What $PITI should we aim for...

[Anonymous]

Anonymous wrote:

Anonymous wrote:I wouldn't go higher than $3000.

For comparison, we are slightly higher HHI than you ($260k) and our PITI is $2200. We also have young kids (k, pk, and daycare) and save a decent amount (max 401ks, Roth's, $500/mo per kid to 529s) and after groceries, fixed expenses, activities, there's not a lot left!

Do you have a lot of room to grow in salaries? If so maybe go a little higher but you don't want to be house poor.

Can only increase maybe 30-50k in the next 10 years.
That is similar to what we currently pay.
We don't do 529s because we cash flow daycare/ tuition now so plan on continuing that.
Admittedly don't max out 401k, but do contribute to get the match.

Hard to swallow staying in the house we have outgrown in order to put money away for 30+ years from now, but aware it's probably the smarter move

Do you have other savings?

It sounds like your retirement savings are low, you don't have college savings. You can cash flow private school (Catholic? $24k/year seems fairly low) but college is much pricier and you're unlikely to get need-based aid at a $200k+ HHI. Do you have an emergency fund?

It really does seem like you should stay put and focus on saving.

[Anonymous]

Anonymous wrote:230k
-40k pre tax retirement
-6k health insurance?
184k taxable
22% tax
143k take home
-24k tuition
-18k tuition

Cash flow: $8,400/mo

I personally would not spend more than 1/3 of my take home on housing, so $2,805 PITI

This is the correct answer. These. I bet don’t leave much for college savings or emergency savings. I would consider 2800PITI the ceiling.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I wouldn't go higher than $3000.

For comparison, we are slightly higher HHI than you ($260k) and our PITI is $2200. We also have young kids (k, pk, and daycare) and save a decent amount (max 401ks, Roth's, $500/mo per kid to 529s) and after groceries, fixed expenses, activities, there's not a lot left!

Do you have a lot of room to grow in salaries? If so maybe go a little higher but you don't want to be house poor.

Can only increase maybe 30-50k in the next 10 years.
That is similar to what we currently pay.
We don't do 529s because we cash flow daycare/ tuition now so plan on continuing that.
Admittedly don't max out 401k, but do contribute to get the match.

Hard to swallow staying in the house we have outgrown in order to put money away for 30+ years from now, but aware it's probably the smarter move

Do you have other savings?

It sounds like your retirement savings are low, you don't have college savings. You can cash flow private school (Catholic? $24k/year seems fairly low) but college is much pricier and you're unlikely to get need-based aid at a $200k+ HHI. Do you have an emergency fund?

It really does seem like you should stay put and focus on saving.

Thank you for this input.
yes, plan to contribute 25K per year per kid through college. Additional costs must be through comb of grants/scholarship/loans, etc

Our retirement savings are low, but one of us is a Fed and will have ~40k pension (in today's $) at retirement.
Total retirement savings now are ~ 150k

We have 16k in an individual brokerage account.
Also an inherited IRA (240K) that we haven't done anything with thus far.

[Anonymous]

why private school?

[Anonymous]

You can’t afford inside the beltway.

[Anonymous]

Anonymous wrote:

Anonymous wrote:$3500

Yikes. So that's looking like a 750k house with current interest rates.
Slim pickings inside the beltway

Unfortunately, inside the beltway is not gonna happen unless you are willing to consider a townhouse or a less than good school district. Even town homes in good school district are rare in that price range. I know it's beyond crazy, in 2017, my close friend bought a nice, split level SFH in McLean for 925k and there were plenty of SFH's in 22043 (Falls Church) for 750-800k.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I wouldn't go higher than $3000.

For comparison, we are slightly higher HHI than you ($260k) and our PITI is $2200. We also have young kids (k, pk, and daycare) and save a decent amount (max 401ks, Roth's, $500/mo per kid to 529s) and after groceries, fixed expenses, activities, there's not a lot left!

Do you have a lot of room to grow in salaries? If so maybe go a little higher but you don't want to be house poor.

Can only increase maybe 30-50k in the next 10 years.
That is similar to what we currently pay.
We don't do 529s because we cash flow daycare/ tuition now so plan on continuing that.
Admittedly don't max out 401k, but do contribute to get the match.

Hard to swallow staying in the house we have outgrown in order to put money away for 30+ years from now, but aware it's probably the smarter move

Do you have other savings?

It sounds like your retirement savings are low, you don't have college savings. You can cash flow private school (Catholic? $24k/year seems fairly low) but college is much pricier and you're unlikely to get need-based aid at a $200k+ HHI. Do you have an emergency fund?

It really does seem like you should stay put and focus on saving.

Thank you for this input.
yes, plan to contribute 25K per year per kid through college. Additional costs must be through comb of grants/scholarship/loans, etc

Our retirement savings are low, but one of us is a Fed and will have ~40k pension (in today's $) at retirement.
Total retirement savings now are ~ 150k

We have 16k in an individual brokerage account.
Also an inherited IRA (240K) that we haven't done anything with thus far.

You are way behind and 25k/yr per kid for college isn’t jack shit , especially since you have young kids. You are very behind in retirement savings. Last thing you need is more debt and more expenses. Your focus should be college savings and more retirement contributions.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I wouldn't go higher than $3000.

For comparison, we are slightly higher HHI than you ($260k) and our PITI is $2200. We also have young kids (k, pk, and daycare) and save a decent amount (max 401ks, Roth's, $500/mo per kid to 529s) and after groceries, fixed expenses, activities, there's not a lot left!

Do you have a lot of room to grow in salaries? If so maybe go a little higher but you don't want to be house poor.

Can only increase maybe 30-50k in the next 10 years.
That is similar to what we currently pay.
We don't do 529s because we cash flow daycare/ tuition now so plan on continuing that.
Admittedly don't max out 401k, but do contribute to get the match.

Hard to swallow staying in the house we have outgrown in order to put money away for 30+ years from now, but aware it's probably the smarter move

Do you have other savings?

It sounds like your retirement savings are low, you don't have college savings. You can cash flow private school (Catholic? $24k/year seems fairly low) but college is much pricier and you're unlikely to get need-based aid at a $200k+ HHI. Do you have an emergency fund?

It really does seem like you should stay put and focus on saving.

Thank you for this input.
yes, plan to contribute 25K per year per kid through college. Additional costs must be through comb of grants/scholarship/loans, etc

Our retirement savings are low, but one of us is a Fed and will have ~40k pension (in today's $) at retirement.
Total retirement savings now are ~ 150k

We have 16k in an individual brokerage account.
Also an inherited IRA (240K) that we haven't done anything with thus far.

You are way behind and 25k/yr per kid for college isn’t jack shit , especially since you have young kids. You are very behind in retirement savings. Last thing you need is more debt and more expenses. Your focus should be college savings and more retirement contributions.

This is nonsense.
University of Maryland is 26,000 per year including room and board.
Many people don't have pensions.
Come down to planet earth, pp. Will make your input more palatable

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:$3500

Yikes. So that's looking like a 750k house with current interest rates.
Slim pickings inside the beltway

Unfortunately, inside the beltway is not gonna happen unless you are willing to consider a townhouse or a less than good school district. Even town homes in good school district are rare in that price range. I know it's beyond crazy, in 2017, my close friend bought a nice, split level SFH in McLean for 925k and there were plenty of SFH's in 22043 (Falls Church) for 750-800k.

If OP is already including tuition in their budget, why does school district matter? Plenty of nice SFHs in Falls Church 22041/22042 for 750-800.

[Anonymous]

If you’re going to do private all the way then you don’t need to pay for a top school district. That will open up your options.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I wouldn't go higher than $3000.

For comparison, we are slightly higher HHI than you ($260k) and our PITI is $2200. We also have young kids (k, pk, and daycare) and save a decent amount (max 401ks, Roth's, $500/mo per kid to 529s) and after groceries, fixed expenses, activities, there's not a lot left!

Do you have a lot of room to grow in salaries? If so maybe go a little higher but you don't want to be house poor.

Can only increase maybe 30-50k in the next 10 years.
That is similar to what we currently pay.
We don't do 529s because we cash flow daycare/ tuition now so plan on continuing that.
Admittedly don't max out 401k, but do contribute to get the match.

Hard to swallow staying in the house we have outgrown in order to put money away for 30+ years from now, but aware it's probably the smarter move

Do you have other savings?

It sounds like your retirement savings are low, you don't have college savings. You can cash flow private school (Catholic? $24k/year seems fairly low) but college is much pricier and you're unlikely to get need-based aid at a $200k+ HHI. Do you have an emergency fund?

It really does seem like you should stay put and focus on saving.

Thank you for this input.
yes, plan to contribute 25K per year per kid through college. Additional costs must be through comb of grants/scholarship/loans, etc

Our retirement savings are low, but one of us is a Fed and will have ~40k pension (in today's $) at retirement.
Total retirement savings now are ~ 150k

We have 16k in an individual brokerage account.
Also an inherited IRA (240K) that we haven't done anything with thus far.

You are way behind and 25k/yr per kid for college isn’t jack shit , especially since you have young kids. You are very behind in retirement savings. Last thing you need is more debt and more expenses. Your focus should be college savings and more retirement contributions.

This is nonsense.
University of Maryland is 26,000 per year including room and board.
Many people don't have pensions.

Oh bless your heart, you must have toddlers.
Come down to planet earth, pp. Will make your input more palatable

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I wouldn't go higher than $3000.

For comparison, we are slightly higher HHI than you ($260k) and our PITI is $2200. We also have young kids (k, pk, and daycare) and save a decent amount (max 401ks, Roth's, $500/mo per kid to 529s) and after groceries, fixed expenses, activities, there's not a lot left!

Do you have a lot of room to grow in salaries? If so maybe go a little higher but you don't want to be house poor.

Can only increase maybe 30-50k in the next 10 years.
That is similar to what we currently pay.
We don't do 529s because we cash flow daycare/ tuition now so plan on continuing that.
Admittedly don't max out 401k, but do contribute to get the match.

Hard to swallow staying in the house we have outgrown in order to put money away for 30+ years from now, but aware it's probably the smarter move

Do you have other savings?

It sounds like your retirement savings are low, you don't have college savings. You can cash flow private school (Catholic? $24k/year seems fairly low) but college is much pricier and you're unlikely to get need-based aid at a $200k+ HHI. Do you have an emergency fund?

It really does seem like you should stay put and focus on saving.

Thank you for this input.
yes, plan to contribute 25K per year per kid through college. Additional costs must be through comb of grants/scholarship/loans, etc

Our retirement savings are low, but one of us is a Fed and will have ~40k pension (in today's $) at retirement.
Total retirement savings now are ~ 150k

We have 16k in an individual brokerage account.
Also an inherited IRA (240K) that we haven't done anything with thus far.

You are way behind and 25k/yr per kid for college isn’t jack shit , especially since you have young kids. You are very behind in retirement savings. Last thing you need is more debt and more expenses. Your focus should be college savings and more retirement contributions.

This is nonsense.
University of Maryland is 26,000 per year including room and board.
Many people don't have pensions.
Come down to planet earth, pp. Will make your input more palatable

Oh bless your heart, you must have toddlers.

[Anonymous]

In the real world a conservative number is 25% of gross income on PITI and that is for people making a lot less than 230k. At 230k HHI, necessities make up a smaller proportion of your expenses so 25% of gross should be even easier.

If you are sending your kids to private, you do not need to worry about the schools as much.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I wouldn't go higher than $3000.

For comparison, we are slightly higher HHI than you ($260k) and our PITI is $2200. We also have young kids (k, pk, and daycare) and save a decent amount (max 401ks, Roth's, $500/mo per kid to 529s) and after groceries, fixed expenses, activities, there's not a lot left!

Do you have a lot of room to grow in salaries? If so maybe go a little higher but you don't want to be house poor.

Can only increase maybe 30-50k in the next 10 years.
That is similar to what we currently pay.
We don't do 529s because we cash flow daycare/ tuition now so plan on continuing that.
Admittedly don't max out 401k, but do contribute to get the match.

Hard to swallow staying in the house we have outgrown in order to put money away for 30+ years from now, but aware it's probably the smarter move

Do you have other savings?

It sounds like your retirement savings are low, you don't have college savings. You can cash flow private school (Catholic? $24k/year seems fairly low) but college is much pricier and you're unlikely to get need-based aid at a $200k+ HHI. Do you have an emergency fund?

It really does seem like you should stay put and focus on saving.

Thank you for this input.
yes, plan to contribute 25K per year per kid through college. Additional costs must be through comb of grants/scholarship/loans, etc

Our retirement savings are low, but one of us is a Fed and will have ~40k pension (in today's $) at retirement.
Total retirement savings now are ~ 150k

We have 16k in an individual brokerage account.
Also an inherited IRA (240K) that we haven't done anything with thus far.

You are way behind and 25k/yr per kid for college isn’t jack shit , especially since you have young kids. You are very behind in retirement savings. Last thing you need is more debt and more expenses. Your focus should be college savings and more retirement contributions.

OP said what they plan to do about college. You can disagree with their plan, but there is no reason to insult them.

OP never gave their ages and yet you are able to declare that they are way behind with 400k in retirement savings and a Fed pension. Ignoring the pension, 400k in savings on a 230k HHI is right on target for a 37 years old and OP might be a lot younger than that.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I wouldn't go higher than $3000.

For comparison, we are slightly higher HHI than you ($260k) and our PITI is $2200. We also have young kids (k, pk, and daycare) and save a decent amount (max 401ks, Roth's, $500/mo per kid to 529s) and after groceries, fixed expenses, activities, there's not a lot left!

Do you have a lot of room to grow in salaries? If so maybe go a little higher but you don't want to be house poor.

Can only increase maybe 30-50k in the next 10 years.
That is similar to what we currently pay.
We don't do 529s because we cash flow daycare/ tuition now so plan on continuing that.
Admittedly don't max out 401k, but do contribute to get the match.

Hard to swallow staying in the house we have outgrown in order to put money away for 30+ years from now, but aware it's probably the smarter move

This is a terrible “plan” you say you have a baby? Tuition is going to be much higher than what you are paying for daycare.

Why would you set your kids up to start their adult lives with crippling debt? At a bare minimum those daycare payments shouldn’t stop. They should be redirected into 529. You also have no business with your kids in private school if you can’t afford college. You are doing them a gigantic disservice.

I have a senior in high school and a sophomore. It’s not as simple as cash flow. I have one who is an excellent student and got into Georgia tech which is an excellent engineering school. I’m so glad I wont be leaving him out to dry. Sure I could have insisted he attend VT, but he got into a top engineering school and this is well worth the extra savings we did just in case state schools weren’t enough. Plus with you having a baby and inflation , the expense will be very different in 17 years from now. Schools are opening even more slots for international students and it is making state flagships insanely competitive and are off the table for many residents.