If you live in the UK, you probably wonder what net worth is considered rich. But you may not know what it is – in the UK, the average household net worth is just PS172,000. A net worth of GBP 2 million won’t get you very far in the big city. A recent study by Credit Suisse shows that there are 2.27 million people with net worths between USD1 million and USD5 million, or GBP0.74 million and GBP3.7 million.
According to the survey, the average UK net worth is PS172,000. The UK population has seen a wealth boom over the last few decades, with total wealth estimated to be PS12.8 trillion, or seven times the country’s annual GDP. However, there are still a lot of people without much to show for their wealth. While average UK net worth is rising, the median net worth is dwindling. This is because more people are becoming bankrupt, having little or no savings.
The income level required to be considered rich in the UK is PS60,500. This figure is dependent on the income of the top 10% of the UK population. Therefore, if you earn this amount, you’ll be ranked among the wealthiest 10% of the population. But it’s not impossible to reach PS60,500, or even PS1,500! That’s more than enough to make you feel comfortable in the UK.
Wealth is distributed unevenly in the UK, with the richest 1% holding nearly half of the total. Those in the top 10% held mainly private pensions and property. The South East, in particular, is comparatively richer than the North, with the median individual wealth being PS157,000 higher than that of the North East. This regional disparity has grown in the past 14 years. Individual wealth increases with age, with the wealth of those aged sixty-four years and above nine times greater than that of people aged thirty-four to four.
In the UK, the top ten percent of income earners earn an average of PS60,500. With a salary between PS2,000 and PS3,000 a month, renting a modest two-bedroom flat, eating out and taking weekend breaks will be affordable. The question of what net worth a person in the UK has to do with whether they’re really rich or poor depends on how much money they earn.
While the UK’s average income is just PS17,600, this doesn’t necessarily mean that they’re rich. A house worth PS17,600 won’t pay for your mortgage or council tax, and that house can’t pay for your groceries, transport, and utilities – a house worth PS180,000 wouldn’t make you feel rich. But PS660k is the minimum net worth to join the top one percent of the richest people in the UK.
The question of what net worth is considered rich has become a controversial subject in the UK, as the definition of rich varies between people and countries. For instance, a person earning $100,000 might not be considered rich if they’re earning only $30,000. However, someone making $1 million may be considered rich because they can afford to buy more expensive items and live a more lavish lifestyle. But if he’s living paycheck to paycheck, he might as well be a college student.