Down and Out on $250K/year....

[Anonymous]

Anonymous wrote:Agree that no one on this thread who is making $250K describes themselves as 'down and out'- it's just that they don't necessarily have the 'disposible income' to easily pay even more than they do now in taxes. We all have to make trade offs and choices. It's not whining, it's just reality. Yes, making $250K vs $150K gives you more choice, but it certainly doesn't eliminate many trade offs. That doesn't happen until you get into much higher income brackets. My family makes about $300K/year- we consider ourselves very fortunate and are happy to have the opportunities we do- definitely no complaints here. It doesn't mean we don't struggle to pay for childcare and other expenses that are much higher in the DC area.

Struggling at 350K though? Really, you are struggling? To me that means you aren't doing something right. Maybe you bought too much house.

[Anonymous]

Anonymous wrote:What exactly is the problem so many people have with the term "rich"? Why are they so defensive about being labeled "rich"? Exactly, what is it you don't like about it?

That it's not true.

Rich is financial independence. If you have to slog it in to work 60 hours a week to get that $250K you're not rich.

For all those who think that you can be rich even if most of your money goes to private school and nannies, would you feel the same way if the same amount of money went to in-home or nursing home care for parents and grandparents?

[Anonymous]

Anonymous wrote:What exactly is the problem so many people have with the term "rich"? Why are they so defensive about being labeled "rich"? Exactly, what is it you don't like about it?

What is it about the term that makes you want to apply it to people who, when you add it up, don't really have a lot of extra money to play with? The original article shows that the $250K couple with two kids, an average home in the area where they live, two cars, and a dog are able to maximize their 401K and put away $8K per year for their kids college. They get to pay about $5K in repairs on their house each year, and about $5K to clean it. They have insurance, they get to spend $200 per month on phone, cable, and internet, a little more than $1K per month on food, $3,000 per year on clothes, take one $4K vacation. Add all that up and there's nothing left over.

Maybe they've exaggerated some of the items, but I invite you to go through the list and add up the savings and then, assuming all you say is true, explain why the quality of life is so much better than a couple making $150K. We all admit that it's nice to be able to maximize your retirement and save for college, but is that really your definition of something only rich people get to do? One $4K vacation? Really? The posters on this topic are saying look, it's nice, but it's just not as much money as you think it is. Plugging your ears and saying "but it's still in the top 3% of earners" doesn't mean that the people making slightly more than you are enjoying a much more lavish lifestyle.

And one more thing, why would the top 3% of earners necessarily be rich when $150K puts you in the top 7% or so. Why isn't $150K "rich"?

http://www.thefiscaltimes.com/Special-Features/Tables/Down-and-Out-on-250000-a-year.aspx

[Anonymous]

Anonymous wrote:

Anonymous wrote:What exactly is the problem so many people have with the term "rich"? Why are they so defensive about being labeled "rich"? Exactly, what is it you don't like about it?

What is it about the term that makes you want to apply it to people who, when you add it up, don't really have a lot of extra money to play with? The original article shows that the $250K couple with two kids, an average home in the area where they live, two cars, and a dog are able to maximize their 401K and put away $8K per year for their kids college. They get to pay about $5K in repairs on their house each year, and about $5K to clean it. They have insurance, they get to spend $200 per month on phone, cable, and internet, a little more than $1K per month on food, $3,000 per year on clothes, take one $4K vacation. Add all that up and there's nothing left over.

Maybe they've exaggerated some of the items, but I invite you to go through the list and add up the savings and then, assuming all you say is true, explain why the quality of life is so much better than a couple making $150K. We all admit that it's nice to be able to maximize your retirement and save for college, but is that really your definition of something only rich people get to do? One $4K vacation? Really? The posters on this topic are saying look, it's nice, but it's just not as much money as you think it is. Plugging your ears and saying "but it's still in the top 3% of earners" doesn't mean that the people making slightly more than you are enjoying a much more lavish lifestyle.

And one more thing, why would the top 3% of earners necessarily be rich when $150K puts you in the top 7% or so. Why isn't $150K "rich"?

http://www.thefiscaltimes.com/Special-Features/Tables/Down-and-Out-on-250000-a-year.aspx

SYou mean after they spend all that money on food and clothes and repairs and cable and tv and take a vacation, they don't have much left over? You're right--they are living right on the edge. How can I add an eye roll here? Good god.

[Anonymous]

Anonymous wrote:What exactly is the problem so many people have with the term "rich"? Why are they so defensive about being labeled "rich"? Exactly, what is it you don't like about it?

I'll bite. I'm rich, but I would never think like that to myself or say it out loud. I come from a very middle class background - well educated but not tons of $$$. I feel very conflicted about thinking of myself as rich, when my parents, who are comfortably retired, will never be rich and in fact, sacrificed a lot financially for me and my siblings. I'm also terrified that if I admit I'm rich, I'll get used to it, and be upset if I'm not rich someday. I want to always be fiscally prudent, and I'm afraid I might get lax and spend too much if I lulled myself into thinking I'm rich. Plus the other reasons that folks have mentioned - we don't "look" rich based on lifestyle and we hang with a bunch of even richer folks.

[Anonymous]

I'm not done yet with you PP. A 4k vacation is a huge luxury. Being able to spend 1000 a month on food without clipping coupons is a luxury. Being able to MAX retirement AND set money aside for college? Luxury.

3000 on clothes? Another luxury. Cable is definitely a luxury.

Being able to afford luxuries easily and still be able to save and pay bills is the definition of rich. Sure, there are degrees of rich, but that is rich.

[Anonymous]

150K is still doing pretty good.

We make a bit over that and I just don't understand people throwing around terms like "struggling." Fine, it's not rich, but don't you get when people use terms like "strugging" to describe their 300K lifestyle as someone just did, that they sound....out of touch? When they have a house, a certain level of security, and access to decent schools and medical care that many people don't have?

[Anonymous]

Anonymous wrote:150K is still doing pretty good.

We make a bit over that and I just don't understand people throwing around terms like "struggling." Fine, it's not rich, but don't you get when people use terms like "strugging" to describe their 300K lifestyle as someone just did, that they sound....out of touch? When they have a house, a certain level of security, and access to decent schools and medical care that many people don't have?

Agree. I am the 16oK poster from a few pages ago, and I feel I am doing very well. Another hundred thousand and I would be ecstatic.

I guess it's true, mo'money, mo' problems. Or so people think.

[Anonymous]

For many, buying diapers for their kids is a luxury. Buying clothes at Target and Old Navy doesn't mean you are not doing very well if you make 250K:

http://www.dcdiaperbank.org/

"Sadly, millions of low-income families--including countless families in our area--are unable to provide enough diapers for their babies and toddlers. The DC Diaper Bank was founded in October 2010 with the goal of helping families in need in a lasting way. Diapers may seem like a small thing, but for a baby and a family without access to a supply of clean diapers, it can change their lives."

[Anonymous]

Anonymous wrote:

Anonymous wrote:Agree that no one on this thread who is making $250K describes themselves as 'down and out'- it's just that they don't necessarily have the 'disposible income' to easily pay even more than they do now in taxes. We all have to make trade offs and choices. It's not whining, it's just reality. Yes, making $250K vs $150K gives you more choice, but it certainly doesn't eliminate many trade offs. That doesn't happen until you get into much higher income brackets. My family makes about $300K/year- we consider ourselves very fortunate and are happy to have the opportunities we do- definitely no complaints here. It doesn't mean we don't struggle to pay for childcare and other expenses that are much higher in the DC area.

Struggling at 350K though? Really, you are struggling? To me that means you aren't doing something right. Maybe you bought too much house.

Actually, it's just the opposite. We just have a different idea of how much savings are required for retirement and education costs.

PP, you must be one of the almost 50% of Americans who pay no federal income tax. Why don't you sit in an office for 60+ hours a week, start taking conference calls on major holidays, start oaying the AMT and then get back to me and tell me how much you can't wait to shell out more money in taxes. I have to laugh though because it's only a matter of time before the tax collector starts coming after the "rich" making 100,000+. Tell me, will you $100,000 earners delight in paying more taxes or would you rather see the government cut out wasteful spending?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Agree that no one on this thread who is making $250K describes themselves as 'down and out'- it's just that they don't necessarily have the 'disposible income' to easily pay even more than they do now in taxes. We all have to make trade offs and choices. It's not whining, it's just reality. Yes, making $250K vs $150K gives you more choice, but it certainly doesn't eliminate many trade offs. That doesn't happen until you get into much higher income brackets. My family makes about $300K/year- we consider ourselves very fortunate and are happy to have the opportunities we do- definitely no complaints here. It doesn't mean we don't struggle to pay for childcare and other expenses that are much higher in the DC area.

Struggling at 350K though? Really, you are struggling? To me that means you aren't doing something right. Maybe you bought too much house.

Actually, it's just the opposite. We just have a different idea of how much savings are required for retirement and education costs.

PP, you must be one of the almost 50% of Americans who pay no federal income tax. Why don't you sit in an office for 60+ hours a week, start taking conference calls on major holidays, start oaying the AMT and then get back to me and tell me how much you can't wait to shell out more money in taxes. I have to laugh though because it's only a matter of time before the tax collector starts coming after the "rich" making 100,000+. Tell me, will you $100,000 earners delight in paying more taxes or would you rather see the government cut out wasteful spending?

Of course you have a different idea, because you want to maintain the same lifestyle after retirement, and end your kids to a college that is a good fit for your social class. But the very fact that you can put away more than is absolutely necessary is a luxury.

[Anonymous]

PP, don't you want to maintain your same lifestyle in retirement? Otherwise, why retire (?)

[Anonymous]

I am also quite sick of hearing the stats of the top 3% or top 7% of earners. I'd love to be in Nebraska on $250K/year. I'd even love to be in Atlanta on that, where private school costs are half what they are here and child care is 30% cheaper. The value of a dollar in DC metro is not the same as the value of a dollar in Nebraska. Generally, incomes in the different regions reflect this differing value. However, the "top 3%" and "top 7%" labels conveniently ignore this value difference. It's a great oversight when you are trying to induce class warfare in the midst of a political campaign.

On another note: We pay $400/month to Verizon for telephone/tv/internet/cell. Do that math, and it's almost $5K/year. Everything in that over one phone line is a luxury. Start working up the scale of how much that is in percentages for the incomes discussed above, and you start to see how someone making $50K probably shouldn't have a $400/month Verizon bill and should cut back. Someone making $250K probably groans when they pay the bill, but they don't cut back the spending. It seems that 15:32 considers that rich. But you can't end the inquiry there. You have to look at what else they are paying and buying. Do they buy a new car every couple of years? Send kids to private when a good public school is available? Employ a nanny when Mom stays home? These, I think, are indicators of being rich. Not whether they have internet access at home.

People make choices with their money and their lifestyle choices all the time. The big question, do you have to make choices at all or can you have it all? Having it all is rich. Making calculated choices whether you put a down payment on a car or drive your 10 year old car one more year so that you can send your child to a non-county camp is a financial tradeoff that fiscally responsible, not necessarily "rich", people make.

I wonder how much phone/tv/internet/cell cost in Nebraska?

[Anonymous]

Anonymous wrote:For many, buying diapers for their kids is a luxury. Buying clothes at Target and Old Navy doesn't mean you are not doing very well if you make 250K:

http://www.dcdiaperbank.org/

"Sadly, millions of low-income families--including countless families in our area--are unable to provide enough diapers for their babies and toddlers. The DC Diaper Bank was founded in October 2010 with the goal of helping families in need in a lasting way. Diapers may seem like a small thing, but for a baby and a family without access to a supply of clean diapers, it can change their lives."

Why don't they just use cloth diapers and wash them out? It's a PIA but, it's been done for thousands of years.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Agree that no one on this thread who is making $250K describes themselves as 'down and out'- it's just that they don't necessarily have the 'disposible income' to easily pay even more than they do now in taxes. We all have to make trade offs and choices. It's not whining, it's just reality. Yes, making $250K vs $150K gives you more choice, but it certainly doesn't eliminate many trade offs. That doesn't happen until you get into much higher income brackets. My family makes about $300K/year- we consider ourselves very fortunate and are happy to have the opportunities we do- definitely no complaints here. It doesn't mean we don't struggle to pay for childcare and other expenses that are much higher in the DC area.

Struggling at 350K though? Really, you are struggling? To me that means you aren't doing something right. Maybe you bought too much house.

Actually, it's just the opposite. We just have a different idea of how much savings are required for retirement and education costs.

PP, you must be one of the almost 50% of Americans who pay no federal income tax. Why don't you sit in an office for 60+ hours a week, start taking conference calls on major holidays, start oaying the AMT and then get back to me and tell me how much you can't wait to shell out more money in taxes. I have to laugh though because it's only a matter of time before the tax collector starts coming after the "rich" making 100,000+. Tell me, will you $100,000 earners delight in paying more taxes or would you rather see the government cut out wasteful spending?

PP, I am so with you. Can someone please define "absolutely necessary" to me? Those people that are not saving for retirement on the income for the career path they chose bother me. Those are the same people that actually expect to have social security to BE there retirement. Social security IS NOT a retirement program. It is there to make sure that people who have been down and out have something. It is not a retirement fund for those who never dropped a dime into a 401K fund that they were eligible for so that they could keep up with the Joneses. Your kids need clothes. They don't need Lucky Brand jeans. Your kids need food, they don't need it from Whole Foods. One TV is more than enough. The library is a good place to get books. Not everyone needs an iPhone.

If you live for today and don't provide for your own future, including aspiring to work hard and get paid well, you get what you deserve. I don't want to subsidize your flat screen because I am stuck paying the AMT because I have aspired to work hard and get paid well.