How much money to “feel rich” in London?
I think for a nice flat in Hampstead/Marylebone/Chelsea etc. with a good lifestyle (good dinners, gym, clubs, trips etc.) you’d need to be on about £300k, assuming no kids?
Thoughts?
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£100k is like 5.5k net a month. you're telling me you can't live on that comfortably as a single person? You don't even spend anything during the week except for lunches
The question is what it takes to feel rich. If I put away half of £5.5k a month, I’m left with £2.25k for all living expenses and recreational , which of course is possible but you certainly won’t feel rich
you must be great with numbers...
If the only thing you buy is lunches you won't feel rich lol.
Having 0 money worries, after factoring in monthly savings/mortgage is the idea here.
I think 300k with kids is a good amount, assuming single could be shy of 200k?
In London? lol no, not even close
Back of the envelope calculation cos I'm curious. Also will caveat that I'm not from a wealthy background and may completely underestimate how much certain stuff costs but I'll have a go.
We're going to assume you've started being rich today (which matters for interest rates etc.). Also gonna be quite generous so this is a lower bound.
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Shelter:
£2-3m 2 bed flat/house. £400-600k deposit (20%). Therefore mortgage is £1.6-2.4m. 30Y term. 4% interest (oof). T
Mortgage payments = £7.6-£11.5k/month or £91.2k-138k per year. (Wow)
I'm going to assume freehold so no ground rent and assume no service charges...
To be accepted for a mortgage of this size, assuming broker uses income multiplier of 4.5, you'd need to make ~£350-530k per year.
Broker may or may not give full credit for bonus there. But let's assume they do.
Post-tax on that comp range (assume no student loan and 5% pension contribution):
£186-277k a year. Or £15.5-23k a month.
So after mortgage you're left with £7.9-11.5k.
side note - you may end up hitting £60k pension annual allowance if company has a good match so the 5% may not be necessary).
All other essentials (bills, groceries, council tax) - call it £1k a month.
Left with £6.9-10.5k.
Transport - obviously you're not riding the tube with plebs so you want your Chelsea tractor (Range rover) or Porsche 911 for getting around. Call that £2k a month (I really don't know here).
Left with £4.9-8.5k per month.
Holidays: 2k a month/24k a year on average.
Left with £2.9-6.5k
Other fun money: 1k a month.
Saving into ISA: 1.8k a month.
THen 1k-4k leftover for whatever else.
I'd say that feels pretty rich?
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TL;DR: £350-530k total comp.
Where would a 2 bed flat cost £2m-£3m?
You can get a fancy new build 2 bed for £1m in zone 1
In the areas OP mentioned. I simply put those boroughs into Rightmove.
helvetica.boldWhere would a 2 bed flat cost £2m-£3m?You can get a fancy new build 2 bed for £1m in zone 1
Yeah in some soulless shithole like Nine Elms or Stratford
I lol’d at the Chelsea tractor
2k a month on holidays wtf
You can move that 2k +1k =3k a month for holidays + other fun stuff around as you please.
Obviously it's not actually a monthly expense, just accrued monthly.
I think these numbers make total sense, you can all it £500K as a round figure. Before people freak out at this number, this total comp is also total household income. If both you an a Partner work, you only need £250K each which is doable by your late 20s if you're in finance (mainly IB -> PE) or mid-30s if you're in consulting. Even if you plan on having 1-2 kids in your early 30s, a household income of £500K is more than enough to live very well. You might have to rearrange some of the funds e.g., you aim to spend £15K on holidays and maybe don't spend more than £2M on a house to account for school fees etc.
I think going to east coast and west coast in the same trip is really tough. Flight from NYC to LA is like 5 hours and so expensive. Also not many flights to Europe from the west coast so will most likely have to come back to nyc or miami. SF is disgusting nothing to see if you ask me and no clubs everything closes so early. I would say add 2 cities in east coast and save your money and energy. LA you need a car to move around there so factor that additional cost.
NYC to LA is pretty cheap right now. $99 - $170 each way.
I don't know how much, but I am currently around GBP c. 110k - 120k and I feel a lot like middle class (share flat with 2 people, using tube, not going to expensive restaurants, not fancy hobbies...) and that is crazy because I am making much more than both my parents combined.
Surely you can afford to take high-end Ubers within central and have decent dinners (GBP 30-35) on the weekend with that salary though?
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