What % of your take home income goes to your mortgage?

[Anonymous]

20:27 again, realizing I made a mistake. 90k is pre-tax -- I SAH.

But, yeah, we live WELL below our means and have a lot of equity in our (small, inexpensive split-level 4 bedroom) home.

[Anonymous]

(but I did do the calculation with take-home rather than gross)

[Anonymous]

Anonymous wrote:20:27 again, realizing I made a mistake. 90k is pre-tax -- I SAH.

But, yeah, we live WELL below our means and have a lot of equity in our (small, inexpensive split-level 4 bedroom) home.

Good for you. I think this is inspiring.

[Anonymous]

Thanks. Nice to hear that on an anon forum as this is the sort of thing that nobody we know really knows about us.

[Anonymous]

(and hoping to pay off the mortgage this year. It really isn't of tax benefit to us with the amount of equity we have in the home and our current tax bracket)

[Anonymous]

Anonymous wrote:(and hoping to pay off the mortgage this year. It really isn't of tax benefit to us with the amount of equity we have in the home and our current tax bracket)

That's really great. You will be so relieved and proud, as you should be. What a good story in this time of overspending and over-mortgaged lifestyles (ours included) which I am trying to change. It helps to be married to someone on the same page, as it sounds like you are. We are not and it is a battle.

[Anonymous]

Thank you, that means a lot. I really do think "under-purchasing" can make an exponential difference from a financial standpoint. I'd like to go back to school at some point (thanks worthless BA in Psychology) and it will be nice to have that not stress us.

I'm probably the worse spender of the two of us but think overall I'm still quite good. My splurges are very minor, inexpensive, rare.

[Anonymous]

Anonymous wrote:Thank you, that means a lot. I really do think "under-purchasing" can make an exponential difference from a financial standpoint. I'd like to go back to school at some point (thanks worthless BA in Psychology) and it will be nice to have that not stress us.

I'm probably the worse spender of the two of us but think overall I'm still quite good. My splurges are very minor, inexpensive, rare.

Ok, since you have a background in psychology, may be you will indulge this question: what, if I may ask, is your family background or habits in terms of spending, income, etc.? I think that can sometimes play a role, and it is a subject I am interested in. Both because I think it has influenced my husband and myself (in the negative) but I also think at some point you have to grow up and be responsible for how you are choosing to live your life. Thanks.

[Anonymous]

Good question... I think my husband has influenced me very positively in this regard.

My mother is very financially responsible and well-off. She was not wealthy during my childhood but got there as an older adult.

My father was and is extremely irresponsible with his finances. Likely personality disorder(s), multiple forms of addiction, you name it -- you get the idea.

I grew up absolutely terrified of money. Not of having money -- but of managing money, having enough money. My dad would always discuss things like not having enough money for rent or the mortgage but then magically come up with some, probably in some completely unethical manner.

I do still kind of get a pit in my stomach when I see bills, which is ridiculous now obviously. My husband is a planner and very financially savvy (he's employed in finance as well) and is quite risk adverse, at least for the basics. Planning things out, constant discussion re: future goals, etc, this is what keeps me sane rather than picturing my family on a street corner. =p

For investment beyond the basics, yes, obviously one takes on varying amounts of risk for risk vs reward ratios, etc, but for the basics we both decided we were willing to have a smaller home and like sacrifices (commute for him) rather than be in debt forever.

For what it is worth, my husband also grew up with one fiscally responsible parent and one who wouldn't know a $5 bill from a $10 bill. His financially clever parent engaged him in financial discussion during his youth, as did a family friend who did well for himself.

I am not a fan of Dave Ramsey as I don't believe debt is evil and credit cards are evil (we pay in full on our Amex monthly) but I can kind of hear the Ramsey folks on the live cheap to live better someday line they spout... and I do think for some people and their spending habits he's probably a good choice. We don't "starve" ourselves for fun (wouldn't want to regret it if I knew I'd be hit by a bus tomorrow) but when possible we make cheaper choices and do often choose to abstain instead.

[Anonymous]

Anonymous wrote:Good question... I think my husband has influenced me very positively in this regard.

My mother is very financially responsible and well-off. She was not wealthy during my childhood but got there as an older adult.

My father was and is extremely irresponsible with his finances. Likely personality disorder(s), multiple forms of addiction, you name it -- you get the idea.

I grew up absolutely terrified of money. Not of having money -- but of managing money, having enough money. My dad would always discuss things like not having enough money for rent or the mortgage but then magically come up with some, probably in some completely unethical manner.

I do still kind of get a pit in my stomach when I see bills, which is ridiculous now obviously. My husband is a planner and very financially savvy (he's employed in finance as well) and is quite risk adverse, at least for the basics. Planning things out, constant discussion re: future goals, etc, this is what keeps me sane rather than picturing my family on a street corner. =p

For investment beyond the basics, yes, obviously one takes on varying amounts of risk for risk vs reward ratios, etc, but for the basics we both decided we were willing to have a smaller home and like sacrifices (commute for him) rather than be in debt forever.

For what it is worth, my husband also grew up with one fiscally responsible parent and one who wouldn't know a $5 bill from a $10 bill. His financially clever parent engaged him in financial discussion during his youth, as did a family friend who did well for himself.

I am not a fan of Dave Ramsey as I don't believe debt is evil and credit cards are evil (we pay in full on our Amex monthly) but I can kind of hear the Ramsey folks on the live cheap to live better someday line they spout... and I do think for some people and their spending habits he's probably a good choice. We don't "starve" ourselves for fun (wouldn't want to regret it if I knew I'd be hit by a bus tomorrow) but when possible we make cheaper choices and do often choose to abstain instead.

Thanks for taking the time to do this. Again, I think you are making really wise choices. I grew up with two very fiscally unresponsible parents. My father was A LOT like yours. I really crave financial security, but oddly have been a bit of a spender in my lifetime. It's like it feels more "normal" to live a bit on the edge, as warped as that is. However, in recent years I have become very interested in living below our means, looking at our finances (which are good) as a blessing and saving and paying off a home as an important goal. My husband grew up lower middle class but with savers (clip coupon types). They are doing fine (his parents) financially, where as mine are on Medicaid and food stamps. He has a bit of insecurity and gets easily wrapped up in expensive cars, home, vacations, etc. Anyway, just some background as you were nice enough to share yours. Thanks, and I will work on emulating more of what you are living. I also like the idea of talking to the kids along the way about finances, money, credit card debt, interest. But we also have to "walk the talk"

[Anonymous]

Me again, thanks for the thoughtful response to my blabber. I think even small amounts of additional frugality must really add up quickly if one happens to be in a higher income bracket than we are.

It must be hard planning with someone wanting to spend more. I do occasionally get jealous at the idea of a Caribbean holiday or something -- but really, the week long trip we have planned for next week will be fantastic... and the farm stay is a tiny tiny fraction of what we'd spend renting even a beach cottage nearby let alone driving further away.

Sometimes I wish my husband were a TINY bit less frugal. He's not at all the type to begrudge me that new skirt or an occasional Starbucks or whatnot, he's just very good at remembering it does all add up, and will bring it up if either of us have spent more casually than we typically do... but that reminder is what keeps me sane and on track, so it works.

If you're wanting to make big changes perhaps some planning on your own first running numbers to see how it would affect things down the line would help in a future discussion? I know looking ahead is helpful to me.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Seriously, you 10% and 7% people are impressive (I mean it!). Tell me more?! I am the one that posted about the book "Stop Acting Rich" I think I could learn from you both.

I am the 10 percent PP. I am an economist (300k) and Dh is an engineer (130k). When we got married, we both agreed that we should be able to live comfortably on a single salary (the lower of the two salaries). This determined our decision to buy a house around 600k in the early 2000s. Since then, most of my colleagues have upgraded to more expensive houses, but I refuse to...I value my freedom to do my job because I like it, not because I have to pay a mortgage.

That's fantastic. Can I pick your brain a bit, as an Economist? HHI about 950K but could change (down). One income. Potential of my income (wife) about 250K (what I made when I stopped working a few years ago). Mortgage, to me, seems out of line. It is 17K (including taxes/insurance, etc.). Thoughts? We also do private school (sigh). Otherwise, we save a reasonable amount (have a bit over 1M in equity in our current home and 1m in savings) we are 40 years old.

Given my preferences, your situation seems risky to me. But as you can probably tell, I am a pretty risk averse person. The important thing is for you and your dh to feel comfortable with your saving/spending behavior.

[Anonymous]

And yes, I think involving the kids is important. I think a lot about age appropriateness as well as my childrens' temperaments. My older daughter seems more anxiety-prone and I want discussions on finances to leave her feeling positive and powerful rather than overwhelmed or nervous.

[Anonymous]

Just wanted to say how much I'm enjoying the last half dozen or so posts. Very insightful and constructive. Thanks.

[Anonymous]

Just about 15%, not including taxes and insurance.