Peak Earnings, Rate Deflation

[thunderlizard]

True enough Bagpuss.

5 years ago (wow I've been on this forum for that long!) we were having the same moan, but the figures were more like £250 than £500, and even then we were doing as good as most and better than some.

[_V_]

I remember when £1000 / day or about £250,000 pa was a lot of money.

Them's were the days. Now all we get is a handful of hot gravel.....

[Colemanisor]

Hot gravel?

You don't know you're born!

All my gravel is cold...

Cold gravel, luxury! we used t'dream of Cold Gravel.

[donaldduke]

I'm sure that most, if not all of you here have heard of Peak Oil, i.e. the annual worldwide production of oil is going to peak shortly (or may indeed have done so already) and thereafter go into decline.

It occurred to me (whilst I was out gardening) that we, IT contractors, have experienced our own version of Peak Oil - Peak Earnings.

I was thinking about my current rate (for the sake of argument, call it £500), which has finally reached the same rate that I was on in 2000 during the boom times, and was feeling pretty happy.

But then it struck me, £500 7-8 years ago was a lot of money. It's still good money, but not the same. Even using a conservative (with a small c) estimate of inflation, it's about £750 in today's money. Using the inflation figure that most people actually experience (housing, insurance, everything bar ipods really) it's closer to a grand a day.

Then it finally dawned on me, it's unlikely I'll ever make that (inflation adjusted) rate again. I've had my peak earnings. Which is fine, only most people reach theirs at 65, not 25.

I completely agree. Infact i remember contractors earning 80K a year back in 1995. 80K back then would buy a house worth 360K today.

Not only inflation but taxes are also higher today than they were back then.

[RightLaugh]

a few of you need to live in the real world. Go for a holiday, sorry experience, to India. Then see how lucky you are. Even £300 p/d is good money.
What also matters is how much your outgoings are. Someone on 350 p/d without a mortgage and doesn't smoke is probably better off then someone on 500 p/d with a 400K mortgage on a 380K flat smoking 20 a day.

[King Cnvt]

a few of you need to live in the real world. Go for a holiday, sorry experience, to India. Then see how lucky you are. Even £300 p/d is good money.
What also matters is how much your outgoings are. Someone on 350 p/d without a mortgage and doesn't smoke is probably better off then someone on 500 p/d with a 400K mortgage on a 380K flat smoking 20 a day.

Or go for a holiday in Dubai/Monaco and see how unlucky you are in the real world.

[chicane]

Even £300 p/d is good money.

It's more than good money. At that level of income (assuming it's sustainable in the long term), you're in the region of 3 times national average income, and probably 7-8 times the income of the lowest earning households that don't live off benefits.

Those contractors willing to live a relatively frugal lifestyle could easily look at retirement by the age of 45-50 on that kind of money.

[Devlin]

We definitely need to keep a bit of perspective, most of us are making excellent money and hardly paying much more than corporation tax on our income!

[King Cnvt]

Sounds like a load of Socialist guilt.

You are not "lucky" anymore than some doctor/dentist/lawyer/tax advisor/corgi gas fitter/city type pulling in £100+/hr is "lucky".

I'm sure there are plenty of New Labour donors pulling in 100x that who pay no tax through domicile tricks.

[Bagpuss]

How apt your name is! perhaps "lack of social skills" would be better though?