Did you buy a house that stretched your budget? Was it worth it?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

[Anonymous]

Question to the mortgage underwriter, do you know how much people have in 401K? I think we showed our lender our pay stubs and savings/investments but not our retirement accounts. Just curious. And you are right, I think most people around here over extend to get a better house.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

You may see a lot of people making $300K plus that are idiots but statistically a very small number of people are making $300K plus. So if what you're getting at is that it's great for an extremely narrow segment of the population to buy a house they can afford on only one income that's great but it still isn't applicable to the vast majority of people.

The advice not to stretch to the max is well taken for all people though.

[Anonymous]

Anonymous wrote:Question to the mortgage underwriter, do you know how much people have in 401K? I think we showed our lender our pay stubs and savings/investments but not our retirement accounts. Just curious. And you are right, I think most people around here over extend to get a better house.

Yes, I do see that. It is required documentation. Maybe your investments were sufficient to qualify, but in the packet we ask for it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

You may see a lot of people making $300K plus that are idiots but statistically a very small number of people are making $300K plus. So if what you're getting at is that it's great for an extremely narrow segment of the population to buy a house they can afford on only one income that's great but it still isn't applicable to the vast majority of people.

The advice not to stretch to the max is well taken for all people though.

Statistically very low nationwide, but not at all uncommon for home buyers in the DC Metro area. Actually highest concentration in the nation. We only handle A+ borrowers , obviously that group is more likely to have 300k earners. I see tons and tons of dual income federal employees who easily are hitting around 300k. Lots of IT workers making even more.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

Do you two work for the same company?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

Do you two work for the same company?

No and now our hhi is closer to 400k.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

No snark- how do you contribute 75k to your 401k?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

No snark- how do you contribute 75k to your 401k?

Me 18k plus 13k match plus 17k another retirement vehicle (rolls into 401k if I leave)
Him 18k plus 12k match
Totals 78k

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

Do you two work for the same company?

No and now our hhi is closer to 400k.

Doesn't add up.

Both of you have ESPP and both of you have an employee match of nearlub100%. As a benefits administrator I've never ever in my life seen an employer who does espp and a full employer 401k match.

I'm thinking you are either financially ignorant or full of shit

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

Do you two work for the same company?

No and now our hhi is closer to 400k.

Doesn't add up.

Both of you have ESPP and both of you have an employee match of nearlub100%. As a benefits administrator I've never ever in my life seen an employer who does espp and a full employer 401k match.

I'm thinking you are either financially ignorant or full of shit

I'm a new poster. I get a 7% match, my salary isn't as high as these. But if we each made 150,000 we would be at a match of 10,500. I think lots of companies do a %, so you could get close to those levels with higher salaries (and at a total hhi of 400 these sound like they both are).

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

Do you two work for the same company?

No and now our hhi is closer to 400k.

Doesn't add up.

Both of you have ESPP and both of you have an employee match of nearlub100%. As a benefits administrator I've never ever in my life seen an employer who does espp and a full employer 401k match.

I'm thinking you are either financially ignorant or full of shit

My employer matches 100% on the first 8 percent. His is 100 percent on the first six percent. Our hhi is close to 400k and this includes the employer stock. My husband makes 185k and I make close to 170k.

Also it's not an ESpp. The stock is given as part of his bonus. I assume his 401k plan is for everyone at his company but not all receive stock.

What you wrote in bold is rather rude and unnecessary. You could have just asked what our match is.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

Do you two work for the same company?

No and now our hhi is closer to 400k.

Doesn't add up.

Both of you have ESPP and both of you have an employee match of nearlub100%. As a benefits administrator I've never ever in my life seen an employer who does espp and a full employer 401k match.

I'm thinking you are either financially ignorant or full of shit

My employer matches 100% on the first 8 percent. His is 100 percent on the first six percent. Our hhi is close to 400k and this includes the employer stock. My husband makes 185k and I make close to 170k.

Also it's not an ESpp. The stock is given as part of his bonus. I assume his 401k plan is for everyone at his company but not all receive stock.

What you wrote in bold is rather rude and unnecessary. You could have just asked what our match is.

Sounds like RSU's.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP here - thanks for the reality check guys. I think a few factors made us nervous, 1) mortgage would be 38% of net take home, which is higher than many people advise, 2) we've become used to saving at a high rate every month, 3) the downpayment would deplete our savings and it would take longer to fill up the emergency fund. Also, once we move we will not be able to get by on just one salary if one of us no longer can work. But I guess thats the case even if we buy a smaller home. Thanks for the input!

This would make me nervous. Does one spouse make a lot more than the other? Do you have a lot of other expenses outside of the mortgage?

Me too. My souse and I based our mortgage on one income. Thank goodness we did....you never know what the future holds and if our mortage was based on two income we would had lost our house.

I've never understood the buy a house on one income philosophy. In the unlikely event that something catastrophic happens you can use your emergency fund and, if the other person still can't work, eventually sell the house.

It's about flexibility, not catastrophe. When we purchased our 500k home on a 300k salary, (financing 400k) we wanted to always be able max out our 401k, ESPP, and college savings. We have just turned 40 and have 1M in 401k and have fully paid off 4 years of college in the Virginia pre-paid for our 2 kids. It ferls great to not even worry a thing about the cost of college for our kids. Our ncome is now higher and we take great vacations and have absolutely no financial stressors. We've invested in real estate as well that is cash flow positive. If one of us ended up working somewhere intolerable or somewhere that became incompatible with having a young family, we could quit without even having work lined up. We will probably be prepared for a very comfortable retirement by 60, if we so choose. There is a certain amount of career confidence one has at the workplace when you are working not because you HAVE to, but because you want to. It enables you to take risks and actions that (for me) has ultimately lead to bigger leadership positions and income growth.

I TOTALLY understand that lower income people have no choice, but to spend a huge amount of their income on housing, but if you have a high income, I feel like there are so many better options to spend all my disposable income on rather than housing. Not to mention the freedom that comes with being flush with cash.

A substantial majority of the population does not have the luxury of that flexibility.

New poster and mortgage underwriter here. Actually, I see so many loans come across my desk in this area where people are making 300K or so a year and stretching themselves to the max. Being in a position of doing a financial cavity search on DC metro residents, I can say that there is a HUGE portion of the population in this area that does have that flexibility, but instead are big spenders. When I see a 300K salary of a family in their mid 40s, with a 401K barely scratching 200K taking out an 800K loan, it really does shock me that people squander the great opportunities they have been given.

I also see people like the above who have made a good, but not enormous salary stretch across some very smart investments. Those are the people who are building wealth, not blowing it.

I'm almost guilty of this. We were in our early 30s with a 300k salary and borrowed 600k. Only around 250k in retirement. But now we are contributing around 75k to 401ks each year plus another 50k plus in company stock. I'm hoping in ten years we will be caught up. We are also paying our 30 year loan as a 15 year loan to help.

Do you two work for the same company?

No and now our hhi is closer to 400k.

Doesn't add up.

Both of you have ESPP and both of you have an employee match of nearlub100%. As a benefits administrator I've never ever in my life seen an employer who does espp and a full employer 401k match.

I'm thinking you are either financially ignorant or full of shit

My employer matches 100% on the first 8 percent. His is 100 percent on the first six percent. Our hhi is close to 400k and this includes the employer stock. My husband makes 185k and I make close to 170k.

Also it's not an ESpp. The stock is given as part of his bonus. I assume his 401k plan is for everyone at his company but not all receive stock.

What you wrote in bold is rather rude and unnecessary. You could have just asked what our match is.

Sounds like RSU's.

That's correct. It's a combination of options and rsus.