Why it’s so hard to make it.

I feel like I complain too much here but after noticing people completely not realise this, I felt compelled to post here.

Many of us might be experiencing the 100k tax trap, at least the slightly older bunch like me. As someone who’s not in the NHS, I have some options but not a lot and like most people, making anything between 100k to 120k is more essentially only making 7k for the extra 20k you earn.

100k is pretty much the same as 60k in 2010. Yet you are paying tax as if it’s still got the same purchasing value. This is a sneaky thing called fiscal drag. It’s when the government doesn’t change the tax code to reflect the change in cost of living and overall inflation and by keeping it stationary is essentially taxing you more.

So not only are you just making the equivalent of £60k for every £100k, you’re also stuck in a tax trap that means you will simply never get ahead in life.

I honestly think you need to factor this in when it comes to pay and conditions. The left leaning lot will not want to talk about it.

Now there are ways that you can offset your tax and I offset approximately 30k in taxes, this isn’t pension, but it’s far too complicated I guess to get into.

My question is… why do we even have to do this in the first place. Some of the most productive people in our country are disincentivised to work hard, simply because we won’t reform taxes, so you end up making a reg salary as a consultant in real terms and because you don’t wanna lose childcare and basically work for free, you drop your sessions.

What a fantastic system.

Before anyone tells me about putting money in your pension, don’t forget the lifetime allowance and also, I would seriously have a look at what kind of reforms are coming into place with pensions before you put all your eggs in that basket.