Household Income...

michaels

Nick_C wrote: »

Another big omission is the cost of travelling to work. Commuting from the South Coast into London can cost £4400 a year or more.

100.70 a week from St Albans to zone 1 plus house prices a long way up Hamish's graph means income doesn't go very far.

BarleyGB

HAMISH_MCTAVISH wrote: »

Here you go.....

I cant fathom this graph, it just doesn't seem right to me, 50% of households have a wealth (thus assuming net equity) > £232k?

Just seems a lot when you think of how many people rent, or have large mortgages.

Very few people have negative net worth according to the graph?

the_flying_pig

BarleyGB wrote: »

I cant fathom this graph, it just doesn't seem right to me, 50% of households have a wealth (thus assuming net equity) > £232k?

Just seems a lot when you think of how many people rent, or have large mortgages.

Very few people have negative net worth according to the graph?

yeah, it looks dubious to me, very highly dubious. the top percentile arguably looks [to me] eminently plausible but the middle & especially bottom look too wealthy by half, imo.

it says that "1% of HH have negative wealth of £3,600 or more"

in other words it's saying that the most indebted person in the second least wealthy percentile has a position that's no worse than minus £3,599.

this doesn't sound quite right to me. think of youngish [endangered species i know but some do exist] first time buyers [say anyone who's bought within the last few yrs] with rubbish pensions. i've read that "Nearly a third of mortgage debt is held by households that have borrowed more than four times their income"...
... of course many of these borrowers will have decent pensions & plenty of housing equity, but many won't.

do others think that liabilities are properly reflected in the chart?

either that or, and added without comment here because i'm trying to be generous, they've included the value of [say] 20 year's worth of state pension on top of everyone's total?

or might that be a chart for, say, 60+ year olds only?

the_flying_pig

"The bottom 50% of households in Britain have just £4,400 of cash, property and pensions compared to the £1.2m held by the top 10%, according to an Office for National Statistics report which lays bare the vast disparities in wealth across the UK."

i've not, of course, sat down & researched/thought about the differences in methodology step by step, but, still, more reason to at least question imo since this £4.4k figure is a good bit lower than the "bottom decile" number in the earlier chart.

HAMISH_MCTAVISH

BarleyGB wrote: »

I cant fathom this graph, it just doesn't seem right to me, 50% of households have a wealth (thus assuming net equity) > £232k?

Graph is from an article in the Telegraph, based on research at London School of Economics that appears to further analyse ONS data, article is here.....

http://www.telegraph.co.uk/finance/personalfinance/10073033/One-in-ten-UK-households-are-asset-millionaires.html

the_flying_pig wrote: »

"The bottom 50% of households in Britain have just £4,400 of cash, property and pensions compared to the £1.2m held by the top 10%, according to an Office for National Statistics report which lays bare the vast disparities in wealth across the UK."

i've not, of course, sat down & researched/thought about the differences in methodology step by step, but, still, more reason to at least question imo since this £4.4k figure is a good bit lower than the "bottom decile" number in the earlier chart.

The Guardian article you link to references ONS data available here....

http://www.ons.gov.uk/ons/dcp171776_289407.pdf

..... Which shows median household wealth is £232,000.

michaels

If the median is 232k and yet the mean of all those below the median is 4.4k then there must be some extremely negative people in that bottom 1%

SingleSue

I over estimated by 1%....

the_flying_pig

michaels wrote: »

If the median is 232k and yet the mean of all those below the median is 4.4k then there must be some extremely negative people in that bottom 1%

i quickly flipped through the source pdf to try & work out where the £4.4k came from.

basically it seems to be have been calculated as follows:

it's the median of the bottom half, i.e. representing, i suppose, the person at the very top of the bottom quartile/bottom of the second quartile and unlike the LSE chart excludes 'physical wealth' like cars, furniture, and stuff.

£4.4k is the sum of:

total property wealth - zero... this looks very suspicious to me, that it'd come out as exactly 0.000, rather than say -£13 or +£2073 or whatever, or even if it's rounded -£2k or +£1k, makes me dubious that mortgage debt has been properly [if at] all included.

pensions - £4k.
bank accounts etc - £400.

what the gruan number excludes, but the LSE chart would include, is the cars & stuff [see above], apparently these are worth about £18k, which sounds an awful lot to me, closer to replacement cost rather than market value for a house full of secondhand stuff?

michaels

the_flying_pig wrote: »

i quickly flipped through the source pdf to try & work out where the £4.4k came from.

basically it seems to be have been calculated as follows:

it's the median of the bottom half, i.e. representing, i suppose, the person at the very top of the bottom quartile/bottom of the second quartile and unlike the LSE chart excludes 'physical wealth' like cars, furniture, and stuff.

£4.4k is the sum of:

total property wealth - zero... this looks very suspicious to me, that it'd come out as exactly 0.000, rather than say -£13 or +£2073 or whatever, or even if it's rounded -£2k or +£1k, makes me dubious that mortgage debt has been properly [if at] all included.

pensions - £4k.
bank accounts etc - £400.

what the gruan number excludes, but the LSE chart would include, is the cars & stuff [see above], apparently these are worth about £18k, which sounds an awful lot to me, closer to replacement cost rather than market value for a house full of secondhand stuff?

And yet on the chart above it says '10% of households have wealth of less than 12.6k' so is it something to do with households cf individuals?

Nikkster

This programme is on Ch4 at the moment...