If you are middle class (<150k HHI), how would things be different if you were rich (>400k HHI)

[Anonymous]

I'm intentionally excluding the group in 150-400k here because I think that's the area where people often don't "feel" rich (at least in the DMV), but are definitely not truly middle class in that they have privileges and advantages from their income that middle class folks don't have).

But if you are under 150k HHI in this area (specifically if you have kids at all, even one) money is going to be somewhat to very tight because of housing costs. And if you are over 400k, you may not be able to stop working or be set for life, but you can pretty much live wherever you want.

Just curious how people conceptualize that SES gap at this point, particularly in the DMV.

[Anonymous]

I don’t conceptualize it because it doesn’t apply to me, since I make what I make. What an odd question.

[Anonymous]

Anonymous wrote:I don’t conceptualize it because it doesn’t apply to me, since I make what I make. What an odd question.

If it doesn't apply to you, why answer at all?

We are under 150k HHI (one kid, live in DC), and I think the three biggest difference overall would be just less stress. But it would come in two forms. The bigger one would be less stress about the long term future, just worrying less about retirement, and being able to pay for or help our kid with college or getting started in life. Right now that's just a constant underlying stress and the biggest motivator for me to increase my income.

But at 400k we'd also have more freedom to reduce day to day stress which would be nice. We cook 95% of our meals at home, we don't have house cleaners, we don't get our car detailed, we do most of our home maintenance and upkeep ourselves, we have to be frugal about child-care, etc. We do all that because we are serious about saving and at our income we really have to pay attention to where our money goes. It would be nice to have a bit more leeway to just order in two nights in a row because we feel like it, or get a sitter for every Saturday night, or have someone come clean the house every month or so. Just things that would take the load off and make it easier to relax and enjoy our home and our time together. Though I'm also guessing many jobs that would pay enough to put us in that bracket would also inhibit relaxation and enjoyment to some degree. So it would depend a bit on the tradeoff there.

I honestly don't even know if we'd move or buy a nicer car or anything. We have a small family and a small house and a practical car, and it works for us. We'd probably take slightly nicer vacations, but it's not like suddenly we'd be flying first class or staying at luxury resorts, because that's a good way to just piss away all your money and while those things sound lovely, I'd much rather have a solid savings and be able to pay for college anywhere our kid gets in, then experience super high end air travel or eat at obscenely expensive restaurants.

[Anonymous]

It makes an enormous difference. It means you don’t feel stressed about paying for kids camp, travel, repairs in your house or car, orthodontia, etc. The list of affordable amenities at 400k that aren’t affordable at $150k goes on and on.

Funny enough, I don’t feel any happier moving from $150k to $400k over the last few years. But objectively life is so much less stressful and easier.

[Anonymous]

That is not middle class and you are very comfortable. We make under that and are comfortable. Save for college and retirement. Pay cash for cars. Housing is a huge part of it and lifestyle choices.

[Anonymous]

I have made this jump in the last few years w kids and the biggest difference I can confirm is free time and stress. Now that we bank $430k/year, I’ve outsource almost everything: house cleaning, laundry, yard work, and often we order dinner if we’re burnt out from the day. I also sign up my son for things sort of on whims. We found a cool tumbling class the other day and I signed up on the spot for $300 for the winter season.

[Anonymous]

That’s all the govt (not gs-14/15) and military with a SAHM. Lots of them living farther out.

[Anonymous]

Anonymous wrote:That’s all the govt (not gs-14/15) and military with a SAHM. Lots of them living farther out.

Most enlisted make far less than that even with the housing allowance.

[Anonymous]

We're at about 120-140k, 40s-50s, one kid, bought a house recently inside the Beltway.

I want to say it would depend on whether just one of us were bringing in all or most of the money, and doing what.

But that goes to show that the number one thing I think that money would be good for is taking pressure off... of my husband, actually. He earns 2/3 of our HHI and is the one who provides health insurance. He does it at a job at which he is undervalued, not incredibly well-suited for (both are true!) and which he borderline hates. Ideally he would spend all of his time industry about which he is passionate but via which he earns very little money (arts). If we didn't need his income/insurance, he would 100% do that, whether unpaid or at least very minimally paid. And we'd all be happier.

*I* would actually be happier if I earned most of the money and did so in my field, but I just started in it, so it's not happening tomorrow. I don't ever want to retire.

I say all this because I haven't read the other replies yet, but very little else would change for us. We'd stay in our house. Maybe we'd stop renting out the basement, but only maybe. Kid at same public school. Most of our spending pretty similar, although we'd comfortably do more repairs around the house, do all the non-urgent healthcare and I'd go to therapy twice a week without batting an eye. That kind of thing.

We'd save more, of course. And give more away. I guess be able to travel more/more comfortably, or maybe get some help around the house, but we wouldn't be spending big on on "things." (And I love to shop, so I have nothing against "things!" But we can afford most of what we want right now in terms of tangible purchases.)

But by far the biggest change would be DH being able to pursue his passion. Honestly, all that will have to happen for this would be for ME to make $150k + health insurance by myself. Maybe even $100k + insurance. Hope I can get there sooner rather than later.

[Anonymous]

Yes it is middle class. I standard government or military salary is middle class. If you have to live far from the city and have a long commute to work in order to comfortably afford housing, you are middle class.

The point is that people in the >400k range don’t need to make those compromises. That is the difference. Whdd we n you are rich you can have what you want.

[Anonymous]

Anonymous wrote:I'm intentionally excluding the group in 150-400k here because I think that's the area where people often don't "feel" rich (at least in the DMV), but are definitely not truly middle class in that they have privileges and advantages from their income that middle class folks don't have).

But if you are under 150k HHI in this area (specifically if you have kids at all, even one) money is going to be somewhat to very tight because of housing costs. And if you are over 400k, you may not be able to stop working or be set for life, but you can pretty much live wherever you want.

Just curious how people conceptualize that SES gap at this point, particularly in the DMV.

It's a ridiculous assumption that at $400k, or with any increase in income, you are going to spend all of the marginal difference on housing. Not everyone pines over living in Chevy Chase or Bethesda in a completely remodeled house like on DCUM. We make $400K and live in a $750K house in a suburb near an end of line metro station. Our mortgage payment is $4000/month. We chose a 15-year mortgage over "living wherever we want" because paying off the house by our early 50s is a priority. Personally I would not want a mortgage payment higher than this because daycare, preschool, etc. are expensive. The house always needs something, a repair or saving for a big project, etc. Savings for retirement is a priority. Saving for college is a priority. So, yes, at $150K housing choices will be more impacted, but the idea that you can or would live anywhere you want as income increases is silly.

[Anonymous]

Anonymous wrote:Yes it is middle class. I standard government or military salary is middle class. If you have to live far from the city and have a long commute to work in order to comfortably afford housing, you are middle class.

The point is that people in the >400k range don’t need to make those compromises. That is the difference. Whdd we n you are rich you can have what you want.

$150 is Not middle class. You don't have to have a far commute, you just get a smaller house, like we did. And very few people need to live close to DC/city. We don't.

At under $150K we live very comfortably. Kids are in multiple activities (expensive), private weekly music lessons, almost paid off house, college savings (at this point enough to pay for a state school, room and board and extras), retirement savings, paid cash for our last vehicle and will for our next. And, we do things like carry out a few times a week. Its how you spend your money. If you choose crazy high housing costs, sure, you can be house poor but is poor financial decisions not middle class.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I'm intentionally excluding the group in 150-400k here because I think that's the area where people often don't "feel" rich (at least in the DMV), but are definitely not truly middle class in that they have privileges and advantages from their income that middle class folks don't have).

But if you are under 150k HHI in this area (specifically if you have kids at all, even one) money is going to be somewhat to very tight because of housing costs. And if you are over 400k, you may not be able to stop working or be set for life, but you can pretty much live wherever you want.

Just curious how people conceptualize that SES gap at this point, particularly in the DMV.

It's a ridiculous assumption that at $400k, or with any increase in income, you are going to spend all of the marginal difference on housing. Not everyone pines over living in Chevy Chase or Bethesda in a completely remodeled house like on DCUM. We make $400K and live in a $750K house in a suburb near an end of line metro station. Our mortgage payment is $4000/month. We chose a 15-year mortgage over "living wherever we want" because paying off the house by our early 50s is a priority. Personally I would not want a mortgage payment higher than this because daycare, preschool, etc. are expensive. The house always needs something, a repair or saving for a big project, etc. Savings for retirement is a priority. Saving for college is a priority. So, yes, at $150K housing choices will be more impacted, but the idea that you can or would live anywhere you want as income increases is silly.

At that income there is no reason not to have fully funded college funds, retirement savings and more. We comfortably do it on under $150K but our house was under $400K and our mortgage payment is under $2K. So, I don't get how you are complaining about things at $400K. But, when we do have an increase in income some years, we put the money toward college or save to pay cash for things like cars. The only difference for us if we had made that much early on and it was stable (or even $250K, we'd have a slightly bigger house). I don't get your comments over a 15 year mortgage, as many of us have that. We also pay in extra each month.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I'm intentionally excluding the group in 150-400k here because I think that's the area where people often don't "feel" rich (at least in the DMV), but are definitely not truly middle class in that they have privileges and advantages from their income that middle class folks don't have).

But if you are under 150k HHI in this area (specifically if you have kids at all, even one) money is going to be somewhat to very tight because of housing costs. And if you are over 400k, you may not be able to stop working or be set for life, but you can pretty much live wherever you want.

Just curious how people conceptualize that SES gap at this point, particularly in the DMV.

It's a ridiculous assumption that at $400k, or with any increase in income, you are going to spend all of the marginal difference on housing. Not everyone pines over living in Chevy Chase or Bethesda in a completely remodeled house like on DCUM. We make $400K and live in a $750K house in a suburb near an end of line metro station. Our mortgage payment is $4000/month. We chose a 15-year mortgage over "living wherever we want" because paying off the house by our early 50s is a priority. Personally I would not want a mortgage payment higher than this because daycare, preschool, etc. are expensive. The house always needs something, a repair or saving for a big project, etc. Savings for retirement is a priority. Saving for college is a priority. So, yes, at $150K housing choices will be more impacted, but the idea that you can or would live anywhere you want as income increases is silly.

At that income there is no reason not to have fully funded college funds, retirement savings and more. We comfortably do it on under $150K but our house was under $400K and our mortgage payment is under $2K. So, I don't get how you are complaining about things at $400K. But, when we do have an increase in income some years, we put the money toward college or save to pay cash for things like cars. The only difference for us if we had made that much early on and it was stable (or even $250K, we'd have a slightly bigger house). I don't get your comments over a 15 year mortgage, as many of us have that. We also pay in extra each month.

I'm not complaining. I'm simply noting OP's assumption that increases in income will all go toward a house. Stuff is expensive and people have other priorities, like what you mentioned above. Not everyone needs or wants a super expensive house.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Yes it is middle class. I standard government or military salary is middle class. If you have to live far from the city and have a long commute to work in order to comfortably afford housing, you are middle class.

The point is that people in the >400k range don’t need to make those compromises. That is the difference. Whdd we n you are rich you can have what you want.

$150 is Not middle class. You don't have to have a far commute, you just get a smaller house, like we did. And very few people need to live close to DC/city. We don't.

At under $150K we live very comfortably. Kids are in multiple activities (expensive), private weekly music lessons, almost paid off house, college savings (at this point enough to pay for a state school, room and board and extras), retirement savings, paid cash for our last vehicle and will for our next. And, we do things like carry out a few times a week. Its how you spend your money. If you choose crazy high housing costs, sure, you can be house poor but is poor financial decisions not middle class.

PP, when did you buy your home? You say it's almost paid off, so did you buy a long time ago, put down a huge downpayment, or double-up on payments? What is your PITI?