[Closed] Life is hard living on £120k a year.

@geetee - if you remove the charitable status from private schools (and Universities ?) then you'll put much more pressure on the state sector as a portion of parents will have to take their kids out due to likely increased costs.

As per CFH a compliance officer isn't getting a 100% bonus, I'd imagine he gets something though.

As others have posted the school fees are the unaffordable thing, any rationale financial analysis would say his kids should be in the state sector which in that part of Surrey is generally pretty good. I imagine he put his kids into private school when he was earning more (as he probably was in the mid-2000's before the banking crises).

Frankly nothing the government can do is going to help him out.

He should move up north

He should move up north - I have lots of friends who have, can't believe how much better the life is - buy a really nice house near a very good state school and still be in the gravy.

SSSSSHHHHHHHHHH!!!!!!! 😉

Start with the word 'network'

There's a certain amount of irony associated with the idea that he might have been earning more as a compliance officer, right before the serious issue of compliance brought the whole banking sector to the brink of collapse.

Affordability is the issue, but there are others such as the notion that you can have a large household income and still be pretty squeezed because of child care costs.

If we want men and women to earn the same then we need them to have equal access to the work place, i.e. not chose to leave for ten years while they have kids.

The cost of that is very high; as I said, for a professional couple who will most likely need a nanny to make it work, it's about £25k a year from your post tax salary (so around £40k pre-tax at the higher rate.)

Start with the word 'network'

People don't do other people favours anymore just because they went to the same school.

bikebouy - Member

iolo - Member
I bought a house in Snowdonia and a small place in vienna mortgage free.

Are you single?
Are you looking for a partner  

Unfortunately for you there is a mrs iolo.
I must admit I have no kids but my step daughter goes to Steiner School paid for by her father.

No, not in an overt, 'he's one of our chaps' kind of way but association and meeting the right people and your social circle does make a significant difference to your chances.

Contracting, particulalry in oil and gas, is proabably the working class equivalent. It's done on a 'do you know any good lads' basis a lot.

There's a certain amount of irony associated with the idea that he might have been earning more as a compliance officer, right before the serious issue of compliance brought the whole banking sector to the brink of collapse.

You can't really hold a mid ranking compliance officer complicit.

Especially one who can't even manage his own salary.....

You can't really hold a mid ranking compliance officer complicit.

Does it even mention which branch of Compliance he's in? Again, there's a lot more to Compliance than meets the eye. Didn't read the full article this morning, was too busy with the crossword!

No, not in an overt, 'he's one of our chaps' kind of way but association and meeting the right people and your social circle does make a significant difference to your chances.

True but that opportunity is open to everyone within the sphere in which they move at least. I've always had a really good network but I went to pretty ordinary comprehensive and a very average uni (at least for my undergrad).

Interestingly I did go to a top 30 global business school and while I graduated ten years ago, and have friends in some fairly senior roles, I've never once experienced the kind of chance you've referred to here. I have had those chances, but they were more of my own making than ones which came as a result of schooling.

@geetee - I don't want to see the thread derailed after "just" 3 pages but the financial crises was caused by too much borrowing by individuals (mostly in the US but in the UK we did quite a decent job), companies (thankfully not too many) and worst of all Governments. You can't really hold a mid ranking compliance officer complicit.

Don't worry Jammy - I've been banging that drum myself for years also. I am in complete agreement with you. Nevertheless, someone somewhere should have been asking whether it was such a good idea to lend to them....

Not wishing to provoke anything, but surely if you're earning a basic salary of £120k pa then a mortgage of £350k is hardly monstrous. Even in the good old days, 3.5 x salary was the sensible calculator you looked at, so with a salary like that, his mortgage is fine.

Except I reckon with a 45K outgoing after tax, he can only be paying interest or making a small investment/repayment and still be eating anything other than Lidl beans everyday.

I think the other point worth making is that his wife could get a job and certainly his oldest son if not the younger one. My kids where all working part time when they where 17.

iolo - Member

bikebouy - Member

iolo - Member
I bought a house in Snowdonia and a small place in vienna mortgage free.

Are you single?
Are you looking for a partner

Unfortunately for you there is a mrs iolo.
I must admit I have no kids but my step daughter goes to Steiner School paid for by her father.

You mean, cough, you are hitched already?

Is dissapoint 😥

thestabiliser - Member
No, not in an overt, 'he's one of our chaps' kind of way but association and meeting the right people and your social circle does make a significant difference to your chances.

As I said, maybe in some industries and maybe more so in London but I've spoken with plenty of mates about this and essentially we feel a bit hard done by as we don't seem to have benefited from it other than the direct benefit of the education itself. I don't believe for a moment that it doesn't happen - just look at the top people in politics for proof - but it doesn't happen across the board and not to the extent that people who are 'outside' think it does.

that money never was theirs and never will be

If you read my post properly you will see that it was their money, the threshold has been reduced systematically so more and more has been taken in tax. Easy target though, higher earners, as shown by many of the comments on this thread. We have a culture propagated by the politicians that people who earn more don't deserve the extra income. Taking money off the higher earners is a lot easier than dealing with the underlying out of control nature of the cost of living. A relatively small percentage of the population are net contributors to the state and a significant majority are net recipients. That's not going to be sustainable if keeps going. House prices, rents and basic expectations of what a normal standard of living is need to be rapidly reassessed to more realistic levels but that ain't going to happen.

Thinking about it - he basically can't really afford to send his kids to private school - like pretty much everybody else in the country.

The fact he has decided to spend all his money on something that is not essential (there is a freely available and often very good alternative) and sacrifice is his lifestyle is his choice to make and I'm sure he believes that the sacrifice is worth it.

But on that basis, why is he offered as a case for our sympathy - affluent family have to scrimp a bit to afford something large majority of population can't even dream of. So what?

"Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery."

Wilkins Micawber.

We have a culture propagated by the politicians that people who earn more don't deserve the extra income.

Or maybe that's a culture propagated by common sense when people see the likes of bankers, top civil servants, senior managers, executives etc taking wildly disproportionate remuneration packages which have no relation to what they actually do on a day to day basis.

House prices, rents and basic expectations of what a normal standard of living is need to be rapidly reassessed to more realistic levels but that ain't going to happen.

I don't necessarily disagree that there needs to be a downward re-adjustment in people's expectations, but that can't/won't happen until those at the top take the lead either through their own self-control (yeah right!) or through government intervention. You seem to be arguing the opposite however.

stumpyjon - policy makers who would agree with the first half of your analysis ie greater tax on high earners is no way to improve the economy - would completely disagree with any government involvement in artificially keeping prices/cost or living down. David Cameron went off on one at the mere mention of rent controls at PMQs today. The market will out - if people are prepared or feel obliged to commit increasing amounts of their income for property then the prices will keep going up and everything else will be squeezed.

This is a structural problem in our economy - the other solution in housing is to build lots more property - but difficult on two points - who wants 1000 new homes in the fields around their village/town? and it will push down property prices.

But on that basis, why is he offered as a case for our sympathy - affluent family have to scrimp a bit to afford something large majority of population can't even dream of. So what?

Context. This is in the Telegraph, a paper which aims at people like him. Now, it may be nothing more than he/his Mrs is friends with the journo. Or it may be a bit more tactical than that: there's an election in 12 months, and everything the papers say on matters of the economy will be driven by an agenda - in this case "look, even one of our chaps on a reasonable income is struggling to get by".

The great and good of STW may hold a (legitimately) different view, but there's a reason for everything, especially where the national press come in....

Or maybe that's a culture propagated by common sense when people see the likes of bankers, top civil servants, senior managers, executives etc taking wildly disproportionate remuneration packages which have no relation to what they actually do on a day to day basis.

Strange how that perspective only ever works in one direction......

This is a structural problem in our economy - the other solution in housing is to build lots more property - but difficult on two points - who wants 1000 new homes in the fields around their village/town? and it will push down property prices.

It is structural. I am against rent controls but you can only use the argument of free markets if they are truly free to clear. If you set planning regs in such a way you limit the number of new houses being built, it won't clear. Similarly, if you build your economy based on how rich people feel because of house price inflation, then similarly, you create a scenario that inhibits house building.

We don't need rent controls if house prices do indeed go down, which is exactly what happened in 2008 and some how we seem to have taken leave of our senses again.

Plus ca change....

Oh and for the record I live in Horsham, which currently has four separate developments and 5000 new homes being built, which I am all in favour of.

... oh I understand the wider Tory narrative - look hard working middle can't even afford to eat out while those unemployed are getting all the benefits etc...

My question was rhetorical

geetee1972 - perspective in one direction - are you sure there isn't just a little bit of stigmatizing of the unemployed and other benefit recipients going?

Election looming - I don't expect too much long-term thinking over the next 12 months...

... oh I understand the wider [s]Tory[/s] political narrative - look hard working middle can't even afford to eat out while those unemployed are getting all the benefits etc...... oh I understand the wider Tory narrative - look hard working middle can't even afford to eat out while those unemployed are getting all the benefits etc...

The middle class put you in power, (not the unemployed), so every party pays more attention to them, be stupid not too.

geetee1972 - perspective in one direction - are you sure there isn't just a little bit of stigmatizing of the unemployed and other benefit recipients going?

You misunderstood me. I just meant that when people who started in low level positions work their way up, they never hold that view even if they once did.

Prejudices aside it's actually quite an interesting article, the point is that every section of society is feeling the pinch, and let's face it £120k salary for a City worker living in Surrey ain't that much, he's being honest and isn't really after sympathy as he said himself:

Jackson’s tone is matter-of-fact. Like the rest of the Squeezed Middle, he is keenly aware that his situation evokes little sympathy.

but it doesn't happen across the board and not to the extent that people who are 'outside' think it does.

So If you are not privately educated we are on the outside ? Mmmmmm

geetee1972 - apologies, yes I agree, the jobs are rarely as easy as people think, speaking as someone who rose from entry level to senior posts. But I've given up arguing the point...

So If you are not privately educated we are on the outside ? Mmmmmm

That was from the pov of people who think that there is some big old boys network/conspiracy, not mine. Some of my best friends were state educated 🙂

geetee1972 - apologies, yes I agree, the jobs are rarely as easy as people think, speaking as someone who rose from entry level to senior posts. But I've given up arguing the point...

Have these senior jobs got very much harder over the years? I ask because remuneration seems to have increased out of all proportion to what ordinary people earn.

I am surprised the footer passed without comment...

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😉

Late to the party but...

When people get pay increases, the tend to live to thier means. Its hard to give up nice houses, private Ed for kids etc and go through the pain of downsizing if you don't have to, therein the guy in the article feels squeezed, and is coping to maintain that lifestyle. Also who wouldn't try to keep the decent house if you felt a bit of squeezing now will leave you in a better position later?

Does anyone really start there career in a one bedroom bedsit on £20kpa, rise to £120kpa and not adjust their lifestyle accordingly? I'm not saying you can't, just that people don't.

But I've found the real issue:

swapping Ocado deliveries for trips to Tesco,

Me and Mrs K have discovered that physical shopping results in a considerably larger food bill than internet shopping, and that's before you add in the cost of fuel to travel to the shop etc.

So in our case, Ocado has actually, yes really, been a cost saving.

Well worth a proper read later whilst consuming some Lidl wine 🙂

Have these senior jobs got very much harder over the years? I ask because remuneration seems to have increased out of all proportion to what ordinary people earn.

Of course not. With the wonders of modern technology and communications, it's probably far easier to manage a large organisation than it was 30 years ago. My father-in-law, who himself was a senior manager at a large publishing firm in the late 80s/early 90s often rants about how senior executives these days have lost all sense of morality, fairness, and integrity when it comes to remuneration. It's even more galling when you see public sector executives with their noses in the trough trying to keep up with their private sector peers.

ransos - probably yes - but in the same way lots of other people's jobs have. Long hours without extra pay, expectation to respond out of hours, immediate solution demanded on every issue due to media pressure etc

Dazh - i'd argue it was more difficult because of the technology - the world moves much faster now - albeit generating more heat than light.

I do agree that in some (but not all) cases the wages are (have) inflated due to there being a closed shop doing the hiring to similar posts by similar people - particularly board level posts [edit]

I think a rebalancing of work and salaries would do everyone a favour. I consider myself well out of it tbh

who wants 1000 new homes in the fields around their village/town? and it will push down property prices.

But it wont push prices down in the current climate. You'd have to carpet the countryside before that happens.

Oh and for the record I live in Horsham, which currently has four separate developments and 5000 new homes being built, which I am all in favour of.

Ugly boxes being built for a large asking price, squeezed into as small as space as possible to maximise the profit for the house builders. They are also in Horsham.

Have these senior jobs got very much harder over the years? I ask because remuneration seems to have increased out of all proportion to what ordinary people earn.

No they haven't, but those who do these senior jobs have been receiving the kind of remuneration packages that "risk takers" in the city are often rewarded.

Why would for example the chief exec of Isle of wight council of all places receive £210,000Pa for his services? Not to mention the ridiculous amount of pay the execs get from the privatised utilities.

why would you offer yourself up for a story like that in a national newspaper? Is he that desperate for £££?
£120k is so far from the 'squeezed middle' that the whole tale comes across as a constructed story for clicks to me...

It's all perspective.
He's struggling because he chooses to pay for private tuition, that's his choice and actually quite selfless.

If you switch it around and lower the scale, a lot of my friends are skint yet can afford iPhones/Nice trainers/Sky TV and nights out. 95% of could probably be mocked in a similar way by the poorest in the UK for our exuberant lifestyles.

Have these senior jobs got very much harder over the years? I ask because remuneration seems to have increased out of all proportion to what ordinary people earn.

I think that's a very interesting question, worthy of an MBA or even DBA dissertation.

My instinctive reaction based on experience, education (an MBA) and knowledge of how senior leadership roles actually work, I would say yes they have and by quite a large degree.

I'd need 30,000 words to satisfy the argument, but a few pithy examples would be:

The complexity of managing the media in a very media savvy world made even more complex by social media (Co-Op is a brilliant case in point).

Risk - being exposed to many more risks and being accountable for those risks

Span of Control has typically increased as businesses moved from large conglomerates and extensions of empire to fragmented ownership structures and 'agency principle' management teams.

Technology means more data means more requirement to be able to analyse and respond to that data.

Have these senior jobs got very much harder over the years? I ask because remuneration seems to have increased out of all proportion to what ordinary people earn.

I wonder whether we would have the same argument here if it where a couple earning £60k each ? They would actually be far better off as their tax bill would be a lot lower.

I wonder whether we would have the same argument here if it where a couple earning £60k each ? They would actually be far better off as their tax bill would be a lot lower.

In both cases if they were sending their offspring to be privately educated, then yes it would be the same.