How Much Would You Spend on a House?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I love how everyone who claims it is better to invest $40K instead of paying off a $40K student loan starts with the assumption that someone has $40K sitting around. For most of us, it takes time to accumulate such a sum, so it isn't a simple 2% vs 8%.

I only have a few friends who admit to having student loans. When the topic comes up they love to say how "well you can earn X in the market." However I seriously doubt that any of them actually have that amount of money available to invest. I doubt they invest outside of their retirement accounts. It's just something they say to make themselves feel better about having debt.

Agreed. I'm a mortgage underwriter and i do a cavity search on people's finances. High earners dont carry around student loan debt. Period. I see alot of people making in the 300-400k range spending ALL their money and only having 401k as investments. And sadly, from what i see, i dont lump the 300-400k into high earners mainly because the manage their money pretty poorly. Lack of investing and carrying around silly loans like student loans and car loans.

What other mistakes do you see? We fall in the 300-400k range and I feel like we also spend all of our money but we do invest around 130k a year plus in retirement (~80k in 401ks plus ~50k stock). Besides that we have a 15 year mortgage. However, the rest of our money is going to graduate school so we don't take any student loans.

How are you investing 80k in 401k? Max contribution is 18.5/pp.

Are YOU investing 50k in stock or are you getting RSU/stock bonuses from your company?

401k #1:
Personal contribution: 18k
Match: 13k

Retirement fund #1 (defined pension that can be rolled into 401k if I leave)
Co contribution: 17k

401k #2
Personal contribution: 18k
Match: 12k

Totals 78k. The stock is in the form of a stock bonus from my company.

[Anonymous]

Anonymous wrote:Your 529s look a little low for your income level. How much do you contribute per month? At your income level, it should be around 1500 per kid per month if fully funding private college is your goal.

+1

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I love how everyone who claims it is better to invest $40K instead of paying off a $40K student loan starts with the assumption that someone has $40K sitting around. For most of us, it takes time to accumulate such a sum, so it isn't a simple 2% vs 8%.

I only have a few friends who admit to having student loans. When the topic comes up they love to say how "well you can earn X in the market." However I seriously doubt that any of them actually have that amount of money available to invest. I doubt they invest outside of their retirement accounts. It's just something they say to make themselves feel better about having debt.

Agreed. I'm a mortgage underwriter and i do a cavity search on people's finances. High earners dont carry around student loan debt. Period. I see alot of people making in the 300-400k range spending ALL their money and only having 401k as investments. And sadly, from what i see, i dont lump the 300-400k into high earners mainly because the manage their money pretty poorly. Lack of investing and carrying around silly loans like student loans and car loans.

What other mistakes do you see? We fall in the 300-400k range and I feel like we also spend all of our money but we do invest around 130k a year plus in retirement (~80k in 401ks plus ~50k stock). Besides that we have a 15 year mortgage. However, the rest of our money is going to graduate school so we don't take any student loans.

How are you investing 80k in 401k? Max contribution is 18.5/pp.

Are YOU investing 50k in stock or are you getting RSU/stock bonuses from your company?

401k #1:
Personal contribution: 18k
Match: 13k

Retirement fund #1 (defined pension that can be rolled into 401k if I leave)
Co contribution: 17k

401k #2
Personal contribution: 18k
Match: 12k

Totals 78k. The stock is in the form of a stock bonus from my company.

Ok, so you are contributing 36k of your income to retirement and are granted stock options in your company stock. So you are investing approx 10% of your gross income.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I love how everyone who claims it is better to invest $40K instead of paying off a $40K student loan starts with the assumption that someone has $40K sitting around. For most of us, it takes time to accumulate such a sum, so it isn't a simple 2% vs 8%.

I only have a few friends who admit to having student loans. When the topic comes up they love to say how "well you can earn X in the market." However I seriously doubt that any of them actually have that amount of money available to invest. I doubt they invest outside of their retirement accounts. It's just something they say to make themselves feel better about having debt.

Agreed. I'm a mortgage underwriter and i do a cavity search on people's finances. High earners dont carry around student loan debt. Period. I see alot of people making in the 300-400k range spending ALL their money and only having 401k as investments. And sadly, from what i see, i dont lump the 300-400k into high earners mainly because the manage their money pretty poorly. Lack of investing and carrying around silly loans like student loans and car loans.

What other mistakes do you see? We fall in the 300-400k range and I feel like we also spend all of our money but we do invest around 130k a year plus in retirement (~80k in 401ks plus ~50k stock). Besides that we have a 15 year mortgage. However, the rest of our money is going to graduate school so we don't take any student loans.

How are you investing 80k in 401k? Max contribution is 18.5/pp.

Are YOU investing 50k in stock or are you getting RSU/stock bonuses from your company?

401k #1:
Personal contribution: 18k
Match: 13k

Retirement fund #1 (defined pension that can be rolled into 401k if I leave)
Co contribution: 17k

401k #2
Personal contribution: 18k
Match: 12k

Totals 78k. The stock is in the form of a stock bonus from my company.

Ok, so you are contributing 36k of your income to retirement and are granted stock options in your company stock. So you are investing approx 10% of your gross income.

I'm not the PP you're responding to. But it's odd to ignore the company match and stock options as though they don't exist. It seems like you are using selective reading to prove a point. But, it's not a good point. Somebody who is making $300k-400k per year and is investing 78k per year is doing fine. Saying they're only investing 10% of their gross salary doesn't paint a full picture.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I love how everyone who claims it is better to invest $40K instead of paying off a $40K student loan starts with the assumption that someone has $40K sitting around. For most of us, it takes time to accumulate such a sum, so it isn't a simple 2% vs 8%.

I only have a few friends who admit to having student loans. When the topic comes up they love to say how "well you can earn X in the market." However I seriously doubt that any of them actually have that amount of money available to invest. I doubt they invest outside of their retirement accounts. It's just something they say to make themselves feel better about having debt.

Agreed. I'm a mortgage underwriter and i do a cavity search on people's finances. High earners dont carry around student loan debt. Period. I see alot of people making in the 300-400k range spending ALL their money and only having 401k as investments. And sadly, from what i see, i dont lump the 300-400k into high earners mainly because the manage their money pretty poorly. Lack of investing and carrying around silly loans like student loans and car loans.

What other mistakes do you see? We fall in the 300-400k range and I feel like we also spend all of our money but we do invest around 130k a year plus in retirement (~80k in 401ks plus ~50k stock). Besides that we have a 15 year mortgage. However, the rest of our money is going to graduate school so we don't take any student loans.

How are you investing 80k in 401k? Max contribution is 18.5/pp.

Are YOU investing 50k in stock or are you getting RSU/stock bonuses from your company?

401k #1:
Personal contribution: 18k
Match: 13k

Retirement fund #1 (defined pension that can be rolled into 401k if I leave)
Co contribution: 17k

401k #2
Personal contribution: 18k
Match: 12k

Totals 78k. The stock is in the form of a stock bonus from my company.

Ok, so you are contributing 36k of your income to retirement and are granted stock options in your company stock. So you are investing approx 10% of your gross income.

I'm not the PP you're responding to. But it's odd to ignore the company match and stock options as though they don't exist. It seems like you are using selective reading to prove a point. But, it's not a good point. Somebody who is making $300k-400k per year and is investing 78k per year is doing fine. Saying they're only investing 10% of their gross salary doesn't paint a full picture.

I'm the poster with the 401k contributions above. We actually aren't saving 78k towards retirement. We are saving closer to 130k each year including the company stock. We are also paying down an additional 25k in equity on our house. Once we've finished paying for graduate school we plan on saving another 50-75k in our brokerage account. We chose to not take out any student loans.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I love how everyone who claims it is better to invest $40K instead of paying off a $40K student loan starts with the assumption that someone has $40K sitting around. For most of us, it takes time to accumulate such a sum, so it isn't a simple 2% vs 8%.

I only have a few friends who admit to having student loans. When the topic comes up they love to say how "well you can earn X in the market." However I seriously doubt that any of them actually have that amount of money available to invest. I doubt they invest outside of their retirement accounts. It's just something they say to make themselves feel better about having debt.

Agreed. I'm a mortgage underwriter and i do a cavity search on people's finances. High earners dont carry around student loan debt. Period. I see alot of people making in the 300-400k range spending ALL their money and only having 401k as investments. And sadly, from what i see, i dont lump the 300-400k into high earners mainly because the manage their money pretty poorly. Lack of investing and carrying around silly loans like student loans and car loans.

What other mistakes do you see? We fall in the 300-400k range and I feel like we also spend all of our money but we do invest around 130k a year plus in retirement (~80k in 401ks plus ~50k stock). Besides that we have a 15 year mortgage. However, the rest of our money is going to graduate school so we don't take any student loans.

How are you investing 80k in 401k? Max contribution is 18.5/pp.

Are YOU investing 50k in stock or are you getting RSU/stock bonuses from your company?

401k #1:
Personal contribution: 18k
Match: 13k

Retirement fund #1 (defined pension that can be rolled into 401k if I leave)
Co contribution: 17k

401k #2
Personal contribution: 18k
Match: 12k

Totals 78k. The stock is in the form of a stock bonus from my company.

Ok, so you are contributing 36k of your income to retirement and are granted stock options in your company stock. So you are investing approx 10% of your gross income.

No. We are saving around 130k a year in retirement accounts. Our salaries are 325k plus around 50k in company stock. So around 35 percent of our gross salaries is being saved for retirement.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I love how everyone who claims it is better to invest $40K instead of paying off a $40K student loan starts with the assumption that someone has $40K sitting around. For most of us, it takes time to accumulate such a sum, so it isn't a simple 2% vs 8%.

I only have a few friends who admit to having student loans. When the topic comes up they love to say how "well you can earn X in the market." However I seriously doubt that any of them actually have that amount of money available to invest. I doubt they invest outside of their retirement accounts. It's just something they say to make themselves feel better about having debt.

Agreed. I'm a mortgage underwriter and i do a cavity search on people's finances. High earners dont carry around student loan debt. Period. I see alot of people making in the 300-400k range spending ALL their money and only having 401k as investments. And sadly, from what i see, i dont lump the 300-400k into high earners mainly because the manage their money pretty poorly. Lack of investing and carrying around silly loans like student loans and car loans.

Hmm, We earn about $300k, have about $120k remaining on student loans, and have about $150k in a brokerage account earning returns that far outpace the interest on our student loans. (That's in addition to the 401(k)s which are maxed out every year.) Of course we could liquidate the brokerage account and pay off the loans, but why would we? The loans are at 2.5-3.5%. I don't say this to brag, but just to point out that you might be a little bit overconfident in your assumptions.