Being lower middle class and living well

[Anonymous]

Anonymous wrote:

Anonymous wrote:My take home is less than the OP's and I have a child too. It can be done folks. I am not in debt either. The posters on this thread are angry because they cannot think of living such a "deprived" life as the OP has described. I know many of my friends grew up the way I did but since becoming adults, they have become accustomed to excessive expenditures. It's hard to remember a time when you didn't have your kids in tons of activities, didn't eat out frequently, didn't buy expensive electronics, etc. When you are happy and content with your life, you do not need to fill it with all of these things.

How much do you pay for daycare? Do you accept government assistance (WIC)?

Wait, your take-home is less? Meaning you make 30% more than OP gross?

[Anonymous]

My take home pay is appr. $2400. My son is in elementary school so no daycare costs except for the before school program ($160/month). No, I've never gotten any type of gov't assistance. I am a public school teacher.

[Anonymous]

Anonymous wrote:My take home pay is appr. $2400. My son is in elementary school so no daycare costs except for the before school program ($160/month). No, I've never gotten any type of gov't assistance. I am a public school teacher.

How did you afford daycare?

[Anonymous]

How do I afford it? I just pay it. It's a necessary expense. I teach HS so I start school earlier than my son's school. I drop him off at 7:00am and go to my school. After my school ends, I pick him up when he gets out of school at 3:50.

[Anonymous]

Anonymous wrote:How do I afford it? I just pay it. It's a necessary expense. I teach HS so I start school earlier than my son's school. I drop him off at 7:00am and go to my school. After my school ends, I pick him up when he gets out of school at 3:50.

So you did in fact pay $1200 for daycare and $1200 for rent then had $0?! I don't see how the math works.

[Anonymous]

Anonymous wrote:

Anonymous wrote:How do I afford it? I just pay it. It's a necessary expense. I teach HS so I start school earlier than my son's school. I drop him off at 7:00am and go to my school. After my school ends, I pick him up when he gets out of school at 3:50.

So you did in fact pay $1200 for daycare and $1200 for rent then had $0?! I don't see how the math works.

To clarify I am not referring to after school care, but full time child care.

[Anonymous]

I think there is something to be said for living within your means and being appreciative for what you have, but OP is living like most of us did in our early to mid 20s.

I got married at 28, bought a house at 29, and will be 30 when my first baby is born in a few months. Instead of a third tier law school, I went to a top 25 law school with no loans thanks to a good GPA and high LSAT. Now I can afford a decent lifestyle, have money for savings, and can invest in the stock market. I don't know if she posted her age, but I'm guessing she's around the same age as me, maybe a couple years younger. Good for her for living within her means, but I can't say I'm inspired by her life choices.

If she's not working at a prestigious nonprofit and/or doesn't have a way to lateral into a higher paying job, I don't know that she's doing that well since plenty of people without law degrees make more than her.

[Anonymous]

Anonymous wrote:My take home is less than the OP's and I have a child too. It can be done folks. I am not in debt either. The posters on this thread are angry because they cannot think of living such a "deprived" life as the OP has described. I know many of my friends grew up the way I did but since becoming adults, they have become accustomed to excessive expenditures. It's hard to remember a time when you didn't have your kids in tons of activities, didn't eat out frequently, didn't buy expensive electronics, etc. When you are happy and content with your life, you do not need to fill it with all of these things.

+1

[Anonymous]

Tell me something I don't know or do.
What savings account is an high interest savings account? 3%? More 10% I hope.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How do I afford it? I just pay it. It's a necessary expense. I teach HS so I start school earlier than my son's school. I drop him off at 7:00am and go to my school. After my school ends, I pick him up when he gets out of school at 3:50.

So you did in fact pay $1200 for daycare and $1200 for rent then had $0?! I don't see how the math works.

To clarify I am not referring to after school care, but full time child care.

So your questions was about daycare prior to my child starting elementary school? I see. I paid $150/week when he was in daycare as a baby/toddler. He was in daycare just during the school year. So, it cost me $600/month. My rent and utilities total $1200/month. When he was 4, he went to public preschool and that's when I started paying for before school care costing me appr. $160/month (although it was cheaper back then).

[Anonymous]

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Anonymous wrote:

Congratulations, OP - I did the same a long time ago.
Now I live with DH and 2 kids in a tiny but cute little dollhouse that still cost a fortune because it's in one of the better school districts. We could afford it on our middle class salary because we had lived frugally like you and had economized and invested successfully in the stock market.

Now we still live very frugally.

Our main expenses are the mortgage and food.
Our disposable income goes to extra-curricular activities for the kids and traveling to see our families overseas.

Keep saving, OP, and make what you can of your career, because kids are expensive.

The voice of experience. It is quite doable!

I'm the PP who lived like you. When DH and I got married and had DC1, we earned 60K total gross income, and all our money went to daycare. One bedroom apartment, which we kept until DC2 was a year old.
Now our gross HHI is 120K, I stay home, and we max out retirement and college savings plus have a little left over for travel to Europe and Asia every few years. But daily, we live a frugal lifestyle which my friends cannot probably imagine. The trick is to never spend spontaneously. Everything is budgeted and planned for, and with that comes a sense of control and satisfaction. Instead of feeling submerged by expenses and jealous of what others earn, I feel empowered by the good financial choices we make and how most of our money is invested.

Whet do you live and where does DH work? And what happens if he is laid off?

We live in Bethesda. DH was laid off during the recession, and thanks to our savings we kept going frugally until he found another job.

So you are raising a family in a one bedroom apartment? B/c on 120k buying even a two bedroom condo in Bethesda is hard unless you have family money.

Um it is called saving for 10 plus years before buying. If you live like the OP,you will amass a good amount of money by the time you're ready to buy.

Show me the math. Homes in Bethesda cost 800k minimum. Saving 1400/month for ten years will net you 200k. But guess what if that 800k appreciates at just 3%, it's cost is increasing at $2000/month, more than you are saving.

So with a lower middle income salary you can't save your way to the expensive and appreciating housing in this region. OP will end up either having an upper middle class income but live in run down housing like many of us or she will keep current job and commute forever. Or just not have kids and keep rockin the group home.

But the title of her post suggested she was surprised role complained about living on lower middle class incomes, but she never realized it's because of the constraints imposed on families. We have all lived like students and its fine for that phase of life. Though I bet her boyfriend lives alone b/c if both members of a couple life in group housing they never get to be alone and make Romantic dinners or the like. That would suck big esp after married.

Who said OP wants to live in Bethesda? There are much more affordable places

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How do I afford it? I just pay it. It's a necessary expense. I teach HS so I start school earlier than my son's school. I drop him off at 7:00am and go to my school. After my school ends, I pick him up when he gets out of school at 3:50.

So you did in fact pay $1200 for daycare and $1200 for rent then had $0?! I don't see how the math works.

To clarify I am not referring to after school care, but full time child care.

So your questions was about daycare prior to my child starting elementary school? I see. I paid $150/week when he was in daycare as a baby/toddler. He was in daycare just during the school year. So, it cost me $600/month. My rent and utilities total $1200/month. When he was 4, he went to public preschool and that's when I started paying for before school care costing me appr. $160/month (although it was cheaper back then).

Where in the world did you find reliable, hopefully not under the table childcare for $150/week? Was this in the DC area? Was this in 1992?

[Anonymous]

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Anonymous wrote:

Anonymous wrote:Hi everyone! I'm the OP. Thanks for the nice comments. One last post before I go to bed.

Anonymous wrote:

Anonymous wrote:Report back after you are married and have kids.

This. 1000 times this.

Why would that change anything? The conventional wisdom in fact is that if you want to save money, get married young. But sure, let's dissect this real quick.

Things that wouldn't change if I got married and had kids:
- Would still eat 99% home-cooked food and generic brands.
- Would still not buy alcohol.
- If my old car doesn't last then I'll buy a used car and use it the same way
- Same cheap $20/month phone plan
- Would still not pay for TV/cable.
- Would still hopefully have a job that pays all health and dental insurance for family.

Things that would improve if I got married:
- Giant standard deduction from taxable income
- Tax credit for each kid I have
- Tax-deductible contributions to a joint retirement savings account.
- If we buy and sell a home together, we don't have to pay taxes on the profit as long as it's not more than $500,000
- Could probably combine car insurance policies and get a discount.

Things that would suck if I got married and had kids
- Having to pay more on living expenses, such as rent or mortgage, because I only have the DH's income to split it with as opposed to 4 roommates and plus I'd have to choose a slightly nicer apartment to make room for kid(s).
- Costs having a child. This is really the only major expense problem. So you start paying right from prenatal care to the actual birth in the hospital, then you lose income even on maternity leave, the clothes and car seat and baby food, etc. Plus I may need to start putting down at least $800 a month for the college fund.

In any case that baby had better get good grades and wrangle some scholarship money! Public school and public university or I'm not paying. I went to public schools and it turned out great for me.

With my lifestyle habits and two incomes, why the hell can't I raise a child and still live well with my class/income level?

Good night for now!

You're a lawyer who isn't even clearing $36k per year. I don't think you're doing that great.

Not OP but wow, look at the bitchy, entitled douchebags in this thread! I think she's doing just fine considering she has no loans and she's apparently saving up more every month than the trainwrecks on this forum - which probably include you, I'm guessing?

Thanks for this great perspective OP!

+1

Not to mention that if she has solid litigation experience, she can probably lateral to a law firm one day while also having saved up money already.

I still think this is a little extreme though. I'd be fine with $500 a month in savings and living a little more luxuriously. Never going to restaurants in a society where restaurants can be an amazing experience, even budget ones, seems like overkill.

if she's making that little, chances are she is working at a small law firm. that, or an uber-prestigious nonprofit job.

also, "Even museums have free admittance days. "? don't nearly all the DC museums have free admission days 7 days per week?

Yeah, as for car insurance. You can save a lot of money on it. The price vary really greatly depending on the company. Use free service like lowcarinsurequotes in order to search for the best company for you and compare it with others. It will definitely help

[Anonymous]

So, I was a lot like OP in my twenties. I probably made $28k per year and saved half of that. Got married 4 years later to a simarily frugal DH. We saved one salary and lived off another--over these years our HHI increased from $80k to $160k. Then we had kids. Net worth was probably $500k at this point. By the time kid 2 came along, I decided to SAH. Lived off one salary for 3.5 years--$110k. Contributed only 10-15% towards savings and added kid #3. Networth now around $1.2 mil now (35 years old). We haven't saved aggressively in years and live comfortably now.

My advice to OP is to get in the market. While I spent my twenties penny-pinching, I dedicated an equal amount of time learning how to manage my savings. Learn everything you can about low cost investments and get into real estate. At year 9 of marriage, we've owned 4 different primary residences plus two rentals.

Save with a purpose and goal. Otherwise, you just end up being cheap, not smart.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How do I afford it? I just pay it. It's a necessary expense. I teach HS so I start school earlier than my son's school. I drop him off at 7:00am and go to my school. After my school ends, I pick him up when he gets out of school at 3:50.

So you did in fact pay $1200 for daycare and $1200 for rent then had $0?! I don't see how the math works.

To clarify I am not referring to after school care, but full time child care.

So your questions was about daycare prior to my child starting elementary school? I see. I paid $150/week when he was in daycare as a baby/toddler. He was in daycare just during the school year. So, it cost me $600/month. My rent and utilities total $1200/month. When he was 4, he went to public preschool and that's when I started paying for before school care costing me appr. $160/month (although it was cheaper back then).

Where in the world did you find reliable, hopefully not under the table childcare for $150/week? Was this in the DC area? Was this in 1992?

Yeah sorry PP, but $600 per month of daycare isn't available anymore. I say this as a single Mom. I pay $1400/month for pre-K. $1500 for a one bedroom apartment. If my take home was less than $3500 I would have no food on the table.