About £60,000 a year

Ed

Ed Miliband entertains The Invisible Man at the Labour Party conference

She says, by @mammapolitico

What’s your family income? Do you get tax credits or childcare payments? Is £60,000 a year a large household income?
If ever there is a scenario that raises the temperature of political debate, this is it.
Rachel Reeves Shadow Chief Secretary to the Treasury stated this week that those earning £60,000 a year “do not feel particularly rich”. She herself earns an MP’s salary of £66,000 a year. Labour’s new vote winning policy is to pledge to not raises taxes for those earning £60,000.

So what do I think about a household income of £60,000? Let me start by stating that despite my 5 years of University education and a teaching career of some years I have never come close to earning that amount of money. I have never lived in a household even when with my ex who is also a teacher that had that kind of combined income. To me at first glance a household income of £60,000 seems like an amount of money I could manage on very easily, thank you very much. It’s all about individual circumstances though.

Lets have a quick look at the figures: Salary of £60,000. On current tax rates £13,822 a year of that would go straight to the taxman in the form of Income Tax. Another £4,414 would go to HMRC again in the form of National Insurance contributions. Actual, in your hand take home pay per month after deductions would be £3480.30. Sounds like a lot of money to me, but hitting that £60,000 a year bracket takes away some benefits available in the lower income brackets – Child Benefit and Child Tax Credits with the accompanying help towards childcare costs.

Exactly how much is an income that will make you feel rich is a question only answerable by individuals, in my opinion. It is entirely dependent upon personal circumstances. Does what money comes into the household match or exceed what needs to come out? Watching Downtown Abbey ono Sunday, with it’s storyline about a rich family fallen in to poverty, casts an interesting light on this question. Land rich and cash poor – many families on a £60,000 salary living in the South East with mortgage payments that would make my eyes water can probably draw parallels with the Crawley family situation.

The question of who to tax and what to tax them, is a question that will probably still be being asked by political parties when I am too old to worry about paying income tax (lets hope I don’t look back and read that I wrote that and think “ Fool, you should have seen it coming!’ as I hand over my “Tax because you have lived too long payment”)

I’ll leave you to mull over your opinion with this quote:

“After the government takes enough to balance the budget, the taxpayer has the job of budgeting the balance.”

***

He says, by @ADadCalledSpen

Read a thing. I should stop reading things really because they prompt me to write things. Or get angry. Or both.

So, Labour are considering a tax break for those who earn under £60,000 a year because this income doesn’t make one rich.

Contentious issue. Some might say this sort of income is that of a rich person. Or a richer person. Especially people who  don’t have a realistic chance of ever earning this amount. Regional differences, salary expectations, costs of living etc mean that £60,000 a year is a lot to some, and yet not so much to others.

I know it’s not the centre of the universe but I will talk about it as I’m from there, lived there and do live there so it’s a region I know well, so forgive the London centric-ness.

London. It’s expensive to live in London. The cost of travel, the cost of accommodation, the cost of childcare. All this goes out, at a rate of knots, while your income stays pretty much the same. The cost of living now is much higher and so this, rising fuel bills, the cost of FOOD and petrol going up each time you blink and… printer cartridges. We all need them and yet they are to most expensive thing per gm than anything on this planet. The street value of printer ink is higher than cocaine. But I digress…

You work full-time. Have three children. Have to pay for childcare, housing, council tax, utilities, food, travel to and from this place which pays you this much and so… what do you have left? Apart from a vague feeling of working to survive, and a feeling of worry about expenditure not matching up to income. A single mum in London earning £60,000 a year with lots of outgoings is in a very different position to a 30-year-old with no dependents earning the same amount.

£60,000 a year. Yo’ is minted man!

No. I don’t think so.

In London or Edinburgh, it’s harder than… dunno, living in Leeds or thereabouts, or in Bristol or Stoke On Trent. Because house prices/housing costs are lower, so mortgage payments or rent will be lower, as will council tax. Maybe childcare costs too. £60,000 a year outside of London may stretch further. It might be a good income and if that’s you, then I’d say you were doing well.

But an income of £60,000 a year. Does this make you rich? Or are the Labour party just trying to claw back a bit of the voting populace with tactics that appeal to the largest portion of the population, those earning less than this amount.

Or am I just playing Devil’s Avocado?

I guess the Labour party have to do something to win back voters. Is it realistic or just a cynical appeal for votes come party conference time?

Ed Balls.

Please let us know what you think. Does an income of £60,000 a year make you rich?

***

Thanks for reading and please leave your comments and thoughts in our comments slit.  £60,000 a year. Would it be enough for you thank you very much? Please let us know what you think.

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37 thoughts on “About £60,000 a year

  1. I think £60000 can make you relatively comfortable but not rich per se. The trouble is, with any income, you live to your means. You maybe get a bigger house or have more children or educate them privately. So the disposable income shrinks. I think it would give you more options; I certainly don’t think it would make you rich.

  2. Arghhhhhh! This brings back memories of when I had to defend our family income over the whole child benefit debacle. We once had a sizeable income, I was a SAHM able to plan weekends away without too much worry, basically we had some disposable income. But shit happens. Redundancy, loans to set up own business, 50% pay cut, zilch disposable income, childcare, fuel costs blah blah blah. At the time I thought 60k was ok, not a lot, but ok. Now I think it’s a king’s ransom! So, yes. It is SO about the personal situation. BTW liking this blog with the two sides thing going on x

    • Self employed myself after earning a teaching salary for some years- oh my goodness it is difficult. £60,000 on paper seems like a Kings Ransom with my current income but as we’ve both said it’s the gap between outgoings and incomings that make the difference to whether you feel wealthy or not.
      Thanks for commenting – we love writing the blog! Hope you will keep reading and commenting. We really appreciate it. x

    • Thanks V. It’s interesting to know people’s experiences in this situation as everyone is different and everyone sees money in a different way. I don’t feel it is a subject for someone to be judgey about though, so I’m sorry you had to defend your position in some way. Surely we all want the best for each other?
      And thanks for the comment about the blog. It’s fun writing it. 🙂

  3. I agree with the first comment, it prob isn’t rich (although it still sounds like LOADS to me!), but it is comfortable. If it were not for the ridiculous overpricing of the housing market you would probably be well off on this income! And I quite agree it is comparative- where you live really makes a difference, we are not in London, but in the South, and in my town you would need that income to be able to buy a family home. We have no hope of ever owning anywhere big enough for our family of five in our region, in fact according to the recent BBC study we cant even afford to rent here- but of course we do, because we live here, our families and life are here, so we have no choice but to rent here! If we were to move to the North we would be considerably better off financially as our housing costs would half, but the richness of your life is so much more than available cash.

    • Think that is so true – for me happiness is more important than money and always has been – probably just as well because I haven’t got any!. Financial problems caused by not having enough money to meet the cost of living can be a terrible strain on families and individuals and then there are those who have no money issues because they have won the Lottery, but have lost friends because of it. perhaps we should go back to a society that operates on a system of bartering!
      Thanks for taking the time to make a very important comment.

  4. I live in a small S.Wales valley where I would rip your arm off for £60,000!
    I get tax credits etc, but no help with council tax, school dinners or whatever else you can get help with. Yet our, take home, is less than half that.
    Do we manage? Well actually, yes. We budget, we go without some luxuries so my boys don’t have to. We are actually quite ok.

    Fabulous post, love this format x

    • Where I live the average family take home pay in my town is more like £28,000 but this includes welfare payments such as Tax Credits and Child Benefit. As many have said, budgeting is the key to survival but it certainly isn’t easy especially with children.
      Thanks for you lovely comments about the blog – hope you will keep reading – we have lots to say 😉

  5. Personally and as I have always maintained. An income of £60k in London with 3 children, you are still on the breadline (especially if you didn’t buy your house in the ‘easy’ days). You only have to look at the costs of rents – 1 bed apartment decent area £1,000 per month – don’t get me started on a family home! Salaries have stagnated, costs have risen, those who may have felt well off on 60K, no longer do. This is my perspective, based upon real stories of people I know there, living the life, struggling to make ends meet and now stacking shelves at supermarkets on top of a full time job to pay for kids clubs/school clothes, etc. London is no longer for Londoners, the prices have been driven up out of reach of most. Those who choose to stay are facing huge financial pressures.

    • Housing costs are a massive issue for you in London. This absolutely has to be taken into account when looking at the whether someone living there is wealthy on £60,000. Where I live in Yorkshire it is still possible to buy a house for £75000 and that’s not a repossession but a perfectly nice home with a garden. It’s awful that house prices and rents have got so out of hand that people are having to leave their home areas or struggle. Future governments need to do something to change this BUT will they?

      Thanks for taking the time to comment.

    • Thanks you. I remember we talked about this some time ago and seeing this article in the press, hearing this news made me think of our previous discussion and so @mammapolitico and I went for it. So, thanks for the inspiration really, and thanks for your comment. 🙂

  6. Great read, thanks. I think it’s all relative depending on your individual circumstances – but let’s face it: those below 60K income may believe it’s a sizeable packet, those above may feel otherwise. Regardless, are we ever satisfied?

  7. £60,000 may seem rich in certain parts of the country and for certain people and I don’t doubt that we are seen as *rich*. IWe are in a position that annuities from our deceased first spouses’ take our income to above £60k. I would not describe ourselves as rich, but we are comfortable. We can pay the mortgage (we live down south and have a small mortgage compared with most), we manage to feed the 6 of us healthily, we can run our 2 cars, we can pay for school trips (although not the £800 ski trips or the £2000 geography trip to the USA…I mean what is going on there!!!) and we can afford a week away to a house somewhere in England once a year and maybe a few days camping. This is not rich, rich is no mortgage, private education (although being a teacher IF I was rich I wouldn’t pay for my children’s education, but that’s another debate),being able to afford holidays abroad, buy brand new cars, not have to look at price tags in shops, not buy birthday and Christmas presents through the year to spread the cost, allow our children the top of the range gadgets they’d love to own, oh and employ a cleaner and a nanny 😉 I have lived at the other end of the scale as a single parent with very little income after my 1st husband died, relying on benefits to get me back on my feet until all the red tape released the monies owed, back then I am sure I’d have believed £60k was rich.
    I am thankful that in the current climate we are comfortable, but I also know that this could change with redundancies, or as both of us have experienced serious illness and death. So, no, I do not think that £60k is rich.

    • You made some excellent points there which really add to this debate. Yes, it doesn’t take much to rock the boat and an income of £60,000 could disappear overnight due to bereavement, redundancy,etc. You also have experienced how hard it is to manage as a single parent on little money – as people keep commenting it’s all relative.

      Thanks for commenting.

  8. I always thought 60K was a fair whack. Then I realised, that you have to pay tax. All the tax.

    If you are single, 60K is a lot. You’re probably a bit minted. If you have a mortgage, childcare, cars, children…60K doesn’t go far at all, especially as you said Spen, if you live in London. London is a total money-stealer. As are kids and houses, but we knew that anyway, right?

    S’all relative, innit? Well written, as always both of you.

    • Would have loved to have earned £60000 when I left Uni – as you say as big lump of money to live the single lifestyle on. I have a sister who did and earns hugely more than that now. Amazing house, drives a Mercedes but no children because she ‘likes her lifestyle too much”. Think my kids are worth their weight in gold, but everyone makes there own choices.
      Thanks for reading and commenting.

  9. I make the monthly take home pay based on those figures £3,480 not £4,213. If that’s the whole household income and the average London mortgage is £1500 that leaves less than £2K a month to pay for everything else. Factor in food and travel and your average family would seriously feel the pinch.

  10. Great post.

    What is frustrating is my partner earns £100k a year and due to his tax bracket will come out with nearly the same amount each month as someone who earns £60k. Doesn’t make any sense.

  11. Well spotted – apologies it’s my mistake – was looking at the monthly taxable income figure. Thanks for pointing that out. As you say that makes the figures look even less like wealth especially for those in London.

  12. Jointly we earn around this in Edinburgh and think on paper we are comfortable, certainly compared to others around us. However no tax credits received but childcare to pay for, luckily family help with childcare 1 day.

    For my husband to earn the money he has to travel 2 hours a day and for me to fit childcare around Work we need to run 2 cars which is very costly. No luxury holidays or extravagant gadgets here but no need to worry week to week how will feed ourselves.

    It is all relative – definitely not rich but can’t compare to people working min wage and struggling to get by.

  13. I don’t think it matters whether £60k is rich or not. I know someone who earns £90k in London and lives in a two bed flat 45 mins from the centre. I don’t think he feels rich in those terms but then he doesn’t think twice about buying a new shirt. I do.

    What matters though is why they are saying it. It’s to try and appeal to the middle class voters they lost in the last election. That is all it is, nothing more than that. So much of politics is not about what’s right and what’s wrong, it’s about what gets you power.

  14. yeah i guess 60k does sound a lot, but it’s also a lot of tax, £13,822 so after all that is swiped away then it’s not so much is it?

    it also hugely depends on where in the country you are living too. are you in london where the average house price £475,940, childcare is £1,400 a month, which is just for starters, council tax, travel, blah blah blah, 60k doesn’t go too far.

    however if you live in the north where the average house price is £143,397 and childcare £500 a month then yes 60k is practically swimming in cash!

    so tell me, how on earth can a sweeping statement of everyone earning over 60k should be taxed at a higher rate? surely it all has to be relative to circumstance and how would that be done? what a load of bollocks

  15. Hi guys. Great talking point..again!
    For me, I live in London, am comfortably off with a joint income of a little above 60k. We have mortgage payments, and run two cars and two kids. We have simple holidays in the UK, but we enjoy our leisure time, eg football and golf (OH). Does that make us rich? I don’t think so. I believe rich is when you don’t have to think about the cost of the things you buy, although staying rich means that you probably do. We use our Tesco clubcard very well, and every little does help! We live in a modest family terraced home in a typically suburban area. We also both work in local government, just had our first 1% pay rise in many years, jobs are being cut all around us, and one of us could be next. But if that happens, we will adapt. In other words, you cut your cloth accordingly, and as others have said, what you have you spend, what you don’t, you can’t!
    Debs x

  16. Pingback: Sunday Summary 29/09/13 | @adadcalledspen

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