Conversely, I knew a guy so poor, the only thing he had was money

Indeed, it was recently found that wealth is being earned more through inheritance rather than income.

Most people think rich is 10-20% more than they earn. In reality, if you earn a salary (barring the top few %, possibly) you're probably not rich!

@@stephenbury7297 You arent rich if you bought something because it was 2 for 1 deal.

Disagree: the primary purpose of wealth is to provide income.

Good luck mate!!!

Hahaha well at least you arent working as a climate scientist 😂

Hope you voted against the contract

It does indeed but thats why Median average is much more useful than Mean average as it removes the issues somewhat. Maybe a follow up where data is available :)

@@TobyNewbatt good point

@@TobyNewbatt Not really as 90% above the median average are in London meaning if you removed it the median would massively shift. You basically have to remove London for the figures to work for anyone.

@@TobyNewbattthat would be cool to see!

Though salaries in London are higher, the cost of living is disproportionately higher for the bottom half.

I am glad you pointed out the impact of Tax and NI - plus you are fully exposed to wider taxation. The bit I hate is that my take home pay around 30k, was about 2k per month, I am beyond doubling the annual salary now, but I have not had a month where I take home 4k per month. Which shows the dragnet effect of direct taxation. Good to hear of someone who retired at 52, I am 54 now, and my retirement options even with a healthy pension are 67....

100k a year does not make you rich, it makes you employed in a decent job

Ooooh, I only just miss out on the top 1%. Must be time for a pay rise!

@@siheath3648 in 170 years "living" and eating at the mama hotel will get you what the top 1% has NOW as wealth (7.6M GBP median).

Im in the top 1%. Honestly I don’t feel rich, I feel far from it to be honest.

@@anyexpatthat’s funny mate. Sure maybe not in London but anywhere else I regard that as rich as possible.

Depends how old you are too. If you are under 25 I'd say 71k a year was rich for sure whereas if you were 40 or 50 maybe not so much.

@@LawrenceTimme this is an important point. I am 52 an in the top 10% but it doesn’t feel like it. I feel very much average.

Very few "rich" people are getting paid PAYE.

Agree, I’m on far higher than that but also have a wife and two kids to maintain too within my salary. I’d consider myself comfortable but far from rich currently.

@@tombfc123Very true, most earn in other ways.

I'm very interested to see peoples thoughts as I suspect feeling 'rich' or wealthy is very subjective

Indeed. I feel wealthy though I live a very simple minimalist life in a rented studio flat in Manchester (I'm 65 and now retired, in the sense that work is optional). The reason I feel wealthy is because, once the state pension arrives in a few months, I'll have ample income to cover my living costs plus I have savings invested for any additional expenses. Basically, not having to work to earn unless I choose to is wealthy to me.

@@adm58 very well said

When I used to be a fully qualified registered nurse in the NHS. My take home pay was £1750.00 net pay.

@@Abdul_Rahman86unfortunately income is not linked to how hard you work or the skills you have. Nurses and teachers are prime example of this.

Thank you :)

absolutely, you do have a lot more options - you could say that the UK is very friendly towards high earners when you think about it adding up all of the ISA/ SIPP/ EIS options you can choose.

If you're on 50k with a young family there's a good chance you'll be in the top 10% when your kids have grown up. Where you are now is not where you'll be.

This is so wrong. 10% of people earn around 100K and after tax is only 60K. It deliberately limits the imagination of middle class. Just go down to Marbella and walk along the quay and listen to the conversation on board. Most of them are British. Not Arabic, not American but British. The cost of keeping a yacht is 10-20% of the vlaue of it. The 1% won't be in Marbella. They will be in Sardinia or south of France. Therefore, how can so many British people have so many yachts on 60K a year? This is why these figures are wrong.

@@ExiledGypsythe people with the yachts dont have a job and earn income they have assets

Simple. Those people with yachts are clearly not on PAYE!

The risk element is a bit factor isn't it. Good on you guys and hope to do the same move to the sun one day! 😅

@@benj6244 - it really is. Most of our risks have been balanced and judged but once we went all in on a seemingly crazy hunch and it paid off massively. That one move secured our future.. But we were mid-30s and figured that if it didn't work we'd have enough time left to start over and go again. There's no freaking way I'd take that chance now! 😁

The sad thing is you just couldn't do that anymore

@@stevencalvert9454 - UK tax law is designed to get money out of 95% of the population, the key is learning how to get into the other 5%! But you're correct, the way I set up my property company almost 30yrs ago isn't allowed nowadays and a few of the reinvestments and capitalisation methods I used are also no longer legit. In many respects I was just lucky with the timing in starting this when I did.

Well done!!! It is often easy to envy top earners however many have sacrificed and invested a lot.

Not so great in Scotland 😢

@@pistopitpit what are the wages like ?

@@Abdul_Rahman86 lower than in England and you have higher income tax. But as the counterweight life is slightly cheaper in comparison to England, still bloody expensive though.

Tax is too high in the UK. My friend moved to HOng Kong. His salary is 100k and he nets 85K

Tax is inefficient in the UK, it's not that it's a bad thing. Middle earners are squeezed whereas the wealthy aren't taxed enough

I'm an additional rate tax payer, at the end of day I take home just over 50% of my salary and all benefits and personal allowances are gone

@@winston022 yeah that’s pretty harsh. The worst part is just before the additional tax rate. Saw someone run the numbers and it’s basically 60% tax between 100-120k

@@hockysa pretty much. Worst part is we can't even complain publicly because everyone thinks we're rolling in dough 😄

@@mattyward1979Good on you. Smart with the pension although there is a trap there as well since tax-free amount is frozen and LTA might be reintroduced. This year I'll manage to put 35k into my pension.

thanks for the idea!

yes indeed I've done videos before on this as wealth is different to income :)

Agreed. I'm 30 and have friends in London who make £50-60k, which to me sounds like a huge amount of money. But their income tax, rent, bills, student loan repayments, travel, and general cost of living mean they aren't able to save all that much. The jobs are stressful, and they live in ramshackle flats in dodgy areas, with noisy neighbours and bad air quality. And to keep making that amount of money they need to stay in London, where they currently have no hope of buying a home. Commuter towns are not even much cheaper when you calculate the train fares and time spent travelling. It all takes a toll on their physical and mental health. I only make in the low £20k's, but am lucky enough to have moved back in with family in the midlands, just paying my own food and share of the bills, and am able to save about half my paycheck, which goes straight into an index fund. It's far from an ideal living situation, but paradoxically I've never felt such an immense sense of freedom and optimism. In a few years I should be earning a bit more and will have saved a hefty deposit for a small house.

This is so so true!

@@thegrinderman1090Too true had a couple mates in London making between 100-150k at one point. One was pretty open and showed me his take home pay was “only” around 70k. Their studio flat rent was around 3k a month. Meaning around three quarters of their income had gone on tax and rent alone. The idea of owning any property in or around London was still miles off for them without a partner on similar income. Jobs were stressful too. They’ve both changed to lower paying, less stressful ones.

Try paying for 3 lots of private school fees and a big mortgage the “high salary” doesn’t go very far!

@pmtilbury6596 Well, that comes down to a subjective discussion of life choices. Either, don't have kids or don't send them to private school and look for a cheaper living arrangement perhaps?

Thanks for watching

I think being able to salary sacrifice into a home might be a good way to fix housing affordability - I would happily take a tax break if I can offload a bunch of my income into a house that I live in

The WEF will not allow you to keep it!

Be careful, Labour have already said they will bring back the lifetime pension cap…

Don't you pay tax on the pension when you take it anyway?

I'm similar, in the top 10% bracket. My eyes water at my tax deductions. I'm very grateful for higher wages but it's only in the last year I got bumped up from a much more modest amount. I definitely don't feel well off.

I probably earn slightly less than that middle bracket with my basic pay (I'm a single, 45 year old psychiatric nurse; for context). Sure, money can be tight at times but I don't drive and don't have children and I think that's a huge factor in why I don't feel the pinch as much as some of my peers. For me it's all about scaling back and managing my finances efficiently. I used to earn more years ago when I was in management, yet I was no more comfortable than I am now because I spent more because there was more to spend.What I do have in abundance now, is time to invest in my hobbies and visiting friends and family more than I used to. I work three 13 hour shifts a week, and can pick up overtime across the NHS trust whenever I want if I need to, there's never a shortage. That being said, I rarely do because I'd rather be off the clock than on it, enjoying myself. Most of my high earning friends are never off the clock, they work huge hours and are constantly emailing or picking up calls outside of work time, or just simply highly stressed because they can't switch off. I definitely don't feel like my life is any less rich because of my annual income.

And you would need to take out an average of 4% that goes to pension. And possibly, quality of life. Europeans tend to start at 25 days off a year which increases depending on age. Then there's maternity leave etc. All these small, but important quality of life stuff. And maybe also what can you buy in the supermarket for that income. I find EU supermarkets cheaper and higher in quality compared to the US, but that's been a while ago. Just my thoughts.

Yep very high rates and lower standard of living , makes you think doesn't it

You can’t compare a tiny country like Luxembourg to a big and complex one like the UK

Thank you weeee Val

Thanks for watching and the idea too

100% agree, completely undifferentiated. If you live in London the cost of living (food, transport, nursery/school fees etc.) is multiples of outside London. Income from employment is taxed at stratospheric levels

Invest and save? Make a legacy for your children and their children?

⁠@@user-si7fj5rh5unot sure what you are trying to say with your comment? Of course one saves and invests but that has nothing to do with affordability of daily life and tax rates (=net take home pay)

We already have wealth taxed. Actually multiple times. It's taxed on death when it's passed to the next generation. And let's remember that any new wealth acquired must have been taxed at the point when it was earned via the income tax.

Thanks as always! We know nobody goes in the public sector to be rich, but I would at least like to see any public sector job to at least keep pace with inflation otherwise you are quite literally losing buying power year over year.

Public sector workers win big on the work defined benefit pension front though.

@@adm58sure but many of us pay a higher percentage of our income than many other workers, mine is 12.9% and I pay AVC’s at £6500 per year which is the maximum. When I start receiving my pension, I won’t have much time for folk when people say I have been given it because I was a public sector worker, I achieved it through sacrifice.

@@adm58 This is true. At 36, I know that come state pension age (if it still exists), I will combine my defined benefit with the state pension to get 55% of my current ~£60k salary (in today’s money). I for sure want to build up more to be considerably more comfortable in my retirement, but it’s nice to know that I have a liveable “not less than” amount confirmed before turning 40. The flip side is that in 18 years in the public sector, my real terms pay for my current level is 35% lower than it was 18 years ago. Including a number of 0% pay increases during the austerity pay freezes.

If you were to compare true value of public sector DB scheme accruals with the 5% DC contribution most private sector workers get from their employers, the gap really narrows. I often seen public sector employees complain that this isn’t true as they have to contribute but I don’t think many of them are pension experts who truly understand the value of DB accrued income (for the record, I am).

Will do!

Cheers Paul! 👍👍

I used to be quite anti labour party. However under the Tories I'm taxed more than anyone since ww2. I fail to see how labour could make it worse? The joke I have amongst other landlords is, how could labour possibly fuck us over more than the Tories, they've had the lot already.

​@@bogstandardash3751indeed. the Tories have become the true champions of the stealth tax.

@@bogstandardash3751 true, the current mob calling themselves Tory seem to have forgotten the low tax/small state philosophy of the Conservative party. That being said, things will only get worse under Labour !

@djsconsulting how soon we forget Liz Truss! :-) Well, we'll soon find out if Labour are little-Britain liars like the Tories. Let's face it, they couldn't do worse - and the country needs a change.

😂

😂

That's is just crazyyyyy, life in the uk is just bs

Where does it go?

​@@duncanbananatyne3890the cars. Mortgage, utilities😂😂

Indeed which Is why I specifically say in the video its for those on PAYE only :)

Even if we're honest with ourselves and say that's true - then what?

Bone idleness?

No it's a overblown management level of employment in most firms .Non value adders to production but seriously put a dent in the wage bill.

Most people don't understand the economic concept of productivity. It is not how hard an individual works, but how productive they are in a period of time. Let me explain as that is crucial difference. If you are a carpenter and you only have a manual saw and a hammer, and you compare yourself with another carpenter with a double mitre saw and electric nail gun you will see that the first carpenter will be much less productive even though he will have to work much harder. The next concept is the education of the workers, if you take a nurse on the lowest level of experience they can only do certain jobs, and others they will need supervision - requiring the time of a second person. A more senior nurse is more productive as they can both do more difficult task, do not need supervision, and can make decisions on the fly without referring to other staff. So now you see that productivity on a economic scale of a country is primarily based on investment in tools and facilities to enable staff to do jobs more efficiently, and investment in education as this allows each individual to contribute more to the economy. One reason the UK productive of the UK has fallen behind comparable economies is the lack of investment in education (at all levels), and the lack of investment by companies in technologies that allow them to compete on the international scale. Another point that affect productivity is infrastructure. Consider a sales person that has to drive around to clients. If the roads are bad, with traffic jams, pot holes they will take longer to travel, maybe only visit 2 prospects in a day, not 3; suddenly the productivity of that sales person has been cut by 1/3 because of poor roads. Infrastructure covers all sorts of things, electricity capacity , roads, rail, internet speeds, crap postal service; they all limit the ability of a person to do their job effectively - so affect their productivity.

Are you insane 😂

Now retired, but I used to be a Chartered Engineer in the public sector. I remember in my mid-thirties that I was regularly in the lowest decile of electrical engineers with similar age & experience based on the annual IET surveys. Nothing changes. Like you, I'm highly sceptical about the pay scales in the finance services industry. PS - You also need to be a bit careful when considering the public sector as a group, military grades get paid much more than civilian equivalents if you only look at age and experience (but of course might find themselves in a shooting war).

whats your career?

I'm in a similar position, I'm not quite in the top 1% and I don't have kids but I definitely don't feel rich. I work outside of the UK and don't have a company pension so everything for my retirement has to be proveded for by myself but that aside I don't feel rich by any means. Very comfortable without a doubt but I definitely can't stop working and I would only have to stop earning for a few months to start to feel the pinch and start to withdraw investments that are intended for retirement. Like several others have already highlighted, my idea of rich is people who don't have to rely on employment to live comfortably. If you have sufficient passive income to ensure you have very comfortable standard of living then I would class you as rich. People in these positions are generally able to navigate the taxation system more effectively to minimise what they give away to the government.

@@coachingconfidant2785 I'm a "Senior Construction Planner" working predominantly in London.

I’m with you on this one, I now fall into the top 10% but it’s far from Rich! Some one once told me it won’t make you Rich but it will make some purchases a little easier.

@@bliss8476 You will never be rich working for someone. the only way to be rich is to work for yourself. the statistics reflect this

But does the top 1% feel much different to the top 10%? If you have worked your way there throughout your life please tell me. I am (also German) in the top 10-20% at the age of 25 and it doesn't really feel like it.

@@abcxyzsven Hi Sven! It took me almost 30 years to get to the 1% and I basically started from scratch. It doesn´t feel dramatically different to when I was around the 10% mark but it allows me to provide an excellent education to my daughter and that is very rewarding. The key to happiness is to understand that living below your means and building a decent investment portfolio to ensure peace of mind and independence is what really counts.

Very true. Agree with that. There has been real decline in living standards in the UK in the last few years.

Yes Prestwich and Radcliffe - £100,000 difference in house prices despite only being a few tram stops away 3 mile. Compare Wythenshawe and the other side of the airport and your talking a £200,000 difference. Middleton (Langley) & Middleton (Rhodes) - massive differences.

You don’t bank percentages

It's true. They have lots of cash in a cave, wear a top hat and sit on that pile of cash cackling.

Indeed this is just tax payers and there is a huge amount of wealth outside of these stats

And lots that don't

You can prob live a lot better off there also than with that money in say london!

Imagine how those earning less feel. I get £4,070.40 a year to live on since becoming disabled following an accident. No one wants to hire you, even with a degree.

@@LiquidMarvel Get into IT. we have people in my company that are disabled and work from home.

​@@LiquidMarvelsorry to hear that. Without knowing your exact situation I've always thought it a bit strange for employers to overlook the disabled especially in the tech age of working on the computer. There should be a vast amount of jobs that can be remote on pc and if I was an employer I'd be fighting for someone who would be incredibly motived to sit and do pc work all day and would be an employee for life. Didn't mean that to sound as cringe as it came out I hope you get the point.

Imagine being cagey about where you live but literally putting your FULL NAME AND DATE OF BIRTH as your username LOL

Welcome aboard! And thanks for watching. Interesting comment I’ll have to see if I can dive into the topic in more depth

Check the description so many people ask I made a link dedicated to it 😂

Yes I’m a nurse and I get paid hardly anything. My pay has only gone up by £400 in my hand in my monthly pay in 20 yrs

We've had lots of immigration which has helped to suppress wages at the lower end of the spectrum.

I left in 89 making £10k … and glad I did… no way I’d be making the same in the UK 35 years later ..

It explains Brexit

​@lesleyrobertson5465 got to call BS on that quick Google says you was on about 17k 20 years ago and 34k now. So can't believe 17k or 100% payrise is £400pm

Same me and my lady. Every time I go out from the supermarket, I feel like I got robbed pal

A lot depends on the debt levels one has. Mortgages are crippling many now but those who don't have a mortgage and have no other debts / own outright aren't being affected much.

@@ep1929 I don’t agree, the cost of living increase over the last couple of years is noticeable if you have paid any attention at all to your groceries spend (for example). Ok, this who are wealthy enough not to bother looking at prices of grocery shopping won’t be aware of it, but they likely are wealthy enough that they wouldn’t notice an impact. As for us, our mortgage isn’t crippling, it’s actually very conservative relative to what many say. About 17% of our household net. We still notice that things are expensive and trending up, even if we are able to absorb it.

@@ScottishJazzman monthly outgoings gone from £625 to £661 this year - that's for everything (mortgage and debt free).

@@ScottishJazzman "paid any attention" - I watch my expenses like a hawk. That's how I keep costs ultra low and that's why I haven't noticed it much.

Indeed which is why I did a video a while back talking about wealth and not earned income 😎

All before tax thanks for watching 👍

I did a video last year comparing which you might like check my channel - but I might do an update later this year too :)

@@TobyNewbatt Thanks

If you can keep the same job/ salary it’s a great life.

I know a few people who have done it and they say it doesn’t make a difference. But yes if you can hold your London job

Thank you for watching - unfortunately those are the kind of stats I'd love to see but aren't accessible as far as I know. Of course this where the real wealth is :/

Yes I’m a nurse and a PAYE. I’ve noticed tradesmen look well off. Bought house. Van plus cars. Holidays.

RPI includes currency movements ... The price paid for the import of raw materials gets fed into the price paid by consumers for the final end product

Politicians use and want you to use the RPI. Currency should be valued against it's ability to buy scarce and desirable assets. Housing, Gold, Technology Stocks, and Crypto. Those are the assets where most of the increase in money supply has gone into over the past decade. If you look at a chart of the BOE balance sheet against the price of housing you will see that it is almost an exact match. It's just a fact once you deep dive into real macro statistics that the currency supply has been increased at a rate that far exceeds general price inflation for which non enlightened people use the RPI as a metric. The take home is that money has been consistently devalued since 2008 and will continue to be. It's the only option the government has with regards to the elephant in the room. The national debt. ...Kicking the can down the road hoping that increased productivity will save them, but it assumes that the world will continue to buy our debt. That game changed tho when the US decided to weaponise the dollar.

I actually love that very few people get it. ..The biggest investment gains come when someone understands something that 95% of people haven't got a clue about and then use it to their advantage. So I'll stop speaking facts and just look at my ROI and smile 😀

@@guy35451 yeah, me too. I stopped work 5 years ago aged 51 and just let my investments pay for my lifestyle. I'd say it's even greater than 95%. I think closer to 99% of people work through their fifties, rather than allocate time how they choose.

Indeed another video on wealth would be great but that data is not something that seems easily available

Wish I could as a nurse

You will never have access to that information

This! The frozen tax brackets (in the US for example they are bumped up by IRS automatically without the input from politicians) is a real killer. It makes comparison difficult as the after-tax income is influenced by many things (child tax credits after 50k mark, voluntary pension contributions etc).

Same here. WFH rocks.

well that's ridiculous

Confirmed. 12% household here. We’re comfortable and secure; but very, _very_ far from extravagant.

I agree. I have a few neighbours who've let slip what they earn and even those who are earning over 100k are spending all of their take home pay these days with big mortgage payments, private school tuitions and the 2 fancy cars on their driveways. Even for people who appear to be very comfortable the thing to watch out for is lifestyle creep and how it eats up your income; private school fees are something I'd certainly be cutting back on as the state schools in our area are all rated as excellent.

Rich to me means 5 million plus a year

The secret is to have 2x top 10% earners. 😂 8.5k take home per month goes a long way. But if childcare is involved, that's a notch down.

@@TsLeng At the same time though, not as far as you might think! I think, if anything, it buys more security without going so far as unabridged comfort and luxury. eg. Could you happily max out pension contributions, have decent income protection insurance, max out £40k of ISAs (~£3.3k/mo), pay all fixed and variable accommodation costs? Probably, but you wouldn’t have _that_ much left over for discretionary spending. Don’t get me wrong, netting £8.5k a month is a lot of money (a good deal more than we get); but I can see how it might _feel_ that it’s just “ok”. Remember, there are a lot of 6 figure earners living month to month.

I put every single source in the description for you to go through :)....but im feeling generous scroll down here: www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/annualsurveyofhoursandearnings/2023

@@TobyNewbatt No i'm sorry I found it, just being impatient ! Thanks again!

Ohh yes that could be interesting but I don’t think we get that data. Thank you for watching 👍👍

Your net pay depends on your own situation. E.g. pension, salary sacrifice, student loan etc.

Indeed it’s very subjective when it comes to quality of life which is why it’s not all about income but really how much you can save! Thanks for watching