[Politics] Does earning £50k a year make you 'rich'

[The Antikythera Mechanism]

Isn't that wealth?

If some earned £400k each year, lived in a rented home and blew all their earnings on a lifestyle, wouldn't they be rich?

No, just stupid as they’d have nothing to show for it.

 

[DarrenFreemansPerm]

But the vast majority of people adjust their expenditure to their earnings. There are always exceptions but I don't believe that would be the case with you, if you earnt that much. Especially as usually you gradually increase your pay over time so it is smaller increments. Go from 20k-25k you might eat out a bit more, 25k-35k you might have an extra weekend break + nicer car... etc

On the whole I’d say you’re spot on, as the wages go up the spending goes up, it’s easy to do and many people fall into that trap. Mrs DFP and myself are very much on the same page when it comes to finances, we’re careful but not tight fisted. We know who we are and what we want from life. Without boring you too much, whilst I’m sure our spending would increase slightly, we simply aren’t the kind of people that spend money for the sake of it, everything is calculated and we’ve found it’s a way of life that works for us.

 

[Wrong-Direction]

On the whole I’d say you’re spot on, as the wages go up the spending goes up, it’s easy to do and many people fall into that trap. Mrs DFP and myself are very much on the same page when it comes to finances, we’re careful but not tight fisted. We know who we are and what we want from life. Without boring you too much, whilst I’m sure our spending would increase slightly, we simply aren’t the kind of people that spend money for the sake of it, everything is calculated and we’ve found it’s a way of life that works for us.

A glimpse into the life of an accounting couple

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[BN41Albion]

What if you earn £50k, but your wife doesn't work and brings up the two kids? And you have a large mortgage?

It's all down to circumstances.

But if you can afford to have a large mortgage, you have two kids and your wife is lucky enough to not have to work and can bring up the kids, that makes you bloody rich!!

So many people's responses clearly show how much of a western world bubble many of us live in.

 

[Weststander]

Definitely means you're rich. If you don't think so then you simply don't realise how lucky you are. Millions upon millions of people around the world would give anything to earn anywhere near that kind of money - even relative to their own country.

A good point, sometimes people need to appreciative what they have and relative to others. (Not said as an evil £5m a year member of the Illuminati, wanting everyone else to stay on modest incomes).

Plus, as menioned by many on the 'change of career' thread, happiness at work is more important that the level of income.

 

[cunning fergus]

For those with school-age children, the earnings band between £50k and £60k sees the loss of child benefit, giving an effective tax rate on this £10k of:

1. Child - 51%
2. Children - 58%
3. Children - 65%
4. Children - 72%
5. Etc.

Child benefit is a taxpayer state benefit, it’s not part of a salaried income.

It’s like the unemployed referring to their social benefits as “wages”.

 

[DarrenFreemansPerm]

A glimpse into the life of an accounting couple

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Is this a good thing or a bad thing?

 

[Wrong-Direction]

Is this a good thing or a bad thing?

Are you both accountants?

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[LamieRobertson]

A glimpse into the life of an accounting couple

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Strange to see you on a football forum ..I thought something like Town and Country would have been more your line after seeing ya Dad

 

[Weststander]

The argument making the rich richer is a bit of a "Class warrior" type statement and creates a knee jerk reaction from people in the higher tax bracket.

I earn close to £70k , Divorced and re-married with 3 kids.
I wouldn't say I'm rich, far from it, but if I had to deal with an emergency, I could cut back on some small luxuries and probably cope.

Do I need a tax cut more than people earning minimum wage, the unemployed etc? No I don't.
But for as long as I can remember government's have given bigger tax breaks to higher earners.
It is illogical, but it is the way governments think.

Tax goes in cycles. Believe me, total taxes as a proportion of total income have risen for many periods of our recent history for those on say £60k. Especially when stealth taxes are taken into account. The Coalition did this from 2010, to help reduce the annual deficit, but people are understandably baffled by the complexities. Yesterday was so unusual with such a significant tax reduction (for those earning over £46,350).

 

[DarrenFreemansPerm]

Are you both accountants?

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Absolutely not, why?

 

[Diablo]

Surely Mr Micawbers quote is relevant to however much you earn be it £50k or £20.

"Annual income twenty pounds, annual expenditure nineteen pounds nineteen shillings and six pence, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

 

[Herr Tubthumper]

I earn close to £70k.

Rich.

 

[Weststander]

Absolutely not, why?

The very organised budgetary controls and prudence?

 

[bha100]

The very organised budgetary controls and prudence?

 

[schmunk]

Child benefit is a taxpayer state benefit, it’s not part of a salaried income.

It’s like the unemployed referring to their social benefits as “wages”.

That's why I said "effectively" - in practice, removal of the personal allowance for high earners, removal of child benefit for medium-high earners, and removal of other state benefits for lower earners all amount to a significant reduction in marginal take-home pay for income in the affected band.

 

[knocky1]

Surely being rich is to do with what you own, not your annual salary. Ultimately, the rich own the land and accumulate wealth based upon that and their other assets. Hence they do not have a salary at all, just (frequently undertaxed) income.

Exactly. I earn nothing personally but my assets and investments keep me going.

 

[Uh_huh_him]

Rich.

If you like.

 

[sully]

I was probably rich for a while at the end of the last decade, while my wife was equalling my salary and we lived in a small house in Hanover.

We moved out of town to give the kids a bedroom each and soon after took a hit on total household income of nearly 50%.

I’m certainly not rich now, but manage to hold on to a few luxuries whilst paying an eye-watering mortgage that runs until I’m 70 and trying to get my wife’s business profitable.

It’s all about circumstances.

When I’m 70, I’ll probably feel rich again, though I might not be able to enjoy it as much as I did 10 years ago!

I also see so many houses that are so far out of my reach that I can’t understand how I can be in the top 10% of earners. Who can all these people be who own houses worth double what mine is (and more)?

 

[Knocky's Nose]

£50k pa is not 'Rich' in my opinion.

It's comfortable enough to pay the bills, have a holiday or two, and drive a decent and reliable car as long as you haven't got a mental mortgage. It's comfortable, and oh my words how quickly do you get used to that feeling. It's such a shock when it disappears!

I think 'Rich' is a state of mind in many cases, though. You can't put a value on it.

I know people on £200k pa combined who are pissed off they can't quite afford to hire a small yacht and crew for their fortnights summer break, buy an even bigger house than their 6-bedroomed mansion, add an extension, swimming pool or a tennis court, and pay for the kids to go to a top private school and so on. They don't feel 'rich' compared to their friends who can afford all of the aforementioned.

I know people on £50k combined who feel blessed they can drive a used BMW, live in an actual detached house, and go abroad 3 times a year - even if it's to Spain and so on. They feel rich.

Your standards, your upbringing, and your personal pride dictate how rich you feel - in my humble opinion.