What's a decent household income to live in Bethesda?

[Anonymous]

Anonymous wrote:what on earth are you spending your money on OP?

We have a similar income ($365K) and have a $3k/month primary mortgage plus a $2k/month mortgage on a second home (plus all the utilities/expenses x 2 homes).
We spend about $15K/year on activities/camps for 3 kids.
We max 2 401ks.
We spend about an additional $10K/year on other travel/vacations.

We want for nothing. I guess maybe it's because we live a pretty simple life. We eat out at Chipotle. We shop at Old Navy (and only on sale). We shop at Giant. I clean my own house. We hire high school sitters for $10/hour or swap childcare with neighbors (my kids are elementary aged).

If you expect $350K to allow you to shop at Saks and eat dinner out downtown weekly then I can see it being tight.

Not OP. We have 3 kids in elementary and also have an HHI of 365,000? Just curious -- for child care, you rely on high school kids and neighbors? Do both of you work full time? (We still have a nanny for 30 hours a week for our 3 kids who are in elementary, at a cost of $3000 per month.)

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Thanks for the replies...i am venting a little bit here but i would like to find out what i am doing wrong.

$350k per year is about $14.5k per month after taxes

Mortgage: $3800 and that's low because of the fixer upper house
2 kids in day-care: $4000 (only 1/2 now since we dont have the 2nd kid yet)
2 cars: $600
Student debt: $600
Bills: $600
House cleaning: $300

that's less $5000 left per month, which would be ok if we didnt eat out and go on trips now and then. We may be doing too much of that...

We also spend a lot on our house because it is a fixer-upper.

The bottom line is that after all these years and all the work trying to do the right thing, we are barely making end meet.

Another thing i am trying to do is figure out why this area is so expensive, this way at least i could get something out of living here.

By the way, I just went on zillow and searched for 4 BR+ homes for less than 800k and 10 houses came up, all in need of work.

$5,000 OF MONTHLY DISCRETIONARY INCOME IS NOT POOR FOR THE LOVE OF GOD

$7,000 of Monthly Discretionary Income. He's budgeting $2000/month per kid for daycare, one kid hasn't even been born strikethrough CONCEIVED yet.
so he has $7,000 of monthly discretionary income he's blowing through.....

[Anonymous]

Anonymous wrote:

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Another thing i am trying to do is figure out why this area is so expensive, this way at least i could get something out of living here.

Prices are higher because of the schools, which you might not be using yet.

The schools are the same throughout the county. What varies is the HHI of the students attending the schools. If you want your child to attend schools where the majority of students come from families with high HHI, then move to Bethesda or Potomac. If that is not important to you, then move anywhere else in the county. Schools are not inherently better because they are located in Bethesda.

That may be true, but people are obsessing about school districts around here. My wife made us overlook a house because it was in the Walter Johnson district, and her coworker told her she should aim for Churchill or Whitman.

Her coworker was wrong, and also is not the person who has to deal with the consequences of having an $800k house. The main thing wrong with your budget is you bought way too expensive of a house at too young of an age. Of course you don't have to live in Bethesda or Potomac. They are two of the richest towns in the county and you're just starting out, with college loans and young children. You got in over your head.

I'm probably 10 years older than you, live in Silver Spring in a $600k house, with no more daycare and no more college loans. Make financial decisions that work for you.

+1

I'm in my mid-fifties, live in Silver Spring in a $700K house, and have two very successful teens - one off to college this fall and the other a rising junior at what DCUM deems a "bad" school. Both kids are doing great and no worries here about them getting into and performing well at good colleges.

We will pay for their college educations from the money we've saved for the past two decades. No more college loans for us, and none for them. In two years, our house will be paid off altogether.

Had we bought in Bethesda 15-20 years ago, none of this would be possible.

Do you mean that your house is now worth $720,000 (but that you paid much less a long time ago?)

I agree that houses in Bethesda are pricey, but perhaps they also appreciate more? The OP spent $800,000 for a house in Bethesda, which buys you a very modest house. But presumably if they fix it up, it will appreciate. Our house in Bethesda has nearly doubled in value since 2002 when we bought it.

[Anonymous]

Anonymous wrote:As for OP's question about who is buying the expensive houses in Bethesda (above $1.5 million etc), I think it's mostly lawyers (in Biglaw) and lobbyists, who make good money. Or it's sometimes people with more modest incomes but who have family assistance with the down payment.

Early 40's living in a $1.5m house in Bethesda with small children. All the people in our age range I know are business owners, not lawyers.. Though I'll admit it's not a large sample either.

[Anonymous]

OP: Think through child care expenses more closely. With 2 kids, it's often cheaper to do a nanny share or sometimes even just get your own nanny. The way you'vve budgeted for day care with 2 kids, that's $1k/week.. you can _sometimes_ get a nanny for around that in Bethesda.

Also remember child care expenses go down over time, while your incomes presumably go up as your careers advance. Once your first kid is 2, you can put them in preschool, and that can be under $1k/month including aftercare especially at a co-op nursery school. Then the 2 year old will eventually turn 5 and be at elementary school, so then you just have after-care expenses.

I know a couple living in a house about the same price in Bethesda, and it's a squeeze when they are really young due to child care, but that goes down as they kids get older.. and it goes fast.

[Anonymous]

Anonymous wrote:

Anonymous wrote:what on earth are you spending your money on OP?

We have a similar income ($365K) and have a $3k/month primary mortgage plus a $2k/month mortgage on a second home (plus all the utilities/expenses x 2 homes).
We spend about $15K/year on activities/camps for 3 kids.
We max 2 401ks.
We spend about an additional $10K/year on other travel/vacations.

We want for nothing. I guess maybe it's because we live a pretty simple life. We eat out at Chipotle. We shop at Old Navy (and only on sale). We shop at Giant. I clean my own house. We hire high school sitters for $10/hour or swap childcare with neighbors (my kids are elementary aged).

If you expect $350K to allow you to shop at Saks and eat dinner out downtown weekly then I can see it being tight.

Not OP. We have 3 kids in elementary and also have an HHI of 365,000? Just curious -- for child care, you rely on high school kids and neighbors? Do both of you work full time? (We still have a nanny for 30 hours a week for our 3 kids who are in elementary, at a cost of $3000 per month.)

I telecommute full time. I work 9-3pm and then watch the kids from 3 to 8pm and work another 2 hours each evening. It sucks to work every evening but it's cheap and it allows me to pick up the kids daily.
In the summer they all go to camp 9-3 or 9-4 for 6 weeks and we take 3 weeks off between my husband and I (9 week public school summer).

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
Another thing i am trying to do is figure out why this area is so expensive, this way at least i could get something out of living here.

Prices are higher because of the schools, which you might not be using yet.

The schools are the same throughout the county. What varies is the HHI of the students attending the schools. If you want your child to attend schools where the majority of students come from families with high HHI, then move to Bethesda or Potomac. If that is not important to you, then move anywhere else in the county. Schools are not inherently better because they are located in Bethesda.

That may be true, but people are obsessing about school districts around here. My wife made us overlook a house because it was in the Walter Johnson district, and her coworker told her she should aim for Churchill or Whitman.

Her coworker was wrong, and also is not the person who has to deal with the consequences of having an $800k house. The main thing wrong with your budget is you bought way too expensive of a house at too young of an age. Of course you don't have to live in Bethesda or Potomac. They are two of the richest towns in the county and you're just starting out, with college loans and young children. You got in over your head.

I'm probably 10 years older than you, live in Silver Spring in a $600k house, with no more daycare and no more college loans. Make financial decisions that work for you.

+1

I'm in my mid-fifties, live in Silver Spring in a $700K house, and have two very successful teens - one off to college this fall and the other a rising junior at what DCUM deems a "bad" school. Both kids are doing great and no worries here about them getting into and performing well at good colleges.

We will pay for their college educations from the money we've saved for the past two decades. No more college loans for us, and none for them. In two years, our house will be paid off altogether.

Had we bought in Bethesda 15-20 years ago, none of this would be possible.

Do you mean that your house is now worth $720,000 (but that you paid much less a long time ago?)

I agree that houses in Bethesda are pricey, but perhaps they also appreciate more? The OP spent $800,000 for a house in Bethesda, which buys you a very modest house. But presumably if they fix it up, it will appreciate. Our house in Bethesda has nearly doubled in value since 2002 when we bought it.

PP here. Worth$700k now. We paid $320k in 2000.

[Anonymous]

I live pretty nicely on $240K per year. One child in private school. But I don't have any loans other than my mortgage. I paid off my college one year after graduation (I had a lot of scholarships) and my car is paid for and 6 years old.

It's all about choices.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The average HHI in Bethesda is less than yours. If you can't afford 2 kids on 350k then you are doing something very wrong.

Most homeowners in Bethesda bought into the DC housing market many years at a price point far far below you, which puts them miles ahead of new arrivals. Lots of smugness around this issue.

Yes i guess that explains why the median HHI is so low.

Yes. Our HHI is $160k and we too feel "poor" in Bethesda. We rarely eat out, watch our $$ and shop for bargains. The expensive kiddie bday parties are just not doable for us.

[Anonymous]

Anonymous wrote:First of all you make more than twice what we do, our HHI is about $140. And we manage to save for retirement and put some away for schools as well.

Our kids are out of the daycare/preschool thing, so we have no childcare costs -- only summer camp and activities.

Do you have a lot of debt? Where is all your money going?

Also, 800K is not a cheap house. For some parts of Bethesda its on the low side, for other parts it's about right.

Sure, you make 140k and you're doing fine. My guess is you bought your house 30 years ago?
Your answers are not relevant.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
Another thing i am trying to do is figure out why this area is so expensive, this way at least i could get something out of living here.

Prices are higher because of the schools, which you might not be using yet.

The schools are the same throughout the county. What varies is the HHI of the students attending the schools. If you want your child to attend schools where the majority of students come from families with high HHI, then move to Bethesda or Potomac. If that is not important to you, then move anywhere else in the county. Schools are not inherently better because they are located in Bethesda.

That may be true, but people are obsessing about school districts around here. My wife made us overlook a house because it was in the Walter Johnson district, and her coworker told her she should aim for Churchill or Whitman.

Her coworker was wrong, and also is not the person who has to deal with the consequences of having an $800k house. The main thing wrong with your budget is you bought way too expensive of a house at too young of an age. Of course you don't have to live in Bethesda or Potomac. They are two of the richest towns in the county and you're just starting out, with college loans and young children. You got in over your head.

I'm probably 10 years older than you, live in Silver Spring in a $600k house, with no more daycare and no more college loans. Make financial decisions that work for you.

+1

I'm in my mid-fifties, live in Silver Spring in a $700K house, and have two very successful teens - one off to college this fall and the other a rising junior at what DCUM deems a "bad" school. Both kids are doing great and no worries here about them getting into and performing well at good colleges.

We will pay for their college educations from the money we've saved for the past two decades. No more college loans for us, and none for them. In two years, our house will be paid off altogether.

Had we bought in Bethesda 15-20 years ago, none of this would be possible.

Do you mean that your house is now worth $720,000 (but that you paid much less a long time ago?)

I agree that houses in Bethesda are pricey, but perhaps they also appreciate more? The OP spent $800,000 for a house in Bethesda, which buys you a very modest house. But presumably if they fix it up, it will appreciate. Our house in Bethesda has nearly doubled in value since 2002 when we bought it.

PP here. Worth$700k now. We paid $320k in 2000.

The days of the house prices doubling are over. That 800k for the fixer upper was more than it's worth already.
Fixing it up is extremely expensive too (and no - no one is going to want cheap fixes). The house should hold its value and increase a little bit but no way it will double in value. Most of what doubled was the price of the postage stamp sized lot and that's peaked pretty much .

[Anonymous]

Anonymous wrote:OP: Think through child care expenses more closely. With 2 kids, it's often cheaper to do a nanny share or sometimes even just get your own nanny. The way you'vve budgeted for day care with 2 kids, that's $1k/week.. you can _sometimes_ get a nanny for around that in Bethesda.

Also remember child care expenses go down over time, while your incomes presumably go up as your careers advance. Once your first kid is 2, you can put them in preschool, and that can be under $1k/month including aftercare especially at a co-op nursery school. Then the 2 year old will eventually turn 5 and be at elementary school, so then you just have after-care expenses.

I know a couple living in a house about the same price in Bethesda, and it's a squeeze when they are really young due to child care, but that goes down as they kids get older.. and it goes fast.

When the kids get older they need other things though and it's not like the activities/classes they want to sign up for are free either.
Your expenses won't be going down that much.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
Another thing i am trying to do is figure out why this area is so expensive, this way at least i could get something out of living here.

Prices are higher because of the schools, which you might not be using yet.

The schools are the same throughout the county. What varies is the HHI of the students attending the schools. If you want your child to attend schools where the majority of students come from families with high HHI, then move to Bethesda or Potomac. If that is not important to you, then move anywhere else in the county. Schools are not inherently better because they are located in Bethesda.

That may be true, but people are obsessing about school districts around here. My wife made us overlook a house because it was in the Walter Johnson district, and her coworker told her she should aim for Churchill or Whitman.

Her coworker was wrong, and also is not the person who has to deal with the consequences of having an $800k house. The main thing wrong with your budget is you bought way too expensive of a house at too young of an age. Of course you don't have to live in Bethesda or Potomac. They are two of the richest towns in the county and you're just starting out, with college loans and young children. You got in over your head.

I'm probably 10 years older than you, live in Silver Spring in a $600k house, with no more daycare and no more college loans. Make financial decisions that work for you.

+1

I'm in my mid-fifties, live in Silver Spring in a $700K house, and have two very successful teens - one off to college this fall and the other a rising junior at what DCUM deems a "bad" school. Both kids are doing great and no worries here about them getting into and performing well at good colleges.

We will pay for their college educations from the money we've saved for the past two decades. No more college loans for us, and none for them. In two years, our house will be paid off altogether.

Had we bought in Bethesda 15-20 years ago, none of this would be possible.

Do you mean that your house is now worth $720,000 (but that you paid much less a long time ago?)

I agree that houses in Bethesda are pricey, but perhaps they also appreciate more? The OP spent $800,000 for a house in Bethesda, which buys you a very modest house. But presumably if they fix it up, it will appreciate. Our house in Bethesda has nearly doubled in value since 2002 when we bought it.

PP here. Worth$700k now. We paid $320k in 2000.

The days of the house prices doubling are over. That 800k for the fixer upper was more than it's worth already.
Fixing it up is extremely expensive too (and no - no one is going to want cheap fixes). The house should hold its value and increase a little bit but no way it will double in value. Most of what doubled was the price of the postage stamp sized lot and that's peaked pretty much .

The doubling of value happened when two income families who didn't want long commutes discovered centrally located Bethesda.
It's been discovered. Houses will hold their value but they won't wildly increase in price .

[Anonymous]

Anonymous wrote:

Anonymous wrote:I do write how expensive all is and it sure is, but you also make a lot of money.
Why are your older cars still $600?
You mention eating out. Stop eating out so much. You toddler (or baby) hardly enjoys. There should be plenty of things to do in Bethesda other than eating out.
$5000 left is a lot. Car payments don't last forever, pre-school payments don't last forever nor do the student loan payments.
You mentioned "older cars". Who cares how old they are as long as they run. Feeling poor is in your head, it's not the reality. Work on that feeling because you are not poor as long as you pull in that income.

I know things will get better but i have been feeling very frustrated with our situation. We moved here for my wife's job and i dont have friends outside of her circle of co-workers yet, so i am using this board to vent a little. i can't bitch to them about the money we are making for obvious reasons. The plan was for me to switch career when she was done with her training but this obviously has to be postpone for several years now.

At least it's nice to see there are some normal people who live around here too (based on posts above), I was under the impression everybody was a millionaire.

But out of curiosity, who buys the $1.5M to $3M new homes that literaly grow like weeds in most of the city?

BTW our 2 year old loves to eat out too...

The people who buy the 1.5-3 mil homes are very high earners. Typically on our block they buy the huge house new, spend money on pricey upgrades, socialize some but not a lot, and then they move out for a bigger, newer mansion despite having only two kids.
They have some serious cash.

[Anonymous]

Anonymous wrote:$3,800 mortgage on an $800,000 house? Did you put very little down? 15-yr mortgage? If it is the latter, that would be an obvious place to save. Maybe I have the #s wrong in my head, but that is higher than I would have thought.

Ummmm, do you realize that his property taxes are probably $900/month alone?