Study shows that 350k/year is barely scrapping by as middle class

[Anonymous]

Anonymous wrote:I live just outside Chicago. My spouse and I are both teachers. Our HHI is 155K. We do okay. We save 20% of our income on top of the percentage of our income that goes to our pension. We save for our our kids' college as do their grandparents. By the time they graduate, we'll have enough to pay for state university. Our oldest, right now, looks to be headed for a free ride to a state school if she wants to go there though, so that can be grad school money. We go on one 3-4 day vacation a year to a location we can drive to. We maintain our very small modest SFH. My husband and I share one car and we are not buying a second car for our teenagers. They will continue to walk, ride their bikes or share our one car when it is available. We don't feel poor. We know we are wealthier than 95% of the rest of the world. Sometimes we feel the pinch, but I know poor and we aren't it. I know that DC is more expensive than Chicago, but is it more than 2x in cost? Aren't there bad neighborhoods that are affordable? Before living where we do now, my family lived in a poor, mostly black and latino neighborhood with significant crime in a condo that cost about 40% of what one in a nice area might cost. I don't like it when people say they can't afford Chicago. For middle class folks like my family, that is code for "We won't live where there is crime", which is very different than saying they can't afford the city. They can, they just don't want to live where it is affordable.

The nerve! So snobby.

[Anonymous]

Not saying it is snobby. I'm just saying they are making a choice instead of the city being unaffordable. The city is not unaffordable. The affordable parts may not be desirable, but they are there. My old neighborhood, while high in crime, overall was fairly safe-ish. If you weren't a gang member and weren't out walking around at 2 a.m., you were fine.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Middle class people do not own $1.8m houses. Nor do they spend $24,000 on preschool. Or $2,000 a month on food.

What a stupid article.

I think the spreadsheet is realistic--whether you call it middle-class or not. COL in DC is high and 24,000$ for two-working parents is the norm here.

Yes, COL in the DC area is high. Hard to get around the high cost of daycare and early education.

But why am I able to be happy and have money left over in our $600k townhouse while others need a $1.8m new construction? We could probably get approved for a $1.5m mortgage, but we aren’t that foolish.

[Anonymous]

I have a friend who got approved for a 1.5 million house loan and she thought that that is what they can afford. Hubris.

Now they are trying to hustle money for their DD's tuition and they have none.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Middle class people do not own $1.8m houses. Nor do they spend $24,000 on preschool. Or $2,000 a month on food.

What a stupid article.

I think the spreadsheet is realistic--whether you call it middle-class or not. COL in DC is high and 24,000$ for two-working parents is the norm here.

Yes, COL in the DC area is high. Hard to get around the high cost of daycare and early education.

But why am I able to be happy and have money left over in our $600k townhouse while others need a $1.8m new construction? We could probably get approved for a $1.5m mortgage, but we aren’t that foolish.

+1 We lived in a $500k condo for our kids first 5 years of life, and then moved to a SFH once we were spending less money on childcare. If you "choose" a $1.8 million house, you're setting yourself up for problems if you don't have the salary (I'm surprised they even got approved for that mortgage at a 350k salary level.)

[Anonymous]

The amount they are paying for property tax (22.5k/year) is huge, plus their vacations (2 destination vacation plus 1 staycation per year) is also pretty luxurious.

[Anonymous]

I think the problem that a lot of posters that have a HHI of $350k+ have is that they thought “rich” would look different than it does for them. They envisioned that they’d frequently be on yachts, in the Caribbean half the year, and Switzerland that other half. They’re shocked that while this kind of HHI does get them a monstrous $1.8 million home in Arlington, the Jay-Z lifestyle is still far beyond their reality. So while every calculator out their tells them they’re upper class, they stubbornly insist they’re middle class because their reality doesn’t align with what they’d imagined.

[Anonymous]

Anonymous wrote:I have a friend who got approved for a 1.5 million house loan and she thought that that is what they can afford. Hubris.

Now they are trying to hustle money for their DD's tuition and they have none.

Yeah, the Zillow affordability calculator is not your friend.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We are wealthy on 350K with a SAHM. Feel very fortunate.

This point was also made earlier, 350k single earner household with a SAHM is a different story than 2 working parents earning 350k combined.

This is a whole different ballpark. First. A two-earner household pays double FICA taxes. They also have the added expenses of childcare, extra commuting, dry cleaning, etc and are more likely to outsource due to the time crunch.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We are wealthy on 350K with a SAHM. Feel very fortunate.

This point was also made earlier, 350k single earner household with a SAHM is a different story than 2 working parents earning 350k combined.

This is a whole different ballpark. First. A two-earner household pays double FICA taxes. They also have the added expenses of childcare, extra commuting, dry cleaning, etc and are more likely to outsource due to the time crunch.

+ 1

I would add - the advantage of having someone help with homework, enrichment and acceleration at home, at no cost.

[Anonymous]

I make $606 per month on Social Security Disability. This is plenty for me to live on by myself. I do not need much. I am content.

[Anonymous]

Anonymous wrote:I have a friend who got approved for a 1.5 million house loan and she thought that that is what they can afford. Hubris.

Now they are trying to hustle money for their DD's tuition and they have none.

Jokes on you, they get scholarship

[Anonymous]

We have this income, and we are very comfortable, with lots of money saved each month or spent on discretionary items. However, that's because we live in Burke. If we wanted to live in Arlington or DC, pay for private school, etc., it would feel tighter. As it is, I would never call myself middle class. But I guess we did have to give up living close in, to have all this leftover. Gives us piece of mind. We could live on one salary if we wanted. We can decide each month whether to save extra or go on a vacation/do a home improvement project. I cannot complain.

[Anonymous]

Here’s why many people don’t consider it rich or call it middle class.

Many Americans grew up in an average home in a non coastal city. They had married parents with one or maybe two parents working normal paying jobs. They lived in a nice part of town but not the nicest. They didn’t go on fancy vacations, but they went on vacations. They took their kids to Disney. Annual beach vacation. A decent car or two in the driveway. College tuition was reasonable. This was all very doable on a normal salary and in many US cities, it still is!

But you can’t replicate that lifestyle in a city like DC, New York, sf etc. you can’t be an average worker bee and live in a nice part of dc, drive a newish car, pay for childcare, send your kids to college, take annual vacations and the like and have much, if anything, leftover at the end of the month.

The home I am writing this from is well over a million and was not even a middle class neighborhood. It was a working class neighborhood. Arlington and what are now expensive parts of the DC area didn’t even used to be remotely expensive.

[Anonymous]

Anonymous wrote:We have this income, and we are very comfortable, with lots of money saved each month or spent on discretionary items. However, that's because we live in Burke. If we wanted to live in Arlington or DC, pay for private school, etc., it would feel tighter. As it is, I would never call myself middle class. But I guess we did have to give up living close in, to have all this leftover. Gives us piece of mind. We could live on one salary if we wanted. We can decide each month whether to save extra or go on a vacation/do a home improvement project. I cannot complain.

Bingo.