Income

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Run n Spread

Brownlow Medallist
Veteran 10k Posts
Apr 2, 2013
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Am more curious than anything what do people consider a high/low income in modern Australia and how do cost of living pressures/expenses factor into the equation? I'm not asking anyones personal income but rather what you rate as desirable.
Personally:

Under $20000pa You are fuc&* and in poverty
20-45k Doable if you keep expenses down but forget a house or family, relationship, kids etc. In essence you live day to day and enjoy life where you can but have no future at the current rate.
45-75K Lower middle class. As a single are fine probably enjoy a holiday now and then but a family/major investment will lead you back to poverty.
75-150K Have included a big gap here as this is middle class territory. Most here watch their spending/lifestyle but in Australia are suspceptible to COL pressure.
150-300K Comfortably middle class. Good property investment prospects if you watch your savings. Can afford a family/property if desirable.
300K+ Comfortably well off.
 
150K seems a bit high to be the bottom of "comfortably middle class" - any individual earning triple figures should be comfortably middle class unless you decide to support a non-working wife and more than 2 kids. Speaking of which, the income of a household is more relevant these days than individual incomes for most.
 

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You've essentially put the spectrum of middle class from 45k to 300k. At first I thought this was absurd but the more I think about it, the more I concede that it would represent the huge middle of the normal distribution.
 
Would love to know the OP's work/life situation and income for you to reach these conclusions.

I'm married with 2 kids, rent a 4 bedroom house, pay utilities, own 2 cars, have foxtel, internet and phone, footy membership etc and manage it all on under 50k a year with enough left over to save for expenses like holiday or future schooling.

My wife is a stay at home mum who gets a couple hundred a f/night in Family Tax benefits and that covers food and clothes as needed.

We know we wont own a home any time soon in this situation however we life very comfortably.

My wife plans on working part time once both kids are in school down the track so maybe some day we will live the 'Aussie Dream' but to think that people on 75k are under pressure from "Cost of Living" seems a rather far reach and I would seriously suggest they seek some sort of help to manage their budget.

LWP finance breakdown -

Income - $1500 per f/night

LESS
Rent - $700 per f/night
UTL - $100 per f/night
Petrol - $100 per f/night

Leaves - $600 per f/night

$600 × 26 f/nights = $15,600 per year ÷ 12 months = $1300 per month

$1300 per month

LESS
Footy Membership - $30
Internet - $50
Phone - $50
Foxtel - $80
Insurances - $120
Rego (both cars) - $120

= $850 per month × 12 months = $10,200 p.a. or about $200 a week left as 'savings'.

All figures are rounded up for easy balancing, and as mentioned my wife gets payments from Centrelink that cover our food.

We buy clothes from thrift shops or K-Mart to save.

We dont drink or smoke.

We enjoy junk food about once a week but otherwise eat mostly rice, potato or pasta based dishes with plenty of meat and veggies for dinner to fill our tummy's. Carbs are cheap hehe

We dont club, party or really do much on weekends that isnt family related.

Not saying people on higher incomes are doing anything wrong, just that it's a gross generalisation to think that a family under 75k are somehow living in poverty.
 
L_W_P said:
Would love to know the OP's work/life situation and income for you to reach these conclusions.

Not saying people on higher incomes are doing anything wrong, just that it's a gross generalisation to think that a family under 75k are somehow living in poverty.
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Fair enough but are you vulnerable to a price shock/sudden job loss/illness? I don't want to speak for anyone else but then again most people are. They were just my figures based on prices, assumptions, experience, observation and guess work.

It's all relative though. I heard someone speaking the other day who would be at least triple most incomes yet the list of expenses/debts he has he would risk bankrupcy if things turned pear shaped.
 
Trevelyan said:
You've essentially put the spectrum of middle class from 45k to 300k. At first I thought this was absurd but the more I think about it, the more I concede that it would represent the huge middle of the normal distribution.
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I have as the outliers at both ends to me represent the extremes. That is not to say people can do well/struggle in the middle depending on debt levels/stability of employment/ family situation etc.
 
Run n Spread said:
Fair enough but are you vulnerable to a price shock/sudden job loss/illness? I don't want to speak for anyone else but then again most people are. They were just my figures based on prices, assumptions, experience, observation and guess work.

It's all relative though. I heard someone speaking the other day who would be at least triple most incomes yet the list of expenses/debts he has he would risk bankrupcy if things turned pear shaped.
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Oh absolutely. If I was out of work for more than about 3 months we would be out on our arses. Thankfully my job, while low paid, is very secure.

On your second point; I heard a saying from a TL when I was in a sales job about 8 years ago, and it really stuck with me - "The more you earn, the more you spend and the more you need to earn again."
 
Family of 4 with a total income of about 56k per year. Like L_W_P, we manage okay but we both drink quite a lot. We don't have foxtel, have only one car and don't have insurance, so that's where we save the extra money (which we then drink).

I survived as a single parent of two on about half that amount for many years. I think people just tend to want to live beyond their means, so that's why a lot of people struggle on higher incomes. Mortgages they can't really afford, eating out too often, buying gadgets and TVs and other s**t they could really do without.
 
im a bit confused here, are we talking personal or household income?

because thats two dramatically different ballparks.

household income
poor is sub 40K
Lower class extends gradually from 40K-60K
while "true" middle class extends at most to 90K.

once you get beyond a household income of 90K your upper middle class, you're no longer in the struggle unless you're living beyond your means.
having been on both ends of spectrum it disgusts me when people on a good racket try to make out they are part of the struggling people.

once you reach 150K your well off.
its time to get real the average income as we all know is skewed upwards.
the average wage is 72K it indicates that even the skewed result shows that both parents working full time would be $144K.

there's a reason the median average wage is never talked about. hell the ABS doesn't even release it. 2011 was the last time it was released and found that the median wage for a full time worker was just $57.400 before tax. stop and have a think about that i haven't earnt that low an amount since what maybe 06-07?. now consider how actual full time work is evaporating, especially among people earning under 60K and take into account that the median wage for part time work in 2011 was $46,000 dollars.

have a read of this if you want a hard look at just how different life is for most aussies.

https://mattcowgill.wordpress.com/2013/05/13/what-is-the-typical-australians-income-in-2013/

even today i "only" earn 65K before bonuses and i work just 4 days week and i have plenty in investments and super, i've never once been so arrogant to count myself as a middle income earner, given the terms association of struggling and especially not when i was single earning 90K a year.

it has allowed me to own on house outright and invest in two more. in a time when most of the middle class will not even have the deposit for one house in a low income area until after they've found a partner live together and have saved for 5-6 years. most will then spend the next 25 years paying that debt off.

having a house in a good neighbourhood two cars and kids in private schools is not "middle class" going on overseas vacations every few years is not middle class and flying to watch the swans play in new zealand on a whim is not middle class.
 

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Sydney Bloods said:
im a bit confused here, are we talking personal or household income?

because thats two dramatically different ballparks.

household income
poor is sub 40K
Lower class extends gradually from 40K-60K
while "true" middle class extends at most to 90K.

once you get beyond a household income of 90K your upper middle class, you're no longer in the struggle unless you're living beyond your means.
having been on both ends of spectrum it disgusts me when people on a good racket try to make out they are part of the struggling people.

once you reach 150K your well off.
its time to get real the average income as we all know is skewed upwards.
the average wage is 72K it indicates that even the skewed result shows that both parents working full time would be $144K.
Click to expand...

Was more talking about wage earners and income but in essence household income comes into consideration as well in a defacto/marriage relationship where income is shared.

radiojake said:
$18,000 last financial year

oh yeah, baby.. come at me
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Come at you how? I was more looking to get an indication on what people as a rule considered high-low income. Don't really care what a person's income is personally. Up to individuals if they want to disclose (here and in general).
 
Run n Spread said:
Come at you how? I was more looking to get an indication on what people as a rule considered high-low income. Don't really care what a person's income is personally. Up to individuals if they want to disclose (here and in general).
Click to expand...


I was being silly -
obviously I'm single with no dependants so I can get away with it -

your breakdown is probably pretty close - Although it would be interesting to see the breakdown of expenses of those who consider themselves 'struggling', when in reality it would probably be living beyond their means...
 
Run n Spread said:
Was more talking about wage earners and income but in essence household income comes into consideration as well in a defacto/marriage relationship where income is shared.
Click to expand...

well if you're basing it individual income 75K is a higher income than 75% of all australian taxpayers.
i fail to see how you could call that middle class.
by the time you get to 105K you're in the top 10% of earners in australia.

a hate using this term but seriously some Mother *ers need to check their privilage. Earning more than 90% of the working population is nowhere near middle class.
 
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