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northwestsmith2

Is Working Worth It?

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In the interest of science I did some research into income and housing benefit. It's all very complex based on where you live and savings etc so I created a single person over 25 who works full time , 40 hours a week and earns £400 a week before tax, it's more complex adding partners and children or other dependents but you get more cash each week.

He/she is entitled to a single room and in this south east area, £161.78 a week in housing benefit which is the lowest rent available. They have no savings or other income.

Income before tax + £400

Tax -£51.25

NI -£31.32

Rent , single one bed flat in bad part of town -£150pw

Council tax after 25% single person discount -£13.46pw

Total Income after these costs, £153.97 or £3.84ph

Job seekers allowance +£67.50

Tax 0

NI 0

Housing benefit +£161.87pw

Council tax benefit +£13.46pw

Total income +£67.50 pw

Now change the job to under 16 hours earning £6.25ph or £100pw before tax

Tax 0

NI 0

Housing benefit +£161.87pw

Council tax benefit +£13.46pw

Total income +£100.00pw

40 hours work = £153.97

16 hours work = £100.00

0 hours work =£67.50

It's not really worth working 40 hours a week for £86 extra than Job seekers, or to work 3 more days and earn £53.97.

Better to work not at all and this is the worst case scenario in terms of benefits, a single person over 25 with no dependents.

Edit: Working tax credit stops at £13,000 pa/£250pw of gross income and requires 30 hours of work to qualify so doesn't apply

in this case.

Edited by northwestsmith2

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From January 2012, under 35s only get housing benefit to cover a room in a shared house not a 1 bed flat housing benefit rate.

Edited by rented

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No but if you are ill-equipped for gaming the system you carry on regardless, slowly losing faith in the belief that you're doing the right thing and sooner or later the earth will resume spinning on the same axis as you are.

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You also have to add in factors like opportunity lost and stress.

For example it might be more profitable to emply a hacker to break into a gangster's email account. You then read his secrets and blackmail him.

Much more profitable. Or how about pimping? Employ some geek to set up a high class escort website servicing bankstaz. Make sure the girls have cameras in their handbag to take photos for blackmailing the punter later.

Alternatively, invade a peaceful country, declare yourself king, carve up the land among you ands your mates. Do a stock take of your new possesions and call it the Dooms-Day Book, or something like that.

That last one, is plain ridiculous. I mean, we wouldn't stand for that if someone tried it here would we?

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You also have to add in factors like opportunity lost and stress.

For example it might be more profitable to emply a hacker to break into a gangster's email account. You then read his secrets and blackmail him.

Much more profitable. Or how about pimping? Employ some geek to set up a high class escort website servicing bankstaz. Make sure the girls have cameras in their handbag to take photos for blackmailing the punter later.

Alternatively, invade a peaceful country, declare yourself king, carve up the land among you ands your mates. Do a stock take of your new possesions and call it the Dooms-Day Book, or something like that.

That last one, is plain ridiculous. I mean, we wouldn't stand for that if someone tried it here would we?

How about push on with your career and salary progression so you earn far more than you could on benefits?

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How about push on with your career and salary progression so you earn far more than you could on benefits?

career/salary progression hasn't been an option in many areas of work in this country for the last decade, but fair point for it's good intention

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In the interest of science I did some research into income and housing benefit. It's all very complex based on where you live and savings etc so I created a single person over 25 who works full time , 40 hours a week and earns £400 a week before tax, it's more complex adding partners and children or other dependents but you get more cash each week.

He/she is entitled to a single room and in this south east area, £161.78 a week in housing benefit which is the lowest rent available. They have no savings or other income.

Income before tax + £400

Tax -£51.25

NI -£31.32

Rent , single one bed flat in bad part of town -£150pw

Council tax after 25% single person discount -£13.46pw

Total Income after these costs, £153.97 or £3.84ph

You omitted +£51.87 Working Tax Credit, so total income after tax and housing costs is £205.84. That makes for a rather better comparison -- your example more than triples his or her disposable income compared with benefits by working full-time. Working Tax Credit is specifically designed to make working worthwhile, so it's a pretty serious omission when you're checking if working is worthwhile.

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I guess most working poor do so because of the protestant work ethic - they'd feel bad scrounging.

However, I have no idea why people imprison themselves in a Maccy D's or supermarket all week for b'all money - you could easily beat the meagre wage, say, cyberpeddling on eBay and spend most of your time chilling out.

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career/salary progression hasn't been an option in many areas of work in this country for the last decade, but fair point for it's good intention

Yes you're right unfortunately, but at least if you stay in the game work-wise there is the prospect of things improving.

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For many, choosing to live off the welfare state is actually a smart move at the moment. However, that is unlikely to remain the case in the future as sooner or later (probably sooner) it will no longer be possible to sustain it.

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You omitted +£51.87 Working Tax Credit, so total income after tax and housing costs is £205.84. That makes for a rather better comparison -- your example more than triples his or her disposable income compared with benefits by working full-time. Working Tax Credit is specifically designed to make working worthwhile, so it's a pretty serious omission when you're checking if working is worthwhile.

£13,000 is the cutoff for tax credit and you need to work 30 hours or more so the first example £400pw / £21Kpa is too much and the second is too few hours.

Although I'll admit the entire system is hideously complicated for what it is.

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/TaxCredits/peoplewhohelpothers/Entitlementtablesfortaxcredits/DG_174877

Edited by northwestsmith2

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Yes you're right unfortunately, but at least if you stay in the game work-wise there is the prospect of things improving.

you are a true and honest man, good post, warmed my heart

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career/salary progression hasn't been an option in many areas of work in this country for the last decade, but fair point for it's good intention

+1, I design integrated circuits and get paid the same as a bl00dy bus driver!

Is it worth it? Probably not. I don't want to hear it, lalalala *fingers in ears*.

My sister got knocked up and now has a 2-bedder close to home. A relative of my girlfriend just got a 1-bedder over in Fife. They don't do much all day. MAYBE it's better off if you claim homelessness... then if you're good with IT do that o the side or something. Honestly in that 1-bed flat today I thought 'f*** this, I work way more than 40 hours a week for a bus driver's salary and all the stress, what's the point when I could be getting free accommodation'?

I can only hope that as time passes, these ridiculous hand-outs will end, and I will work my way up to more money.

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plus smarter cloths, shoes etc, lack of time to search out bargains, BOGOF offers, cheapest Tetley t-bags (currently half price at Sainsbury), buying lunch from Pret a Manger or similar. It costs a lot of money to go to work.

Definitely *cries* lol.. Travel costs must be the biggy.

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+1, I design integrated circuits and get paid the same as a bl00dy bus driver!

Does that make you smart or dumb?

I suggest you drive a bus! You didn't need to accept that job, if it's more demanding than the money is worth to you and you're not in it for a future payout that will make it worthwhile, don't do it.

Employers will pay naff all for technically demanding jobs for as long as people take them.

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Does that make you smart or dumb?

I suggest you drive a bus! You didn't need to accept that job, if it's more demanding than the money is worth to you and you're not in it for a future payout that will make it worthwhile, don't do it.

Employers will pay naff all for technically demanding jobs for as long as people take them.

Well, of course I'm not going to quit! I'm hoping to work my way up somewhat - but for being 4-5 years into the profession, it's a bit damning. Engineers are bad at asking for payrises, granted - shocking, in fact. I'm going to ask next review, I'm effectively single with few ties so my trump card (which I'll likely follow through with) will be to move to another country that does pay more.

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@guitarman001

I am an embedded software engineer so probably get close to what you get.

I would just like to point out that if housing wasn't so expensive then benefits would be less and it would look like you are on a good wage.

However this is not the case and unfortunately I can't see it changing.

That is why I an Fing off to Republic of Ireland next year, leaving behind the student debt and buying a cheap property. IMO that is the smartest thing you can do if you are under 35.

The UK is not looking good long term for many reasons including housing and demographics. Ireland is riddled with debt and I expect them to default and then a strong recovery. They UK's long term outlook is grim to say the least.

I may move back after 10 years, however I will not be waiting here as it is just not moving quick enough.

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@guitarman001

I am an embedded software engineer so probably get close to what you get.

I would just like to point out that if housing wasn't so expensive then benefits would be less and it would look like you are on a good wage.

However this is not the case and unfortunately I can't see it changing.

That is why I an Fing off to Republic of Ireland next year, leaving behind the student debt and buying a cheap property. IMO that is the smartest thing you can do if you are under 35.

The UK is not looking good long term for many reasons including housing and demographics. Ireland is riddled with debt and I expect them to default and then a strong recovery. They UK's long term outlook is grim to say the least.

I may move back after 10 years, however I will not be waiting here as it is just not moving quick enough.

It's not even that - look at some other easier jobs that pay the same if not more. But yes, in general I get you.. The sucker that I am, I am paying off my £15k debt... :o

I have to wait another year at the least (UGH) but I still plan on moving to Munich or Villach. It will likely be expensive but at least I'll be getting market rate (right now on £30k after 4 years, moved very little from starting position...) and learning a new language, life experience etc. Can't say I'm getting much 'life experience' in the UK. The U.S. would be awesome for salary but AWFUL for holidays. I was reading a book on Germany which said how their weekends are sancrosanct, no work on weekends etc lol.. hope so. Might have to pop onto toytown and ask about that.

Do you have a job lined up, or are you waiting until next year? I haven't looked at property over there. I know Analog Devices are in Ireland, maybe I should check for interest. Not fancy the U.S. yourself?

Edited by guitarman001

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The U.S. would be awesome for salary but AWFUL for holidays.

Look carefully at the terms when comparing jobs in other countries; my official vacation time is less in Canada than the UK, but in the UK I was expected to do unpaid overtime whereas here when I work overtime I have a choice of pay or time in lieu. As a result I have about five weeks of extra vacation accumulated from overtime over the last couple of years and when I go on call for the current project it counts as an extra four days overtime a month so I could take three months off every year.

Wow, I hadn't even realised that myself until now :).

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No job lined up as of yet, however we have some savings and are planning to buy a small cottage with 1 to 2 acres like this:

http://www.daft.ie/searchsale.daft?id=565757

for around £50k to £70k (with a small unsecured loan). I have a website which gives me 12k per year so we can live off of that for a while + I plan on doing some software contracting for 6 months per year.

The missus wants to run a cattery on the land. We can generally turn our hand to anything to get by in the short term.

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I can only hope that as time passes, these ridiculous hand-outs will end, and I will work my way up to more money.

They will, and hopefully you will!

We shouldn't be turfing single mums onto the street, but we also shouldn't be encouraging women to get pregnant by giving them such a benefits boost if they do.

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£13,000 is the cutoff for tax credit and you need to work 30 hours or more so the first example £400pw / £21Kpa is too much and the second is too few hours.

Although I'll admit the entire system is hideously complicated for what it is.

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/TaxCredits/peoplewhohelpothers/Entitlementtablesfortaxcredits/DG_174877

I'm going by the government's own Benefits Advisor here: https://www.dwpe-services.direct.gov.uk/en/benefitsadviser

That's where my figure came from, after entering the details used in the example. Try it yourself.

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  • 296 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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