Reply to I Live Comfortably on Less than $70K After-Tax in DC Area

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I've never understood it either OP.  We make $200K and have more money than we know what do with.[/quote]

Is this from two people working and do you have kids?  Most people are strapped because of childcare and housing costs.  [/quote]

And having kids may lead to pressure to live in expensive areas with better schools, and to spend on good experiences for the child.

Parents also may want to think about paying for college. [/quote]

We make 100k and have two kids and also have more money than we need.. It's all perspective.[/quote]

That's about $8600 a month, gross. I would love to see what your budget is. Are you saving at all for those two kids to go to college? How much are you saving annually for retirement?  My property taxes alone are $10,000 and I live in a DC suburb in a 25 year old house. I don't see how you have more money than you need unless you don't own a home, plan to work until you die and don't plan to fund college for your kids.[/quote]

Well, my property taxes are $2200 a year (and that's a deduction on my schedule A).  We have about $50k saved at this point in college savings for 5 and 8 year olds, however expect our kids to get scholarships for some or all of college.  Our child care bill is zero, our kids both started school at age three here in DC - we paid only for one year of preschool at $200 a week.  Mortgage, PITI is $1400 a month (house is worth just shy of a million in downtown DC), we spend about $4k a year on vacations, about $1000 a month on food (split between eating out and groceries), car is paid for and we don't drive much, so perhaps $50 a month on gas, $500 a year on insurance and very little on maintenance, utilities are maybe $200 a month total?  We do a lot of free activities in the DC area -- because there are tons of them. Our local pool is free.  Don't spend a lot on clothes -- maybe $400 a year for all of us (outlets are our friends).  Max out retirement for one (spouse does not have 401k) plus company match, plus two max Roth IRAs - we have very healthy retirement balances at this point, and if it weren't for health insurance costs I'd consider retiring in the next five years.  We also donate at least $2k a year to charities we support.  We have a networth of $1.7m so we have a safety net if we need it, but we live off my salary and our savings/investments just grow each year.[/quote]

How do you have a PITI of $1400 on a million dollar house in DC?  [/quote]

Presumably, they either (1) bought a long time ago, or (2) put down well more than 20% down payment.[/quote]
DP. But how is the property tax only $2200? My house is worth half theirs, and my property tax is triple that.[/quote]

DC.  Homestead deduction.[/quote]

That is too small to account for the difference.[/quote]

No it is not. It's exactly why my tax bill is that low. Look it up.[/quote]

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