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

[@rosso2017]

Nice video but I would say it misses out on some of the key differences in cost of living. Things like medical bills and insurance take a large portion of US pay. Lack of sick pay, lower amounts of holiday pay, and other reasons make me quite happy to be earning in the UK rather than the US despite the lower salaries.

[@TobyNewbatt]

There’s loads left for another video! You’re right there is so much to cover!

[@fablorwhirlwind9230]

This is a big myth that is often repeated, as someone who moved from the uk to the us most people here get insurance for themselves and their families as a workplace benefit, fair enough with less holiday and sick pay but most salary increases from moving to the US more than cover it. My salary increased by 3x and overall cost of living is only slightly higher (from London to nyc).

[@Chanesmyname]

We have three US people who have moved to the UK to live and work because of the medical costs and expenses the US charges, they say they are far better off here and we have better social care, given that I think the NHS and our social care is in a terrible state, god knows how bad the US is…

[@conconmc]

Medical insurance you only really need if you are older and at risk of poor health, not soo much when you are young.

[@Chanesmyname]

@@conconmc if you are US and haven’t got medical insurance you have to afraid of leaving the house at any age? I don’t think a bad fall or a car accident would much care how old you were to cause a truly serious issue with bills?

[@zakeriaabdi693]

Rich in my books means you fully own your own home in a decent neighbourhood and can pay your bills without a job (dividends or massive savings). If you get 100K a year and have a massive 1 million GBP mortgage and loads of credit card debt, you are in reality 5 minutes from being homeless and only transiently rich not permanently.

[@Bettys_Eldest]

I retired early six years ago, and considered myself rich. Three years ago my wife became ill, despite the fact that I have even more assets, I have become poor. You can't as they say put a value on your health.

[@MrBrotein]

Great video bro! UK earnings are TRASH. Making money in the UK is like fighting an uphill battle, it can be done but you’ve really got to grind.

[@sacredgeometry]

You get better safety nets and for the most part the extent of poverty and the inherent violence that comes with it has always been lower than in the US. You also get taxed less out the gate but you have to spend more in lots of other areas. i.e. its high risk high reward. Where as the uk is significantly lower risk and only marginally lower reward. That said being in the top 5% of earners and being able to feel recent inflation is probably indicative of the current situation more than anything else. That probably shouldn't be the case.

[@BlatentlyFakeName]

Working conditions and terms are FAR better in the UK though. E.g. you get at least 28 days in the UK (by law), in the US you might get 10. You also get more sick days, flexible working hours etc. US conditions can be horrible. A huge point though is healthcare in the UK is free and covered by standard taxes. In the US if you get ill you can not only become bankrupt but lose your job too as it's something you can be sacked for. In the UK is is illegal to sack someone for being ill.

[@aleph8888]

Waiting 60 weeks to see a consultant on the NHS, but it’s “free”. 🤪

[@BlatentlyFakeName]

@@aleph8888 But you won't basically get told to go and die if you can't afford it, or the insurer won't cover it. Like in the US. Also private health insurance is dirt cheap in the UK as the companies have to compete with the NHS. Many companies give it to employees, I get it for myself and partner and it costs me nothing at all. Wait times are much shorter with that.

[@itouch00]

I really enjoy these videos. You can tell you’ve spent a lot of time researching everything. You also simplify things. Great work 👍🏼

[@TobyNewbatt]

Thanks David, means a lot! They are a lot of work but also a lot of fun too :)

[@larsmenken2679]

A few years ago the company I worked for in London opened a NY office and moved a few people over. No idea if they adjusted their salary, but everyone of them had to downgrade how they lived. The director had to move hundred miles out to Connecticut to hold a house for his family, senior manager had to started flat sharing again, another director moved from a house in London to a flat in NY, ... . When we think NY we think 'Friends', 'How I met your Mother', ... . That doesn't seem to work like that in real life. The only people I know that did a permanent move all 3 had a spouse working in banking. where their good UK salary based jobs was just complementary to the family income. So take-home might be monetary better, but quality of life is still impacted. And that's before health care comes into the equation.

[@cathycooper7933]

Having started my working life with nothing, I worked hard and saved harder all my life. I lived aboard and saw people with eye watering salaries and lifestyles to match… I kept my lifestyle pretty simple by comparison, saving as much as I possibly could.. My brother earns more than double what i did and spends every penny… I retired at the age of 49 (due to property and S&S investments), and I now consider myself to be “wealthy” whilst my older brother is “rich” but will work until he has to retire… In short i think that wealth is freedom, and being “rich” is abut having flashy cars and a big house etc… Great video as always.. Thank you

[@wyrmie84]

Another cracking video Toby! I was speaking earlier about the corruption of capital on democracy - - This video has highlighted my point perfectly. I know it was not your intention but its stood my arguement in good sted, much appreciated!

[@Unshou]

So basically, in the US, you earn more, you pay less taxes and your cost of living is lower. I guess we need to factor in the cost of medical insurance but I suppose a lot of employers offer that with the job? Unfortunately, for people that earn well below the average, it looks like they are significantly worse off.

[@LCTesla]

cost of living analyses that account for health insurance and education cost have been done and tend to have European countries pulling ahead of the USA.

[@macallanfinerare2552]

The big issue to consider in the US is property tax. It can consume a biiig part of your income but it can also be zero.

[@TobyNewbatt]

Yes, great point!

[@mwb]

The US is just so expensive, without going into personal details, a like for like home (2 bed, garden and in a fairly OK area) in New Jersey, where I was based for a bit was just under $5,000 a month in rent, in the UK it was just £600. A bag of oranges at Tesco was about £1 back in 2016 when I went out to the US, whereas a bag of oranges at Trader Joes was about $4, Whole Foods $5 and Walmart $5 again. Most food was the same, and it was just as cheap to eat out, but don't get me started on tipping, 20% for just speaking to someone! We maybe on less overall in the UK, but for me personally I am way better off than I ever was living in the US.

[@donLennin]

£600 rent in the UK, where do you live? I know nothing less than £2k for a 2 bed.

[@mwb]

@donLennin guessing you are in the south? Move to the midlands/north, you will be well impressed with rentals up here. My last 3 bed was £700 a month, and this one was £450 when went moved in, now £600. Cheaper than the mortgage would be.

[@nightmark2120]

@@mwb LOL then don't live in average rent is $2200 and if you live in the midlands is like I tell you I live in west virginia very different. Average rent is $891 in west virginia.

[@petermorris3665]

Great video Toby. The US is distinctly different from the UK in many areas. For example, the staff in our US office get less holiday than we do but get much more pay. There are also cost of living issues and lets not forget that in the US petrol/diesel is virtually given away free of charge but that their travel distances are much greater than in the UK. I think that the sweet spot is being in the UK but working for a US company 😊😊

[@TobyNewbatt]

Great point there Peter! Absolutely so many areas I could have gone down, and they definitely lack a few key areas, I think you’ve found the hack there I’ve mostly worked for US firms in the past!

[@bigbubba4314]

Petrol, fuel is given away in the US? Where?

[@juliaw151]

​@@bigbubba4314 it's like $6 a gallon there! They're practically giving it away!

[@vincezab1]

I'm an American working for an American company in London, and it is indeed the sweet spot.

[@jolandac6555]

This must of taken ages to research, thank you for such a good video, I really enjoyed this one!

[@PaulAllen-f1m]

Hi Toby, Brit living in California, another thing you need to factor in is real estate tax, it's eye watering. What I've learned is if you are a high earner in the US, it's great, if you are not a high earner, it's not so great, more so than the UK.

[@TobyNewbatt]

Ouch yes that’s a huge factor! Costs way more than the equivalent council tax here in the UK

[@Cassp0nk]

So basically we encourage all the rich tax slaves in the uk to leave!

[@DavidBennell]

good point, its easy to have a low income but hold lots of assets and be far better off than younger people with much higher incomes, for example people have seen their wealth double and tripple holding property which is very hard to keep up with if you don't own property, I know younger people on very respectable incomes, earning £60k, that still rent (£1,800 pm) because they can't aford to buy, while people who were on minimum wage their whole life are living in £400k houses because they were able to buy them for £10k 50 years ago

[@atix50]

I've friends currently spending $700k per year on health insurance, property taxes and college fees for 4 kids. Cars, clothes, extras the whole 'lifestyle'. They're a business owner and a nurse. Between increases to costs of living, probably mortgage rates this year and less money being turned over in their business They're seriously considering a move back to the EU. I am actually stunned by the extras They're liable for and they've great health cover and their property is worth less than ours although it's significantly larger. $8 for a take out coffee and $20 for a sandwich and $50+k a year health insurance but they've a lot not covered WTAF!

[@robbybroon4904]

Having lived around the UK including London and also in several places in the US for a number of years, would say that the big differences you missed are medical insurance expenses in US, higher mortgage rates, much higher property tax in most states vs UK council tax, grocery bills are 2x the UK, education is more expensive. Also nothing like an ISA to let you grow and USE your earnings tax-free before retirement. Also would add that the British pound is way undervalued at the moment historically. My Uk house that I have owned for 20 years has doubled in value in GBP terms but is up only 9% in USD terms in 20 years. The UK is becoming a sweat shop economy with the currency so low, almost akin to China.

[@wafercrackerjack880]

GBP is not undervalued. It's sufficiently valued right now.

[@hasinabegum1038]

Are mortgage rate higher in USA?Gas and utilities definitely cheaper in USA

[@saiyedakhtar3931]

​@hasinabegum1038 rates are higher (slightly) but the cost of a house is much cheaper.

[@robbybroon4904]

@@saiyedakhtar3931 buying a house in US in most areas is cheaper, but mortgage rates are slightly higher and property taxes are way higher. Comparing Chicago, IL and London, England - property taxes in Chicago are 10x annually what I pay in London, for same value of property. Insanity.

[@Jhill101]

⁠@@robbybroon4904 No stamp duty in Chicago though. Property taxes are essentially a way of spreading stamp duty over a term of years instead of paying it all in one go.

[@danielpemberton2356]

I wonder what the difference is in financial literacy is each country in the world and how that affects personal wealth. Another video idea Toby?

[@TobyNewbatt]

Thanks Dan! Yes very interesting topic

[@mikeroyce8926]

Great video Toby on a fascinating topic. I became aware that US citizens earned more than UK citizens; but consoled myself that we had free healthcare and state pensions. Imagine my shock that the US state pension "social security" is as far as I can tell better than in the UK state pensions. "the average Social Security retirement benefit in February 2023 was about $1,782 per month, or about $21,384 per year" For me at age 66 and 9 months I will qualify for the UK full state pension of £10,600 per year. So in the US they easily beat us. Anecdotally I believe most US college gradudtes pay less tuition fees than in the UK!!!!! Then there is "free" healthcare in the UK... Firstly opticians are not really free - and not many dentists treat new patients under the NHS. And we always seem to pay quite a lot for NHS dental treatment. My friend (with breathing difficulties) can never get an ambulance when he needs them and pays for taxis to take him to A&E. Our free NHS has long waiting lists for non emergency operations. Are we really worse off all round? Have run the comparisons using a pre Brexit exchange rate. I seem to remember the pound was $1.50 prior to Brexit compared to $1.23 this week.

[@TobyNewbatt]

great comment Mike!

[@BIG2hats]

No way, we pay way way less (or nothing at all in reality) in the UK. My age-mate cousins in the US are struggling with the debt they have whilst I pay literally nothing. After my pay rise I’ll have to pay only £100/mo. I will NEVER pay anything close to any US student

[@A190xx]

I would correct a few items: 1) The average US worker does not get paid leave with some getting just 2 weeks unpaid per year. Most UK workers get 4 weeks paid, so we need to add 8% for this alone. 2) The US has one of the largest wealth gaps in Western nations, so these averages ignore the modes. For example, the minimum hourly rate is $7.25 in some states and many workers rely on tips to making a living wage. 3) 66.5% of US bankruptcies are due to medical bills and an ambulance can cost $2,500. 4) GBP was overpriced for many years ahead of Brexit, so it is disingenuous to select the $1.50 exchange. One could also cite it was $1.386 on 29/02/2016 versus $1.423 on 01/06/21. The GBP/EUR was alway around €1.05 to €1.15 from launch and then rose to €1.43 before dropping back to the same band since. 5) The average US student pays $102,828 if they attend a uni in their state, but this can be £176,056 for out of state over 4 years versus £27,750 in the UK incurred over 3 years.

[@stevelongden7368]

Exactly this ^^^^

[@saiyedakhtar3931]

​@@A190xxtotally wrong. Average in state tuition is 10,000 per year. 100,000 is fir a place like Harvard. Second, federal minimum wage is 7.25 but no one actually pays that. A Walmart employee pushing carts gets more like $17 an hour. No one paying less than $12 in the market in reality. Medical debt bills are a bit if an exaggeration. Obamacare took care of the gap in heathcare. So, if you are poor you essentially get free Healthcare.

[@minimad8793]

I think the definition of being Rich is having the ability to cover your monthly expenses and to have at a minimum, 20% excess income each month. This would make a lot of normal working folks better off in life.

[@jimipet]

This doesnt make sense, because the amount you choose for your monthly expenses, will decide if you have a rich life or a poor life. If by montlhy expenses you mean just to barely make your livings, then this can be done with like 1000£/ per month in most cities in UK. Does this mean that if you earn 1200£ you are rich? Of course not. You first have to decide what a rich life would look like for you. Then you have to calculate how much would be your monthly expenses in that rich life and then add 20%. The resulting income, will make you feel rich.

[@minimad8793]

@@jimipet As most people have there own goals and lifestyle choices my reasoning is this, those able to have at least 20% of there earned income available for whatever they choose to use it for, sows the seeds to improve there quality of life in the medium to long term. The little wins in life count and it worked for me. So yes, being rich is the ability to cover all your expenses, have at least 20% free to do what you want and over time with a bit of discipline, increase your margins.

[@sacredgeometry]

@@minimad8793 Within reason. Most people think excess when they think of the word rich because thats what the word means. It means abundance. £200 leaves very little space for abundance and very little margin for error. You may feel comfortable living within your means ... and you absolutely can feel that. I like many other people have lived on less and worked my way through that amount of money, so I get it. But there is no way you are affording to buy a house on that amount without some serious luck in your investments. There is no way you are able to amass a certain amount of security for the present and future. If you had children you would really struggle etc. You aren't rich, you are just getting by and doing the correct thing of living within your means. You are comfortable. Not rich.

[@DrMalcolm97]

​@@sacredgeometry yes, but if you are in your 20s, saving 20% of income and investing regularly, you're bound to achieve some wealth in the next 20 years

[@sacredgeometry]

@@DrMalcolm97 No. Not if your income is negligible. 20% of practically nothing is not going to achieve some wealth over 20 years. Especially at modern rates of return. If 20% of your income after unavoidable cost is lets say $/£50 which it is for some people. Thats at best 600 a year. Thats 12,000 over 20 years. Let's say you make a consistent 11% ROI. Thats what 38k compounded over 20 years?

[@imsavor]

One of my fave quotes: “it ain’t about how much you make. It’s about how much you keep”

[@sfriedtomato]

US Expat living in the UK now. Good video. I'd suggest including some framework to measure the basic expense like medical, schooling for children/universities, insurance, number of holidays, ACTUAL working hours, culture, and quality of life. Even though I work for a US company in the UK, I still found the culture is quite different.

[@sunnydavies3990]

I'm a brit working for an American company in the UK and my American colleauges on calls don't understand why we log off at 5pm everyday and think we are lazy, crazy right?

[@paulosullivan3472]

@@sunnydavies3990 I am British working for a British company and I cannot remember the last time I logged off before 1830hrs, I dont know if I am unusual but I wouldnt assume all people log off at 1700hrs.

[@Krosshairbbyg]

@@paulosullivan3472 Brit in a British company here, most people on my team log off around 4pm with some staying till 5pm just in case someone wishes to talk to a member of our team but after that there's very few people who stay longer than that, I think overall it depends on your work and what your workload entails as well as deadlines.

[@TheManolis1984]

Very good video there. I think you make an excellent point that high income is kind of irrelevant if the cost of living is also high. I consider myself a prime example of that as I do earn considerably more than the average (still not in the 10%) but still can't afford to buy a property where I live.

[@BIAWolf]

Self employed or Paye? Employees never win even when they earn considerably more. Business owners and self employed have an arsenal of tools to get in that higher income bracket and still pay minimal tax

[@oliversamuel1]

This might already have been mentioned, but healthcare and welfare state benefits (childcare etc) should be factored into this. The US spends twice as much of their GDP on healthcare than the UK and has poorer metrics. So hard to say you are richer or poorer if you’re not calculating the full costs/benefits of a tax and income system.

[@dan._.5720]

Great video Toby. Puts into perspective how much more competitive our American neighbours are. Please could you do all the UK salary data with London only rather than the whole UK. I feel salaries in London are a lot higher.

[@mygoogle1482]

I’d focus on optimising wealth not being hung up on salary paid by a company.

[@tdtm82]

I would argue that average rent in London is way over £1,000 and Brighton is very expensive as is Bristol. It's important to add things like health costs in the US compared to the UK as that's why our taxes are higher too as it's private in the US.

[@sacredgeometry]

Right. If you live in a country where one health problem could demote you from affluent to homeless. I would suggest that you aren't rich. If you are sensible you keep specific savings as contingency if you aren't then your assets (i.e. your home, your belongings, your savings) are.

[@joshthomas8986]

The difference between the US and UK is that Americans are so much more risky and optimistic! I think the UK thinks more long term! Both great countries are great when it comes to making money.

[@DavidWilson-kr5gt]

Your forgetting that in the US people pay in to a 401k & health insurance directly from their salary. As an Englishman who has lived in the US for sometime I can say that I is massively important on where you live with regards to both salary, taxes and cost of living. American certainly have more disposable once you earn over $75k a year, less than that and people tend not to be able to save money. It’s been 13 years since I lived in England but on visits back there it appears that the cost of living is still lower than the US.

[@shintsu01]

interesting to see that such a gap with the US, and how unequal it is. maybe interesting to do the same with EU countries like Germany and Netherlands?

[@obamasglock]

The Netherlands have an extraordinarily interesting economy. While they have some of the lowest income inequality in the world, they have the #1 highest wealth inequality in the world. Truly unusual. Economics Explained did an interesting video on it.

[@LCTesla]

@@obamasglock it's a statistical mirage. that wealth inequality number means nothing. Netherlands will have very similar income numbers to the UK shown here, maybe just 10% higher.

[@TheStovo]

Earnings in the US appear higher than they actually are because the $ is fairly overvalued. It does mean they have better purchasing power when buying global assets but their day to day living expenses are also incredibly expensive so they might not have much disposable income to buy those assets.

[@garrethmurdock3308]

I live & work in the UK, I feel the UK will undergo a brain drain in years to come, generally better off working and living in the US rather than the UK for several reasons: • Higher pay: Wages and salaries in the US are generally higher than in the UK, especially for highly skilled, white collar jobs. The US also has higher average household income and GDP per capita. This means Americans generally have more disposable income and a higher standard of living. • Lower taxes: The US has a lower tax burden than the UK, with lower income tax rates and less consumption taxes/VAT. Americans get to keep more of their paycheck. • More entrepreneurial opportunities: The US economy and culture is more entrepreneurial, with higher business startup rates and more venture capital funding available. This creates more opportunities for innovation and building wealth. • Less regulation: The regulatory environment in the US is less burdensome for businesses, with fewer restrictions and less red tape. This makes it easier to get new enterprises or business ideas off the ground. • Warmer climate: Much of the US, especially the South and West, has a warmer climate with more sunshine than the UK. For many, the weather is a factor in quality of life and mood. Of course, there are also arguments to prefer living in the UK, including universal healthcare coverage, more paid time off, and tighter social safety net. But purely from an economic opportunity and standard of living perspective, the US has significant advantages over the UK for many people.

[@sl0w_racer]

Great video and perfect timing! I am at this moment planning to move my whole family to Texas end of next year. Im a 45% tax payer and we are now done paying these huge taxes and getting to keep so little of our cash. In the US i will be paying 26.5% tax and be able to add at least 50% more pay, something i'm discouraged doing here because it means i will lose the £60k pension annual allowance. We will also go from a 2000sq ft house to a 7000sq ft house with a pool. So overall a much better standard of living and we cannot wait to leave now. Thanks for the info!

[@TobyNewbatt]

Sounds great mate, best of luck! What a life change :)

[@janoginski5557]

Hello Racer, definitely go. There is no State income tax in Texas, (so l believe), there may be some Federal tax but either way you will pay a very much lower rate of income tax. My son works full time for a realtor company, ( commercial & industrial) but we also started a business of our own, specialising in property maintenance, so far very successful & looking like it’s going to grow rapidly. Another aspect we’ve found is that the Americans, certainly the Texans are very helpful if you’re a decent individual, bright & ambitious with a good work ethic & capable of producing excellent service or work, it’s a great place to be, they have a get it done mentality, positive & motivated. Unlike the UK, where it’s largely low ambition & just enough will do. There is definitely a case for stating that there is low moral in the UK, an oppressive tax system is probably largely to blame. Glad we made the move.The States does not get a good press here but this is insular “Little Britlander” speak. All the best with your move to Texas. 💰

[@abrin5508]

Yep - if you can get a decent job in a decent cost of living area you will be quids in. My pay more than doubled, taxes went down and my equivalent house was 4 times the size with 2 acres. I was pretty average in UK but over here I'm a multi-millionaire after being here over 10 years. I am not an entrepreneur or an executive - just normal guy doing skilled job.

[@daspeed198]

@@abrin5508 I never realise skilled labour got rewarded so highly in the US, i'm going to uni to study engineering later this year and now it's making me consider relocation once i'm finished

[@ANTSEL]

BEST MOVE YOU WILL MAKE. We moved from the UK to Las Vegas 2 years ago and haven’t looked back. You probably won’t even pay 26.5% once you factor in all of your deduction (something we leaned , we assumed 24% tax ended up being 16-18% effective). Honestly the comparison between the UK and the USA is kind of a joke in terms of earnings, healthcare (if you have a decent income) and taxes ! Good luck in you move and we hope you love it as much as we do!

[@lplate1000]

Really interesting. Always great content. 🙂.

[@vinyllondoner]

Overall, U.K. fairs much better than I expected with regards to net wealth which, to me, is psychologically more important than just focussing on salaries and taxes. Great video!

[@TobyNewbatt]

Yes relative wealth is extremely important to consider and it’s something we could talk about for hours!

[@samyoe]

Watching this video after half a year, I think the US has the benefit of not having a housing crisis, in addition to higher salaries and lower taxes. As such, it's not as hard to get onto the property ladder and start accruing wealth via assets if you command a decent salary. I'm currently applying to do a PhD in the US, then hope to stay to work after my studies. Being a top 25% earner in London is too depressing 🤯

[@hardcorechuks]

Great video mate ! Very informative! Other comments have touched on less focus on cost of living and healthcare.

[@TobyNewbatt]

Thanks mate! Yep there’s so much to cover unfortunately without making a 1 hour video lol

[@FirestarterAJ12]

It would be interesting to compare amount of money saved. I recently went to the US and day to day products such as groceries, coffee, a Big Mac, are nearly twice as expensive as the UK so that will reduce the difference somewhat.

[@hasinabegum1038]

I think gas and utility prices are cheaper in USA

[@alistairjackson8150]

Agreed, but they also use a lot more of it. Air conditioning, less efficient cars, driving to work, driving to get a coffee...

[@BrandonRyan]

@@alistairjackson8150 But a lot of us have solar, work from home, etc.

[@rayperkins6006]

I have just returned from Leeds in the North of the UK. Prices are around 2/3 of London prices. If you have a decent job, you can live very well indeed.

[@Black-Circle]

live well in a small town in yorkshire wow what a life.....NOT

[@jimbocho660]

​@@Black-CircleLeeds is not a small town and Yorkshire is beautiful.

[@derrick1751]

I can only imagine the amount of hard work that's has gone into making this video.

[@TobyNewbatt]

Appreciate it thanks Derrick!

[@Asdfgghhhjj]

You have to factor in that all UK employers have to pay NI contributions of 12.5%, which is not included in the salary.

[@TobyNewbatt]

Yes true, still that's not the problem of the employee :)

[@-M_M_M-]

The US is a much richer country than the UK. Wealth differences are tricky to analyse. The top top centiles are due to owning publicly traded companies, which in turn are generating value by and for many other people that might not own any shares.

[@jettser17UK]

Cos the US is geographically much bigger with more natural resources and people that's why. But if the UK was 40 times bigger on parity with the US, it would be 5.9 times richer than the US size by size. Go figure! 🤗

[@-M_M_M-]

@@jettser17UK I don't know where you get those numbers or ideas from... -China is massive but poorer than UK or US. -Venezuela swims in natural resources and is poorer than almost everyone else. -Switzerland has neither resources nor size and it's richer than almost anyone else. It is not a size or a resources issue.

[@jettser17UK]

@@-M_M_M- This is too complicated a discussion and we both going off topic at times when I'm just comparing those two countries, whether it's per capita and GDP or in relative terms. Being bigger, the better the chance of being resources rich and population size cos smaller countries tend to be limited unless they expand. I guess there's no simple answer here due to differing variances of other overpopulated but poor countries! The West is truly a special region.

[@parkinsonga3092]

I earn £120,000 per year, but I live in the North East of the UK. Previously I earned £52,000 and I considered that a good amount, but we only run one car, we don't drink or smoke and we do have a frugal lifestyle except for our biggest expense which is two horses.

[@Nyahheet]

Great video! Will really need this for The Republic of Ireland

[@MarlonKingShow]

Thanks for the break down, makes me feel better about my salary, but doesnt change my situation, saving is slow, costs are high, wages are low, regardless of averages or top 25% etc. Wages in US definitely look better, but i wonder what the comparison would truely look like when taking knto account health care.

[@stephenj5432]

is this including the income of the self employed and say for owner managed companies who take a low salary but high dividends?

[@TobyNewbatt]

No just pay through PAYE Stephen so yes there will be skew if we include people who make money via dividends but I don’t believe that kind of data is available

[@morpheus9137]

Stock based comp is huge in the US, so yeah the truth is they will earn even more and pay less income tax. Property taxes and heathcare is worse, but if you are a high earner better off in USA.

[@RemiXRemi_]

While the UK has shorter working hours, more paid days off & a lower cost of living the higher salaries in the US make up for it imo. Free healthcare is a common benefit mentioned about the UK but 47% of Americans had healthcare insurance covered by employers & 67% had access to healthcare benefits. Although I wonder why the median wealth is higher in the UK considering the median salary is higher in the US. But there are many variables to consider when deciding which country is better to live in & it's all subjective.

[@BlatentlyFakeName]

Health insurance won't cover all of the costs though, or only up to a certain amount. So even if you are covered in the US you are screwed if you get something serious. Also they won't cover existing illnesses and often you'll still be billed for certain things. You actually get a better deal on private healthcare in the UK as they have to compete with the NHS, which is mostly free.

[@BrandonRyan]

@@BlatentlyFakeName Any decent insurance plan will absolutely cover you for the full amount of your treatment. If anything, you have a max out of pocket and then your plan pays everything above that in the event of catastrophic illness and medical bills. And yes they do cover pre-existing conditions as long as you've been previously covered.

[@TheCodeConnoisseur]

What’s that display board above your monitor and where can I buy one please?

[@libramartin]

English language question - can you say "median average"? I assume "mean" means average, but median is median. Or am I mistranslating/understanding?

[@TobyNewbatt]

Yes you can say ‘median average’ or ‘mean average’ but when most people just say ‘average’ they typically are talking about the mean average 👍

[@AS-yg5dt]

Nice video Sir 😃🙏🏽

[@knowledgeseeker5499]

Awesome video. Love it bro ❤

[@TobyNewbatt]

Thank you!!

[@jungleboy1]

now compare with some bigger European countries e.g. Germany, France, Netherlands. I think i have some outcomes France - = less time in work, better pay? Germany = similar to UK but better pay and cheaper outgoing costs/expenses.....

[@TobyNewbatt]

That would be an interesting one!

[@m.ehtizan]

Hey Toby, I just watched your video and I must say that it was really informative and well-made. I loved your videos. I was wondering if I could help you edit your videos and also make highly engaging shorts for you?

[@ThaTurminator]

At 1:04 you make a mistake. AVERAGE is NOT the same as the 50th Percentile. I don’t know if you said the word “average” by mistake or didn’t mean it in the Mathematical sense of the word, but just a discrepancy I thought you should clarify. It is now unclear if $46001 is the 50th percentile, or mathematical average. Averages are normally skewed upwards by a few extremely high earners at the top, making the average normally higher the the 50th percentile which I think is a better representation of the true “typical” salary.

[@TobyNewbatt]

Median average is the 50th percentile. I hope I made that very clear. I know the differences between median and mean and I speak about them in the video as we progress hopefully you enjoy 👍👍

[@carlenecayhill]

Great comparison video Toby 👍🏾 a lot of numbers and stats to get through so well done.

[@yanmamabear5734]

Great video. What I am wondering are: (1) since in US people have to pay to get health insurance coverage and pay out of pocket for medical expenses, would it be a more fair comparison if you take those expenses into consideration for US net income? (2) is it a lot cheaper to live in UK vs. US?

[@BrandonRyan]

But we don't pay to get medical insurance AND pay out of pocket for expenses. It's one or the other. Medical insurance is subsidized by your employer and you can usually pick how much you want to pay vs how much flexibility you want. It's really not all that expensive for basic HMO coverage and those plans usually have zero out of pocket expenses. I pay less for private coverage here than I would for national insurance...by a lot. And because I can essentially deduct my wife and kids, my tax rate is half what it would be in the UK. Unfortunate because I'd consider moving there as it's where my wife's family is...but the massive tax increase while losing access to what is essentially on-demand-pick any doctor you want- healthcare is a bitter pill.

[@mellonviskaino9537]

It’s just crazy. I live in the uk. About to graduate and a starting salary in my profession varies between 30 to 40k. If you have 10 years of experience you would be making around 80-100k. If you take out rent (I live in London) and you are sole breadwinner of the family and you want to avoid mortgage you will never be able to afford a property here. It’s just so sad

[@TG-tl4uj]

The U.K. is a total basket case, you could argue we have free healthcare but the reality is it’s basically unusable now. State pension is very low, property is unaffordable and we’re taxed to the hilt.

[@TheSilvercue]

This video is misleading. I am in the US at the moment and everything is soo expensive now. I am horrified by the prices. It was not like this before. Eating and drinking out is ludicrously expensive now. Taxis, UBERs, car rental, sooo expensive. It is costing me double what I pay in the U.K.

[@kw8757]

Health care isn't free in the UK, it's free at the point of use but where do you think a big chunk of our taxes go? Running the NHS, that's where...and the state pension is just a big Ponzi scheme.

[@InternationalKarl]

I’m American and leave in the U.K. and would never trade going back to the U.S. Got you pay for Health care Phone bills Etc

[@nathijomac]

This comparison just comes down to the decrease in the strength of the pound. If it was still two dollars tot he pound like it used to be, then it would be even.

[@TobyNewbatt]

Yes this is a big factor for sure! I remember the days of a 2:1 pound for dollar not very long ago

[@morpheus9137]

At one point it was 4:1 pre WW1.

[@donaldduck5731]

I’m getting contacted now by US agencies for mechanical engineering roles, space and robotics, salaries in the range of $150k to $190k, almost 4x UK salaries, plus people think enginers are low skill workers in the UK.

[@eventhori3on]

Thank you.. I am a mechanical engineer and work on boats with weapons! 8 years experience and 40k! Ridiculous! I would earn 3 x more on the US! Easy! They want highly skilled engineers but my wage hasn't moved in 8 years! Well went up 3k in 8 years! But cost of living gone up loads so really it's gone down!

[@dfdf-rj8jr]

Adjusted for purchasing power parity, which includes healthcare and transportation, Americans enjoy 30% higher median income than Brits. Keep coping though :)

[@hejiranyc]

According to this video, I make a bit above the cutoff for 1% in the US and I'm single. I have to say... I feel solidly middle class. To be clear, I do not worry about money; however, I do make an effort to save as much as I can for retirement. I am shocked that the 1% threshold in the UK is so low! I was under the impression that UK/UK incomes are comparable since the costs of living are comparable.

[@jimbocho660]

The CoL in the US is double that in the UK.

[@K5ingh007]

How does the strength of the £ versus the $ currently impact things in comparison to 5-10 years ago?

[@hockysa]

could we have specifically a New York vs London comparison?

[@TobyNewbatt]

Nice idea!

[@ade1963]

You didn't take into account Purchasing power parity - which is about 1.5 for UK vs USA

[@TobyNewbatt]

Depends what’s you’re buying! But yes there’s so much left to cover honestly easily hours worth of stuff. Thanks for watching Ade!

[@Jimmy011087]

NI is a bit of a misleading one as the employer in UK has to pay towards that too. Say you’re hired in on £30k, that’s actually more like £33k to the employer. Might as well say you are on £33k but add that bit to the tax bill

[@lifesacardgame6454]

What about adjustments for such things as private medical insurance, where the US does not have an option of state provided medical care? You may keep 80% of your income but how much goes on essentials such as medical?

[@danielheredia-ux9nf]

I suggest a tornado graph to compare income by percentile

[@andyasia]

2 kids in private school costs you £150k of pre tax income. A decent family house costs £1.5m and a moderate mortgage would be another £100k of pre tax income. Filling up only your ISAs, junior ISAs, SIPPs costs another £200k of pre tax income. Basic living expenses at that level is another £150k of pre tax income. A nicer life is another £100k of pre tax income. Yes, this is nowhere near the poverty line but you're not cash rich, you're just paying the bills, mortgage, kids school, holidays etc. and you have burned through £650k of pre tax income. If you pulled that back to £500k of pre tax income it is only £23k per month of which mortgage is £6k, ISAs and SIPPs are £10k, school is £6k and you have nothing left. So I say about £1m a year and you start to feel moderately well off.

[@Shteev91]

Thank you for fixing the thumbnail to include us all!! 😂

[@TobyNewbatt]

😎

[@dan._.5720]

Do London average salaries vs whole UK. The difference might surprise you.

[@WarrenF]

There’s not much of a difference

[@greg.investing]

Great video, as ever. Thank you for confirming that I am a potless peasant! 😉

[@crustyzimmerman3324]

It would handy to see a graph. For instance, I’m on a poultry 50k, but what percentile am I in?

[@biosourcebaits9936]

Enjoyed the video, it's accurate. I'm a Brit living in the USA. I basically have the same job as a UK cousin. He was bragging about his 40 k GBP salary. I didn't mention I earned more than 3 times that and paid half the taxes... This is not a brag, just a statement of fact...

[@beaverundercover3479]

can you please so a comparison on state pensions. Which country has the best state pension.

[@TobyNewbatt]

Nice idea!

[@rachelwilson86]

I live in the US. It looks that it costs less to live in the UK than the US.

[@adrianmaule7128]

1) HEALTHCARE in the USA: Workers can pay up to $1000+ in premiums PER MONTH and STILL have a high annual deductible of $12000 or so before the insurance kicks in. 2) Pension vs Social Security. Our social security barely provides a poverty lifestyle at retirement. Most people put extra money into a 401k that is a pre-tax amount that goes to private investments. Without these two points addressed, there's no proper comparison

[@hasinabegum1038]

I think employers pay part of medical insurance in USA

[@adrianmaule7128]

@@hasinabegum1038 And workers still play $1000+ per month. I'm IN the USA. It's expensive! Now I'm with a really good employer, great health insurance, I still pay more than $500 per month for my family's coverage. I STILL have $11000 deductible. And like I said, this is great health insurance...the best I've had.

[@BrandonRyan]

1000 a month with high deductibles???? This would be the worst insurance plan I could imagine. Anyone with that situation should be looking for another job.

[@BrandonRyan]

@@hasinabegum1038 They do.

[@adrianmaule7128]

​@@BrandonRyanthe golden handcuffs is some high salary jobs have this, especially subcontracted tech jobs from recruiters. These recruiters act as gatekeepers to the better full time hire jobs at Fortune 500 companies

[@thewhiskersfamilytheamazin6036]

I'm from Denmark but this video is great👍

[@TobyNewbatt]

Thank you 😁

[@fitta74]

Can you do a video about scandinavia vs The US (how much do you need to be rich) ?

[@wintersnowowen2254]

We definitely are less well off in the UK. Our salaries are crap and have not been rising with cost of living.

[@viadislav453]

Crypto currency and NFTs will outsmart the banking system in the neareqst future serving as a global fiat. Already making over 85% profit from my current investment

[@mrtuber3491]

You can earn 1 million lira but that don’t make you rich when you know what that can buy you.

[@elom44]

An interesting video but this is only half of the equation. It covers what you earn before and after tax. You need to also include the cost of living and quality of life / employment benefits. Only then can you draw a meaningful comparison.

[@chalkers]

VAT is a killer in the UK!

[@filipdobrin6515]

No we are not , the colleagues from the company that I work for in US earn almost double what we earn here and do the same job pretty much . We are on 60-70k a year and they are on 100k-120k a year in pounds not usd .

[@jconnor619]

Great insight Toby, I'd love to see a video on household incomes averages. 🇬🇧 Vs rest of world

[@TobyNewbatt]

Nice idea thank you!

[@jconnor619]

​@@TobyNewbatt or even region by region UK

[@spiritzen]

Some rich people are just too frugal for their own good, their focus is just making more and more money. At the same time those further down spend stupidly to feel and look ‘rich’. Enjoy your money, but also invest wisely. Don’t be miserly.

[@rssiyengar]

In the US a major expense that many bear is health insurance premiums ..which you did not call out ...and those states that dont have income tax sock it to you with sales tax and property tax ..in the final analysis i doubt there is much difference in the taxes between UK & US...but salary discrepancy will remain

[@TobyNewbatt]

Yes that’s very true although I am assuming that a decent employer takes care of healthcare as is pretty common. We have sales tax in the UK too it’s 20% which is double what even the worst state in the US. It’s such an interesting topic with a tonne of variables thank you for watching!!

[@BrandonRyan]

Taxes are way higher in UK, especially if you are married on a single income in the US. The UK has no provision for "married filing jointly" and doesn't have nearly the dedcutions available in the US. My tax rate would be double in the UK vs US. Also, no US state has sales tax anywhere near the 20% that is VAT. The highest is 10% and some states have no sales tax at all. Property tax can vary depending on where you live though and can indeed get high if you have an expensive home.

[@valerienewbatt9678]

Very good video

[@TobyNewbatt]

Weeeeeeee Valllllllll

[@Pierreland-sz4un]

Your forgetting we get 28 days holidays ishh and bank Holidays plus if receive a finanal salary pension worth hugh amount plus state benefits can't be compared to benefit of uk

[@stevenbarton2398]

What about cost of living, property prices and medical expenses UK v. USA. You could also look a global stats of use of credit v. savings and investments

[@TobyNewbatt]

Yes there are so many variables here we could go down, which I why I mentioned this in the video. Lots more video content for the future :)

[@stevenbarton2398]

@@TobyNewbatt Look forward to it

[@charlotlottie]

I've always wanted to know the comparison of how far the wage went and if that's why roles seem better paid over there. When I visited NY years ago I was shocked at the price of bread. But no comparison I've seen seems to balance the complexity of the costs.

[@charlieq3054]

@@TobyNewbatt include education fees when you do

[@alexplummer6397]

So you’re saying I’ll be in the top 10% if I move to the uk

[@TobyNewbatt]

See you next week 😂

[@PYTwwe]

Doesn't feel right to me. Making 250k per year in CA doesn't put you in the top 10%, unfortunately.

[@TheSilvercue]

I am visiting in the USA at the moment and the prices are horrific on eating and drinking out. I have been a few times before and always found it slightly cheaper than U.K., but now it is so expensive. I know there are cheaper places too, but there are in U.K. too. I have been horrified by the prices. Car rental, UBERs, taxis too…all soo expensive…and when did they start having toll roads everywhere?

[@person.X.]

That is interesting. I spent months travelling around the US in both 2009 and 2011 and I was struck by how cheap it was - car rental, beer, motels etc. However when I started to research another trip recently I was taken aback by how expensive it had become. The UK is much cheaper now even with all the inflation.

[@TheSilvercue]

@@person.X. I got back at the weekend and spoke to an American friend about it who said the price increase over last 10 years are heavy. I won’t be going back for sure. It is closer to Norway prices than U.K. prices now.

[@ReggieChump]

Top video editing/work, again. I remember you sneaking some Goldeneye N64 footage in a video before 👍. Can anyone help, please? I had a Chip Instant Access Savings Account open with quite a lot of money in it, but I pulled all my fund's out, as the FSCS replied to a letter I sent them, stating that Chip isn't under their protection!! It seems to me if Chip went bust, they can simply say, sorry your money was being "safeguarded", or in the process of being transferred, so it's not under FSCS (like they CLAIM it is). Clearbank is under the FSCS, but Chip won't confirm where the money is resting whilst in the aforementioned account!

[@bobdidit55]

Cost of living is totally different. Box of cornflakes 500g/18oz is a perfect example, in GBP £2.25 UK including taxes £4.40 US not including taxes I know where I’d rather live, plus I won’t get shot in Scotland 😂

[@TobyNewbatt]

Cheaper to buy a burger and chips for breakfast 😂.

[@educatednumpty71]

You forgot to factor in other Taxes and Health insurance Americans pay that people in the UK don't.

[@danielheredia-ux9nf]

You can’t find anything to rent in London for less than 900£ pcm

[@lifeisagame2023]

More top quality content Tony! Im rich.....on life!

[@TobyNewbatt]

Thanks mate! 👍👍👍👍

[@kenroyforte6175]

Nothing shocking. Always felt taxes are too high in the UK.

[@samyoe]

I want to immigrate to the US because they pay high 6-figure tech salaries, and there's no state income tax in states like Texas. One thing I think you could have mentioned is the proportion of millionaires as a percentage of the total population (the US has more). Edit: apologies, still learning my states

[@juliaw151]

Austin isnt a state 😂

[@ericshang7744]

The killer of US living expenses are medical bills, insurance, lack of paid leaves etc.

[@Colinrobson1]

Toby, two points for me. America has a massive advantage over every country, its geographic placement. No disputed border, oil, gas the best farming land there is etc. As such they would have to be extraordinarily badly run to not be rich compared with the UK. I have friends that are very wealthy and also what you could call tight beyond belief. As an example a multi millionaire driving to the beach to dig up a few bags of dirty sand rather than buy nice clean dried for a few quid. They are obsessed with having money, keeping it and getting more. Sometimes at any expense. Keeping money is their only objective and the whole family becomes dragged into the obsession, it controls them.