I Live Comfortably on Less than $70K After-Tax in DC Area

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:In your position you are absolutely not saving enough for retirement. You may be living fine, but you are shorting your retirement. Also, you should assume 4% for long term growth. At your age I wouldn't include SS either.

OP here. I am saving 18% of my income, which is more than the 15% that advisors recommend. And once I increase my contribution, I will be putting away 20%. I've been doing that since the first year after college, and I'm sure I'll be fine. The main thing is that I started early.

Don't count your employer match toward your retirement goal. I made $18k when I started out at 21 and because I saved as much as I could I am at about $1 million at 44. My DH did the same. $2 million in our mid 40s gives us a tremendous amount of flexibility for our future. What is your financial goal to retire with and at what age? An arbitrary percentage may or may not get you there.

When you are young with no family iit is also the time to establish a healthy emergency fund and create a taxable savings account for a down payment or other life priorities. You're right, &90k is a lot for a single person so use the money wisely. The Bogleheads forum is a good place to get feedback.

Thanks for the input. I actually researched that when I was setting up my retirement plan, and it said any employer match counts toward the 15%. But I will check out Bogleheads, since the discussion here is veering into a new direction about how much retirement savings is adequate.

Also, as far as emergency savings, I have about $35,000. If I lost my job, I could drop my spending down to $4,000, which would give me almost 9 months of living expenses. My research told me to have 6 months (one place said 3), so I think that's good as well.

I'll check out the site you recommended. Thanks.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:In your position you are absolutely not saving enough for retirement. You may be living fine, but you are shorting your retirement. Also, you should assume 4% for long term growth. At your age I wouldn't include SS either.

OP here. I am saving 18% of my income, which is more than the 15% that advisors recommend. And once I increase my contribution, I will be putting away 20%. I've been doing that since the first year after college, and I'm sure I'll be fine. The main thing is that I started early.

Don't count your employer match toward your retirement goal. I made $18k when I started out at 21 and because I saved as much as I could I am at about $1 million at 44. My DH did the same. $2 million in our mid 40s gives us a tremendous amount of flexibility for our future. What is your financial goal to retire with and at what age? An arbitrary percentage may or may not get you there.

When you are young with no family iit is also the time to establish a healthy emergency fund and create a taxable savings account for a down payment or other life priorities. You're right, &90k is a lot for a single person so use the money wisely. The Bogleheads forum is a good place to get feedback.

Thanks for the input. I actually researched that when I was setting up my retirement plan, and it said any employer match counts toward the 15%. But I will check out Bogleheads, since the discussion here is veering into a new direction about how much retirement savings is adequate.

Also, as far as emergency savings, I have about $35,000. If I lost my job, I could drop my spending down to $4,000, which would give me almost 9 months of living expenses. My research told me to have 6 months (one place said 3), so I think that's good as well.

I'll check out the site you recommended. Thanks.

You sound like you have your ducks in a row. How much emergency fund is also dependent in part on how secure you job is. My EF is high because I have little job security. In contrast, DH's job is about as secure as you can get so we know we will always have his salary as a base.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We're a family of four doing very well on a little under $90k.

We live close to downtown, go on European vacations every other year, travel frequently and eat out often. We are also frugal in all other areas and have plenty of money.

It blows my mind that people complain that $300k is poor. It's about the choices you make. You dont have to send your kids to the $2k a month downtown day care, or to $500 a week camps, or live in a macmansion.

OP here. Thank you. You're making the very point I've been trying to make. The people complaining that they can barely make ends meet on $200k make disparaging, snobby remarks about those of us who choose to live in Fairfax.

I'm betting that 90K family of 4 bought their house 15+ years ago, with kids out of daycare.

As for disparaging remarks about Fairfax - OP betrays her own lack of self esteem re: living in Fairfax. People aren't disparaging Fairfax but are rightly noting that it's much cheaper to live there than DC or closer in suburbs.

[Anonymous]

Anonymous wrote:We all have children. Because we are on a site called DC Urbanmoms.

+1

Good God, OP, get over yourself. We're all very proud of you, but you really have no clue until you have kids. They're expensive, and it makes life really stressful.

[Anonymous]

Anonymous wrote:

Anonymous wrote:WTF is all this crap about $300k being middle class and $80k being poor? I (single, no kids) live very comfortably on less than $70k (net). Here's my approximate spending:

$1650 PITI (3-bedroom, 1700 st condo in Fairfax County)*
325 condo fee
200 cable/phone/internet
150 electric
50 water
400 groceries/household stuff
150 gas/commuting. (3-person carpool)
800 medical (includes premium)

Fixed expenses: $3725

$600 Eating out/entertainment
150 Clothes (don't need much - have plenty)
50 Household repairs
200 Donations (annualized)
250 Vacations (annualized)

Discretionary expenses: $1250

Plus, savings toward retirement: $700

Total....$5675 per month ($68,100)

Because if you had even ONE child you'd need to add in at least 2k a month for daycare/nanny.

Not to mention diapers and bottles and strollers and clothes and if, like me, you couldn't breastfeed, formula.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Here are some other expenses I don't see listed that many people have:
- Student loans -- this is a HUGE killer for most people
- Gifts (maybe this comes out of entertainment/eating out, but our Christmas budget is at least $800)
- Life and/or Disability Insurance (assume you don't need it since you're single or your employer provides a small policy that is enough, but many married/parents need more life insurance)
- Gym Membership or other physical fitness expenses (maybe work provides, you don't work out, or you have a home routine with no cost)

- I transferred from CC, and won an 1/2 tuition academic scholarship to the four-year university. I also worked part-time. Parents made up the small difference (for which I am grateful).
- Yes, gifts come out of the entertainment line,
- Employer provides life/disability
- Great clubhouse at my condo community, with pool and work-out room. They give yoga classes there, too.

Right, which you can take at 1x salary as a single person because you are not responsible for anyone else. Get married and have a couple of kids. Then you are paying out of pockets for life insurance multiple times your salary so that you family isn't fucked if you get hit by a bus one day.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I've never understood it either OP. We make $200K and have more money than we know what do with.

This is so true. We have one kid and net annual salary is about $135,000 (this does not include about $35k a year in automatic retirement withholdings), so about $11,300 a month. This is so much more then we need to live comfortably that I don't bother budgeting for individual expenses, but as a general breakdown:

1. $3,300 a month mortgage/PITI.
2. $600 a month childcare.
3. $3,000 a month for everything else. Basically, pretty much everything goes on the credit card, and the monthly bill averages to around $3,000 a month.

So that's $6,900 a month in expenses, I'll round that up to $7,000. That gives us about $4,300 a month extra, which I add to "the pile".

Side eye at that

Under the table home daycare, guaranteed.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:WTF is all this crap about $300k being middle class and $80k being poor? I (single, no kids) live very comfortably on less than $70k (net). Here's my approximate spending:

$1650 PITI (3-bedroom, 1700 st condo in Fairfax County)*
325 condo fee
200 cable/phone/internet
150 electric
50 water
400 groceries/household stuff
150 gas/commuting. (3-person carpool)
800 medical (includes premium)

Fixed expenses: $3725

$600 Eating out/entertainment
150 Clothes (don't need much - have plenty)
50 Household repairs
200 Donations (annualized)
250 Vacations (annualized)

Discretionary expenses: $1250

Plus, savings toward retirement: $700

Total....$5675 per month ($68,100)

Because if you had even ONE child you'd need to add in at least 2k a month for daycare/nanny.

Not to mention diapers and bottles and strollers and clothes and if, like me, you couldn't breastfeed, formula.

if I had a child, I'd also have a husband, and our income would be double.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Here are some other expenses I don't see listed that many people have:
- Student loans -- this is a HUGE killer for most people
- Gifts (maybe this comes out of entertainment/eating out, but our Christmas budget is at least $800)
- Life and/or Disability Insurance (assume you don't need it since you're single or your employer provides a small policy that is enough, but many married/parents need more life insurance)
- Gym Membership or other physical fitness expenses (maybe work provides, you don't work out, or you have a home routine with no cost)

- I transferred from CC, and won an 1/2 tuition academic scholarship to the four-year university. I also worked part-time. Parents made up the small difference (for which I am grateful).
- Yes, gifts come out of the entertainment line,
- Employer provides life/disability
- Great clubhouse at my condo community, with pool and work-out room. They give yoga classes there, too.

Right, which you can take at 1x salary as a single person because you are not responsible for anyone else. Get married and have a couple of kids. Then you are paying out of pockets for life insurance multiple times your salary so that you family isn't fucked if you get hit by a bus one day.

If I had a family, I would have double the income - so an additional $6,000 for diapers, extra life insurance, etc. You people are adding in extra famiky costs without considering the extra family income.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We're a family of four doing very well on a little under $90k.

We live close to downtown, go on European vacations every other year, travel frequently and eat out often. We are also frugal in all other areas and have plenty of money.

It blows my mind that people complain that $300k is poor. It's about the choices you make. You dont have to send your kids to the $2k a month downtown day care, or to $500 a week camps, or live in a macmansion.

OP here. Thank you. You're making the very point I've been trying to make. The people complaining that they can barely make ends meet on $200k make disparaging, snobby remarks about those of us who choose to live in Fairfax.

I'm betting that 90K family of 4 bought their house 15+ years ago, with kids out of daycare.

As for disparaging remarks about Fairfax - OP betrays her own lack of self esteem re: living in Fairfax. People aren't disparaging Fairfax but are rightly noting that it's much cheaper to live there than DC or closer in suburbs.

Sure they disparaging Fairfax. One snob even said it's a punishment having to live there.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We all have children. Because we are on a site called DC Urbanmoms.

+1

Good God, OP, get over yourself. We're all very proud of you, but you really have no clue until you have kids. They're expensive, and it makes life really stressful.

Yeah, kids are expensive. But with two incomes adding up to around $200k, it's perfectly fine.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:After taxes DH and I live on twice what you earn, hence 140K, with two teen kids, both eating a ton, doing several sports, having a nice house we bought with a huge down payment. One kid just finished private school, no not the 40K per year one, but still a private, the other wanted public. With vacations to Europe every year, paid off condo in CO, unrented, fully furnished for our pleasure. And DS who traveled around the US for a sport competitions and even around the world. I assume you are younger, hence we saved more over time for these other things. Quite frankly, I have no idea what are you so smug about. We seem to be doing way better with comparably way less money per person per year. Three cars too, and car insurance for a teen. The question is not how are you managing well enough on your salary, the question is why aren't you doing better?

I'm not bing smug. You aren't getting the point. (And it isn't necessary to put me down.)

Nobody was putting you down, my comment on doing better has to do with your discretionary expenses, what exactly is that much money per month for?

OP here. First, you are actually proving the point of my thread - that it doesn't take $250k to manage even an ordinary,middle-class life, and anything less is a struggle. You are living an affluent life.

Second, about my discretionary expenses - I assume you mean $600/month. That's $150 a week, and that lunches at work, going out with friends for dinner once a week or so, ticket prices for different social events, a movie once or twice a month, gifts for parties (and family birthdays), stuff like that.

Discretionary expenses: $1250[b]

I don't actually care, but in your OP it says 1250. 1250 per month is a lot of money for fun. How did you come up with $600 now instead of 1250 from your original post?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We're a family of four doing very well on a little under $90k.

We live close to downtown, go on European vacations every other year, travel frequently and eat out often. We are also frugal in all other areas and have plenty of money.

It blows my mind that people complain that $300k is poor. It's about the choices you make. You dont have to send your kids to the $2k a month downtown day care, or to $500 a week camps, or live in a macmansion.

OP here. Thank you. You're making the very point I've been trying to make. The people complaining that they can barely make ends meet on $200k make disparaging, snobby remarks about those of us who choose to live in Fairfax.

I'm betting that 90K family of 4 bought their house 15+ years ago, with kids out of daycare.

As for disparaging remarks about Fairfax - OP betrays her own lack of self esteem re: living in Fairfax. People aren't disparaging Fairfax but are rightly noting that it's much cheaper to live there than DC or closer in suburbs.

That right, if you were lucky enough to buy a house 15+ in a good close in neighborhood like Mclean with good schools it's easy to live <$100. In these neighborhoods you don't need private schools, less commuting costs, more free time and less child care costs.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:After taxes DH and I live on twice what you earn, hence 140K, with two teen kids, both eating a ton, doing several sports, having a nice house we bought with a huge down payment. One kid just finished private school, no not the 40K per year one, but still a private, the other wanted public. With vacations to Europe every year, paid off condo in CO, unrented, fully furnished for our pleasure. And DS who traveled around the US for a sport competitions and even around the world. I assume you are younger, hence we saved more over time for these other things. Quite frankly, I have no idea what are you so smug about. We seem to be doing way better with comparably way less money per person per year. Three cars too, and car insurance for a teen. The question is not how are you managing well enough on your salary, the question is why aren't you doing better?

I'm not bing smug. You aren't getting the point. (And it isn't necessary to put me down.)

Nobody was putting you down, my comment on doing better has to do with your discretionary expenses, what exactly is that much money per month for?

OP here. First, you are actually proving the point of my thread - that it doesn't take $250k to manage even an ordinary,middle-class life, and anything less is a struggle. You are living an affluent life.

Second, about my discretionary expenses - I assume you mean $600/month. That's $150 a week, and that lunches at work, going out with friends for dinner once a week or so, ticket prices for different social events, a movie once or twice a month, gifts for parties (and family birthdays), stuff like that.

Discretionary expenses: $1250[b]

I don't actually care, but in your OP it says 1250. 1250 per month is a lot of money for fun. How did you come up with $600 now instead of 1250 from your original post?

The $1250 includes pro-rated spending for vacations, charitable donations, and clothes. Those were separate line items. I consider the $600 the month-to-month "fun." Different ways to look at it.

[Anonymous]

I am a parent and our net is less than OPs.... Should I start a thread?