Earning a six-figure salary once signified financial success, but due to tax traps and inflation, £100,000 has become the threshold for 'struggling' in London. For decades, that salary was the ultimate psychological milestone of professional success, offering a gateway to a detached house, a fancy car, private school, and multiple foreign holidays a year. However, as three financial experts point out, that dream may be over.
New Benchmarks for a High Salary
Freddie Winter of Gratitude Financial Planning told Metro: 'I work with a lot of professionals in typical high-earning careers earning over that threshold, and the overriding feeling is “it shouldn’t be this hard”. £100,000 is no longer considered a high salary. People may be getting their tiny violins out, but the fact is that in today’s economy, earning £100,000 annually is no longer enough to be considered a high-paid job.' He points to inflation, frozen income tax thresholds, and high property prices as reasons why his clients are struggling to get on the housing ladder in London. To reflect this, he proposes a new metric: a high salary should be four times the national average. Based on the latest Office for National Statistics data, that would work out at £154,128 nationwide, while in London the figure rises to £187,200.
What Top Earners Actually Make
Chartered accountant Abigail Foster places the threshold slightly lower, between £75,000 and £100,000. She notes that while the ONS figures show a median monthly salary of £2,588, earning over £80,000 puts a worker in the top 10% of UK earners. She said: 'I talk a lot about HENRYs, High Earners Not Rich Yet. These are professionals on big salaries who still feel financially stretched because of housing costs, childcare, student loans and lifestyle inflation, particularly in London and the South East.'
Average UK Earnings
According to the ONS, the average median monthly salary as of January 2026 is £2,588, which works out as £30,696 per year before tax. For those paid weekly, the average is currently £735 per week, which is £38,532 per annum without deductions. In comparison, for the nation’s top earners, the median annual pay was as much as £4.58 million for the 2024/2025 financial year.
The Tax Trap
Abigail also warned of a 'tax reality' that catches many people off guard. 'For every £2 you earn over £100,000, you lose £1 of your tax-free allowance. That creates an effective 60% marginal tax rate between £100,000 and £125,140. It catches people out all the time. But feeling wealthy depends far more on your costs, location, and whether you’re building assets, not just earning income.'
Redefining Wealth
Financial specialist Vivian Tu, founder of Your Rich BFF, thinks earning £75,000 used to be the 'gold standard', but it has lost its status. Instead of focusing on a specific figure, she has an alternative way of looking at wealth. Vivian, author of Well Endowed: The Secrets to Strategic Spending, told Metro: 'These days, I’d say a high salary varies based on where you live and frankly, isn’t necessarily a number, but rather how many of your “buckets” you can fill. Does your income allow you to cover all of your basic necessities? Does it provide you with a discretionary spending budget that helps you feel like you are thriving or just surviving? Does it allow you to protect your future by saving for emergencies, paying down your debts, and maxing out all of your retirement investments?' If you can do all of this, then you are successfully making money and living a life you should be proud of.
