How can someone be a top earner and still feel poor? It defies logic and can seem like a slap in the face to millions of people who earn less. And yet sentences like “running out of money mid-month” or “cutting back” seem to be what many six-figure earners quietly whisper among themselves.

An astonishing nine in ten people earning between £100,000 and £125,000 do not consider themselves rich, according to the Times Wealth Survey. And of those earning more than the additional rate tax threshold of £125,000, only one in five feel wealthy.

But rather than tearing into Britain’s top earners — labelling them financial illiterates/idiots who are spending way too much on Waitrose deliveries, Chelsea tractors or nannies — we need to ask; how the hell did we get to this point?

We have a big problem and it’s not with higher earners.

It’s with our tax system and its cliff edges. It’s with inflation. And above all — it’s with a housing market that is so unaffordable that many people are no longer even able to get on the first rung.

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Tax has become a real issue — especially if you earn just above one of the thresholds. The paradox is that making just above £100,000 puts you in line for a huge tax bill that could mean you are worse off than someone earning just below that. And you get no sympathy.

Anyone earning more than £100,000 a year after pension contributions (their “adjusted net income”) starts to lose their tax-free personal allowance of £12,570, at a rate of £1 for every £2 of earnings. It means that those earning between £100,000 and £125,140 face a marginal tax rate of 60 per cent.

Parents also lose out on free childcare help from the government. Once your taxable income reaches £100,000 you don’t get your 30 hours of free childcare but 15 hours instead. You also lose the ability to claim tax-free childcare, which is worth up to £2,000 a year.

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This issue has been exacerbated by the fact that tax thresholds have been frozen, meaning millions more people have been forced to pay more tax.

The personal allowance, the amount you can earn a year before paying income tax, has been £12,570 since 2021. If it had increased with inflation it would be over £15,500 today, according to the Institute for Fiscal Studies, a think tank.

The higher-rate threshold, the point at which you start paying 40 per cent tax on earnings above the limit, has been £50,270 since 2021. It would be over £62,000 today if it had been linked to inflation.

The latest figures from HM Revenue & Customs show that the tax take for April to September was £438.6 billion — £32.1 billion more than at that point last year.

Rising prices are also hurting households, even those with bigger wallets. We cannot forget that every time inflation surges, the value of our money falls. Inflation has remained stubbornly high — the consumer prices index measure has been at 3.8 per cent since July, nearly twice the Bank of England’s 2 per cent target.

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Even when inflation slows, it doesn’t mean that prices are falling — they are just rising less quickly. While higher earners might have more disposable income, they’re also likely to spend more, so will feel the effects of inflation more acutely.

The worst problem we have, though, is the housing market. Property prices have continued to inflate like body builders on steroids and we can’t keep up.

In 2000, the median average home in England cost £78,500 — 4.2 times the median average earnings of a full-time employee (£19,000), according to the Office for National Statistics. In 2024, the median house price was £290,000 — 7.7 times average earnings (£37,600).

Higher earners are more likely to have bigger houses and bigger mortgages. This was all well and good when mortgage rates were at an all-time low but now it’s a different story. You might be a high earner taking home £5,000 after tax but if you have monthly mortgage repayments of £3,000 you’re all of a sudden not so flush.

The truth is that high income is often consumed by taxes, rising prices and housing, leaving little chance of someone feeling wealthy. And next week’s budget, with its highly anticipated tax raid, could make life even less rewarding for higher earners.

Hearing six-figure earners complaining about their finances might be jarring, but if earning that kind of salary is not enough to feel wealthy, we all have a problem. Only time will tell how it will damage aspirations — and so the economy as a whole.