Overheard at the LFGSS golf club bar

Why did he replyn to himself?

Word count innit

i think thats what the young people call a thread

Bingo

young people

Shakes head.

To be fair, school fees have risen a shit ton since I went to school.

The school I went was about £1500 per term when I was a kid. Its £7k per term now. If it had just risen according to inflation, it'd be £2700 per term in 2021.

Its a common story across the board. Private schools have become a LOT more expensive.

Edited: I put the wrong value into the inflation calculator.

Also almost no one thinks they're rich.

I remember listening to someone discussing a paper they'd done interviewing wealthy New Yorkers. Lots of these people, or their spouses were on >$1m pa. But they often shopped in sales, needed that income to maintain their lifestyle, didn't feel that they could spend limitlessly, lived in a city with a high cost of living, etc. and so didn't regard themselves as rich.

In more anecdata, I used to sit opposite a sales person who dealt with HNWIs and as a scare sales tactic he'd break down their income and expenditure and what they needed to retire. So many were literally just covering their costs. This isn't about playing a small violin, but just pointing out how most people's brains work.

Also almost no one thinks they're rich.

This in spades. Most 1%ers I know feel that they "struggle" to get by.

Most 1%ers I know feel that they "struggle" to get by

Keep tripping over all those Rolex and champagne bottles they leave lying around

just pointing out how most people's brains work.

In many instances, it's the way people's brains work that causes them to be relatively successful / unsuccessful.

I know quite a few very successful people who shop in Aldi because they recognise the value. At the same time, I work with people who are pretty much on mimimum wage who turn up driving a BMW.

I feel rich. I don't struggle.

I don't have kids, pets or a car. I choose to work get paid 4 days a week because that's fine in terms of income. I don't worry about money when I'm buying food or other things. I think I'm in the top 25% of earners so objectively as well as subjectively I'm well-off.

Maybe there's also lots of people who are comfortably rich and just don't go on about it a lot?

Possibly but I also think that a lot of high earners are up to their eyeballs in mortgages and school fees.

Yeh they might have a high salary but most people I know have suffered from severe lifestyle inflation as their salary has gone up and are buried by mortgages. Depending on location, the mortgage can be tough to reduce but lifestyle inflation is completely under their control but they don't see it, got to keep up with the Jones's

I'm rich in some ways, not in others.

I'll freely admit my salary makes me rich... in fact I filled in this https://ifs.org.uk/tools_and_resources/where_do_you_fit_in to try and determine what my top n% is, and it said: "you have a higher income than around 99% of the population" and "In conclusion, Your income is so high that you lie beyond the far right hand side of the chart" - this is based on me being a sole income household compared to it actually comparing to multi-income households. I earn a lot.

But... salary != wealth.

I come from no money, no inheritance, no family gifts, a much harder slog to earn every penny of a deposit for a mortgage, etc. I work with a colleague who is in his early 20s and has a higher disposable income than I do because his grandparents gifted him a house (one of their 2nd/3rd rentals) on his 21st birthday... an inheritance tax avoidance I guess... and so I in my late 40s have less disposable income than him in his early 20s.

I am definitely rich. But there is also a very large inter-generational middle-class that is far richer in other ways. My colleague wouldn't count himself as rich, he doesn't... but definitely he is, in fact almost everyone I know is rich as these are not the circles I move in I guess, this is what my peers earn, etc. I still remember shivering in an underpass sleeping rough, but it's irrelevant really... I've achieved social mobility as politicians call it, and moved from street to flat to home, from work to career. Judged solely on my last payslip I am off the scale, but it's a poor thing to judge anyone by... if I had a child I couldn't afford private education for them.

I'd love to see more people become rich in my lifetime... i.e. higher salaries for others, less tax on that salary.

So how to fund the country? I'd also love to see more of the asset value of wealth be redistributed... i.e. land tax that erodes large estates and holdings, increased capital gains tax on assets, etc.

Income is the one way to help change people's lives... tax everything else (inc private schools).

So how to fund the country? I'd also love to see more of the asset value of wealth be redistributed... i.e. land tax that erodes large estates and holdings, increased capital gains tax on assets, etc.

The one change I'd love to see is banning mortages for any residential property that isn't your primary residence.

Now we're talking, except you'll just encourage companies to form to pool cash to buy houses then redistribute rental income. The only real solution is to ban sales of non primary residences.

Bugger, that's my plan to buy a second mansion next to St Andrews scuppered!

Scotland tho - different rules, innit...

.

Unless you have literally insane mortgage

Only came into a decent income in my 40s, only available mortgage once I'd saved a deposit was a 22yr one due to when I'd retire at and my lack of pension (no proof of income beyond 65 - too much time on the streets or then in dead end jobs grinding to get off the streets to have any pension beyond legal minimum in the last 4 years).

So yes, mortgage is ~50% of my insane salary.

The assumption that salary equates to rich also assumes normative middle class lives, or at least a consistency in income over a long period of time prior. If one takes a homeless person and gives them a top 1% salary they aren't suddenly rich, only when it's sustained over such a period of time that assets can be acquired does it really translate to wealth.

I'll end my life more comfortably than I began, but nothing else. I may have earned slightly more than most people in an average working life, but I am earning more of it at the end of my working life and far less in the first two decades of working (and this is not the tax efficient way to earn money!). I am unlikely to retire early, will probably need to retire late just to ensure I'm not totally broke after 80 (if I get that far).

Now we're talking, except you'll just encourage companies to form to pool cash to buy houses then redistribute rental income. The only real solution is to ban sales of non primary residences.

The countries who forbid mortgages on 2nd homes tend to back it up with laws that give tenants more rights and rent control. As you suggest, the downside is that a small number of people hoard most of the property but the upside is that its not treated as a get rich quick scheme by landlords and tenants receive stability, security and lower rents in return.

I don't think it would be a bad thing if the UK started to chip away at the obsession with property ownership by making renting more attractive.

I don't think it would be a bad thing if the UK started to chip away at the obsession with property ownership by making renting more attractive.

In fact this could be the way to improve the environment, as a higher % of rentals with bigger burdens on landlords would be a more effective way to incentivise greener heating and building investment (insulation) that would be administratively easy to handle (fewer number of landlords involved) and reach more people (more residents per landlord). It would also encourage the development of rental only apartment blocks leading to better services accessible to all renters, i.e. Swedish style blocks with shared facilities.

.

It's fine to want to own your own home but investment properties are totally out for me... It's crazy in Australia, everyone fucking does it...

I agree with @Velocio here that salary ≠ wealth

If you are an old money white guy, you can slum it on living wage with a safety net there if you need it. I am in similar boat as Velocio but first gen immigrant and still pay subscription to this island via the home office.

As @Stonehedge pointed out thats mad increase in fees even if I was going to send my actual kid to hypothetical private school. Same for early years childcare, the increase is not inline with inflation (or inflation plus 5% or whatever it needs to be for economy to balance).

I have a shitty car thats cheaper than any of my bikes and mortgage thats 37% of my salary (and have a partner on a similar salary). Other than bikes I dont spend money on anything else. I have office grade laminate and IKEA furniture in the house, most 2nd hand. Use 2nd hand clothing for everyone in family.

So I'd say I am accumulating wealth and certainly feel rich but the moment I make (unnecessary) lifestyle choices like iPhone 13, Range Rover and Private school for kid, I'd be fucked.

So I think this whole 'squeezed middle' thing is a matter of choice.