lifestyle for $500K HHI

[Anonymous]

Anonymous wrote:I'm curious how this is for others too. We are closer to 400k but we can't seem to wrap our heads around the fact that this is what doing well in this economy in DC looks like. Our money goes to mortgage, one car payment, student loans, max out 401k, childcare so we can remain in our busy jobs, preschool, life insurance and other insurances (homeowner, car, etc). We don't worry about money day to day in terms of buying food out at lunchtime, family meals out a few times a month, babysitters here and there, but I can't remember the last time we had money to pay for a nice vacation or buy a new piece of furniture. Our house is a close-in townhouse so we can get to our jobs with modest commutes that is 3 bedrooms and we can't figure out how we will afford to move to anything bigger in a good school district. Private school is impossible to pay for long term, at least with current childcare costs.

You don't pay federal, state, county taxes? Half of what we make goes right out the door. That means 500 HHI (dream on) is really 250-300HHI. Then start subtracting from there.

[Anonymous]

I pay a LOT of taxes but I certainly do not pay 50% of my income.

[Anonymous]

Anonymous wrote:I pay a LOT of taxes but I certainly do not pay 50% of my income.

If you tithe, it gets fairly close.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I think part of the problem is expectations. When we bought, our income was 1/4 of that (~125k), which was decent at the time. We could afford a 1800 sqft 4 bedroom house that was built in the mid-60's and not updated. Those houses now cost about 3x what we paid, but the people who make 3x what we made don't want a 40 year old fixer upper. They think they should have the fancy 3-4000sqft new build.

They need to reset their expectations. This isn't a new phenomenon. I blame HGTV.

ITA.

In fact, as the COL has risen in this area, people's expectations should have been lowered. Instead, they have inexplicably been raised. It makes no sense AT ALL. A recipe for unhappiness and financial disaster.

That doesn't make sense. You always want to provide a better or at least the same life you grew up in for your current generation.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think part of the problem is expectations. When we bought, our income was 1/4 of that (~125k), which was decent at the time. We could afford a 1800 sqft 4 bedroom house that was built in the mid-60's and not updated. Those houses now cost about 3x what we paid, but the people who make 3x what we made don't want a 40 year old fixer upper. They think they should have the fancy 3-4000sqft new build.

They need to reset their expectations. This isn't a new phenomenon. I blame HGTV.

ITA.

In fact, as the COL has risen in this area, people's expectations should have been lowered. Instead, they have inexplicably been raised. It makes no sense AT ALL. A recipe for unhappiness and financial disaster.

That doesn't make sense. You always want to provide a better or at least the same life you grew up in for your current generation.

That is unsustainable.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think part of the problem is expectations. When we bought, our income was 1/4 of that (~125k), which was decent at the time. We could afford a 1800 sqft 4 bedroom house that was built in the mid-60's and not updated. Those houses now cost about 3x what we paid, but the people who make 3x what we made don't want a 40 year old fixer upper. They think they should have the fancy 3-4000sqft new build.

They need to reset their expectations. This isn't a new phenomenon. I blame HGTV.

ITA.

In fact, as the COL has risen in this area, people's expectations should have been lowered. Instead, they have inexplicably been raised. It makes no sense AT ALL. A recipe for unhappiness and financial disaster.

That doesn't make sense. You always want to provide a better or at least the same life you grew up in for your current generation.

That is unsustainable.

Providing the same lifestyle you grew up with in the same area? So what do you do just start going down until you live on the street corner?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think part of the problem is expectations. When we bought, our income was 1/4 of that (~125k), which was decent at the time. We could afford a 1800 sqft 4 bedroom house that was built in the mid-60's and not updated. Those houses now cost about 3x what we paid, but the people who make 3x what we made don't want a 40 year old fixer upper. They think they should have the fancy 3-4000sqft new build.

They need to reset their expectations. This isn't a new phenomenon. I blame HGTV.

ITA.

In fact, as the COL has risen in this area, people's expectations should have been lowered. Instead, they have inexplicably been raised. It makes no sense AT ALL. A recipe for unhappiness and financial disaster.

That doesn't make sense. You always want to provide a better or at least the same life you grew up in for your current generation.

That is unsustainable.

Providing the same lifestyle you grew up with in the same area? So what do you do just start going down until you live on the street corner?

"a better or at least the same" is unsustainable.

[Anonymous]

Anonymous wrote:I pay a LOT of taxes but I certainly do not pay 50% of my income.

We make $430K, we net just about $218K. We do not have a mortgage deduction.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I pay a LOT of taxes but I certainly do not pay 50% of my income.

We make $430K, we net just about $218K. We do not have a mortgage deduction.

Does that include any savings off the top?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think part of the problem is expectations. When we bought, our income was 1/4 of that (~125k), which was decent at the time. We could afford a 1800 sqft 4 bedroom house that was built in the mid-60's and not updated. Those houses now cost about 3x what we paid, but the people who make 3x what we made don't want a 40 year old fixer upper. They think they should have the fancy 3-4000sqft new build.

They need to reset their expectations. This isn't a new phenomenon. I blame HGTV.

Actually, people's incomes HAVE NOT generally risen 3x, although housing has risen 3x.

[Anonymous]

the problem is you work so hard to get up to that sort of income, only to realize that is buys you jack shit. same dumpy house, same dumpy cars, maybe you eat out a bit more or take a nicer vacation, but quality of life stays the same.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Here You can live a traditional middle class lifestyle in a good area for about 350. The biggest bills are housing and childcare.

I don't want to get baited into this, but, wth are you talking about? I love the "middle class lifestyle" argument. At 500k, your are clearing, wait for it, about $25k per month after fed and state taxes/self employment tax/AMT etc. Donna Reed didn't have a $5k month blow habit. The Beaver's mom didn't spend 3 weeks in Africa at an point in her life (even flying coach). This ain't middle class. Middle class is spending a week in a crappy house, that isn't on the beach, in Ocean City. No flying. No cleaning service. No weekend getaways or Acuras. You're all nuts.

Bullshit. We make $430,000 gross; we clear $16,400 a month after 401(k) (including catchup contributions for one of us); health; life; disability insurance; union dues; etc.

Yeah, not so fast. So I said $25k after *taxes* (everything in my list). The money you use to fund your 401k, insurance, etc is stuff you're choosing to spend your money on (otherwise it would be like saying "I clear nothing each month after mortgage, retirement, savings, bills, cars, and school"). If you clear $16,400 after you've paid for retirement and insurances of all kinds, you aren't middle class. That's demented.

I make just over $400k and our net after tax (but before the stuff you list) works out to be almost exactly $21k per month when computed over the year.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I pay a LOT of taxes but I certainly do not pay 50% of my income.

We make $430K, we net just about $218K. We do not have a mortgage deduction.

Come on. $218k looks like a very precise number, but this can't be right (or you desperately need a new accountant). No one should be paying nearly 50%. I own a business, don't have a mortgage deduction, and get raked over the coals on taxes, and don't pay even 37% between state and fed.

It's fun to be the poor rich person, but this doesn't square with reality.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I pay a LOT of taxes but I certainly do not pay 50% of my income.

If you tithe, it gets fairly close.

People, you can't bucket your tithing as a tax and use that to justify your flaky, tea party-sequel assertion that you're paying 50% in taxes. Tithing, even if it is a requirement of your faith, is an expense you're choosing to pay.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I pay a LOT of taxes but I certainly do not pay 50% of my income.

If you tithe, it gets fairly close.

People, you can't bucket your tithing as a tax and use that to justify your flaky, tea party-sequel assertion that you're paying 50% in taxes. Tithing, even if it is a requirement of your faith, is an expense you're choosing to pay.

Do you see the happy face next to my comment? That means it was light jab, not intended to be flakey or a tea party assertion.

Plus, not everyone who tithes is conservative.