Is £90k A Good Salary In The UK?

James Beattie By James Beattie 18 Min Read

If you land a £90k per year job you’re doing pretty well for yourself. However, you may be wondering just how well you’re doing.

In this article, we will explore the actual value of a £90k per year salary, assess its value based on your age and compare it with earnings in your local area. By examining these factors, we aim to provide a clearer perspective on how good a £90k salary is.

Quick Overview
Earning £90k per year puts you in the top 5% of earners in the UK, making it a rare position to be in. It will provide an amazing lifestyle no matter where you live and an even better one if you live outside of London. Even in London £90k is a great wage and can provide an amazing lifestyle in the city.

How Does £90k Compare To The Median UK Salary?

The median average salary for full-time workers in the UK is currently £33,280. Making £90k per year is a massive £57,720 more than it. It’s safe to say if you are earning £90k per you are well ahead of the average population.

Even in the most expensive city in the UK £90k can go a long way. You are earning well over double what the average Londoner earns.

Ultimately, earning £90k is an amazing salary no matter where you live. Even more so if you live outside of London or the South East. It will cover the living expenses of a large family and provide you with plenty of money for fun as well as investing if you live solo.

What is £90k After Tax In The UK?

If you’ve landed a £90k job you’re doing great, however, you won’t be bringing all of that money home. The government wants their cut and on a £90k salary, their cut is significant. Their cut comes in the form of Income Tax and National Insurance.

On a £90k per year salary, you will be in the higher rate tax band. This means you will get your tax-free allowance of £12,570, pay 20% on income up to £50,720, and finally pay 40% tax on the remaining £39,280.

Many people think if you enter into the higher rate you will pay 40% of all of your income. This is not true. You will only pay 40% on any income above the initial £50,270.

You will pay £23,432 in Income Tax and £6,643 in National Insurance.

This leaves you with a net take-home pay of £59,925 per year or £4,994 per month.

How a £90,000 salary is broken down

If you have student loan payments, they will also get taken out before your pay hits your account.

Is £90k A Good Salary For Your Age?

Looking at the average median salary for full-time workers across all age groups in the UK, we can see that £90k is well above the average in all ranges. The highest median average salary is £37,825 per year.

Earning £90k a year means you are pulling in more than double what the average person in their peak earning years earns. In comparison, you are way ahead of the average.

AgeMedian Average Yearly

Ultimately, at any age earning £90k per year is more than good. It’s enough money to live a lavish life in most places in the UK. It can even support a full family without your partner needing to work.

In London where the average cost of living is significantly more expensive, you will be able to afford a nice home, while enjoying life and saving for retirement.

Is £90k A Good Salary Where You Live?

Location plays a huge role in how far your salary will go. Living in a higher average salary area usually comes with a higher cost of living. For example, the average salary in the North East is £29,521 whereas the average salary in London is £41,866.

If you are earning £90k in a lower average salary region in the UK, your £90k is great by comparison.

Earning £90k in the North East is going to give you a much better lifestyle than earning £90k in London. Pound for pound, you are going to get a much better house in the North East vs London. Someone earning £90k in the North East also has the option to keep their expenses very low and invest heavily in their retirement.

Median-Average-Salary by region

Earning £90k outside of London means you’re on a very good salary. With this income, you can enjoy a great life, go on vacations, and save a significant amount for your retirement.

Can You Live In London On £90k Per Year?

With an annual income of £90k, you can comfortably afford to live in London. This amount surpasses the average Londoner’s earnings by £48,134. It enables you to secure a nice flat, indulge in occasional dining out and entertainment, all while responsibly setting aside 20% for retirement savings.

Average wages in London are about 30% higher than in the North East. However, London’s rent prices are roughly 300% higher. This drastically cuts the disposable income of many Londoners, compared to those living in other UK regions.

You should be comfortable on £90,000 per year in London and potentially be able to save more than the recommended 20% of your income if you get aggressive with your saving. We recommend living with a roommate to try and cut down on living costs.

Budget Template For £90k Salary

If you’re on a £90k per year salary, you’re in a really good position to build some serious wealth through investing and benefiting from compound interest. If you can keep your expenses fairly low and be diligent in following a budget, you should be able

Using a budget to track your spending is the best way to see where your money is going each month.

On a £90k per year salary, you are bringing home £4,994 per month after tax and national insurance. I have put together a rough budget template below to help you get started. However, everyone’s financial situation is different so you may need to make some adjustments.

We will follow the 50/30/20 rule. This means roughly 50% goes towards needs, 30% to living life, and 20% to savings/investing.

Monthly Net Income£4,994
Utilities & Insurance£350
Entertainment, Clothing etc£1544
Saving & Investing£1000
Monthly Budget For £90,000 Salary

If you want to get into more detail with your own personal budget, I would recommend checking out our Monthly Budgeting Google sheet.

50/30/20 Budget Planner - Google Sheets
  • Monthly Budget Overview
  • Custom Categories
  • Transaction Log
  • View Daily Spending Overview
  • Track Needs, Wants, Savings/Investments & Debts

Housing On A £90k Salary

Housing costs typically represent a significant portion of our expenses in life. With a £90k salary, you should be in a comfortable position to consider buying a house once you have saved up for the deposit.

If you’re young, I personally would adopt an aggressive savings approach to enter the property market. This may require temporarily reducing expenses on vacations and luxury items for a few years. However, the long-term benefits will be substantial. By saving £1200 per month, you can accumulate a deposit of £29k to £43k within 2-3 years.

When initially renting a property, it’s advisable not to aim for the largest and most expensive house within your budget. Remember that your first rental is temporary, so consider opting for a more affordable option. This allows you to allocate more funds towards savings and expedite the process of purchasing your own home.

How Much Should I Spend On Rent With A £90k Salary?

The rule of thumb for renting is that you should not spend any more than 30% of your income on rent. For example, on an £90,000 salary, you can aim to spend roughly £1500 to £1600 per month on rent.

However, if you live in a high-cost-of-living area such as London or the Southeast, you might need to stretch your housing budget slightly further. In other parts of the UK, you should be able to find a suitable house for around £1500 per month.

Another effective strategy is to consider finding a housemate or partner to share a house with. This way, you can half your rent and other housing expenses with them. You can then save aggressively towards investments or a deposit on your own property.

How Much Mortgage Can I Get On A £90k Salary?

Earning £90k annually in a stable job makes you eligible for a mortgage, providing an excellent opportunity to consider purchasing a house outside of London. If you are buying a property with a partner, your borrowing capacity will increase significantly compared to applying alone. To begin the process, it’s advisable to save up a deposit of 5% to 10%, with 10% being preferable if feasible.

Typically, mortgage lenders allow borrowers to borrow around 3.5x to 5x their pre-tax income.

With a yearly salary of £90k, you could potentially secure a mortgage of approximately £360,000. Assuming an interest rate of 6%, this would result in a monthly payment of £2,158 for a 30-year mortgage.

However, it’s important to note that this exceeds our recommended budget of £1500 per month. It’s essential to consider additional expenses associated with homeownership, such as insurance, council tax, and maintenance costs. If I were purchasing a house alone, I would aim for a mortgage of no more than £250,000, resulting in a monthly payment of £1,499 under the same terms.

On the other hand, if you have a partner with a full-time income, your household could comfortably manage a mortgage of £360,000, offering a more manageable monthly payment.

How To Become Financially Free On £90k Per Year

If you live outside of London, you should not be struggling to live on a £90,000 per year salary. If you are, you’re making some significant financial mistakes. Here are a few fundamental personal finance rules you should follow to become financially stable.

Create A Budget

Creating a budget is the first step to becoming financially free. Knowing where your money is going each month allows you to be intentional about when you spend money.

You can use the template we provided above, to start your budget. You will likely need to make some adjustments based on your own personal situation.

Get Out Of Debt

If you have any bad debts, your first priority should be paying them off. This might be credit card debt, car payments, personal loans, etc. With high-interest rates, these debts will make you struggle to ever get ahead financially.

Pay off these debts as fast as you can, starting with the highest interest first. Once you wipe out your debt you can start to focus on setting yourself up for financial success.

On £90k per year, you should be able to wipe out most debt quickly. If you have a car that has a £45,000 loan on it and you have no investments or emergency fund, it’s time to sell it and buy something more affordable.

Build An Emergency Fund

Once you have cleared your debts, it’s time to start securing your future. An emergency fund allows you to be prepared when things go wrong. If you get laid off at work or your car breaks down, you don’t have to stress. This money is specifically there to fix these problems.

You should aim to save 6 months of essential expenses. This is housing, food, and essential bills. For someone on a £90k salary, this is likely around £2450 per month. You should aim to save £14,700 in an emergency fund.

Keep this money in a high-interest savings account and only touch it for ACTUAL emergencies. Even if you lost your job you have plenty of time to find a new one, without having to stress out too much.

Avoid Lifestyle Inflation

You are earning a very large salary at £90k per year and it can be easy to fall into the trap of lifestyle inflation. This is when your expenses scale as fast as your income. You get a pay rise and instead of investing the extra money you buy a more expensive car.

This happens with a lot of people and it’s a sure-fire way to stay broke. If you spend everything you make you will never get wealthy. Try and practice delayed gratification. When you get a pay rise, invest the extra money and keep your current lifestyle until you are financially secure.

Start Investing

Once you have an emergency fund and have wiped out any bad debts, it’s time to start investing. You may already invest some money in a pension each month through a workplace pension scheme. If they offer a match, you should be maxing this out first.

You have a couple of options for investing. If you are planning to invest for retirement and don’t ever plan on touching the money until then, I would recommend investing in a SIPP (Self Invested Personal Pension) due to the tax relief benefits and government bonus.

I personally try to max out my stocks and shares ISA first as I like to have access to the money at any time, in case an opportunity comes up, such as buying rental property or investing back into my own business.

Either way, setting up one of these investment vehicles and investing in simple index funds is one the most popular ways to start investing.

Final Thoughts

£90k is a huge salary for any individual in the UK to earn. It puts you in the Top 5% of earners based on your Pre-tax income. Living outside of London on this salary should set you up for a great financial life. In London, £90k is more than enough to live an amazing life. Your expenses may be slightly higher but as long as you don’t fall into the trap of lifestyle inflation you should be good.

Moreover, this income is more than enough to support a family while also saving for retirement. If you have a partner, your combined earnings will enable you to enjoy a great life.

Learn how good other salaries in the UK are:

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I'm passionate about personal finance and making money. Currently trying to FIRE solely by building online assets. Grew my stock portfolio to £86,000 by 26.
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