Being lower middle class and living well

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I don't think you're taking into account how you'll feel after the fourth sleepless night in a row while working full time, and then coming home to two small children having temper tantrums and a messy house. THAT will be the moment when you want to first start cooking dinner? Sorry, OP, but you'll want to order take-out on those nights.

+1 million

$20 co-pays for kids sick visits IF you can get a doctor to see you x 6 per year (initial visit & follow-up, referral to specialist)
$40 for emergency urgent call centers when you can't get to docs x 6 per year
$50 for parking fees at doctors offices for above
$200 in lunches & snacks out when running around with kid
$200 per kid for field trips, PTA dues, etc
$300 per kid for clothes per year (you don't always get EVERYTHING hand-me-down, ie snow boots that fit, winter parkas, etc)
$200 per year for dental care for kids until time for ortho...ha, ha, ha...then it is
$2000 minimum ....
......

This is just a beginning....

Don't forget the $400 hospital bill (after insurance) for stitches for your three year old's arm.

But, I applaud OP's efforts - more people should live like this.

Yes. Think about how much further ahead she'll be if and when she does have a higher income and still lives frugally.

+1000 You rock OP! A few people that I know that have lived frugally like you do also have the money to show for it--ten, twenty years later.

Exactly. The facr people are warning her about ortho costs and she isn't even married or pregnant is laughable. She is so far ahead and over the years will make more money. By living this way, she can take a few years off of saving so aggressively and will still be a head. She has more money saved than some of my inv banking friends. It is so funny people want to put her down and tell her kids will ruin everything. I wonder if those same people saved this much shen they were single?

I would want to spend an extra 200 a month on dining out. Especially the cheap ethnic restaurants around. OPs existence sounds a bit boring and she might as well live in a lower col state.

[Anonymous]

Anonymous wrote:OP, I have never lived outside my means, always saved money, never bought things I couldn't afford, and don't make anywhere near as much money as many on this board. But you sound unbelievably smug. I agree with much of how you're approaching finances, but as I finished reading your self-pat on the back, all I could think is "boy, some day life is going to bite HER in the ass".

You are still young and have that black and white vision of youth. Someday, your life is going to turn very gray, and you're going to need to roll with the punches.

So it's a good thing she is being sensible now.

[Anonymous]

Congratulations, OP - I did the same a long time ago.
Now I live with DH and 2 kids in a tiny but cute little dollhouse that still cost a fortune because it's in one of the better school districts. We could afford it on our middle class salary because we had lived frugally like you and had economized and invested successfully in the stock market.

Now we still live very frugally.

Our main expenses are the mortgage and food.
Our disposable income goes to extra-curricular activities for the kids and traveling to see our families overseas.

Keep saving, OP, and make what you can of your career, because kids are expensive.

[Anonymous]

Anonymous wrote:I'm getting a little tired of everyone in this country, and especially this rich-people forum, complaining about how hard it is to be middle class nowadays. Yes, there are some problems - wages haven't risen with cost of living, taxes are higher, etc. But I'm a single, middle class young woman in DC, with a take home of about $2,600 a month, and I not only get by very nicely, but feel like I can live in the DC metro area in comfort and happiness and a feeling of well-being. I'm a lawyer with thankfully no debt (parents paid for my undergraduate education at a small, cheap state university, and then I went to a third tier law school at around 90% scholarship and my grandparents chipping in for the rest + living expenses). I work for a low-paying employer (trying to maintain anonymity). Here is how I cut down on my expenses and live really well:

My health, dental and vision insurance is taken care of by my employer. I live with four roommates in a lower-middle class neighborhood either on the edges of the city or in MD/VA, and my rent is around $650. I pay utilities like gas and electric and Internet splitting it up with roommates, but we do not bother with paying for cable. I instead have Netflix on my laptop, which is $8/month. My roommates and I share the Netflix account and even split that cost, so guess what I'm paying for Netflix per month? $2. And I get to stream anything and have lots of fun.

I do not own a fancy smart phone, just an HTC Evo 4G which I got for $99. My cell phone provider is not Verizon or AT&T or T-Mobile, but a tiny independent carrier called FreedomPop, where I pay a flat fee of $20 a month for unlimited talk, text and data (well until a 1GB limit, then the speed drops).

My car is a very old late-90s model (unwilling to divulge details) with plenty of miles on her but carefully tended to, tweaked and strategically upgraded over the years (new wheels, new brakes, tuning engine to get more power,etc) for less than $4,000. I save on gas by limiting my driving through combining errands, and carpool to work when I can. I also walk a lot and this way I also get my exercise. I do a LOT of walking when I can - to friends' houses, to the library, etc. Walking is also a romantic date activity for my boyfriend, in fact!

My food and medication are all generic brands, and I remain as healthy as a horse. Lots of non-organic veggies are perfectly safe to eat. I almost NEVER eat out at restaurants. That's right, never. Why spend $20 on my food and then being forced to tip on top of that? Or wasting money with to-go deli sandwiches that are overpriced and I can make at home? I take a brown bag to work. I have a coffee flask so I haven't visited a Starbucks since law school. I can buy enough food at my non-fancy grocery store, and I'm an experienced and creative enough cook, that I can make restaurant-worthy meals in my own kitchen. I buy a lot of stuff in bulk. I think the last time I went out to a restaurant was around seven months ago. And I almost never buy alcohol - it's expensive, has empty calories, bad for my health, and not something I need to have fun. However I'm happy to drink if an employer or client is paying. I do drink tons and tons of water though, which has not only changed the texture and tone of my skin but is also completely free! I don't buy soda, I don't drink much juice, and I buy very little coffee because I can get free coffee at work. I also make my own snacks and take them everywhere with me.

How do I socialize when I don't buy drink or food outside? I manage! For date nights with my boyfriend, we usually cook together and then watch a movie, either at my place or his, or we go out and do something relatively cheap or free (concerts in the park, etc). I go to bars with my friends and just drink water (I don't even want to spend $2 on a beer - you'll be shocked how quickly that adds up plus I don't like the taste of beer much). I invite friends home for a potluck dinner and cook a couple really good dishes as the hostess. My friends are misers too, so if we want to eat outside, we can always cook our own food and grab a picnic table at a public park.

There are also tons of free events around town, which I enjoy going to with a friend or a date. Even museums have free admittance days.

I also don't buy books unless I can't find them in the library and I really want them.

I take care of my clothes meticulously, and only shop at thrift stores or on sales and clearance racks at stores like Marshall's or TJ Maxx. I have rewards cards at stores like this. I also find that online stores can sell really cute clothes for very competitive prices, because they have no physical infrastructure to pay for. I buy holiday presents up to eight months in advance sometimes, meticulously searching for dirt cheap deals on items that I know my loved ones really want for birthdays or Christmas or Valentine's Day.

My holidays are always domestic and sometimes even local. I haven't gone abroad in about 5 years and I don't feel I'm missing out. I have a lot of fun with my family members, roommates, friends or co-workers, whether I'm back in my parents' house or out camping in a gorgeous park. Most recently my boyfriend and I drove down to colonial Williamsburg, which isn't far from DC and is a wonderful weekend trip for history nerds like us.

My savings, which is in the range of $1,400 per month, go into a high-interest savings account where compound interest makes sure my net worth doesn't fall behind inflation. In 2016 I'd like to move in with my boyfriend (who earns about the same as I do and is just as thrifty), but currently we're saving aggressively in our cheap living arrangements.

Eighty years ago the culture of eating out, traveling wildly, and having all kinds of unnecessary luxuries at home or in your lifestyle wasn't expected of the middle class. I think we need to change some of the expectations we have regarding what kind of lifestyle is considered "middle-class".

You talk a lot.

[Anonymous]

Most of her peers have I phones, cable, student loans and eat out frequently. That there is the 1400 a month she is able to save.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Report back after you are married and have kids.

This. 1000 times this.

I am sorry but I have to agree with this. OP, based on what you write, you cannot afford to marry and have kids, or could barely afford it. Which is pretty much the central thing people are talking about when they say that the middle income american family cannot get by or get ahead.

[Anonymous]

Anonymous wrote:Hi everyone! I'm the OP. Thanks for the nice comments. One last post before I go to bed.

Anonymous wrote:

Anonymous wrote:Report back after you are married and have kids.

This. 1000 times this.

Why would that change anything? The conventional wisdom in fact is that if you want to save money, get married young. But sure, let's dissect this real quick.

Things that wouldn't change if I got married and had kids:
- Would still eat 99% home-cooked food and generic brands.
- Would still not buy alcohol.
- If my old car doesn't last then I'll buy a used car and use it the same way
- Same cheap $20/month phone plan
- Would still not pay for TV/cable.
- Would still hopefully have a job that pays all health and dental insurance for family.

Things that would improve if I got married:
- Giant standard deduction from taxable income
- Tax credit for each kid I have
- Tax-deductible contributions to a joint retirement savings account.
- If we buy and sell a home together, we don't have to pay taxes on the profit as long as it's not more than $500,000
- Could probably combine car insurance policies and get a discount.

Things that would suck if I got married and had kids
- Having to pay more on living expenses, such as rent or mortgage, because I only have the DH's income to split it with as opposed to 4 roommates and plus I'd have to choose a slightly nicer apartment to make room for kid(s).
- Costs having a child. This is really the only major expense problem. So you start paying right from prenatal care to the actual birth in the hospital, then you lose income even on maternity leave, the clothes and car seat and baby food, etc. Plus I may need to start putting down at least $800 a month for the college fund.

In any case that baby had better get good grades and wrangle some scholarship money! Public school and public university or I'm not paying. I went to public schools and it turned out great for me.

With my lifestyle habits and two incomes, why the hell can't I raise a child and still live well with my class/income level?

Good night for now!

I can't tell you why but it did.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Report back after you are married and have kids.

This. 1000 times this.

I am sorry but I have to agree with this. OP, based on what you write, you cannot afford to marry and have kids, or could barely afford it. Which is pretty much the central thing people are talking about when they say that the middle income american family cannot get by or get ahead.

So you don't think she and her boyfriend will receive a raise? Ever? How can they not afford to marry? It only costs around 100 dollars to marry! I would think even if they didn't make more money, they could float all of their expenses on his salary alone, she could stay home with kids and have some sort of side job.

[Anonymous]

I assume the 2600 net is after full retirement max, am I correct? The 1400 a month is in addition to the 17,5 you put in retirement last year?

[Anonymous]

Anonymous wrote:

Congratulations, OP - I did the same a long time ago.
Now I live with DH and 2 kids in a tiny but cute little dollhouse that still cost a fortune because it's in one of the better school districts. We could afford it on our middle class salary because we had lived frugally like you and had economized and invested successfully in the stock market.

Now we still live very frugally.

Our main expenses are the mortgage and food.
Our disposable income goes to extra-curricular activities for the kids and traveling to see our families overseas.

Keep saving, OP, and make what you can of your career, because kids are expensive.

The voice of experience. It is quite doable!

[Anonymous]

You're young now but as you she you may find that your friends and roommates aren't up for group living and cheap potlucks. Your health care may increase, or you may have other emergencies

[Anonymous]

Cooling story

[Anonymous]

Anonymous wrote:Report back after you are married and have kids.

this x10000. Once you have kids, it all changes. I was living a pretty good life as a young single person on a public school teacher's salary. But now that I am married with two kids, it would be very very difficult to live comfortably on that salary. Good thing DH makes decent money, otherwise we would be having a hard time.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Report back after you are married and have kids.

This. 1000 times this.

A million times!

I can't believe how much more expensive it is to have kids than it was to be a "single lady in my 20s" like OP.

She's naive and clueless and she's trying to sound wise. What an ass!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Congratulations, OP - I did the same a long time ago.
Now I live with DH and 2 kids in a tiny but cute little dollhouse that still cost a fortune because it's in one of the better school districts. We could afford it on our middle class salary because we had lived frugally like you and had economized and invested successfully in the stock market.

Now we still live very frugally.

Our main expenses are the mortgage and food.
Our disposable income goes to extra-curricular activities for the kids and traveling to see our families overseas.

Keep saving, OP, and make what you can of your career, because kids are expensive.

The voice of experience. It is quite doable!

I'm the PP who lived like you. When DH and I got married and had DC1, we earned 60K total gross income, and all our money went to daycare. One bedroom apartment, which we kept until DC2 was a year old.
Now our gross HHI is 120K, I stay home, and we max out retirement and college savings plus have a little left over for travel to Europe and Asia every few years. But daily, we live a frugal lifestyle which my friends cannot probably imagine. The trick is to never spend spontaneously. Everything is budgeted and planned for, and with that comes a sense of control and satisfaction. Instead of feeling submerged by expenses and jealous of what others earn, I feel empowered by the good financial choices we make and how most of our money is invested.