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The magic disappearing act...;Personal Finance

After paying their mortgage and council tax bills Rhona McLaughlin and her partner have less than pound;200 a month to spend on food, household bills and other essentials.

"What gets us is that we both earn what is really a reasonable amount of money but every month it's all accounted for and there's very little left over," says Rhona, who qualified as a mature student two years ago and now teaches at a grant-maintained school in Streatham, south London.

Things were not quite so tough when she was renting a flat. But with London house prices going through the roof, she and her partner did not want to wait too long before getting on to the property-owning ladder, so a year ago they bought a house for pound;78,000. They could only afford the repayments on their 95 per cent mortgage because Rhona has no travelling expenses asthe house is within walking distanceof her school.

Chris Tabron, who heads the geography department at the same school, has a more difficult journey to work. He lives in Kingston, west London, and has just bought a car because he has to take a lot of work home and could not carry it all on the train.

The pound;100 a month he pays for the car, on top of the repayments on the 100 per cent mortgage he took out last year to buy a pound;60,000 one-bedroom flat, leaves him and his fiancee with little spare cash at the end of each month.

Originally from Liverpool where he has friends who are also teachers, Chris says he would need an extra pound;1,000 to pound;1,500 a year to enjoy a standard of living similar to theirs.

"Their wages are a couple of thousand pounds less but the houses they can afford and their living standards are a lot better than mine," he says. "The journey to work is also easier there, but the promotion opportunities are not as good as in London."

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