Reply to Middle class life has me completely baffled

Forum Index » Money and Finances

Reply to "Middle class life has me completely baffled"

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous][quote=Anonymous]Do you own your own business? Why are you paying for taxes and healthcare and pension outside of your take home???

Your numbers don't add up at all. At $180K your should be have a take home income close to $8500 per month. Your bills are only $2500 per month. Where is the 6K going?[/quote]

Let me do a better job here:

$180,000 HHI

-26,000 Federal
-16,000 State
-11,000 Social security and medicare
-39,000 for pre-tax retirement contributions
-3000 for health care per year
-4800 per year for required pension contribution

After tax/401k/health/pension = ~$80,000 per year left over in free cash.  $80k/12 = $6667 per mo in cash.

Expenses per mo. :

-1000 for maxing out Roth IRAs
-1700 rent
-100 phone bill
-150 car insurance
-300 groceries
-80 electric/gas
-70 parking
-90 internet
___________________
total: $3500

Free cash left over = $6667 - 3500 = $3100 (a little higher than what I had before because I had to go back and look at my pension contributions, which I was estimating before from memory).

$3100 - $300 per mo towards new car funds - $1000 for emergencies = $1800 per mo left over for a house.

Again, I've assume $0 for clothes, entertainment, car maintenance/repair, and miscellaneous.

The bigger picture here is that I cannot fathom tacking on $3000 more per mo. for childcare if I had children, another $300-400 car payment if we had to buy and finance a new car, spending more money than we do on clothes for ourselves or children, contribute to college savings, and have enough left over for retirement.....and oh, also afford a house.  That's what I mean when I say I really don't understand how in the hell people are affording a middle class life with a family, a house, a car, and savings for college/emergency/retirement assuming there are zero health care disasters, no job loss, and other extremely expensive setbacks. 
[/quote]

House: Lots of people buy in condos and/or up and coming neighborhoods to get on the property ladder.  Time is on your side for this.

Kids:  Childcare is only That expensive for the first few years (assuming post covid world); you can pause retirement contributions during then.  We bought far out (<500K) to live on one salary similar to your numbers but can still splurge on a part time nanny.  You spend less on travel and leisure when you have young kids (you cant buy sleep heh heh)

College: your income will likely rise and as long as you don’t go house debt crazy you will be able to pick up a 529 eventually.

Bottom line: it’s a high COL area but there are big benefits to raising your kids here in terms of education and opportunities if you play your cards right.

You will make it work. [/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics