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saving since 2005

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Posts posted by saving since 2005

  1. you seem pretty aggressive - just out of interest, do you earn £100k?

    i confess that i felt that i had 'made it' at £100k in London

    it really depends what you you want to do with the money - £2k on mortgage and bills etc leaves you £3k to spend on whatever nonsense you want is pretty relaxing

    You can only really afford a 1 bed in scruffy zone 2 area for 1.7k a month on mortgage payments!

  2. The online calculator uses 4% meaning if you earn an average wage then you just about pay back an average amount in 26 years.

    http://www.studentfinance.direct.gov.uk/scheme/dgv/pws/repayment-calculator.html

    Scratch that, looks like interest rate is based on earnings :confused:

    Interest is included in the calculation above:

    Retail Price

    Index (RPI)3.6%+ interest rate based

    on your salary

  3. Wow, no one ever seems to ever do the maths on this horrendous scheme.....

    Paying back 9% of income over 21K. Assume you start work at 21K, you would need 8% p.a. income growth to only just pay it off at 30 years.

    Excellent system, definitely not a tax on jobs Mr Clegg.:lol:

    The online calculator uses 4% meaning if you earn an average wage then you just about pay back an average amount in 26 years.

    http://www.studentfinance.direct.gov.uk/scheme/dgv/pws/repayment-calculator.html

  4. Most will never make enough to even start paying the loan through PAYE.

    But it's not defaulting if you never pay back the loan as student loans are not really like other loans. If I buy some massive tv from argos on credit they are not going to give me a loan where I only have to pay it back if I earn 50k a year.

    Anyway if you do a degree in something that skilled that is in demand then earning 21k + isn't out of the reach of many starting wages.

  5. Yes. But at a lower rate than on earned income (above the tax threshold). And it helps a lot with longer-term planning: smoothing over good and bad years, and potentially extracting money to retire on, tax-efficiently.

    You can also get quite a few things with untaxed money, if they're relevant to the business.

    Its all quite interesting, maybe I should of done that a few years ago when I was still into working in IT and living in London. I can't stand all day inside doing non rewarding work and lowering my health. I decided i'd rather be poor in money but do something rewarding and not spend all day thinking i'm wasting my time. I don't want my back and belly to be the same state as the vast majority of people that work in an office all day.

  6. I would agree with your statement, and depending on the exact industry and any specialist knowledge, could be higher (and of course also jobs paying less are around). Contractors are around double that and as other poster says, lacks job security and benefits. However to mitigate this, I know of some contractors who earn 140k+ (well their company does, thus validating your point) and hoard cash (100s of thousands) in their company accounts in order to build up a nice war chest in case of any lean periods so they can keep paying themselves their salaries (just below 40% tax threshold of course).

    (Though commenting on a previous post, personally I'd rather earn 100k as a contractor than 40k as a permie! unless the benefits bring it up to nearer 70/80k...)

    But don't you have to pay a tax on horded money? corporation tax?

    Else many people would just do a couple of years work then pay themselves 42.5k a year for the next decade or two.

    I still think you have to earn double the permie wage to make contracting worthwhile. Even more if you have to go live away from home during the week.

  7. Taking the field you mention you do under the spotlight, the obvious example, a software developer contractor in London can expect somewhere around £500-700 per day (depending on any specialities and industry). If you assume you work 220 days per year that should get you 110k-150k per year. Of course you'd have to pay your employers NI etc out of that and other overheads of running a company.

    In fact I know of people working in London who fly back and forth from Ireland and Northern Ireland each week. So it's actually 'commutable' thanks to Ryan Air/Easy Jet. But once you factor in the cost of somewhere to stay during the week, trains from the airport, parking and car at airport the other end, it does eat away at the gains. And of course if you're contracting you also are rewarded for a risk premium of your work not being very stable.

    I don't think its fair to compare a contractor wage to a permie. I would rather be on 40k a year, with regular holiday, paid bank holidays, training weeks, paid sick, paid charity days, more guarantee of work, a payoff if made redundant, employer pension contributions, employer paying NI bla bla than 100k contractor.

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