How Much Do You Need to Earn to be Rich in the UK - (Here's What The Data Says)

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This video looks at how much the top 10%, 5% and 1% of top earners in the UK make. But then also looks at what it means to be wealthy and why income and wealth are different. I show you all of the latest data from the Office for National Statistics, recent academic studies and company financials to break down and answer the question of what it means to be rich in the UK and what things the wealthy actually invest in.
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[@TobyNewbatt]

Just posted another video now that compares the US to the UK! Enjoy! How Much Do You Need to Earn to Be Rich in the US (vs. the UK) kzbin.info/www/bejne/rn7dZ2R_bNmWpaM

[@washingtonx1]

You keep saying a monthly "take-home figure" when you actually mean a monthly gross figure. That's not the take-home pay, it's the gross amount before taxes. That's kind of the whole point of your video, so you should fix it.

[@TobyNewbatt]

@@washingtonx1 it’s a mistake in the script. It’s all before tax as I stated at the beginning. Thanks for the comment and I hope you enjoyed the video 😎

[@jordansamuels2052]

Can you link the study you are reading please

[@TobyNewbatt]

@@jordansamuels2052 Not sure which one you are after - all data on wages is available on the ONS website you'll have to go digging. The 'study' on wealth you might be talking about is this one: warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/wp576.2021.pdf

[@jordansamuels2052]

@@TobyNewbatt thank you!!

[@TomWellyWells]

It’s simple, I will feel rich when work becomes a choice.

[@TobyNewbatt]

Thats a nice way to sum it up.

[@douglasherron7534]

That's called FU money.

[@anyexpat]

@@douglasherron7534 FU money is jumping in your own G650 and going to watch your sports team as the owner

[@douglasherron7534]

@@anyexpat Not true. FU money is when you can turn to your boss, tell him 'FU', and walk out the door without worrying about having to find a new job. What you are describing is filthy rich levels of money... you don't need that to say FU.

[@gluehoof573]

So my wife is rich...I'd better ask her for a loan.

[@TheBClark88]

My wife and I are both in the top 10% bracket and our combined annual income, including bonuses and share schemes is about 140-150k before tax. However we have no generational wealth (our parents all worked blue collar jobs) and while very comfortable we don’t live a life of luxury. We have a 10 year old car and a fairly modest 3 bed house. We live in the south east, over an hour from London, and our mortgage and childcare costs alone equate to an annual salary of £58k a year. I am incredibly grateful for our situation but salary isn’t the only metric for wealth.

[@TobyNewbatt]

Great comment Ben

[@ericshang7744]

We are in similar situation except we are not in UK and we don’t have children. The scary part is we don’t feel rich at all, the only enjoyment we have is going out for big breakfast on weekends.

[@ericshang7744]

@@anyexpat don’t get me started. The prices have increased so much, I once charged $2 extra just to get the eggs scrabbled.

[@RileyRedux]

Spot on! I am in a very good career, but all my peers in other careers have free rent at home and their parents are chipping in for their house deposits. I'd much rather be them.

[@anyexpat]

@@RileyRedux You may feel that now but when you do finally buy your own place it will be way more satisfying. Being given things seems great when you are younger, but trust me working and buying your own is always a better feeling

[@camzy01]

Shocked how (relatively) attainable a top 10% income is, I'd have expected that figure to be at least £30k higher lol. UK's growth and wage stagnation has been appalling

[@ivermektin6874]

Don't forget they are keeping tax bands the same to benefit from any future salary inflation.

[@sender5804]

thats not top 10% of income, but top 10% of salary. I'm sure another 10% don't really need to work and can live from assets / investments

[@camzy01]

@@sender5804 valid distinction, and yep I wouldn’t be surprised at all if that was the case

[@kinggeoffrey3801]

I genuinely know people that earned 30-40k a year in the 80s. The skilled market has been stagnant for decades.

[@leonhenry4861]

@@kinggeoffrey3801exactly, I know people who earned 90k in the 90s. All retired nicely. Mean while 95% of workers today still can’t get that salary, absolute joke 😂

[@mtmachine13569]

I left my 55k a year job in London last year. I now live in the Philippines. I pay £100 a month in rent and spend a total of £400 a month. Living in a 3 bedroom house with my fiance . I work less than two hrs a day as a remote consultant(making 2k a month) and feel rich.

[@apc4884]

But you're geographically trapped. If the political climate changes, your life changes significantly.

[@yilmazh3127]

Well done man you’re winning 🎉

[@mtmachine13569]

@@apc4884 That applies to everyone everywhere. I can always come back to UK but most people in UK can't afford a month break from their direct debits.

[@pocnit]

​@@apc4884Meh most brits (and americans) don't even have £1000 for emergency bills. If your situation changes, you're fucked anyway.

[@apc4884]

@@pocnit most brits are on the housing ladder though. When you're in a country with a much smaller gdp, you're essentially off the housing ladder. It's all about net worth. Poor uk people have a higher net worth, albeit no disposable income. Could the OP move back to the UK to buy a house, probably not.

[@Unshou]

Just a quick correction. "Monthly Take Home Pay" typically refers to what you take home after tax and NI deductions. So an annual salary of £62,160 has a monthly take home pay of £3,759, not £5,180. The numbers you're using aren't wrong but referring to them as "Monthly Take Home Pay" might be confusing to some.

[@TobyNewbatt]

I know it was a mistake in the script with the word take home all figures a are gross before tax 👍👍

[@hkatsonga]

I was also confused by the inconsistency. Thanks for clarifying.

[@cashkitty3472]

He said before tax . I'm on £68 and monthly payments are over £5k

[@TobyNewbatt]

@@cashkitty3472 Yep its all before tax, mistake in the script when I used the word take-home! Sorry :)

[@00dude3]

Another issue is someone who is graduate on 62k will take home less than a non graduate on 62k due to student loan so that will also adjust the figures slightly

[@midlifecarsis6420]

What this REALLY shows is how embarrassingly low incomes in the UK are.

[@stevegeek]

Agree. I managed some staff in Europe and some of the workers in Germany / Netherlands earned the same as me, when I was their manager! UK salaries are not that good, generally.

[@iancooksley1]

Someone on min wage in a full time job will get circa £21.5k per year......and the average in the UK is £26k. As a snapshot would appear something is wrong, but would suspect many factors are contributing to that ie immigration providing cheap labour, failure of our education system to educate rather than indoctrinate our children.

[@NomadJRG]

@iancooksley1 these figures are heavily skewed by part-time workers and the lack of information on dividend income for directors. Real figures would be around 25-50% higher for average full-time workers. So probably more like to be 50%: £40k, 10%, £90k, 5% £120k, 1% £260k.

[@ParksRec]

@@NomadJRG based on nothing more than your gut feeling lol

[@Dunk1970]

@@ParksRec According to the ONS, the median salary for a full time employee in April 2022 was £640 per week, which is £33.3k. Mean salaries are higher than Median, so his £40k guess will not be far off. Certainly closer to the mark than £26.3k.

[@GrooveTasticThang]

That isn’t the monthly take home as the tax increases exponentially including 62% between 100-125k - £200k brings 9k per month

[@acloserlook6133]

Terrible

[@Rob-cy8xc]

I live in Dubai and earn 150k a year after tax (I'm 38) I work in finance. the irony of money is the more you have the more you spend. I felt like I was better off 15 years ago on 25k before tax. Happiness is the key, money helps but in the end health and happiness is key

[@Rob-cy8xc]

@@Raulsta1985 I am a financial advisor so I would hope I have a rough idea. I pay school fees, nannies and sky high rent along with 2 members of staff. Like I said the more you earn the more you spend.

[@CROSSNSHOOT]

Dubai is the place to be. We do not get value for money in the UK losing 45% in tax

[@Rob-cy8xc]

@@Raulsta1985 with respect I have listened to your rubbish long enough. Your opinions are just that. I really couldn’t careless what you think, I have entertained you long enough . I’m sure you know nothing on the subject matter so I’ll take my chances cheers. People pay for my advice, I haven’t even asked for yours, that is the difference. My guess is you are sat in a basement somewhere, annoyed life hasn’t turned out how you wanted, so you think by writing pointless abstract comments online makes you look rounded and worldly. It doesn’t. If I can pull in 150k a year after tax at 38 I would argue I don’t need your advice and imagine you need mine.

[@semolinasemolina8327]

Yes, take your advice, my friend's dad died at 65 on the operating table of heart surgery. He barely saw his family growing up. Yes, he lead a big Big big life, like lots of different types of life, but my friend wished that he saw more of his dad x

[@semolinasemolina8327]

​@Smiley 😂❤ well, no, not really, because the more cash you are earning, the more you need to concentrate on more things, so you need to outsource services. Also you need to attend and circulate in more expensive professional circles. As a high provider, you are expected to support people with less. You also get less support such as discounts or financial support. (Because you don't need the financial support). For example, my family gets a gigantic 17k on benefits. That has a council tax discount too. If we mainstream schooled, the kids would get free school meals, prescriptions, holiday club and childcare support. In total, the amount I would need to earn as a scrounging single mum would be 35k after tax to run a car, pay in full for full time childcare etc. So basically teachers earn about 28k after tax - not enough to even support one child.

[@rdyson]

Often overlooked is that many enter the top 1% earnings only briefly. Whilst I’m sure there’s some cushy jobs, most high paying roles are just too crushing to do them for decades. Part of the reason building wealth is harder than just landing a good job.

[@legendofthepeach]

I think a lot of people think £150k is a lot of cash but once you go through super tax and national insurance you’re losing 62% of it. Most likely around £8k a month. It’s good but it’s not crazy money.

[@fzriow]

The other issue of this is that this data is from PAYE employees, way more than 1% of the country earn more than 162k if you took directors taking dividends at 7% and 20% tax. Most directors on paper earn 12.5k a year and the rest is all dividends

[@legendofthepeach]

@@fzriow yeah if you want to earn proper money you are top of your own business. No ceiling and so many more benefits

[@mattcarpenter6986]

Over £50k per year N.I drops to 2% and 45% tax would be on earnings between £125,140 and £150,000 so its not quite that bad.

[@legendofthepeach]

@@mattcarpenter6986 no your effective tax rate can be as high as 62% once you start earning over £100k you start losing your first £12k of tax free allowance so for every pound you earn you’re losing 40% tax and every £2 you lose £1 of allowance. Effectively after about £100k-115k you actually earn no extra money per month

[@lospolloshenmanos2041]

@@legendofthepeach at £150k your effective tax rate would not be 62%. With just income tax and NI alone effective tax rate would be just over 40% at that amount. If you added undergrad repayment plan 1 (lower income threshold for payment than plan 2) and postgraduate student loans you could get to just under 53% effective tax rate at that income.

[@darronsmall6321]

I would feel rich when I can afford to pay my bills, have 3 ballanced meals a day and be able to afford to go on holiday now and then

[@Ahturro]

Feeling rich for me is to have a healthy family around, some food in fridge and a roof above head.

[@deanwilson7031]

Very true health and family is everything

[@X_85]

My husband and I are both in the top 5% but the hell we have gone through to get here goes unnoticed. Both immigrants that arrived in the UK in 2004 with £250 in each of our pockets, we worked 12 hours a day, 6 days a week and lived off of 50 pence per day (back when you could get a toad in a hole for that much at Safeway). We walked 6 miles to work and back each day, rain, snow. Never took a single benefit, never been unemployed (not even for a day), not one single sick day in 20 years. We fought day in, day out, had to constantly prove ourselves, defend ourselves, and in a few months we will have paid off a 30 year mortgage in 10 years. If you were to see us in the street, you would never guess that we had means. We dress in unbranded clothes, drive a 2014 car, do not go out and spunk our cash when all our friends are out and about, but it is our choice to do this.

[@TobyNewbatt]

Thank you and welcome!

[@ilikelampshades6]

All for the taxman to take you to the cleaners. Earning that much money today requires even more sacrifice but the reward is a much smaller/ average house. Would you go through all of that again today if the reward for all of that effort was a tiny little terraced house that is 1000x inflated in price?

[@X_85]

@35627819028353729-4984653 That's a very fair comment and most likely something that very few people think about. The more you earn, the more you get taxed, and the lesser your own returns are. When you get to the 40-45% tax rate, things like getting a bonus should be exciting, but pretty much every penny goes to tax if paid with your normal salary. You therefore pretty much only end up with your monthly salary amount before tax. It does hurt seeing this, especially if it's not always clear where your tax is going to. Thinking back, I truly do not know how I managed to stick it out, but honestly, I would not want to go through it again. My friends have wild memories of places they've been, concerts they've attended, life experience which I do not to a great extent. We go on one holiday a year, nothing lavish but we have something to show for it whereas our friends do not. They're living, we're working, I think they have the better deal, but I have never had the courage to take my foot off the gas. I always think about getting old and not being put in a government run home as I think that scares the life out of me the most.

[@steveetches6013]

@@X_85 - No one ever says on their death bed, "I wish I'd spend more time in the office". If you measure the wealth of your life by the numbers on a spreadsheet, you are missing a significant part of the equation I feel. Sure money and financial wealth is important, more there is more to life than just money.

[@stevem-h3562]

@@steveetches6013 THIS ^^^^^^^

[@usmanakhtar6110]

The actual income figure doesn't mean much without undertstanding outgoings. Genuinely being 'rich' is the person who is debt free, mortgage free (inhertence from their parents!) and no outstanding payments like cars. Those people are truly rich.

[@FortheLoveofAutomation]

The quickest way to jump into the top 1% is to work as a contractor i.e. £500-1,000+ per day (typically tech and project management type roles).

[@KolyaNickD]

This has now been clobbered with the IR35 tax changes.

[@FortheLoveofAutomation]

Hi​@@KolyaNickD. Most people I know put their rates up to offset the change. I'd still be quite happy earning £750 a day on PAYE through an umbrella company.

[@AdrianMcDaid]

​@@KolyaNickDI fall into this section. Your correct. My saving grace my long term contract is in South of Ireland

[@KolyaNickD]

@Adrian Mc well I finally got a contract back outside ir35 in belfast am pleased to say. Trying to get out of contracting though and do something completely different.

[@AdrianMcDaid]

@@KolyaNickD what you mean like real Job!

[@UKGeezer]

Rich to me just means being able pay my bills and feed myself without having to worry about it, and have enough left over to invest/save a bit and treat myself now and again. As long as I'm not struggling financially, then I consider myself rich.

[@silenttekkerz1]

💯

[@johnworeilly4051]

Also, it is worth keeping the UK in perspective, compared to the rest of the world. Reference the Credit Suisse Global Wealth Report, latest edition is 2022, which shows that near enough 1% of the world has a total wealth of approx US$ 1 million, which includes property, financial AND personal pension (I.e. NOT including State pension). According to that report, 2.8 million people in the UK are in that position, and 26.5 million adults have wealth in the top 10% of the world.

[@JMEUTEUW]

The problem is the taxation in the UK. In Scotland, if you earn over £40k, you pay extra income tax. Imagine if you earned over £80k per year…. Then there is, NI, council tax, road tax, VAT…. And then your private pension is taxed…. It’s a never ending cycle of taxes and now very high bills.

[@ms-jw3oy]

This is exactly the problem. I earn £220k a year or more (sales) and my wife the same. We each pay £90k+ in tax a year, then we just bought a house that’s another £25k in stamp duty out of money we’ve already paid tax on. I bought a new car, as it’s over £40k I pay an extra £500 per year on top of the road tax for the first 5 years. Because we spend more we contribute more in VAT, fuel tax, alcohol tax, insurance tax etc etc.

[@JMEUTEUW]

@@ms-jw3oy and the government says we need to contribute more because we earn more…. The difference is I have worked very hard to get where I am with countless sacrifices and all I do is pay taxes

[@rodneyfungus8249]

@ms-jw3oy. and sadly most of the population think high earners like you should pay even more tax. When they say the government should do more to help with the cost of living crisis what they really mean is that people like you should give more money to them (via the taxman). I bet if they had your income and paid your levels of tax they’d soon think differently.

[@ms-jw3oy]

@@JMEUTEUW it's the media that annoys me more, creating the narrative that we need to tax the rich more and this focus on "the 1%". I have friends who sit there telling me how we need to tax high earners more (I don't think they realise my wife and I are top 1% earners), and I'm thinking "In a commission month I pay more tax in one month than your gross annual income". Now I understand I am in a very fortunate position where I have been able to work my way up to earn a lot of money while still relatively young, but I think people don't realise how much tax we pay. For example a lot of people don't realise that once you earn £125k you no longer get any tax free allowance.

[@richlee509]

​@@ms-jw3oy poor little boy x

[@shintsu01]

My advice is to keep your monthly spending the same even if you increase your income. This way you will automatically save more money able to buy a house stock and have the feeling you are rich. If you increase your spend with your increase of income, you basely have a problem if that income falls or disappear. I think that's the main problem with people that had high income are now poor. and i don't know if i would like to experience a big drop in quality of live suddenly.

[@ivermektin6874]

I earn 60k and don't feel rich. I am not short of money and can't afford a property on my own but can afford plenty of other non-essentials I don't really care for. I think these figures show just how suppressed wages are in the UK for so many people. But that doesn't surprise anyone familiar with the class system that is alive and well today in the UK.

[@STANLEYDMX]

That’s a big problem in the UK, being unable to buy a property for yourself and having to be forced to buy with someone who you may or may not end up being with in the future.

[@ivermektin6874]

@@STANLEYDMX Family system is completely fractured in England because of it.

[@RikAindow]

I'm a single guy in my mid 30s with a salary of £31k a year, in a house worth maybe £100k (was £80k back in 2015 when I bought it). I don't view my house as an investment as I bought it as somewhere to live, and I don't plan on moving anytime soon. My salary allows me to cover the basics, and have a gym membership. To be truly comfortable though, I reckon I'd need another £10k a year as with that, I could pay off my debts more quickly and not have to worry about budgeting as much.

[@mauricepicard]

With mortgage paid and bills taken care of, you feel secure, not rich. One feels rich when you can go to any shop and not having to check the prices.

[@sdavis7096]

For me to feel rich it would mean being mortgage free.

[@payyans87]

You’ll feel rich when your heart is content with what you have.

[@jacklav1]

Richness = what you want/ what you have. Quickest way to get rich is to want less.

[@jackpowell9276]

What i find most shocking though is the 50% being 26k, that is absolutely shocking, and 75% isn't much better. Even 10% Seems to me we're basically saying there is almost no middle class at all anymore, and 75% of the country have very little discretionary spending power with housing being such a major cost on top of energy too. Those income brackets with a 3% mandatory pension contribution come out with takehome (no other deductions/student loans to) 50% | 26340 | £1775 PCM 75% | 40920 | £2572 PCM 90% | 62160 | £3665 PCM 95% | 84600 | £4716 PCM 99% | 175416 | £8362 PCM It really changes that income progression story. The reality is, those higher bands will contribute to large pensions for large retirement pots or early retirement, and probably keep take home salary at or below £4000 PCM until they max out the 60k pension a year. Which on 175k a year would be a £5104 take home, with 60k per year into pension.

[@blacov89]

This is why tory party wanted to increase the cap or remove it all together if I remember correctly. Once again looking after their own and to hell with the rest of us.

[@conorturton]

Interesting to see that as a lorry driver, a job that many in this country look down on, I'm in the top 25%.

[@pelocitdarney5718]

I look up to lorry drivers, literally. Also, they always win the wheel nuts test, having more wheel nuts than car drivers. and so are entitled to priority on the roads. But total respect in terms of the value they add to the supply chain, and in terms of the responsibility they have to keep idiot car drivers from killing themselves.

[@user-yb6tk1ru6x]

Why do you think that they are looked down on?

[@richlee509]

​@@user-yb6tk1ru6x they are

[@user-yb6tk1ru6x]

@@richlee509 that's sad. I don't look down on them. I have a supposed high status career, but would prefer to do something that just made me happier. Regardless of whether some ppl looked down on it. Those ppl need to get over themselves.

2:13 £84.6k per year does not get you a "monthly take home" of £7,050 Assuming if you meant "after tax" £84.6 k gets you a "monthly take home" (after tax) of £4,843.12

[@TobyNewbatt]

I misspoke when I said take home. It’s all before tax! Yes I am a muppets don’t worry you and 100 others told me 😂

@@TobyNewbatt no worries. Still enjoyed your video

[@oliverpolden]

Paying off your mortgage is one of the worst things you can do to become rich. Think about it, you’re probably paying anywhere between 1-3% on a large chunk of money. If you pay off your mortgage, that’s a large chunk of equity you no longer have access to that you could instead be investing to get 5-20%.

[@chrishart8548]

I think assets and wealth are more important that income. Even a doctor would struggle to buy the average property now. And the way the tax system works income tax destroys income.

[@japanesescott]

Bit confused why you left out Northern Island and Scotland as being a part of the UK in your thumbnail.

[@Pixel_Runner]

The issue with this is that it's not actually based on what you "earn" it's what you pay tax on. While I'm on PAYE (so i can't do anything dodgy), I "sacrifice" as much of my salary as possible. This means that some reports would put me higher up, other reports would put me in the bottom 10%. There's also wealth that does not include money. For example, I can have a video call with a doctor within an hour or two 24 hours a day, 7 days a week. With the current state of the NHS, this is quite valuable!

[@deanwild4971]

I like the way you defined this as being in the top 10% of taxpayers. This is very different to being in the top 10% in terms of wealth.

[@luisfilipe756]

such nice and interesting video, thank you for this. For me to feel rich, I would have to be free from HAVING to work. As in, if I do not have a job, I can still keep my quality of life.

[@A190xx]

As the figures focus on taxable incomes, it does not account for the financial value of other benefits, such as pension, sick & maternity pay and enhanced annual leave. For example, the average nurse on £35,000 will receive around £7-10,000 in non-pay benefits, so compares favourably with say a sub-contracting bricklayer on £35,000 with no- non-pay benefits.

[@ProfitKings29]

I worked in a factory doing 7 days a week non stop on overtime i was getting £1026 a week - £300 tax roughly i came out with £700 a week i felt rich on this wage . I know people that dont get £1000 a month so i was grateful for what i had and tried to be careful with the money and not waste it . But the meaning rich to me is not a wage its a mindset , being able to preserve money and save it . I saved £15,000 i had no bills due to living with my brother and no Debt i have this rule now where £10k is me broke , its my £0 mark in my head . I dont waste money on liability’s like cars or mortgages + scotland is cheap rent for a new 3 bed house which we have on a housing scheme is £480 a month which is nothing when the house income total is £8000 a month

[@csmt12]

We live in a skills based economy. ONS should be capturing split by skillbase. Plenty of data out there that could inform this. No use teaching kids to get into a particular industry, teach them the skills they need to thrive (think data science, engineering, software). The highest paying jobs cut across industries.

[@Cid3rArmy]

"take home" isn't gross pay like you suggest. "take home" pay is the net after tax and pension etc.

[@LocrianDorian]

I think one key point is where you live. In London, that top 5% salary can't be right, as you can barely afford to rent a nice place for yourself with that much. I would argue having your own place (without flat mates) is definitely a very basic criteria for feeling rich at all, at least in my mind it's mandatory. No rich person would ever choose to live with random flat mates.

[@PraetorUA]

You need to look at it per age bracket, most high earners don't get these top end jobs until later in their careers so it skews the figures. For example, top 1% was 100k in 2019 for 24-34, while top 1% was over 300k for 45-54.... Not that I'm trying to hit before 34 or anything...

[@Bull_sheet_Bob]

Is there any way to avoid paying tax.? Any MPs here who could tell us?

[@danjones2701]

I actually really appreciate this content. First video I've seen, but within social media these days (which I've had to take a break from) the hyperreality portrayed about wealth and getting rich and stuff like " you need to be a millionaire by 30" does take a mental toll on you. It creates unrealistic goals, not to say that some of us here won't work towards being that rich or perhaps even more... but everyone has different interpretations of what Rich is and so it's nice to have a video that provides that grounding. It makes the goal of reaching the top 30 more realistic than being a millionaire. I actually think that's positive for mental health in this day and age.

[@TobyNewbatt]

Thanks Dan! Appreciate the comment

[@77Clarity]

The numbers you gave are not "take home pay", they are the gross figure before deductions. so for £62k, take home pay is around £3700, for £175k - take home pay is around £8600. So even at that level to become wealthy will take a long time, with lots of planning and investing of savings in property or other assets.

[@michaelosullivan6921]

Just found the channel, what an insightful video into the perspective of what 'rich' is to someone.

[@TobyNewbatt]

Thanks! Was a fun video to make and such an interesting topic

[@jacobfield4848]

If you have a household income of over £40,000 outside of London you are doing ok. Keep your eye simple and live under your means.

[@jamesburke6739]

Shocked regarding the 10% salary number. I certainly don’t feel rich despite this, but cost of living now is eroding our ability to invest (pension, ISA, GIA) but I aim for 25%. Is that normal?

[@TobyNewbatt]

if you save 25% of your income you're doing very well for yourself keep it up!

[@thanoskaranatsios9053]

Very well constructed video and very good presentation by the host! I would love wo see a comparison worldwide or just Europe!

[@jamessmithson-br7rm]

This doesn’t take into account London, either cost of living (and what salary actually buys you) or the impact of London on average salary by industry. I’m surprised that the figures are so low, including the top 1% level. It makes sense that there is a leap after 100k, as the effective 60% tax up to 125k takes a big dent out of earnings, but 175k doesn’t really feel like top 1%. I don’t think being on 6 figures in London puts you in a particularly comfortable or well off position at the moment. A hypothetical single person on 100k in London, with savings for deposit, no debt, and top credit rating would qualify for about £500k mortgage (based on online mortgage calculators). Assuming they want to be nearish the city within Greater London, within 0.5 mile of a station, have a reasonable commute and not be living in a horrible area, they’d be lucky to get a 2 bed flat. Hardly living the life of riley, and probably not what the man on the street would think of as comfortably top 5%.

[@BL4CK0UT17]

I earned 38k after tax last year being a salon owner. I feel rich 🤷🏼‍♂️ work 3 days a week and live within my means. Got a decent house and a nice car.

[@leoderbyshire1076]

that's pretty nuts to know lol. So me and my brother are both in the top 25% right now.. witch is kind of cool to know. I'm working for that 10% aimed by end of 2024. But even then if i hit my targets figured it would just be in top 50%

[@Kroylin]

I’m to young for a job but I’m working on KZbin and my social media’s right now

[@julianfp1952]

What a fascinating video. On the numbers though there is one thing to bear in mind. The ONS statistics talk about - as you described it in this video - those people who are "on the UK payroll"(*) so for instance the statement at about time index 2:35 that the £175,416 (or above) number is the income of about 300,000 people in the UK is a bit misleading because that number will be higher due to rich retirees. It would be interesting to know what the top 50%/25%/10%/5%/1% income figures would be if one took the entire working age and upwards population regardless of whether they were actually in employment. I'm sure the absolute income bands would come down a lot because you'd be including people living entirely on unemployment benefit or state pension plus lots of other retirees with pensions far lower than their final salaries. I'd love to know those numbers though. (*) I assume "UK payroll" does mean employment and doesn't include welfare payments.

[@DonJuanDM]

The ambition runs through every blood vessel in your teens, the world is your oyster. Then you go full steam ahead in your 20s like there is no red lights. Then you either make or break or having a family in your 30s. Then you either keep on fighting the good fight or regroup your life or plug along with kids in your 40s. Then you start to accept how the game ends up and become a spectator in your 50s. Then you wish how you would do differently if you can be 20 again in your 60s.

[@burieddreamer]

To feel rich I need 1 million pounds. A 1-time payment of 1 million. That's it. Even at a rate of 1% per year, that money on a savings account would generate a passive income of 10 thousand pounds per year. That's £833 per month with zero work. If I keep working and reinvest that money, in a few years I wouldn't have to work at all. The first million is the problem.

[@t_h_visuals]

It depends what your definition and measure of ‘rich’ is.

[@serifini2469]

I think in order to feel rich I'd want to be in a position where I could live comfortably for the rest of my life without having to work again if I didn't want to. My wife and I got there about 5 to 10 years ago and I think we did it in easy mode. Partly because we both work in relatively well paid professions that we enjoy, medicine and engineering, and also because we have a good understanding of investing. The main reason though I think is that neither of us wanted children and so all the money that would have gone into school fees and childcare costs was instead invested in ourselves. That also means we don't have to worry about leaving an inheritance to the next generation or having to act as the bank of mum and dad.

[@gideonriddell4535]

Figures skewed by paper wealth tied to overvaluation of their own companies that they can't sell without crashing the value.

[@timb1612]

i don't really know what "rich" means, chocolate can be rich and it doesn't always taste nice so instead i'll answer "what's enough?" i used to earn bellow average and struggled to pay my mortgage or put food on the table, i felt like i was worse off than everyone around me. i used to pay into a work shares scheme, it payed out enough to cover most of my mortgage, (95%-ish LTV), my disposable income went up and things seemed easier. i moved job within the company twice and my salery went up. if i were not to spend a penny all month after my bills and food shop i would now be able to save more than i used to take home. technically i am far better off than most people i know, however having spent so long struggling to make ends meet i now have very few ideas as to what i should do with the excess. i think thats pretty rich, having enough to feel "meh w/e, i don't need to spend it"

[@JohnnyTurnerMusic]

Jesus, well thats a boost for me! I work as a car salesman and earn around £38,000 a year. Long hours at times though and not every weekend off either!

[@olih27]

Everyones definition of rich is different. As a salaried worker (with no outside investments/inheritance) are you ever really rich. Maybe you are earning 100s of thousands of pounds in salary, but to get to that level you have to make very significant tradeoffs in your work life balance, so in that case are you really rich? Most people i consider rich have/had their own business, so have more control in how they spend their time. Obviously the risks and consequences of failure are higher, but so are the rewards.

[@ExplorewithSarahlouise]

It also depends on spending a lot of ppl waste a lot of money I think Minus rent you can live pretty cheap here in London you can do pretty much some activity every day for free and take a packed lunch

[@coderider3022]

Did these include the 20-35% pension contributions public sector would pay? Public sector wages are low but their benefits (never get sacked, pension contributions , Flex Time) more than make up for it. Public sector wages drag these things down but in reality, much higher.

[@leeraewi]

Not surprised. And when I lived in London, I think I would have felt comfortably wealthy at £60,000-80,000.

[@leeraewi]

Comfortably wealthy is not the same as feeling rich, btw. To feel rich, it would have to be over £200,000. I know people who have been on £120,000 who kind of financially struggled, even though they were making way more than most of their friends.

[@hotsaucebeliever]

This is really sad considering the current cost of living crisis. You'll only barely survive on a salary of 26k and definitely be extremely stressed but that means half of all salaried employees are barely getting by! That's insane for a modern economy! Even crazier considering that the UK has a population of around 67m, that's around 1 in 4 people making less than that 26k.

[@calibrepowa1762]

Does anyone know why the figures for top 1 % wealth in the Uni of Warwick report 2016-18 (5.5mil per adult per family) is so different to the ONS report for 2018-2020 (3.6 mil per household)?

[@TobyNewbatt]

I'd guess that quite a bit of this data is based on self-reporting so it is up for the individuals to say what assets they own. I'd highly doubt there was any centralised database on wealth? Could be that.

[@calibrepowa1762]

@@TobyNewbatt Thanks for the reply Toby

[@TLOGhx]

Student loan repayments are stinging right now, not necessarily because they're high but because I've realised just how much I'll be paying back. I have about 80k of debt which is increasing rapidly with the interest rate. I think I'll pay it back but it's probably going to be something like 150k in terms of actual payments by the time its written off 🤧🤧🤧🤧 yikes. I just graduated last year though and have a decent job in London which I took over better paying options. Hopefully I don't regret it 😬

[@TheRealNaika]

most would be more than happy with 60k take home pay. thats more than enough for regular people and people who come from paycheck to paycheck living(18-23k). 60k take home would be otherwordly

[@llxhs8]

I’m in the top 10% and am an employed barrister. Everyone thinks I’m rich. However I still live pay cheque to pay cheque. Why? I’m from a poor north east family and grew up in a single parent family in a council estate. I had to take out huge loans to become a barrister and was earning a pittance until my 30s - living in London on £12k slowly increasing to £35k. I was in my 30s when I finally paid off my debts. I had no savings. I ended up moving back home and took out a mortgage but myself became a single parent and now over half my income goes solely on nursery fees and my mortgage. I paid for some minor home improvements when I moved in - still need a lot of work doing - but until my daughter starts school I will continue to have no money left at the end of the month and now look forward to my mortgage payments dramatically increasing next year. I sometimes have no motivation to work as I feel like I’ll always be skint no matter what I do, and everyone thinks I’m rich! People don’t realise the financial sacrifices some people have to make before they finally get a decent salary and, by that point, in my case, the housing market is almost impossible to manage.

[@llxhs8]

I should add I only bought a modest 3 bed terrace and I have a nearly 10 year old car. I haven’t been on holiday in 4 years. The neighbours all have better cars than me and are always on holiday

[@njjj3338]

I'm in top 5%, BUT I have no debts AND I can quit my job tomorrow and not have to work for at least 15 years! Can the some of the top 1% do that? Probably not, because they will be (not all) up to theirs eyeballs in debt (mortgage, car, bills etc)!

[@sleepwellguildford9259]

Becoming wealthy is when money works for you and you don't work for money, also knowing that you can afford to have that Porsche, Ferrari or Lambo but don't want it. I used to look in shop windows at Rolex watches wishing some day I could buy one, now I can buy virtually any one I want, I choose not to, I don't need to impress . So many people get finance on cars, use credit cards to buy things to make themselves look wealthy, but are just getting poorer, whilst making the clever ones prosper....!

[@carltontweedle5724]

Toby you got the Union Jack wrong, It is on England different flag. You also missed the cross of ST Andrew the welsh flag, plus Northern Ireland. Do you ken anything.

[@ZelB06]

Really interesting video. For me being rich is to be able to enjoy your job whilst being able to pay all your bills have a nice house and car in a nice area with a yearly holiday. We did get to this point bar the area but we've just bought a new house and the mortgage is £1100 more a month than our current one! It's worth it but I think we will feel it a bit when we get moved in but hopefully should only be a few years before we are back into the same sort of situation again (once we no longer have to pay childcare and outstanding debts)

[@lehoff]

I earn over 110k and with 2 kids and a wife that's on a low wage, I certainly don't feel rich. That said, I don't have to worry about bills. The figures are a bit misleading as earnings after tax change dramatically as you get to over 100k because of the 60% tax trap. And no one bases their income of before tax earnings. I'm not complaining about my salary, but people seem to think I should be driving around in a new modern car, and have a bigger house, or designer this and that. Whilst we don't live hand to mouth, we're not exactly able to be frivolous with our spending. 2 kids, hobbies, and a home to look after costs a lot. Our cars both are 10 years old, over 100k miles on them, our house needs a lot of work, but we focus on eating good food, and taking the kids on holiday / experiences rather than buying tat that means nothing. I also focus on putting money into my pension.

[@DrBretPalmer]

3 sources of income and financial independence

[@unclebob8419]

I am rich, I'm worth about £20m, I've built that up from running businesses. What doesn't get talked about often is the amount of responsibilities that you take on as your wealth grows and it starts to ruin the fun of having money. Most of us have businesses with staff, that comes with many headaches and risks. Accountants and financial advisors are often advising you on what is best for them, they are out to take a slice of your money. Owning and managing properties is incredibly time consuming and can be risky, having money locked in properties that you can't sell isn't fun. The list goes on. Most people couldn't manage the responsibilities that come with creating wealth, you need to be a high functioning person that is dedicated to work. Once you become wealthy, you may never stop working, there's no guarantee that your children are going to take over those responsibilities for you.

[@TobyNewbatt]

Very interesting comment this Bob!

[@jminsh463]

Rich is not having to worry about money for going out for a meal, somewhere nice for the day or occasionally buying something frivolous for myself- so having the cash to cover all necessary living costs plus at least 6 months of living costs in savings plus fun money.

[@jamesfraser1231]

I earn 40k in the south of england, and I feel like the data is very skewed depending on where in the country you live. On my salary, I don't feel I can comfortably live alone and rent even a 1 bedroom property without having to live paycheck to paycheck, which seems nonsensical for someone just off being in the top 25% of the country. I know if you live further north, this isn't the same case though.

[@TobyNewbatt]

Exactly James you’re spot on. There’s a lot more to this story! Lots more videos worth

[@peterjones8335]

The money earnt between £100k and £125k is effectively charged at a tax rate of 60% for that £25k

[@kinggeoffrey3801]

I know so many people taking out big mortgages in 2019 before covid and the rise in interest rates. Now they are all panicking as they are in their final year of their fixed term and their mortgages will be going up by £600 a month. All of a sudden their 40k-50k a year salaries look miniscule. I'm glad I over paid in that period. It's given me the option to work part-time and I'm not even 40. I only earn £13.50 an hour, 25 hours a week. The wife earns 40ishk pro rata. We still have a mortgage but it should be paid off in 3-4 year's. Goes to show that most people spend ridiculous money on massaging their ego.

[@WashingtonAli1]

What a video!! subscribed!

[@nataliam9764]

This shows that salaries are complete crap in the UK.

[@accaeffe8032]

Yepp, 50% earns less than £26K a year, most likely earning the minimum wage.

[@scbond]

Somebody’s low down on the list 😂

[@PeterCruz-un8iy]

In order to feel rich, I’d say the below: - owning a property - being able to cover food healthcare and basic holidays - have a car - have saving to prevent any debt, or in the event of emergency

[@rtm1619]

I have all 4 but I'm in debt to pretty much all of them (finance and mortgage). I don't feel rich, I feel like I'm tied to my job to pay these off.

[@TortleTalk]

​@rtm1619 owning a property is different to a mortgage. A mortgage means you truly own nothing.

[@hamsterminator]

I don't think anyone ever feels rich. Even the wealthiest people covet what they have in order not to lose it. Besides that, once you get to the upper tax bracket the numbers don't really mean much anymore. I earn twice the "90%" figure here- but take home only 50% of that...

[@trzmaier]

Having a car only for elites these days? lmao

[@darkknight17]

This really isn't rich, this used to be normal and average if you were middle class. The ruling elite have screwed us all into thinking living in a garage studio flat or shoe box or normal or healthy.

[@Nada-Mal]

For me, rich is: having enough passive income that said income covers all my living costs.

[@monikamoon14]

And I don't need a day job

[@gb5584]

Rich is being content with what you have in life

[@firmbutton6485]

Ridiculous. I have been through it all, from yts slave, unemployed, working behind a bar, in shops, and then trained as a nurse and am now doing well. Never have I never felt ok money wise. You are clearly of a ‘poor me’ generation.

[@GeorgeKershawBMX]

Top 10% at £62K? That is scarily low. Would have expected that to be about double that!! Crazy to see these numbers when almost every other car on the road is only a few years old… some people must be making crazy financial decisions 😂😂

[@GeoffBuysCars]

This is such a great comment

[@JivanPal]

> some people must be making crazy financial decisions Indeed they are. The ease of access to credit is in large part responsible for that, but lack of financial education is another massive factor; if you can't run a budget, it won't be surprising to see you spending your funds recklessly.

[@dongmingzhu666]

Not really. I tell you what, many people are doing cash-in-hand jobs and pay little or no tax. People I know... plumbers, builders... they all take cash for their work. On paper they probably in the lowest bracket but they are driving expensive cars and living in million pound houses

[@GeorgeKershawBMX]

@@dongmingzhu666 possibly… but I would love to know how someone who doesn’t declare their income would be able to get a mortgage.

[@normanamey9828]

@@dongmingzhu666 and very easily identifiable by the tax inspectors that they are living above their declared income. House and cars gone after back tax, interest and fines. No better than a drug dealer or burglar living the same sort of lifestyle. If you declare shit money, live a shit money lifestyle and spend under the radar. Most cash in hand workers are not smart enough to not get caught. And ultimately they are screwing the country for everyone else, probably while moaning about how the NHS and schools are underfunded…..

[@LunaNova1122]

My dad always told me growing up : A poor man that acts rich will always be poor and a rich man that acts poor will always be rich.

[@pocnit]

Wow he sure did talk a lot of nonsense.

[@JivanPal]

@@pocnit Where's the nonsense? If you're not talking about the poorest of the poor, but just the average Joe, it definitely rings true. I am constantly astounded by how much money people I know that earn on the order of £10k-£20k spend on tat, given that I, someone earning £50k, wouldn't be able to justify buying those things given the way that I run my budget.

[@paromita10]

💯true!

[@anyexpat]

@@JivanPal I like to watch old rap videos of rappers with bundles of cash then google to find out i am worth more than they are.

[@pocnit]

@@JivanPal I mean it's obvious to anyone with 2 brain cells that you'll never get rich by "acting poor". The real difference here is the extra £30k-£40k you make in salary. Ironically you could buy a new smartphone every year, wear only outlet-price brand clothes, eat out every weekend, lease a car and get a mortgage and still have more money than the £10k a year person even if they saved 100% of their salary. A person in the UK in 2023+ will never EVER get rich from savings on mundane things, that's complete nonsense and absolutely laughable. While someone already rich... i.e. inheritance, trust fund babies etc. can buy a million things a minute and barely make a dent in their wealth, if at all.

[@shyhistorian]

"All of the figures are before the grubby taxman has gotten his groggy mits on your money." If there's anything that makes us unified as Brits, it's our disgust towards HMRC.

[@stewartmacdonald601]

Erm.... At the start, when you were converting yearly salaries into monthly wages, you were saying take home, when I assume you meant top line. As for example, a salary of £84,600 would be a top line of £7,050. Not the take home, which would be closer to £4,843 per month. Assuming you paid tax in England, this drops to £4,651 in Scotland.

[@TobyNewbatt]

Yes i used the phrase take home when I specifically stated that all figures were gross, this is my mistake. All figures are gross as I said at the beginning

[@Kaku24]

Feeling rich for me is to be able to save more than I have to spend and having no debt.

[@SHYBMX]

For me to feel rich. I want my mortgage to be fully paid off. When ever I have kids, they are all educated and have jobs, And finally able to retired and live off my investments

[@TobyNewbatt]

nice and simple, brill!

[@Activocirculante]

Rather than setting deadlines and amount levels, try setting performance and quality standards. That'll give you the chance to be happy Today rather than... Ever?

[@xyz5485]

Live in cheap countries in south east Asia. You can pay a worker £10 a day and that’s generous. You might be able to do that right now

[@SlackHoffman]

You’ll be lucky 🍀 even by the age of 70 😂

[@Biggus_Dickus_69]

​@S S B well done I'm sure it was so difficult for you to pay off a mortgage on a sub £100K home in the middle of nowhere 😂

[@luc1ferblack]

Being rich is not about how much you earn its about how much you spend. I met a BA who was on £700 a day was struggling because his wife wanted the big house nice cars etc. He was in payments up to his ears. I met an handyman who would spend 5k on each kid every Christmas. I also had a neighbour once who lived in a run down area but had 2 top of the range Mercs on finance on his drive so he could look cool. I love charity shops we both take home £2300 a month each and together we pay £1,400 for a mortgage. We have a big tv 2 games consoles and 2 laptops we barely use. we have a lot of free money because we don't like expensive restaurants and think designer clothes are a ripoff. You are only as wealthy as the lifestyle you pick

[@NawazKhan-ui6eo]

BA ?

[@noreplyzone-ef7uz]

Business Analyst

[@moneymanifestation9505]

I think you meant to say it's about how much you keep 😂when your frugal then yes you can be rich in no time. The problem is like you stated people by things they don't even need.

[@davideyres955]

Being rich is about how you plan for future finance. My friend has always had a plan of where he wants to be financially in future years. Took a lead out of his book and started investing.

[@fishslappr]

It's not what you earn. It's what you own. Wealth inequality is far higher than income inequality

[@mks2310]

I drive a hgv in the North East and was on 26k a year In the last year and a half it gone to 34k So 1500 a month in hand to 2200 a month I still only live to 1500 a month the rest I now invest I feel minted now 😆

[@TobyNewbatt]

So so so important to keep costs under control and sounds like you're enjoying it as well. Keep up the investing :)

[@philiphawkins4684]

I thought the shortage of lotty drivers ment much higher wages than 34k. I would look around for more.

[@mks2310]

@philiphawkins4684 it's only class 2 and the North East Class one and London will be

[@ricequackers]

"Truly rich" is when you can live off your assets without needing to work. A banker/trader/quant in the financial industry making £300k or so is ultimately in the same boat as the majority of the country - they have a nicer house, flashier car, more holidays and more funds to fall back on, but they still need to keep an eye on their high mortgage/childcare/education costs, and they'll be in trouble if they lose their job and don't find another one in time. It's the ones above them that are the properly wealthy.

[@MarkLikesCoffee860]

People earning £300k who are broke because their lifestyle also costs £300k are idiots. If they eventually got "above them" they'd still be broke. My lifestyle only costs me half of what I earn. I have more money than people who earn 10x more than me. It's not about how much you earn, it's about how sensible you are.

[@NazTheGreat]

Exactly !​@@MarkLikesCoffee860

[@fear_not]

Wow! These numbers are really surprising! I was on almost 40k in my last job (social services) and I definitely didn't feel rich but on the other hand, I managed to save 30k in few years and quit the job to travel for a year. I would probably feel rich if I could afford a mansion in London instead of a studio flat with 30 years mortgage.

[@TavernMasterAndy]

Talking about your pre-tax income is pretty pointless. 100k dwindles after the tax man cometh.

[@TobyNewbatt]

The tax man cometh and taketh away.

[@richlee509]

​@Toby Newbatt the tax man is a c

[@michaeldooley654]

To feel rich for me is to have "enough" spare money every month to do whatever my family want whenever they want. Financial freedom.

[@MartynThomas1]

The difference between "income" and "wealth" is crucial. I've watched a few videos like this one and discovered that although I'm in the top few % of earners, I'm probably only just (or perhaps not even) in the top 35% by wealth and assets. I come from a pretty modest background and so although I sometimes feel rich, when I look at the house extensions, new cars and fancy holidays of the people on my road or at work, I often don't feel it. When a friend sold their 3 bed ex-council semi and bought a £2M+, 6 bed detached in the posh part of town, I realised that "inheritance" if far, far more important than salary.

[@selwynhammond4582]

I beg to differ. Having been given no start up or inheritance I started in mid 90s with income of £7k and progressed my career to be a higher earner today. I am now just in my 50s and in top 2% in terms of wealth according to this video. How was it possible? Learn to live well within your means and save 10% of salary on top of pension savings. Even on minimum wage a couple investing 10% of their income after 40 years will be in top 10% wealthy in the country.

[@conconmc]

Agreed

[@Jack-cs5pm]

@@selwynhammond4582 You mean top 2% in Taxpaying income, not wealth. People in the top 2% of wealth don't typically have to work much at all for their wealth, and it will continue to accumulate due to the nature of the economic system we all live by.

[@varsas10]

I certainly agree that a high monthly income does not mean you are rich, especially if that income only started recently and you don't already have a nice house etc. Anyone who has to work isn't rich in my opinion.

@@selwynhammond4582 Congrats on your success. Truly mean it. However, asset prices have grown handsomely in the past few decades, a trend that will be less likely in the coming years. Furthermore, living costs have grown significantly as % of after tax income in recent years.

[@rustywolv]

I’d feel ‘rich’ when I don’t have any debts and I can choose the hours I work.

[@petermorris3665]

To me, being 'rich' is all about assets not salaried income because you can lose your job anytime. My Mum lives in London and a London Premier League footballer has bought 3 houses, for rental income, down her road alone!

[@neilcameron434]

100% rich people's income doesn't come from salary, and to a large extent the rich can choose to pay tax or not.