Who has INCOME over 40K and is still in serious Debt????

Pennysmakepounds

OK…I’ve been reading these ‘Debt’ thread for some time now and am amazed at the sheer amount of debt some people rack up…

Now I realize, that people on LOW income can sometimes through no fault of their oun get into trouble with debt…

My question is:-
Do people with High wages (Say 40K and above) also find this to be true????

Or is it mainly the low earner that are in this situation????

butler_helen

I Don't think it matters what your wage is, all it takes is no savings and an unforeseen disaster to get into debt. E.g losing your job or the house burning down.

Plus it depends on who needs to live on the 40k and where they live. From reading these boards and from real life it's all about personal circumstances.

Johnnybegood

As my old dad said, the more you earn the more you spend!

Puddickle

We have combined earnings of over that now - but didn't when we started getting into debts (as students)... once you are in debt it is a vicious spiral of never having emergency cash and being comfortable spending outside of your means.

Cycrow

You can live outside your means on any wage

ilovelondontown

Pennysmakepounds wrote: »

OK…I’ve been reading these ‘Debt’ thread for some time now and am amazed at the sheer amount of debt some people rack up…

Now I realize, that people on LOW income can sometimes through no fault of their oun get into trouble with debt…

My question is:-
Do people with High wages (Say 40K and above) also find this to be true????

Or is it mainly the low earner that are in this situation????

We're DINKS- and have a "high income" if you want to call it that, but it's all relative.

I live and work in London, my husband and I pay rent (don't have enough disposable to save at the moment) at a price of £1250 a month- pretty standard where I live, we commute into London at an annual cost of over £2500 and our wages haven't moved in 4 years, meanwhile the cost of everything has, and keeps going up. This is before you even factor in monthly bills, food, let alone anything that is considered a luxury.

I don't own a car, I haven't had an annual holiday this year and have put off having children because of this issue.

Wack £25K of debt on to rent and travel and you find that even "rich" people can get into debt through no fault of their own.

eyeopener2

Loads of people. We've had cases of incomes over £70/80/90/100k and being in serious debt.

Mortgages, school fees, job loss, keeping up appearances. Doesn't matter how much you earn if you spend too much.

Idiophreak

It depends what you mean by "serious debt", really.

The Mrs and I both earn over 40k and we have around 10k on CCs (0%), are around halfway through repaying a 20k loan and have a few other hire-purchase/finance agreements ongoing...Say that equates to £35k, plus mortgage, outstanding debt, it sounds pretty "serious".

But then we clear around 2k of the CC debt per month, can easily make the minimum payments on everything on just one of our wages and are under no illusions that our debt was certainly not acquired through "no fault of our own" - we spent all the money on cool stuff...For us, our debt levels are easily manageable....other people would see it entirely differently.

Johnnybegood

I think income is largely irrelevant, its all too easy to spend a little more than you earn over time, its has far more to do with physiology than your wage bill.

Julesiep

What do you mean by serious debt? Someone on a lower income may class a smaller debt as serious. We earn £45000 but owed £51000 when I found out I was pregnant and went on mat leave. Serious debt is whatever is hard for the individual.

Weird_Nev

If money out > Money in, it doesn't matter what those figures are. Once savings are gone, you're in debt.

In many ways I think the high earning lifestyle tempts people into bigger and bigger debt. You are moving in circles where it is expected that you have the big house, the new Audi, send the little ones to the best school and go on fabulous holidays. If all of that outstrips your earnings, then you're in trouble.

Similarly, earning more gives you access to more lines of debt. Loans are bigger, you have a bigger mortgage. You get trapped into a lifestyle of spending that is all the more difficult to break.

As a personal example, we moved overseas and my wife more than doubled our family income on her own, nearly tripled it in fact. We got our first ever loan, at 33, to by a car because they're so expensive here. That is something we'd never entertained, even for a moment, back in the UK.
It's less than 5% of her income to pay it back, and the cost of the loan was fully calculated, and we felt it was the right thing to do to get a safe, reliable car sooner and get on with our lives. We don't regret it for a moment, but it shows how "striking it lucky" can alter your perception of finances.