined to confirm that they will not raise rates of NI.

In reply to Kevin Livingstone:

50 Cent is rich.

James

In reply to JonC:

£1M of assets was the exact figure I used earlier in my definition of "Rich".

Its soooo good to be proved right by a professional.

<<Smug>>

In reply to Kevin Livingstone:
More than twice my income.

I think the 21K I get allows me a reasonably comfortable (but no frills) life-style, so yes, they're rich to me. Certainly more so than 99% of the worlds population.

In reply to ChrisJD:

Yes, but £1m is pretty much at the bottom end of the scale.

Many people are worth £1m when you take account of houses, pension funds, death benefits etc - without being truly rich.

I start to get interested at around £3m

In reply to John Rushby:

I thought EW paid you...

In reply to Matthew B:

Anything over 30K would be luxury. I have all I really need to live on my 20K salary - choice of good food, exercise, garden, roof over my head etc etc. Can afford filtered or bottled water rather than tap water...already moving into the realms of luxury there rather than standard of living.

Seems we forget just how well off we are and expect so much more. iPods, computers, dish washers....all luxuries really.


How could anyone struggle on £120 a year? £20K could provide all a family of 3 needs with the £100K paying off the mortgage. You could have a flat paid for in 3-4 years. I don't know of anywhere in the world where it is possible (earnign local currency) to buy land and a house with just one years salary.

In reply to RobLovatt:

>Rememebr the averege wage in london is pulled up by rich city fu**ers! if you took the middle entry it would give you a better idea of what real people are getting by on.

Why do you think I posted that list up? </shakes head>

>so it's ridiculous to say plenty of people earn over 50K.

I never did...

Anyway, be careful who you're calling a Rich City F*cker I might be one of them

In reply to JonC:

My definition was >£1M in real "paid for" assets and cash/accessible-shares.

And I won't bother to give you a call until I get to £3M

In reply to RobLovatt:


Ah but they do.

In reply to ChrisJD:

Pensions funds *are* real, paid for etc, and you discount them at your peril. If you have one and get divorced you're quite likely to lose half of it and you won't then think it's not real.

Death benefits, well, maybe not - it's still highly relevant tp net wealth but not to this argument maybe

Gosh, touting for business on RT? Not many "rich" climbers about, though one does see the odd nice motor at Eric's

In reply to gourd:

IMHO it's all about choices.

I agree that deliberate excess is always a bit ugly (in my eyes)...but each to their own. I have no problem at all with highly skilled people who are in short supply being massively rewarded - provided they create value and employment. How they then spend it is a matter of choice (one we all make on some scale).

I also don't think you have to have stomped on anyone to be successful. In my experience it's more valuable to be aware of politics (so you can steer round them) than to play them. Most of the deeply skilled Board members I've come across are simply that - strategically clear, insightful, high drive and focus, and recognise that they'll create value by getting folk to work with them rather than by "stomping".

Finally, and I'll take a good flaming on this I expect, but many (most?) people *could* get a job with more money if that was the single most important criterion for them. They choose based on wider criteria - location, work content, familiarity, flexibility, hours, culture....

John

In reply to ChrisJD:

They do tend to go hand-in-hand.

High-paid jobs support larger loans that turn into big housing assets once paid for.

High-paid jobs tend to come with bigger benefits - share-options or equity.

Surplus from high-paid jobs enables investment.

Wealth begets wealth.

John

In reply to Moacs: I agree with alot of what you say. I know a lot of 'well off' people who are perfectly decent people. But I think that a lot of people don't believe they can make the world a better place and so just work for themselves. They then become part of the problem rather than the solution.

If I got paid £1million at the end of the year, too right I'd party, but I'd always remember the words of a friend. "We now live better than kings". How true. My standard of living, on my meagre £35k, is probably better than Henry VIII's.

I don't necessarily agree that these people are 'highly skilled'. It's about making the active choice to be greedy. I know I could get alot more if I changed jobs but I just can't be bothered with the hassle.

In reply to Moacs:
Tend to find that people in these high paying positions often attribute it to their own drive, ability, get-up-and-go attitudes, and tend to blame those "non-achievers" for their own predicament.

At the other end of the scale, the "don't-haves" look up at the rich with resentment or awe (neither of which is particularly healthy).

IMHO, the former is not really true, but more a matter of luck. Everyone has drive and motivation when they are in a job that respects them, rewards them and offers them a future. Only the fortunate few ever reach that position.

All subjective of course...

In reply to gourd:


Err, WTF? You're equating the ability to earn more through being bothered to change jobs with greed. Wierd.

In reply to David Martin:

How is anything over 30k automatically a luxury? I'm about to move house (nothing huge, two-bedroom place in Aberdeenshire) and wouldn't even get the mortgage if I earnt less than 30k, and that's with the benefit of some equity from a previous property.

An old mate from school and his girlfriend were looking to try and buy a flat in London last year, and gave up, as despite a combined salary just over the £100k mark, they couldn't afford anything in a decent area (and again, they weren't after anything huge, just enough space that they weren't cramped) by the time they'd taken off the costs of student loan repayments, tube season tickets, etc.

In reply to gourd:

and everyone in nursing is a saint?

In reply to Route Adjuster:

Muppet,whose taxes do you think finance the rest of the country ??????

In reply to David Martin:

I agree - luck plays a big role, but "rewards" is much wider than money for most people. If you truly care about nothing else but money, then pushing drugs to kids is ok, or prostitution or bank robbing. So most of us apply a set of filters - both push (illegal, unpleasant, poorly paid, dangerous, badly located, dead-end) and pull (developmental, well-paid, well-located, etc.)

I mean, just look at all the undiscovered MPs, chefs, playwrights, agony aunts and sports commentators on here!



John

In reply to Matthew B:

Re: your mate and his GF

Then they should lower their expectations of what constitutes a decent area. Urban snobbery that - if you need a home then move into what you can afford. People seem to expect to be able to buy their dream home in their ideal location as their first or second house purchase these days. They should compromise on their expectations or quit whingin...

In reply to Postmanpat:

Taxes which are capped at a measly 40%. When you earn >100K or more than >200K etc. etc. the extra tax paid in proportion to the disposable income you have just gets less and less. Tax should progressively get higher the more people earn, that way there would be a common sense ceiling beyond which there would be little point in going.

Why on earth does someone need >£1M a year to live, it just gets greedy.

i propose the following tax levels.
>£100K 50%
>£250K 60%
>£500K 75%
>£1M 90%

That should fill the coffers and stop the needless greed

In reply to Route Adjuster:

stand for election on that detailed prospectus, see how you get on

In reply to Enoch Root:

I don't think I'd get many votes from the london area.

In reply to Route Adjuster:

Nobody is whinging, but it is a fact that they were unable to find anything affordable, and they really weren't being that fussy, or looking for anything huge. I agree they could 'make do' elsewhere at a significant sacrifice to their quality of life, but my argument was solely in relation to the topic of this thread, i.e. is £50k pa 'rich' (and I don't see how that tag could be applied to someone restricted financially to an undesirable area with a long commute).

In reply to Route Adjuster:


Why does it have to be greed? Believe it or not, not everyone decides to go out and make a fortune. Some inherit it, some make it almost by chance. A tiered tax system, yes, but to so penalise people merely for what we might perceive as being lucky (or greedy) is going a bit far.

And who are you (or I) to decide what level of income is "acceptable"?

In reply to Route Adjuster:
My point was that the South East pays a huge proportion of the taxes paid in the UK and in that sense subsidises the rest of the country rather than visa versa .

As for your second argument .a)The more people earn the more tax they do pay .b) How can you be unaware or choose to ignore the overwhleming evidence than high marginal tax rates reduce the amount of tax paid rather than increase it .High marginal tax rates may make you feel self righteous but they reduce the funds available to finance public services etc .

In reply to Matthew B:

Definitely not. There is well off and rich, 50 k is not rich, £5m a year is rich.I reckon you need assets of £20m plus to be rich.

In reply to Route Adjuster:

The flat-rate tax article in this months Economist as previously mentioned on this thread is well worth reading as a counter argument to your proposals....

It's available on-line here:

http://www.economist.com/displaystory.cfm?story_id=3860731

In reply to Route Adjuster:



why do you need your salary to live on, maybe that's greedy too? Surely you could live on less....

In reply to Kevin Livingstone:

I suspect that a significant number of two income households have a combined income in excess of £50k.

In reply to Route Adjuster:
sounds like you feel underpaid and as such resent the fact that people earn substantialy more than you

Nobody has really put this in a global context yet. If we want to be truly relative about it all then most of us folk on this sceptred isle our rich.

As for what will start to happen when the third world starts demanding the same share of the pie as the first world or the sustainability beyond the next 20 years of our lifestyles... well these are halcycon days.

In reply to Route Adjuster: I think you are looking at this a bit simplistically, say Ferdinand wants 100k a week off Man U, what ever you set the tax at, he'll ask for the appropriate amount to to give him the amount he wants after tax. So large companies will pay there top men more, meaning more is lost to tax, meaning less goes on the workforce lower down the hierarchy, no?

In reply to JonC:

I was referring to earnings and would not regard inheritance in the same category.

Regarding the greed issue - footballers are a classic example, how can they justify salaries of >£50,000 per week - if this is not greed what is it? I know that they are only paid these salries because the clubs pay them, but who at the end of the day gives the clubs the money - sponsors, TV rights and the supporters. Everyday joe (not earning such high amounts of money) are the ones who buy the sponsors product (and therefore provide the cash to pay the clubs), buy the TV licence, pay per view or turn up every week to support their club.

Reducing the amount of money floating around the top of the system would filter all the way back down to the people who provide the cash in the first place making them feel a little wealthier. In other words, the people at the bottom of the pyramid support ever wealthier people further up the pyramid - this, I feel, is capitalism gone a little bit crazy and where it begins to look like greed.

In reply to Kevin Livingstone:

The important factor is surely disposable income in determining whether or not someone is rich? The other factor which determines someones wealth is the value of their assets (net of borrowing) over and above income.

Income is only relative to the cost of living.

If you are living and working in an area with high housing and transport costs eg London. £50k a year might in fact leave you worse off than someone living in a provincial area on half that once tax, mortgage/rent and commuting costs have been deducted.

In reply to Route Adjuster: with regards to footballers where would you have the money made by the clubs go then and why just footballers surely all people who "perform" (musitions celebs and such) are over paid by your definition, at the end of the day people are payed in relation to what profit they cant bring to there employers buisness, the more you make the more you earn sounds a fair way to do things to me!

In reply to Route Adjuster: we have had amssive arguments in here about this, but players get paid the going rate, if not theyll play else where, the moneys in the game, fans willingly pay, I don't, but thousands do, so who gets the money, directors or the guys the people pay to watch?

Personally how can people afford that money, same as smoking, but its a free world,

what do you suggest as an alternative?

In reply to Trangia:

Don't disagree, as is my situation - As I said earlier, this year its camping for hols AGAIN !!!

In reply to djviper:

On the contrary I actually feel massively overpaid (on a global scale) for the job I do in terms of the "amount" of money I earn per year (nowhere near £50K by the way). I don't feel overpaid in terms of the effort I put into the job however, or in relation to what other people get paid in this country.

But I am saddened that we are so focussed on our own materialistic desires that we (as a nation) feel we deserve even more money so that we can buy the house we WANT or the new car we WANT. What about settling for what is acceptable and spreading our wealth elsewhere?

If we are not careful we are in danger of disappearing up our own inflated house price (and the feeling of wealth it brings) backside.

In reply to Route Adjuster: i have to agree with you on this but i unfortunatly feel that the only way every one will learn is when theres a total ecconomic crash!

In reply to Iain Ridgway:


Instead of keeping the money 'in the game' Reduce the costs of tickets or pay per view. More people attend or watch the matches - profits stay sensible but not greedy.

In reply to Postmanpat:

You don't honestly believe that baloney about the SE subsidising the rest of the UK?? Remember that all those Civil Service / Forces jobs which are based in the SE are paid for out of everyones taxes and that a large proportion of the tax "take" is, in fact, generated UK wide and simply reported through the SE. Then count up all of those re-generation and infrastructure projects and work out who is paying for them (like the Olympics).

In reply to Route Adjuster: Ok look at attendences? more people cant attend?

why should they, we could say that about the cinema, climbing walls, everything where a profit is made, I think what you want is in china, called communism?

In reply to Route Adjuster:

Mate, wake up, you are living in a dream world.

Don't know how old you are, but its time to update your world view from that of a naive 17 year old "sixth-former" trying to put the world to rights.

In reply to Iain Ridgway:
Er , no they won't .Large companies will say to people "how about coming to live in New York/frankfurt/Monaco/Bombay where it costs us less to employ you and junior staff ".Result : less jobs and less tax in the UK.

In reply to Dr U Idh:
Yes . Not sayng it's a good thing or that we shouldn't try and reverse the process (unlike the cretin Prescott) but that's the way it is .

In reply to Postmanpat: yes I know, so footballers liek Rio will get 100k a year, whether its here or in spain, if we want to see the best footballers in the world in the premiership we have to pay, if we dont then we dont pay.

In reply to Route Adjuster:
What is your definition of a "sensible" profit ?

In reply to Kevin Livingstone:
seeing as i'm never likely to ever see that kind of money, then yes,it is rich.
k

In reply to Kevin Livingstone:
I know I'm coming into this a bit late, but no... I don't think 50k is 'rich'. (But then I live in the South East.) I think 'rich' is probably having enough money to buy the things you want without having to worry about it too much, on top of the usual things you *have* to spend money on like accommodation, food, bills and taxes. (I appreciate that someone could by that definition be 'rich' on 5k a year if they didn't want much, but I think that's quite apt - you would truly be rich in that situation...)

In reply to Iain Ridgway:
100k a week , surely ?! God,that is quite a lot .Bastard !

In reply to Dr U Idh:


Not you, unless you play the lottery. About 1/3 from London Council Tax payers.

In reply to James Jackson: Yes. What's wierd about that? If you change jobs to earn more money, is that not greed? The whole debate about football on this sums it up for me. Pay them less and they go elsewhere. Fine by me. Once you've lived in Ibrox you really don't care about a bunch of people who live in nice areas and socialise in expensive clubs but who have little personal interest in the people who give them that lifestyle.

In reply to John Rushby: No but at least they're trying. Are we?

In reply to Minka:


So what is "the point of living in London"? If you're in a lower paid job serving the needs of the higher earners and you have/want a family, then a family home in London for your dependants is essential.

We should have a higher marginal rate of tax for the higher earners and it should come into effect at a reasonable level, probably around about the national average income. It is just not acceptable in a society for the well of to drive the cost of housing etc beyond the means of the rest of the population. The bottom line IMO is that a house is a home and should never be allowed to be seen as some sort of investment opportunity.

In reply to timjones:

Er, because that's where the jobs are .

We do .What sort of level were you thinking of raising it to ?

< It is just not acceptable in a society for the well of to drive the cost of housing etc beyond the means of the rest of the population. The bottom line IMO is that a house is a home and should never be allowed to be seen as some sort of investment opportunity.>

So we should ban private ownership of of housing maybe ?

Picks jaw off desk ...

In reply to timjones: i don't think it's necessarily the well-off driving up house prices. everyone is borrowing madly. you don't have to earn a huge amount to get a big mortgage, a few credit cards and a house full of furniture from dfs on "interest free credit". which is of course nothing of the sort...

In reply to Postmanpat:


No just include the ridiculous rises in the rate of inflation. Which would drive wage demands higher which would force the B of E to increase interest rates which would slow the ridiculous rises.

Never understood why people who work in London get extra. If they don't get paid more they wont work there which means that business would have to move elsewhere to find workers. The rich won't then have a service sector to support living in London which would surely drive property prices down therefore making London an affordable place to live??

In reply to Postmanpat:

Difficult question...a sensible profit, like a sensible salary is one that that provides a good return on investment but stops short of being excessive. I know this is full of ambiguities and therefore points major holes in my argument. I have no problem with companies reporting profits of a few million, or in the case of large companies, a few hundred million - in % terms its probably a small margin ontheir turnover. But when Banks and oli Companies report profits in the Billions it smacks of exploitation, capitalism gone mad and a small few profiteering from services that we all need and pay for. We all have bank accounts, we all use Oil in one form or another - therefore we must be gettgin overcharged if these companies are making £bn's of profit in a single tax year.

In reply to gourd:

I think most unions and employers are bright enough to work out that just because the collection method for the statistic has changed nothg has changed in the real world . Either house prices are relevant to wage negotiations are relevant or not relevant , regardless of theheadline inflationnumber .

See your previous point .Because house prices are taken into account when negotiating wages .


> If they don't get paid more they wont work there which means that business would have to move elsewhere to find workers. >

Sure , but businesses are not in the business of engineering social policy .They need to hire employees .

It might make sense for government to devolvee more to the provinces .Instead the buffoon Prescott encourages people top flock to the South East .

In reply to Iain Ridgway:


No need to jump to extremes here, what I would like to see is the emergence of conscienscious capitalism. If huge profits are bieng made then re-invest them in other parts of the world, not in the bank accounts of a few.

What is the point in having Billions in the bank, you can't spend it when your dead! having a few million should surely provide all of the freedom you could ever desire.

In reply to kat: Negative attitude mate, I never thought I'd earn wot I do now (Below £50k by the way) but I am, so you never know whats around the corner ?

In reply to Postmanpat:


But they're not. As a public servant I'm tied to a wage deal dependant on the rate of inflation (approx. 2.5%). Apparently average earnings have gone up by 4.5%. So I have been dealt a deal where I will once again fall behind private businesses.

In reply to Route Adjuster:

This is almost an unbelievable comment . Are you unable to grasp the simple idea that that it is not the absolute size of the profits that is relevant but the profit margin and the return on investment .

Suppose I run a coffee shop .I sell you coffee for £1 and make a profit of 5p out of which I pay half to my aging aunt who helped to finance the shop . Most of the remaining 2.5p goes into refurbishing the shop , intersting new ideas for the menu etc . I think you'd agree that this is not excessive .

Supposing I became very successful , sold 400,000 cups of coffee per year and made a profit of £20,000 - which meant I employed more staff, paid my now very sick aunt some more money and decided to spend the balance on a new shop .

Is this obscene ?

In reply to timjones:

Love to see that happen - it would keep labour out of government for 100yrs, let alone 18yrs !!

. It is just not acceptable in a society for the well of to drive the cost of housing etc beyond the means of the rest of the population. The bottom line IMO is that a house is a home and should never be allowed to be seen as some sort of investment opportunity.

tosh - I think you'll find MOST people buy houses because they want a home - I agree the market has gone crazy in recent yrs, perhaps due to speculators, but in the main, myself included, even though the house is worth 70% more than my mortgage, it is still a home for me and my kids......
On a lighter note I complained to the Portman B/Soc that they were offering 5x salary mortgages - They argued that people could not afford to buy otherwise, very true I said, but all it does is fuel the prices !!

In reply to Nao: the thing is, most people dont have the money to buy all the things they want without worry, so for those that do, it doesnt seem unfair to ask them to contribute a bit more tax than people who are struggling to make ends meet on their wages.

In reply to Route Adjuster:
Thats what they DO !!! (And then get accused of exploiting the places they invest in )

In reply to Psychopathic_Barbie:


But they already do...

In reply to gourd:


Housing costs used to be included in inflation. Unfortunately the wonderful labour government that it looks like a load of stupid b*ggers are going to vote in to power again decided to remove housing costs, council tax and virtually everything else that does increase in price from the inflation figures. (in the name of transparency and not fiddling the figures at all, following on with disguising child benefit payments as negative taxation rather than spending to cut the DHSS bill etc)

But hey, you all trust tony to follow through on his promises this time and change public services in a way that can't be altered (fixed?) for a thousand years (quote/unquote), don't you?

Incidentally - £50k, well paid, yes but not rich. I hit that for the first time this year, living on my own, no dependents, can I afford a decent house around Exeter, like hell i can! Personally, and it goes against the grain to say it, being a raving capitalist normally, one way to fix the house price inflation (driven by all these bloody buy-to-let investors) might be to limit the number of properties any individual can own...

In reply to Postmanpat:
Thats what they DO !!! (And then get accused of exploiting the places they invest in )

I think a better example would be Tesco's - record profits, yet the farmers supplying their produce are being undercut, going out of business and generally being dealt a raw deal. All by a company that has expanded to a sufficient level.

Greed.

In reply to Postmanpat:

See one of my other posts, I do make comment on the profits in relation to turnover.


Don't be pedantic, I wouldn't class £20,000 as obscene profit on a small business, thats deserved profit for working hard. I wouldn't even class £200,000 as obscene profit for a small to medium sized business.

But I do class profits in Banks, Tesco, BP and Shell running into the Billions as obscene and greed.

Anyway, I think this is getting a little too far removed from the OP of is £50K rich. (which by the way I don't think it is)

In reply to Route Adjuster:


well, that's what the shareholders want. quite a few of whom probably earn less than 50k...

In reply to Route Adjuster:


Figures for 2002 (from a quick google) - Tesco turnover 23.2 billion, profit after tax 830 million, that is somewhat less than the 5p per cup of coffee that you thought was reasonable for the small business. Shell's profit to turnover ratio is much the same. They're not obscene profits, it's just the companies are huge. Though I suppose you would be happier if tesco was replaced by lots of small businesses with the same net turnover and profits?

In reply to Route Adjuster: Have you actually looked at Tescos etc in terms of ROI - theyre good but not brilliant

In reply to Route Adjuster:
I am not being pedantic .I am illustrating a simple point as simply as I can but you still don't seem to get it .
As other have pointed out , all these companies earn profits of around 5p per £1 of revenue or less.

In case you hadn't worked it out , their investment requirements (and it was YOU that suggested they should be investing more ) go up roughly proportionately to the size of their revenues . So , if I run twenty coffee shops I am going to need a lot more profit to keep them up to date and if I am going to grow my business I need to open twenty new cake counters and a new shop to make any difference (rather than just add a new counter in one shop).

They also have far more shareholders . To grow my business from one coffee shop to twenmty I needed to find nineteen extra maiden aunts all of whom need some income from their pensions .So I need to make a bigger profit .

So we have established . The actual profit margins and return on investment of the companes you name would not be in any way out of order , and probably rather low, for a small business .We have also established that they need to have bigger profits in order to finance their businesses and pay their sharehodlers .


So why are they obscene ?

In reply to Kevin Livingstone:

Depends on your spending habbits but I think 50k is enough to live quite a comfortable lifestyle, and are they taxing only the earnings above £50k or the lot...

In reply to Kevin Livingstone:

Right .
Family - two adults , two kids .
Income £50k
Tax : £15k
Net income £35k

Averagehouse in SE england £300k .Assume a £200k mortgage (optimistic)

Cost of mortgage : £12k
2 cars cost £25k , borrowing cost £3k
Running costs £2k
2 family holidays cost £3k

So , net of house, car and two holidays , net income =
£15k . assume £3k on unavoidables -insurance , emergencies etc .

So total net income for family of 4 is £1,000 per month or
£62 per person quid per week-out of which comes clothing , food, luxuries etc .

Rich ??? what a load of BOLLOCKS

In reply to Postmanpat: mortgage of £200k at £1000 per month, I think that's optimistic (unless it's interest only) and you've made no provision for pensions or the costs of running the house eg council tax (probably £2k per year) bills etc

In reply to sloper:
I know but I may have overestimated the tax .

In reply to Postmanpat: An extraordinary calculation of a families basic needs!
1) only one parent works. Sorry, but this is a lifesyle choice - most families do need both adults to be involved in some form of work.
2)two holidays at 3k - again, this is a lifestyle choice. family holidays can be gotten cheaper. Most couples with young families do not take two expensive holidays per year.
3) 2 cars at £25k? Hello? most single people do not buy brand new cars. Let alone couples with young families, let alone once per year. Out of that do, most do not pay over £12k per car. very few couples with two young children would buy two brand new cars each year. With one -totally unrealistic -stroke you have reduced a £50 k income to a 325 k income.

showing you can think of ways to manage badly on £50k is not difficult - but being unable to afford two brand new expensive cars a year plus two expensive holidays for the whole family does not prove you are not wealthy!

In reply to sloper: you forgot to include the au pairs wages and the golf club subscription old boy.

In reply to doz generale:

depends where you want to live - east end is getting better now and i have just bought a flat in west ham with an affordable mortgage.. obviously i couldn't afford chelsea or knightsbridge etc!

£50k a year in london is not a bad wage but by no means rich!

PS I don't earn £50k !!

In reply to Psychopathic_Barbie:
1)It was never defined originally whether it was household or personal income .

2)Sure it's a choice but its a choice that most people aspire to and doesn't make people "rich" to do it .

3)This is a finaincing cost , not a new one every year .

You are completely missing the point . The £62 figure is clearly inadequate to live any more than a very basic daily lifesyle .So in fact , to eat and dress better and go the pub and watch the football occasionally they won't actually have two cars or a second holiday .

If you actually think that to be able to do all these things , which you cannot do on £50k per year makees people rich then so be it .

In reply to Psychopathic_Barbie and the bloke who deleted the bit about 2 new cars EVERY year:
He's costed 2 cars at a total of £3k per annum, not unreasonable for a second hand car over 4 years or so.

In reply to Psychopathic_Barbie:

I think that however much you earn, you always end up living up to your means. Thus, everyone *feels* tax. If something is physically impossible to do, it is not done. e.g. if you can't your job in London because of the cost of living, you try and do it somewhere else. If you can't do that you do something else. If you can just about afford to buy a new car rather than a second hand one , you will. Similarly if you can do neither you may have to adjust locations/use public transport/walk to places/cycle. One person may have to buy their clothes in House of Fraser, another Primark and another Oxfam. Almost everything is a lifestyle choice. We just forget the days when our choices were more limited.

Tax will always hit hard. I think that the whole tax at 50k thing comes down to a social ethos more than anything else. We have to remember that some people have fewer choices than us and that there are some things that should be provided irrespective of circumstance e.g. decent standard of health and education, care for the elderly etc.

The original question of whether 50k a year is actually rich? I'd say to someone with no dependants, yes, to someone with a family, no.

Curly

In reply to curlymynci:

yes, I think this is what underlies most of this thread. Though the discussion was originally about £50k as an individual taxable income - - other wise it would be silly, we would have households of four adults earning £20k each and be talking as if they were richer than a household of two adults earning £30k each.

i just cant help wanting to giggle when I hear someone on twice the average income expaining how he can barely keep body and soul together.

I think that you misunderstand the word profit. A 5p profit is when AFTER reinvestment (e.g. salaries, refurbishing, line development) there is 5p surplus.

In reply to Kevin Livingstone:

It's all relative

I think the national average wage is somewhere around £25K -- which is not particularly high. I think a typical family with one wage earner would find it difficult to make ends meet, yet many do.

As you approach the upper income tax band at 40K, even allowing for the extra tax and NI, most people would be hard pushed not to be 'fairly comfortable', and certainly not 'on the bread line'

Above 50K, whilst not being rich, it's twice the national average, therefore I've no problem with those who argue that anyone in that fortunate position should be able to contribute more than the less well off.

At the same time, I believe in incentives and rewards therefore no-one should have to pay more than 50p in the pound income tax, irrespective of their earnings. (Lets face it the wealthy can generally afford to pay accountants to minimise their tax liability. Avoidance is legal, evasion is not)

Income Tax should be proportionate and fair.

In reply to gourd:


I've read some right rubbish on these pages but this really does take the Garibaldi....

Inlcude house price rises in nominal inflation to force interest rates up to make big rises unaffordable. Where to start??? Wage rises are negotiated in the market and have very little to do with nominal measures to start with. The BofE and the MPC already do take house pricesinto consideration, I know someone who worked on exactly that for years. And if interest rates went up then not only would big rises be unaffordable but small rises would be too - except that the poorer (by definition) would be hit hardest. And who would be better off - errrr no-one - big pay rises with no extra productivity just means more money chasing the same goods - including housing.

Why does London pay more? Because its been at the centre politcs, government, trade and infrastructure since the Romans. As for your suggestion that companies should put themselves out of business by refusing to pay the local market rate so the jobs will go elsewhere (ie: their competitors), that's when I start wondering if you're a troll??????? Madness....

In reply to btffmog:
Yes, it's a retained surplus that is reinvested in the business .
Reinvestment is NOT salaries or ongoing costs . These come under selling,general and administration costs and are charged against income . Reinvestment , by which I mean capital investment , is not charged against income like salaries (it is accounted for in depreciation charges).
In the case of BP the company made about 23bn in operating income last year of which 12bn was used in capital expenditire and 12bn paid to shareholders so their net cash actually went down a bit .

Bottom line is , it's you that don't understand profit .

In reply to Kevin Livingstone: I've been thinking about things like this...I have no idea what my parents income is as my dad refuses to tell me what he earns. My mum worked (not full time) until my sister and I went to uni - she's now not working at the moment as she hated her job. We have a nice detached house in a village, but I doubt something of the same value would get us very far in london (i think the terraced house my aunt and uncle used to have in Brighton was worth more). two cars (one a company car, the other second hand) and a nice 'big' holiday every year and maybe one or two smaller breaks. BUT we are fairly frugal on everyday living - don't spend much on clothes, certainly never designer labels. Food is generally Asda or sainsbury's economy or bought in bulk and no ready meals really - i think mum would have a fit at the thought of shopping for food at marks and spencers or drinking bottled water....so on the whole I would say we are well off but not rich.

However, it does depend on what you are used to. For example, I have friends whose families DO regularly shop at marks and spencers or waitrose and have 'posh' (to me!) food as part of their normal diet rather than the occasional treat. These friends are also ones who have pretty much had everything they've wanted. For example, i got an allowance to things i wanted - if they wanted a pair of trousers or something they just had to ask (including £70 handbags! :oS). I'm not saying they didn't work to earn money, they just never really had to budget as their parents were always there. Anyway, if you are used to this lifestyle - eating expensive food, buying expensive clothes and other 'everyday items' (makeup, cigs etc) then the same income would seem a lot less.

I'm not sure if I've explained that very well, but what i'm basically trying to say is that you have different perceptions of what is a 'good' income depending on the lifestyle you are used to. After being a student for three years I think any income would be nice

In reply to btffmog:


Not really. Profit in a year is income minus expenditure. Reinvestment will affect future years profits (through depreciation or amortisation) but won't affect this year's profits at all.

In reply to curlymynci: Yes...I think I was pretty much agreeing with what you'd just said! :oS

In reply to Derbyshire Ben:
Interesting but I don't quite understand Related Cost of Living - what sort of stuff does this cover - I think I have a related cost of living of 100%

Lived in London and could have spent 50k without batting an eyelid.

In reply to Enoch Root: Troll?

Never. It's just market forces. I didn't say businesses should put themselves out of business. I said that if you do a job in London which is the same as in Leeds then you shouldn't get paid more. This would drive the low paid out of London leaving the rich, who make it the ridiculously expensive place that it is, with no public services or social infrastructure.

If it's madness then tell why my wage having gone up 2.5% and my house by 23% in the last year isn't also madness? I will never realise my equity because anywhere I want to move to is now even more out of reach

In reply to Ali:

In reply to gourd:

No,you didn't say it because you seem to be unable to make the failry simple connection between companies refusing to pay their workforce the market wages and companies therefore having no workforce and going out of business .

In reply to Psychopathic_Barbie:



Not really. Not if you have two kids below school age. Not everyone can earn enough to justify the costs of full-time child care.

In reply to Postmanpat: Ho. save the insults. I'm perfectly capable of making the connection. But this thread is about wealth and inequity. Why should someone who makes the concious choice to live in an expensive city be paid more than someone doing the same job in a 'cheaper' one?

I don't get to buy an expensive house where I live then tell my employer "you'll have to pay me more". It's also leading to ridiculous policies like building housing specifically for public service workers so they can still stay in London. Why should I pay for that? If they can't afford to live there then move out. This already happens when 3 bed semi's get sold in the SE and the money get's spent on a small estate on a Scottish Island!

In reply to gourd: So under your logic, someone who does a call centre job in leeds should get paid the same as someone doing the same job in india. Ignoring the different costs of living!?

In reply to gourd:

errmm. Lets see a)thats where the demand for workers is and b)what about those who didnt make the concious decision to live there eg where just born in the area and have roots and dont particular want to move, leaving aside the difficulties this gives.



>It's also leading to ridiculous policies like building housing specifically for public service workers so they can still stay in London. Why should I pay for that? If they can't afford to live there then move out.
Right so who teaches the kids, mans the hospitals. Although I have to admit the definition of key worker can be more than slightly irritating.

In reply to Dazzle: mmmmm...

Got me there. Good point. Why shouldn't they? Is that not what fair trade is all about?

In reply to dissonance:


That's my point no-one does, they can't afford to live there!

In reply to gourd:

>It's also leading to ridiculous policies like building housing specifically for public service workers so they can still stay in London. Why should I pay for that? If they can't afford to live there then move out. This already happens when 3 bed semi's get sold in the SE and the money get's spent on a small estate on a Scottish Island!

Do you have any idea, any idea whatsoever about how these schemes work? Any? At all? They don't just give people the houses y'know. Almost all of the deals are loans (you the taxpayer still get the money back) or shared equity schemes (you the taxpayer probably make a profit on the deal). Christ.

In reply to Enoch Root:

Trouble with democracy is who gets to vote.

In reply to Enoch Root:


No not really. But I do now, thanks.

In reply to Postmanpat and chris_j:



I understand your arguments completely and when you talk in terms of profit per pound of revenue then the proportions are not what I would class as 'obscene'. Trying to adjust a business model to work with a thinner margin of profit would be risky and not attractive to shareholders. Is it becoming the case then that as globalisation of large companies is becoming more common then these seemingly huge profits are also becoming more common - the NET profit across the industry as a whole may be remaining static? Anyone got any figures on that?

If this is the case (net profits across commercial sectors remain constant but more conentrated to fewer individuals)then my argument is completely flawed - if this isn't the case then joe public is being steadily and progressively robbed.

In reply to gourd:

also - if you're so keen on inequity - has it crossed your mind that getting paid more on paper when prices are higher are in >exactly< the same position?? Ever heard the term 'real' wages or 'real' income? Prices rise, your income falls.

In reply to Dave Garnett:
It is a lifestyle choice for the hypothetical person we were discussing who earns 50,000.

But for most people with young kids and a partner that I know or work with, its a financial neccesity for both partners to work in some form.

This may mean part time work, for some people it has meant arranging their work so that they swing child care responsibilites, for some people it means a parent helping out with the kids. I'm not saying this is an ideal situation - just pointing out that the things that better paid people consider "essentials" are often in fact choices not available to those on lower incomes.

I dont know many people where the earnings of one partner is enough to support another adult and a couple of kids on a long term basis - or if they decide its important to them to do so, its at the cost of not having holidays, new cars etc.

As has already been said- the things that people consider 'basic' tend to change according to their income.

In reply to Rid Skwerr:


true democracy is naught but a chimaerical phant'sy

In reply to Enoch Root: Ok. I'm happy to admit I over-stretched myself on this one. But I have a real problem with London weighting. Glasgow used to have a population of 1.2 million it's now nearly half of that. Why? Loss of industry (and urban sprawl). London should be just as susceptible to market forces.

In reply to Route Adjuster:
the NET profit across the industry as a whole may be remaining static? Anyone got any figures on that?


What industry ?

Profit margins go up and down .Overall there has been an upward move in margins over the past twenty years from a historically very low base in the the seventies . The margins of tesco, however , would not be noticeably different from a successful retailer twenty years ago and those in the oil sector probably last peaked in the oil shock .

Why do you think they are going to individuals ? Do you think profits of listed companies go to indiduals ?

In reply to Postmanpat:

I find the profits of tesco etc appallingly low. If you compare them with t/o it is frankly ridiculous and not excessive.

In reply to gourd:
One additional point .Yes , as I mention coroporate margins have increased significantly since the 1970s .This , however , means that maiden aunts are preapared to incvest their capital in companies that can then grow and provide jobs and dividends .

At their low in the seventnties maiden aunts didn't want to part with their money , companies didn't grow , and unemployment was endemic .

In reply to gourd:

Glasgow was much more dependent on heavy industry than London.

In reply to neilh:
Arguably they sacrifice profitability to gain market share .

In reply to Postmanpat:

Maybe it is also because they have competitors. Just think if it was a monopoly, it would be like diamond mining.

In reply to Psychopathic_Barbie:


Rubbish.

From the statement "£50k is a reasonable salary" it does not in any way shape or form follow that £45k is also a reasonable salary. It is. As is £42k in case you wondered.


You're paid what the market can bear, unsavoury as it may seem. Some professions pay better than others, typically those that are hard to fill due to long education requirements, or skills shortages due to other reasons. It really is a rather simple equation. It boils down to supply and demand.

In reply to David Martin:

Quite easily, depending on commitments. I'm not on anything like that, but I'm on a "reasonable" salary by some of the definitions that have been bandied about on here, and I struggle. A lot.

I mainly struggle because of my stupidity of a few years ago when my business (employing 8 people) went tits up (due to a major client going to the wall) and I got myself into tremendous debt in making sure that all my suppliers, ex-employees, etc were taken care of.

I should of course have let them all lose their arses rather than racking up a large debt at enormous interest rates (when you seem to be a bad credit risk, the rates go through the roof) to see them right, but I didn't.

Consequently an enormous proportion of my "reasonable" salary goes on servicing a debt that I saddled myself with out of some misplaced sense of honour or obligation, and we do without many things that people on much lower family incomes seem to manage to afford.

It's all relative. A "rich" person to me is someone who could live comfortably off the income from investments without the need to engage in paid work. As long as you still *need* to work for a living, you might be considered to be "well paid", or even "extremely well paid", but not "rich".

In reply to Postmanpat:

A few on here seem to think that I thought £50k is rich - it is NOT and I should know as I'm now very close to that and certainly struggle to make ends meet living in the South East while the missus stays at home to look after the kids etc etc etc etc

Don't get me wrong, the person on £25k is also struggling but probably does not pay the mortgage I have so all things being relative !!!!!

In reply to Kevin Livingstone:

and the person on £25k might not have two expensive cars. Do lots of families have two cars adding up to £25K? helluva lot of money in cars there.

In reply to Rob Naylor: Well done for taking the ethical option - very tempting to just bail I should imagine. Hopefully at least that will have earned you a reputation for treating people fairly that will be useful if you start up another business.


Back to the main subject, which was originally about tax thresholds. Remember, the £50,000 level talked about is for an individual with no other dependants, tax deductions etc. Things like dependents, non working partners etc are being thrown in to the discussion - but remember that if you have dependents you will also be claiming tax allowances for them - so in this case you would not pay the higher rate of tax until you had reached a higher income level anyway.

BUT. regardless of whether you want to define £50k as 'rich' 'well paid' or 'quite comfortable thank you', the statistics say that individuals earning over £46,000 pounds p.a. are in the top 5% of uk incomes. Which makes you very well off compared to the remaining 95%.

In reply to Psychopathic_Barbie:


I know someone who earns £120k who defines it as 'not enough', as he always claims he's too skint to get his round in. I suspect he's an anomaly though.

In reply to Psychopathic_Barbie: meant to provide the link

http://www.channel4.com/4money/funnymoney/richometer/

In reply to CJD: yorkshireman I assume???? ;-D

In reply to Psychopathic_Barbie:

oooohhhhhh yes

In reply to Psychopathic_Barbie:



I posted these Stats way earlier and they give slightly differnt picture:

http://www.statistics.gov.uk/cci/nugget.asp?id=285


"Top of the earnings league in 2004 were 'Health professionals' (median pay of full-time employees of £993 a week), followed by 'Corporate managers' (£643) and 'Science and technology professionals' (£605). The lowest paid of all full-time employees were 'Sales occupations', at £246 a week.

The top 10 per cent of the earnings distribution earned more than £825 per week, while the bottom 10 per cent earned less than £230."


So according to that last paragraph, 10% of the full-time working population earn more than £43k

In reply to Psychopathic_Barbie:
" the statistics say that individuals earning over £46,000 pounds p.a. are in the top 5% of uk incomes. Which makes you very well off compared to the remaining 95%."

I think the slight flaw in this spurious statistic is that 'the other' 95% could be on 46 grand dead, and the top 5% on 46k and 1p and that would hardly be significant would it?

Obviously the above is an extreme advantage and isnt actually true, but spurious statistics prove not alot.

50k is not rich. Not unless you earn 50 grand AND have assets. If you take an ex student who has 10grand in student loans + credit cards etc, and a 50k income, which is about 2.5 grand a month say. If they die at the beginning of the month they would be worth -7.5K. Not exactly rich is it?

However. If you earnt half of that, and had a house worth 100grand, a car worth 1 grand and a mortgage of 80 grand. A death at the beginning of the month would make you worth 22,250notes. Ie alot more.

Current income alone does not make people 'rich'.

You could have no income but a huge trust fund (of say 20m squid, which you could not touch till you were 18 say,) from daddy's estate, and you would not be rich by this definition. As you would not 'earn 50 grand,' as its all locked away until you are 18.

Wizzen Goose

In reply to CJD:
What's "a lot" . We're not talking Jaguars and Porsches here . A new Golf can cost £20k . So lets say you've got two second hand Golfs that could be £25k . It's not exactly Bill Gates territory .

Anyway , let's say you have cars that cost £15k . It's still costing £2k per annum . Leaves the family an extra £20 per head per week . One trip to a major football match per year and thats gone .

In reply to Postmanpat:

yeah, was just thinking in terms of how it seems more usual that families either have one company car (which, admittedly, they get taxed on) and another car, or one big shiny car and one smaller or older car.

do football matches really cost that much? good lord.

In reply to Postmanpat: "One trip to a major football match per year and thats gone ."

have you seen the price of tickets at Sheffield wednesday, old money division 3, now division 1, still paying over £20 a ticket.

In reply to Postmanpat:

the other thing I'm thinking is that that £50k would go somewhat further in the north... (although again it depends which part) and that there's no provision for savings or pensions there.

In reply to CJD:

I think a big premier ticket is about £50 quid (never been) .Add in transport costs , lunch etc for 4 and you're probably talking best part of £300 .

Actually the family would be saving 20 quid per head per month not per week . I guess you could go to three football matches on that .

In reply to Postmanpat:

I guess it's 'entertainment' as much as anything else and that big pop concerts cost that much, but it still seems suprisingly expensive.

In reply to CJD:
Well someone's got to pay the players' hundred grand a week ! Fortunately not me since I don't have Sky either .

In reply to CJD: good lord, I'v just read the posts following yours. Do you think they are all anxious about paying for their rounds? ;-D

In reply to Iain Ridgway:
no match involving Sheffield Wednesday could ever be described as "major"

In reply to Kevin Livingstone:

I think this entire discussion is totally ludicrous, I earn a smidge over £14,000 per year all told, with which I support my wife and child.

*ANYONE* who thinks it’s difficult to support themselves with £50k a year is quite simply crap with money, no question about it.

In reply to Bokonon:

You may well have a point - it's probably more to do with the fact that someone who earns £50k would be more likely to take more expensive holidays etc.

some of the television programmes encouraging people to get out of debt are quite interesting - people seem genuinely mystified that they don't have to pay £40 for manicures every week, and that astute shopping can save them money. Not that surprising at all if you think about it, but I think that a lot of people's living costs rise to meet/exceed their income. As I said earlier, the person I know who earns £120K is apparently always skint, whereas other people I know who earn £20K live very well indeed.

In reply to Postmanpat: Off issue slightly but football does not have to be that expensive, if you support a big London club, Chelsea especially, it may cost you £50 or more, but the last half dozen time I have been to Old Trafford it has cost between £18 and £25.

In reply to Kevin Livingstone:

Ahem, your mortgage is an investment though!

Case in point: a) I could never in my wildest dream hope of getting a mortgage to even begin to pay for a house, not in London and probably not outside.
b) As of last night, our landlord has just said we are being turfed out in two months - now, with you're own property you have security in the fact that this will not happen.

In reply to Bokonon:


It's not that simple. Typically, your expenditure rises with your salary. On a higher salary you will find piled higher mortgage undertakings, etc. If I lived in a tent and lived on nothing but value beans, with no debts, then sure, I'll have no problems supporting myself on pretty much any salary. But let's say you're the sole provider for a family with a £275k mortgage to service for a shoe box flat somewhere in London, then suddenly £50k doesn't exactly allow for any extravagances, and nor would you be "crap with money".

In reply to Stefan Kruger:

I guess there is an argument that perhaps it isn't economically viable for that person to survive on that wage in London, then, but then that leads to the whole question of house prices...

In reply to Bokonon:

Total bollocks and you've a lot to learn - Back in 88' I earned £9k and had £42k mortgage with my wife - We had our daughter in 92 so the missus stopped working - I earned £13k at the time (This woz when interest rates hit 15%) so basically did what you are doing now
At the time we lived in a ONE bed house so had to move if we wanted space for the family.....Fast forward to present day and now I earn not all that short of £50k
mortgage is now £130K, so its only around 2.5 times salary admitted,the missus has a part time job paying only enough to keep her in knickers etc etc
Of my monthly salary, after mortgage, car loan (about 3k left on a 1998 Frontera) credit card bill, housekeeping (of £600), pension contribution etc etc, £235 monthly train fare and nearly £200 a month on bloody council tax I'm left with perhaps circa £150 to spend as I wish (This being on petrol for the car, maybe one takeaway and general cash for a pint with work mates)
so NO I AM NOT rich - we do NOT have foreign hols, new cars, the latest hi-tech mountain bike etc etc
I of course accept that to someone on your income I may seem rich, but I've worked bloody hard to get to this point and believe me (as many others here will concur) it is not "rich"
I could tell you about a friend of my wifes, whose joint income with hubby is above £200k - Now that IS rich as they have at least two long haul hols a year, he drives an AMG Merc and she a new shape Beetle and both kids are in private school - Very nice people, but VERY comfortably off

In reply to David Martin:


you may be right, but I was in a position to buy my first place back in 88' and yes the value of the house and only having a 30% mortgage now does give security - ( I spent sevaral yrs paying £00's extra off my mortgage rather than going out and boozing it up). But so does it give security to your's and my parents who are in an even better position
I do sympathise with anyone buying or trying to buy now and my worry is that without a strong supply of first time buyers able to afford to get onto the market my house is worthless as I cannot sell it !!!

In reply to Stefan Kruger:

Agreed. I earn considerably more than 50k but after debt service, mortgage payments and commuting costs would not describe myself as rich at all. I'm comfortably off but can't spam money on stuff at will.

In response to the chap who posted saying he supports his family on 14K I'm not crap with money I just have bigger commitments. For example my mortgage payments alone are about 17.5K per annum and my season ticket for the train costs over 5K and that's not because I live in a mansion (2 bedroom semi detached cottage) but simply a reflection of the fact that I work in London (and have to commute as I couldn't afford to buy anything vaguely worth living in in London).

I think much depends on location as were I earning what I do and living in the highlands I agree I would be rich however living where I do I am certainly nothing of the sort. Where do you live (this qu addressed to the 14K chap)?

In reply to Kevin Livingstone: a simple summary
if you can walk into any shop and not ask or worrie how much things are your rich!!

In reply to djviper:

Yup that sums it up - I think this thread has been done to death now so I'm bailing

In reply to Kevin Livingstone:

For starters, I never claimed you were rich.

Your financial situation is down to *you* and how *you* manage the money you have, I have said and will continue to say that if you are *struggling* on 50k a year then you are *NOT* managing your money properly – or have not managed it properly in the past.

Other than council tax and income tax there is *NOTHING* what so ever to dictate *how* you spend your money, obviously you need to shelter, feed and clothe your family, but the way in which you do that is not dictated by any one but yourself (ves?).

*You* have CHOSEN to live at the absolute limit of your income, *YOU* have decided to manage your money in this way, you decided to buy a car, you decided to spend £600 on house keeping, credit cards etc. etc.

Its all down to *your* money management skills, nothing else.

Nobody made you do it.

In reply to many of the above: "I'm not really well off coz I spend all my money on lots of neat stuff".

In reply to Kevin Livingstone: I do that, but because I am a few grand in debt, whats another £100, I just have no money management.

In reply to Stefan Kruger:

Only by choice, just because you earn x amount doesn't mean you have to have X price house does it.




Well you would be, because you chose to buy a flat for £275K
when you can't really afford to, so thats poor money management.

In reply to Enoch Root:

'democracy is two wolves and a sheep voting on what's for dinner'

In reply to Bokonon:

Do you really live in oxford? Do you have a council house or one provided for you by your employer because I don't know how you survive on 14K a year unless you do.

In reply to tb:

Abingdon. And i rent - because i know i can't afford to buy on my wage.

In reply to gourd:


Because not enough people will make the conscious choice unless they are paid to make it .

In reply to Kevin Livingstone: at a a slight tangent, I know lots of fairly well off people (certainly by the definitions in this thread) - doctors, vets, lawyers mainly - virtually all of them, myself included are crap with money and spend the lot without ever feeling very rich or accruing any savings etc. The few "old money" proper rich (from big country house, ponies, major public school etc) people I know are phenomenally careful with their money (and I know careful with money when I see it - my dad's a Yorkshireman and I married Scottish) and just keep accruing more and more. The point? Maybe here is a profound cultural / psychological element to being "rich" over and above the actual sums - it's a state of mind

cheers, Paul

In reply to Postmanpat:

groooooan, this thread is becoming an exercise in pointing out the obvious.

To summarise, 50k+ is what the top 5-10% of earners are on. Whether this makes them rich or not depends on their lifestyle. Sound good?

In reply to Bokonon:

I'm amazed that you manage it. I can't imagine doing what you do (thought you must be a vicar or something so the housing would come free)

In reply to Justin:

sounds like jerrymandering to me....

In reply to Minka:

Not the latter part , no ! Whether you are rich depends on how much money you not , not how you spend it .
I'm pointing out the obvious because he appears to be missing it .But you're right .It is quite dull now .

In reply to Minka:

gerrymander with a G one supposes and only if the sheep had formerly been accompanied by the rest of the flock who were now having a seperate vote.

I thought it was a great description of a democracy

In reply to tb:

thought it looked wrong but was to lazzzzzy to spell check

In reply to Bokonon: You arrogant wan...ker

I suggest you try living in the South East, commuting to London , paying the morgage down here etc etc and then say that - You know f..ck all about my money managing skills so I suggest you bog off until you experience it for yourself....or are you just a lazy bugger which is why you do not earn £50k ?

In reply to Bokonon:


Your job location frequently dictates where it's practical to live.


See the above.

You say you support a family on £14k. That is very impressive indeed. I would not be able to get a mortgage at all for any house in Bristol with such a salary, ever. You'd need at least twice that to have any chance of getting on the property ladder. Probably more. And even if you'd manage to get a mortgage here somehow, the repayments would cripple you. Of course, you could say 'move somewhere else', but that isn't the point. Money stretches differently depending on where you live.

In reply to Kevin Livingstone:

I live (broadly speaking) *in* the south east - I don't own my own house because I *know* I can't afford it.

I have turned down a number of jobs in London because I know that despite the fact they pay more, they are in the long term uneconomical.

I know enough about your money management skills to know that you struggle (by your own admission) on £50k a year, and as far as I'm concerned, that’s poor money management skills.

I don't work to further my financial position which is why I don't earn anything close to £50k a year, I probably could quite easily be on £30k+ had I not gone to uni stayed at home and got into banking, however I have chosen to pursue a less financially rewarding career - as such I have had to be very careful with my money.

I'm only just starting to realise how poor I must be. Maybe we manage fine on one income well under 50k because Edinburgh's so cheap?

In reply to Stefan Kruger:


Howwever even within any given location there are houses and there are houses...



I don't have a mortgage, i rent because I know that it is not financially viable for me to get a mortgage.

In reply to Rid Skwerr:

Maybe thats thwe case with me aswell, i live somewhere so cheap (har de bloody har) that I find it easy...or maybe not.

In reply to Bokonon:
My mortgage is only 2.5 times salary, not 5x that some people may have - Dont forget that I am also taxed at 40% and pay higher NI....As my earnings increased we moved well within our affordability for our expanding family....just because you naively think that £50k is "rich" please do not make wild statements that I do not manage my money - We manage quite well thank you, but simply have higher outgoings than you or do you want to live in Utopia where we all earn £14k and live in a "standard" flat ????
I suspect I'm not the only one who takes offence at your stupid statement so I suggest you try to learn more before making rediculous statements as that.....Give me a call in 20 yrs or so and lets see what you're doing then ?

In reply to Kevin Livingstone:



Are you not above the NI cutoff?

A fair proportion of our income goes into a mortgage. This is investment in an asset so more a sign of wealth than a cause for pleading poverty.

In reply to Kevin Livingstone:

Wheeee, easy there Kev!

I do think he's got a point. I survived until quite recently on about £14K a year. It certainly sucked, but it was manageable. Blue label Tesco's all the way, but there was food on the table and the bills were paid, rented a dire shared house out in Wembley and there was no shortage of £3-£4.50/hr jobs which helped me tick by. In short there is seldom a reason, with no dependents, to go hungry and claim poverty here.

At the same time, now I earn 8K more a year, I obviously can't claim to be rich on just short of £22K before tax, but despite my bitching, life certainly is comfortable, certainly in comparison to before. I can honestly say I would have characterised myself as scraping by before, now I am comfortable (more or less).

- I spent a grand on a months holiday this year
- I brought a rope, climbing shoes, etc etc
- I own a laptop
- I have gym and climbing wall memberships
- Magazine subscriptions, £3 donation to the Blue Cross
- A contract mobile phone
- I can afford a few beers ever week
- I can go out for dinner/bar every few weeks
- I have just started paying in to a pension
- I can afford part-time study

In short, I am well off. I cannot afford to buy a house and I will not have kids until I earn substantially more OR if I am able to pool finances with a potential partner.

I am also aware I have substantially more spending power than most of the rest of the world. No matter how tough it gets, there's no point in comparing myself to richer friends or celebs.

I view the 8K extra I now earn as somewhat of a luxury - it allows me to buy those things listed above (and more) and none of them is a necessity.

Now, if I was to earn £50K a year, I would be in a position to earn £30K more over 12 months. £30K is more money than I have ever experienced in my life and all I would have to do for a year is live EXACTLY the same way as I am doing now. For just 12 months. And I would have THIRTY THOUSAND POUNDS in my piggie bank. That is rich.

If, after 12 months I no longer had that 30K then it is entirely my own fault. If I wanted to spend it on cars or booze or golf clubs or whatever, then it would be entirely due to my own inability to manage my finances better.

Cut the guy some slack, he has a point.

In reply to Bokonon: So hang on, you are the sole earner in your household on £14k pa - yourself and partner are brining up a child.

Clearly you are on housing benefit / tax credits etc beacause you can't be arsed to get a job on £30k - and then you lecture people of money management.

%^&^ off you scrounging git!

In reply to pat m:

er... what about him being a student and perhaps working part time?

and not everyone has £30K jobs anyway.

In reply to Bokonon:


..but they tend to all fall within roughly the same price band.


Fair enough, but you still maintain that people who choose to stretch themselves to take out a mortgage instead of lining a landlord's pockets are suffering from poor money management skills?

In reply to David Martin: You wouldnt have £30k - youd have £18k after tax

In reply to CJD:


I think it's counterproductive to dignify arseholes with your attention.

In reply to CJD:

Thats not what he said in his earlier posts

In reply to Rid Skwerr:

you may well be right.

In reply to Kevin Livingstone:



So you don't struggle? then what's your problem?

In reply to David Martin:


It's not rich, it's foolish.


Your £30k would be more like £17k after tax and NI, and then after 12 months having been eaten up further by inflation.


Agreed. But investing your spare cash as a deposit for a house, or some other long-term investment you would make the money work for you.

In reply to pat m:
Right, but after tax my £22K becomes 15K. Your point?

In reply to pat m:

We don't get any housing benefit what so ever, we get very little in the way of tax credits - all of which I have included in my £14k a year, I noted that my income comes from a number of sources (I get a grant to study full time as well as working a full time job)

In reply to Stefan Kruger:

Jesus, if you are at the point where the devalutation in your savings due to inflation becomes a problem, then you fit right into the rich category.

I assume you are either alluding to my piggie-bank getting stolen or the fact that I haven't invested that 30K elsewhere. Having an investment worth £30K makes me rich!

Like I say above, my £22K becomes £15K after tax. Sure, there is a higher tax burden on higher earners, but I CERTAINLY don't see the 22K I am supposedly paid, turn up in my bank account!! That 10% and 22% I end up paying in tax hit's me damn hard, but still think it's worth it despite it being "invested" in bombing Iraqis.

Again, just because money is tied up in investments doesn't mean you no longer rich. Please don't tell me that's what you are trying to say?

In reply to Bokonon:

I actually meant that in response to your very rude statement earlier I manage my "finances" quite well thanks and telling by some of the earlier responses on here I'm not alone either

I'm bailing from this discussion now cos its done to death and you are obviously stuck in your short sighted ways - As I said earlier I do sympathise with you or anyone who cannot buy a place and has to rent (ie line someone else's pockets) but please do not criticise me or anyone else for being able to buy 17y yrs ago and earning what we do - I bet you claim for your entitlements don't you, so you cannot manage on your pay either !!!. I don't mind paying higher tax to provide those benefits to those earning less but don't criticise me for it, I have done prertty well over the yrs but £50k IS NOT RICH in the Southeast - FULL STOP......so until you are in that position yourself etc etc etc......

In reply to Stefan Kruger:
If property prices and stocks and bonds are coming off then asets in a piggy bank would be a very sensible idea .

In reply to Bokonon:

Ahh so you're a filthy stowdent!

14K pa for a student is pretty good really and one assumes that at some point in your life you will go and get a decent job with the qualifications you're currently earning

In reply to Kevin Livingstone: Not going to join the 'lets hound Kevin brigade' but me and the missus bring in c.£55K. After everything you mention we're left with a bottle of wine almost every night, lunches most weekends, carryouts regularly, holiday (albeit a duff one) and we just employed a cleaner (paid off car so using that!).

I would chuck your job in and move up here. How can you be happy?

In reply to tb:

£14K for a student who's supporting a child...

In reply to Bokonon: £50k in London is peanuts

In reply to CJD:

WTF has a child got to do with it? being a full-time student and managing to earn 14 K is a lot.

Don't go mistaking my statement of fact for criticizm although were I inclined to criticize I'd probably have something to say about the wisdom of having a child when you have a non-working spouse and are a student with no decent income. Would it not have been sensible to wait a year or two?

In reply to tb:

the child might not have been as planned as one would hope.

Just thought I'd mention it as a point of observation, as I guess that money has to go a bit further.

didn't mean to rile.

In reply to CJD:

Oh sorry, I thought you were having a go (bit hungover and therefore sensitive today);¬)

In reply to gourd:

Believe me I have every intention to move BACK to Lancashire/Yorkshire at some point in the future - For now we'll manage as we do now.....U never know by next yr I may be on 60k ?, but with my employers performance over the last months I may be joining the £14k brigade in a few months

In reply to David Martin:


I'm trying to say the exact opposite. Being "rich" has nothing to do with your pay. Well payed doesn't equal rich. That's where this whole thing started. Being rich means not having to work, but being able to live off your investments. Anything else is 'comfortably off' at best.

My reaction was against the people above who say in a blanket sort of way "If you don't consider yourself rich on £50k a year you have dysfunctional money management skills". That's just a plain ludicrous statement.

In reply to Kevin Livingstone:

move back up north anyway. It's a far nicer place. and the climbing's better

In reply to Kevin Livingstone:
£50k IS NOT RICH in the Southeast - FULL STOP......


As I said Earlier:

"For starters, I never claimed you were rich."

I've not even used the word rich once to describe you, or anyone for that matter, what I did say, and I will *still* maintain is that if you feel that you are struggling financially on £50k a year, you're not doing it right.

In reply to Kevin Livingstone: Best of luck! I keep encouraging my wife to go for a job with more responsibilty (and money) but her answer is always the same. Long hours, stress and not having time for the kids. The more I read about other peoples lives the more I think mine is peachy.

In reply to Bokonon: £50k in london is peanuts

have you ever had to pay 40% income tax?

In reply to Bokonon: when you are 43 and not 23 and not sponging of 40% tax payers in the form of grants and tax credits - then you can lecture people on money management

In reply to Bokonon: I dont need to reply to this as others have done it on my behalf !

In reply to pat m:



Most of the money i do not directly earn does not come from the UK government thanks, the grants are given to me because the people involved feel I am a worthwhile investment, so you can shove your holier than thou shit up your arse.

Money management has nothing what so ever to do with the source of your income.

In reply to CJD: That was a quick delete!

In reply to pat m:

'cause Bokonon summed it up nicely for me.

In reply to Bokonon:

Regrettably you started it by making ridiculous statements about people who earned 50K not managing their money properly. A textile worker in India could say the same about you on your 14K as you'd seem incredibly well off to them.

The fact is money management has nothing to do with the source of income as you say, it also has nothing to do with the amount of the income either. My wife and I have a combined income well in excess of 100K but I wouldn't describe us as rich. We are comfortably off but do ahve to think before buying things and don't have vast amounts of disposable income (although compared to you I suppose they probably are pretty vast) I'd say we manage our money pretty well but choosing to spend a lot of it on commuting and mortgage payments isn't bad money management it's simply the reality of life.

In reply to Bokonon:


One final point - You are obviously studying for something to better yourself are'nt you ? will this result in better earning potential ?
Lets asuume it does, and you are offered that nice job on say £20 - £25k (Bloody ell you're catching up on me already!)
Lets just say that housing prices crash (which I expect they will do at some point)
Do you are your other half then say, bloomin eck, we can afford to buy now, lets go for it

Now move forward a few years, perhaps a couple of house/job moves etc you are basically in the SAME position as me....
So in other words it is YOU who is talking SHITE until you've got into that situation and know what we mean....

Once you are on the property ladder if thats wot you want then I hope for your sake that interest rates don't hit the 15% mark as they did back in 1990 - I was on £13k back then and came damn close to losing the house, so since then I've NEVER taken on a multiple of more than 2.5 times salary, even though I could get 5x !

In reply to Bokonon: i just looked at the online land registry average house price statistics (dec 2005) and £275K is still well above the average for a flat in most parts of london. obviously not if people choose to live in the most expensive boroughs - but as you have pointed out, that IS a choice, not a neccesity.

its quite interesting to compare the boroughs mind - you can get a flat for an average price of just under £174 in leafy epping, bromley (south of the river but by no means the ghetto) comes in at average £182 for a flat. move into the cheaper boroughs of east london and youre looking at an average £133, £138 for a flat. Still bloody expensive if youre on the average wage, but for the top 5% earning over £45k afforadble enough I would have thought - less than 3X annual salary.

In reply to tb: >My wife and I have a combined income well in excess of 100K but I wouldn't describe us as rich

great stuff.