Make 350k-400k, feel middle class

[Anonymous]

Anonymous wrote:In surprised no one has mentioned the growth of the dual income household as a driver over the last 30 years.

Exactly. Read the "The Two Income Trap" by Elizabeth Warren

All the men and women going to college and getting advanced degrees to build solid careers has so many benefits. But like anything, there are negatives.
Higher cost of housing because so many two income earners driving the prices up. Women and men delaying marriage and children so more people end up not married or have trouble having kids or have to pay for expensive IVF. Higher cost for childcare. It is hard to find a balance because so many people want the same things.

[Anonymous]

Anonymous wrote:The Washington metropolitan area is becoming more like the New York City or San Francisco metropolitan areas. Would you purposely choose to live in those cities? Probably not, because we recognize that the ordinary cost of living in those cities is prohibitively expensive, and that our income of $350-400 K would not go very far in supporting an upper-middle class lifestyle.

If you believe that NYC or SF or DC are the only places that you can live because they are so cosmopolitan, and intellectual, and international, and cultural, then so be it. You are purposely making the tradeoff to live more modestly, and constantly worrying about money, precisely so that you can live in an area that is more cosmopolitan, and intellectual, and international, and culturally significant.

But what if, like the original settlers, or our founding fathers, or the pioneers, you believed that you can bring "civilization", and "intellectualism", and "culture" with you and raise your children with those interests and values wherever you may settle. Then an affordable world of options all over this country (or the world) open up to you -- outside of the very most desirable metropolitan areas.

Choose any place in the country -- Billings, MT, or Oak Park, IL, or Bloomington, IN, or Santa Fe, NM. I will choose the random (for me) area of Vestavia Hills, AL. As you can see $539K will buy you a perfectly nice, if not dream home. More importantly the public schools all have 10 ratings, so your children will be well-educated in an area where all your neighbors and friends also send their children to the public schools.

http://www.zillow.com/homedetails/5105-Club-Ridge-Dr-W-Vestavia-AL-35242/974256_zpid/

Tuition in-state at the University of Alabama is $4,800/semester for a full-time undergraduate student. And since your kids plan to go there they can somewhat enjoy their high school years, without constantly worrying about the grades and extracurriculars needed for the Ivy League -- like everyone's children around here stress over.

Yes, there are federal jobs to be had in that part of Alabama, and private sector ones also. If you continue to earn between $350-400K there, you will not only feel rich -- you will be rich as well. But as the cost of living is so much lower in every respect (including state income taxes), you can afford to have a stay-at-home parent, or to take new jobs that only pay you between $250-300K.

That is one option for everyone feeling bad about their income in this area, the other is to realize that you live here because you love all that the region has to offer, and that you are willing to pay for the high-quality of cultural, intellectual, international, and cosmopolitan life. It is a trade off for sure.

Spot on. My husband and I, both lawyers earning a good income, never even considered New York or San Francisco because even when we graduated law school -- in the early 2000s -- it was clear that we could not afford the "international" lifestyle of those cities. People like us, who in the past might have naturally gravitated to NYC or SF, instead moved to Washington, DC, or Seattle, WA. That in turn placed/places cost pressures on those cities, driving others who can no longer easily afford them to Charlotte, NC, or Portland, OR, if they still want to maintain the nice life that their income can afford.

[Anonymous]

Anonymous wrote:We earn about 350k a year, and I feel completely middle class at this stage of life with 2 young kids in daycare, student loans, retirement college savings, and mortgage. Although our lifestyle is middle class, our savings are not. Between pretax and posttax savings, we probably sock away 90k a year.

Your family of four is able to SAVE twice as much per year as the average American family of four MAKES in a year. STFU.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We earn about 350k a year, and I feel completely middle class at this stage of life with 2 young kids in daycare, student loans, retirement college savings, and mortgage. Although our lifestyle is middle class, our savings are not. Between pretax and posttax savings, we probably sock away 90k a year.

You have $90k in savings a year AFTER two daycares / mortgage / retirement savings / college savings and feel "completely middle class"? I just can't even wrap my head around this.

But isn't that the Democrats' goal? No more wealth-building or accumulation for those trying to break above the middle class. That way we can all be "equal".

[Anonymous]

Anonymous wrote:

Anonymous wrote:The Washington metropolitan area is becoming more like the New York City or San Francisco metropolitan areas. Would you purposely choose to live in those cities? Probably not, because we recognize that the ordinary cost of living in those cities is prohibitively expensive, and that our income of $350-400 K would not go very far in supporting an upper-middle class lifestyle.

If you believe that NYC or SF or DC are the only places that you can live because they are so cosmopolitan, and intellectual, and international, and cultural, then so be it. You are purposely making the tradeoff to live more modestly, and constantly worrying about money, precisely so that you can live in an area that is more cosmopolitan, and intellectual, and international, and culturally significant.

But what if, like the original settlers, or our founding fathers, or the pioneers, you believed that you can bring "civilization", and "intellectualism", and "culture" with you and raise your children with those interests and values wherever you may settle. Then an affordable world of options all over this country (or the world) open up to you -- outside of the very most desirable metropolitan areas.

Choose any place in the country -- Billings, MT, or Oak Park, IL, or Bloomington, IN, or Santa Fe, NM. I will choose the random (for me) area of Vestavia Hills, AL. As you can see $539K will buy you a perfectly nice, if not dream home. More importantly the public schools all have 10 ratings, so your children will be well-educated in an area where all your neighbors and friends also send their children to the public schools.

http://www.zillow.com/homedetails/5105-Club-Ridge-Dr-W-Vestavia-AL-35242/974256_zpid/

Tuition in-state at the University of Alabama is $4,800/semester for a full-time undergraduate student. And since your kids plan to go there they can somewhat enjoy their high school years, without constantly worrying about the grades and extracurriculars needed for the Ivy League -- like everyone's children around here stress over.

Yes, there are federal jobs to be had in that part of Alabama, and private sector ones also. If you continue to earn between $350-400K there, you will not only feel rich -- you will be rich as well. But as the cost of living is so much lower in every respect (including state income taxes), you can afford to have a stay-at-home parent, or to take new jobs that only pay you between $250-300K.

That is one option for everyone feeling bad about their income in this area, the other is to realize that you live here because you love all that the region has to offer, and that you are willing to pay for the high-quality of cultural, intellectual, international, and cosmopolitan life. It is a trade off for sure.

Spot on. My husband and I, both lawyers earning a good income, never even considered New York or San Francisco because even when we graduated law school -- in the early 2000s -- it was clear that we could not afford the "international" lifestyle of those cities. People like us, who in the past might have naturally gravitated to NYC or SF, instead moved to Washington, DC, or Seattle, WA. That in turn placed/places cost pressures on those cities, driving others who can no longer easily afford them to Charlotte, NC, or Portland, OR, if they still want to maintain the nice life that their income can afford.

The new definition of trickle-down economics!

[Anonymous]

Anonymous wrote:

Anonymous wrote:We earn about 350k a year, and I feel completely middle class at this stage of life with 2 young kids in daycare, student loans, retirement college savings, and mortgage. Although our lifestyle is middle class, our savings are not. Between pretax and posttax savings, we probably sock away 90k a year.

Your family of four is able to SAVE twice as much per year as the average American family of four MAKES in a year. STFU.

$90k a year in salary-not savings- is middle class.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We earn about 350k a year, and I feel completely middle class at this stage of life with 2 young kids in daycare, student loans, retirement college savings, and mortgage. Although our lifestyle is middle class, our savings are not. Between pretax and posttax savings, we probably sock away 90k a year.

Your family of four is able to SAVE twice as much per year as the average American family of four MAKES in a year. STFU.

$90k a year in salary-not savings- is middle class.

SFTU is a ridiculous response.

Whether you are middle class, upper class or whatever you want to call it, if you are making $400K and you are fully funding retirements, maxing out 529 plans and saving money for college, you should be applauded. You could be blowing it on handbags or buying too much car. If you are truly making that much money and feel poor because you are saving a bunch of money, and taking good care of your kids that is something to be happy about.

We make a lot, we save a lot and we spend a lot, but we always try to have an eye on the future - retirement and college - those come first. Then we have fun. In the grand scheme we are very lucky and thankful. We don't spend a lot of time worrying about whether we are middle class or rich. For us, we are trying to live life and retire on our terms and we have worked very hard to make that a possibility.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We earn about 350k a year, and I feel completely middle class at this stage of life with 2 young kids in daycare, student loans, retirement college savings, and mortgage. Although our lifestyle is middle class, our savings are not. Between pretax and posttax savings, we probably sock away 90k a year.

You have $90k in savings a year AFTER two daycares / mortgage / retirement savings / college savings and feel "completely middle class"? I just can't even wrap my head around this.

Well he did say "although our lifestyle is middle class, our savings are not". I think he recognizes that the savings numbers he's throwing out are huge.

We are at $290 and save about $70k, plus pay down about $10k a year in debt plus have investments that throw off $30 or $40k in FCF. Like the prior poster our life is very middle class.... But our savings are not.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:$350-400K in this area *is* middle class.

Call it "upper middle class" if you like. It's not upper class.

We have doubled our income in the past 5 years. From just under $200K to just under $400K. How has life changed for us?
- regular expenses are covered as a matter of course (don't have to be constantly checking the bank balance to make sure there's enough to cover)
- we are now saving for college (on track to cover in-state tuition for our 2 kids)
- our cleaner comes every week instead of every other week
- we are taking more vacations (long weekends here and there in addition to longer August vacation)
- unexpected expenses can be handled fairly easily (the new roof gets paid for out of savings and we don't feel the pinch)

Seriously, that's about it. We are still driving the same cars. Kids still in public school. We are endlessly debating whether to move up from our 2200sq ft house but afraid to double the size of our mortgage (that's what it would take to stay inbounds for our current schools). We pay mega amounts of taxes (federal and state). We do NOT anticipate retiring at 55 with $5m in the bank. Definitely not on track for that.

I think this post is very accurate and describes us as well. We also doubled our income (from $180K to $360K) in the past 5 years (when one parent went back to work and the other got an increase in pay). I would have rolled my eyes to the heavens if you had told me when we were making $180K that $360K wouldn't really change our lifestyle much. But really, it hasn't. We do have a good deal more breathing room. We're now able to save adequately for retirement and college--as it we'll actually have a few million saved for retirement and will probably be able to pay for state school for the kids. We don't stress out about having an occasional sitter or night out. When the air conditioner compressor breaks like it did this week we don't have to stay up late worrying about how to replace it. However, we're by no means able to upgrade to the next level of house or buy luxury clothing or a beach house. Not that I expect to or need to obtain any of those things in my lifetime. But they are certainly still out of our reach.

Those who are saying that they "save" for retirement and college on incomes of $80K or $150K (both mentioned before in this post) may be saving but it's simply not possible that they're saving anywhere near enough (especially if they live in the DC area). The $80K poster would have to be saving half of their yearly income to do so. So to say, "I can have it all on $80K, what are you doing with $300K?" is silly. Most of us are doing exactly what we did on $80K with far more breathing room and a much better ability to save.

Sure, but if you can get by on the oh-so-paltry sum of $80k, you don't NEED to save at the stratospheric rates of someone who feels $300k is necessary for an adequate lifestyle.

+1

[Anonymous]

Anonymous wrote:$400K is not a lot of money AFTER YOU'VE SPENT IT ALL.

Think of all you've consumed before being left with "nothing" each month: expensive educations, excellent child care and health care, outstanding public schools, housing in one of the most desirable markets in the country, etc, etc. Nevermind your food, clothing, cars, retirement and college savings, etc. Most people can't fathom having even a few of these things, let alone all of them.

So stop whining. You've purchased a premium lifestyle with your spending power.

THIS

[Anonymous]

Anonymous wrote:

Anonymous wrote:$350-400K in this area *is* middle class.

Call it "upper middle class" if you like. It's not upper class.

We have doubled our income in the past 5 years. From just under $200K to just under $400K. How has life changed for us?
- regular expenses are covered as a matter of course (don't have to be constantly checking the bank balance to make sure there's enough to cover)
- we are now saving for college (on track to cover in-state tuition for our 2 kids)
- our cleaner comes every week instead of every other week
- we are taking more vacations (long weekends here and there in addition to longer August vacation)
- unexpected expenses can be handled fairly easily (the new roof gets paid for out of savings and we don't feel the pinch)

Seriously, that's about it. We are still driving the same cars. Kids still in public school. We are endlessly debating whether to move up from our 2200sq ft house but afraid to double the size of our mortgage (that's what it would take to stay inbounds for our current schools). We pay mega amounts of taxes (federal and state). We do NOT anticipate retiring at 55 with $5m in the bank. Definitely not on track for that.

I think this post is very accurate and describes us as well. We also doubled our income (from $180K to $360K) in the past 5 years (when one parent went back to work and the other got an increase in pay). I would have rolled my eyes to the heavens if you had told me when we were making $180K that $360K wouldn't really change our lifestyle much. But really, it hasn't. We do have a good deal more breathing room. We're now able to save adequately for retirement and college--as it we'll actually have a few million saved for retirement and will probably be able to pay for state school for the kids. We don't stress out about having an occasional sitter or night out. When the air conditioner compressor breaks like it did this week we don't have to stay up late worrying about how to replace it. However, we're by no means able to upgrade to the next level of house or buy luxury clothing or a beach house. Not that I expect to or need to obtain any of those things in my lifetime. But they are certainly still out of our reach.

Those who are saying that they "save" for retirement and college on incomes of $80K or $150K (both mentioned before in this post) may be saving but it's simply not possible that they're saving anywhere near enough (especially if they live in the DC area). The $80K poster would have to be saving half of their yearly income to do so. So to say, "I can have it all on $80K, what are you doing with $300K?" is silly. Most of us are doing exactly what we did on $80K with far more breathing room and a much better ability to save.

I never said "I can have it all on 80k". I said I feel middle class at 80k so I have trouble imagining someone making three to four times what we make saying they are also middle class and feeling pinched.... Come on.

[Anonymous]

Anonymous wrote:We earn about 350k a year, and I feel completely middle class at this stage of life with 2 young kids in daycare, student loans, retirement college savings, and mortgage. Although our lifestyle is middle class, our savings are not. Between pretax and posttax savings, we probably sock away 90k a year.

LOL - your savings per year is more than our income per year. Don't whine.

[Anonymous]

Are you living like the Connors from Roseanne or the Hecks from The Middle? The WHites from Breaking Bad? If yes, then that is a reality check for middle class

If you are living like Modern Family's the Dunphys or MerDer from Grey's or Don Draper, then sorry, you are not middle class.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:$350-400K in this area *is* middle class.

Call it "upper middle class" if you like. It's not upper class.

We have doubled our income in the past 5 years. From just under $200K to just under $400K. How has life changed for us?
- regular expenses are covered as a matter of course (don't have to be constantly checking the bank balance to make sure there's enough to cover)
- we are now saving for college (on track to cover in-state tuition for our 2 kids)
- our cleaner comes every week instead of every other week
- we are taking more vacations (long weekends here and there in addition to longer August vacation)
- unexpected expenses can be handled fairly easily (the new roof gets paid for out of savings and we don't feel the pinch)

Seriously, that's about it. We are still driving the same cars. Kids still in public school. We are endlessly debating whether to move up from our 2200sq ft house but afraid to double the size of our mortgage (that's what it would take to stay inbounds for our current schools). We pay mega amounts of taxes (federal and state). We do NOT anticipate retiring at 55 with $5m in the bank. Definitely not on track for that.

I think this post is very accurate and describes us as well. We also doubled our income (from $180K to $360K) in the past 5 years (when one parent went back to work and the other got an increase in pay). I would have rolled my eyes to the heavens if you had told me when we were making $180K that $360K wouldn't really change our lifestyle much. But really, it hasn't. We do have a good deal more breathing room. We're now able to save adequately for retirement and college--as it we'll actually have a few million saved for retirement and will probably be able to pay for state school for the kids. We don't stress out about having an occasional sitter or night out. When the air conditioner compressor breaks like it did this week we don't have to stay up late worrying about how to replace it. However, we're by no means able to upgrade to the next level of house or buy luxury clothing or a beach house. Not that I expect to or need to obtain any of those things in my lifetime. But they are certainly still out of our reach.

Those who are saying that they "save" for retirement and college on incomes of $80K or $150K (both mentioned before in this post) may be saving but it's simply not possible that they're saving anywhere near enough (especially if they live in the DC area). The $80K poster would have to be saving half of their yearly income to do so. So to say, "I can have it all on $80K, what are you doing with $300K?" is silly. Most of us are doing exactly what we did on $80K with far more breathing room and a much better ability to save.

Sure, but if you can get by on the oh-so-paltry sum of $80k, you don't NEED to save at the stratospheric rates of someone who feels $300k is necessary for an adequate lifestyle.

+1

How are you planning to generate $80K gross income in retirement? Rule of thumb is you need $1 million invested for each $50K of income. With a 80K HHI, you're going to save $1.6 million over your lifetime? Or, realistically, are you going to live on nothing but Social Security? If so, how is that a middle class retirement?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We earn about 350k a year, and I feel completely middle class at this stage of life with 2 young kids in daycare, student loans, retirement college savings, and mortgage. Although our lifestyle is middle class, our savings are not. Between pretax and posttax savings, we probably sock away 90k a year.

Your family of four is able to SAVE twice as much per year as the average American family of four MAKES in a year. STFU.

$90k a year in salary-not savings- is middle class.

SFTU is a ridiculous response.

Whether you are middle class, upper class or whatever you want to call it, if you are making $400K and you are fully funding retirements, maxing out 529 plans and saving money for college, you should be applauded. You could be blowing it on handbags or buying too much car. If you are truly making that much money and feel poor because you are saving a bunch of money, and taking good care of your kids that is something to be happy about.

We make a lot, we save a lot and we spend a lot, but we always try to have an eye on the future - retirement and college - those come first. Then we have fun. In the grand scheme we are very lucky and thankful. We don't spend a lot of time worrying about whether we are middle class or rich. For us, we are trying to live life and retire on our terms and we have worked very hard to make that a possibility.

The point is not to go around complaining that you are "middle class" on 350k a year while saving 90k a year. They obviously prioritize saving, which is to their benefit. But just because they don't ALSO have 90k to blow on handbags and dinners out doesn't make them middle class. What is so hard for people to understand about this??? It's very simple people.