Income is something we don’t really talk about publicly in the UK. It’s hard to really understand where we stand compared to the rest of the country with our own income. When we think of “The Top 10%” we probably start thinking about Lamborghinis, Private Jets and Mega Mansions however you may be shocked to learn that you have none of those things, yet are still in the Top 10%.
In this article, we will look at how much you need to make to be in the Top 10% in 2023. We’ll also take a look at some of the career paths you can go down to enter this 10% bracket. Let’s jump in.
How Much Do The Top 10% Of Earners Make In The UK?
According to the latest data from HMRC, the top 10% of earners make an annual personal income of over £59,200 in the UK. This is roughly 2x the median UK income of £33,280 per year.
This is pre-tax income which is made up of multiple income sources such as salary, dividends, interest and more. We all know that we don’t get to keep everything we make. The tax man always gets his cut.
There’s no doubt this is a great income but it’s not necessarily an income you can live a lavish life on. Especially, if you’re a family with two or more children. It’s certainly enough to live a comfortable life but you likely won’t be driving a Ferrari and flying a private jet anytime soon.
What Is £59,200 After Tax?
On a £59,200 income, you will be paying in the higher rate tax band. You would get your tax-free allowance of £12,570, then pay 20% tax from £12,571 to £50,270 and finally pay 40% tax on the additional £8,930.
You will also have to pay National insurance. Here’s how it all breaks down:
On a £59,200 salary, you will pay £11,112 in Income Tax and £5,642 in National Insurance leaving you with a take-home pay of £42,446 per year. Not quite what people think of when they think about the “Top 10%”.
How Much Do The Top 1% Make
The top 1% of earners make significantly more than the 10th percentile. To enter the Top 1% you need a whopping £183k of pre-tax income or £121,000 of post-tax income. There’s a significant difference between someone in the top 1% of earners and the top 10%. These are two completely different levels of earnings.
How To Become A Top 10% Earner In The UK
Reaching the top 10% of earners in the UK requires a combination of education, skill acquisition, and making strategic career decisions. The starting point is leaving school. You either want to land a job right out of school that has a great career development path or go to university and study a STEM subject.
Throughout your career, you will have to continually pursue education and stay on top of market trends. Networking and having a good personal brand are great ways to expedite your road to a job that pays a top 10% income.
Some careers that give you the ability to earn over £59,200 per year are:
- Medicine: Consultants, surgeons, and specialists often have high earning potential.
- Law: Partners in law firms, especially those in commercial law and financial services, can earn substantial amounts.
- Finance and Banking: Investment bankers, hedge fund managers, and high-ranking positions in finance can offer significant salaries.
- IT and Technology: With the tech industry booming, roles like IT consultants, software engineers, and data scientists are increasingly lucrative.
- Entrepreneurship: Starting a successful business can lead to substantial earnings, although it comes with its risks.
- Real Estate: Successful property developers or high-end estate agents can earn considerable sums.
- Entertainment and Sports: Although competitive, successful entertainers, artists, and athletes can achieve top-tier earnings.
Ultimately if you work hard and focus on your career, anyone should be able to reach this level of income.
Final Thoughts
If you are trying to reach the Top 10% of earners in the UK it is definitely not out of reach. You will need to make over £59,200 per year pre-tax. Generally, if you follow a STEM program at University and get into a good job you can work your way up to middle management and earn this type of money.
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