184k hhi here with 3250 piti and 1600 in daycare. No issues.

Ours is 2500 with 1900 in daycare costs. Slightly higher HHI but not much upside potential. I'd go a little lower if you're going to have a kid soon.

OP what interest rate is that? Sounds high for 550k and 27% down.

Anonymous wrote:

Anonymous wrote:If you are in the DMV and plan to use a high-quality day care center, I'd budget $25K/year per child for the first few years.

We have a wonderful daycare center (church-based), and we're paying 14k a year. While I don't dispute that there's plenty of places that DO charge 2k/month, the best course of action would be to research centers in the area where you're building your home. I assume if you're looking at a new build for 550k, you're not looking in Arlington or a close-in DMV suburb, and costs of daycare will probably reflect that. But I could be wrong!

AND make sure you can get a space in the daycares. For instance, there are many daycares in the District that charge $1200/month. However, most have 1-2 year waitlists (rendering them kind of irrelevant unless you call at just the right moment or just the right kids happen to age out when you need a spot). So people end up paying more for nannies or nanny shares.

Anonymous wrote:If you are in the DMV and plan to use a high-quality day care center, I'd budget $25K/year per child for the first few years.

We have a wonderful daycare center (church-based), and we're paying 14k a year. While I don't dispute that there's plenty of places that DO charge 2k/month, the best course of action would be to research centers in the area where you're building your home. I assume if you're looking at a new build for 550k, you're not looking in Arlington or a close-in DMV suburb, and costs of daycare will probably reflect that. But I could be wrong!

If you are in the DMV and plan to use a high-quality day care center, I'd budget $25K/year per child for the first few years.

Anonymous wrote:The down payment would come from our current savings. Since we plan on building our home we would have 9 more months to create a reserve (30K+) after we deplete most of our non-retirement funds.

I'm just worried about the uncertainty of having kids and all the expenses related to that.

Childcare is expensive depending on what you want to do. A nanny around here can run $3000-$4000/month. There are also additional expenses of food, clothing, toys, doctor's visits, etc. with kids. I think that mortgage payment is high for your income. We have a similar payment and make about $250,000/year. Our childcare expenses ended 2 years ago since our kids are in full time school. We are comfortable, but are definitely not rolling in money with all our expenses each month.

The down payment would come from our current savings. Since we plan on building our home we would have 9 more months to create a reserve (30K+) after we deplete most of our non-retirement funds.

I'm just worried about the uncertainty of having kids and all the expenses related to that.

We have that HHI and we currently have a $2800 mortgage. It's very easy for us to manage and we're still saving 4k a month. No childcare though. We're hoping to lower it with our next mortgage though.

PP above, just wanted to add - if/when the time comes for daycare, you can always pay a year's tuition up front (usually there's a discount) rather than weekly/monthly. This is what we did the first year. It's just optics, but psychologically we felt less "pinched" when we were able to take a chunk from savings and replenish it throughout the year, rather than have a large amount of each paycheck earmarked for the daycare expense.

We have the same HHI and similar savings, and pay for daycare for 1 toddler (1300/month). But we also have a car payment, student loan payments, and commuting expenses. Our mortgage is $2500 PITI; we save as aggressively as we can and don't have much disposable income, but I feel comfortable.

Would your down payment come out of your current non-retirement savings, or does that number reflect what you'd have left? If you're currently saving $3500 a month and your current mortgage is $1700 and nothing else changes after you buy, wouldn't you just be saving $1800 instead? It sounds doable.

175k HHI

What are you currently earning?

Sorry I left out that our current mortgage is $1700 PITI.

Hi Everyone,

Just wondering if we are over extending ourselves on a home that we are planning to build (9 month build time) in the ideal location for us. Mortgage payment would be $3250 PITI (550k home with 27% down).

Wife and I are 28 and no kids (plan to have kids in the near future)
Current Total savings -
Retirement savings - 125k
Non Retirement savings - 150k

Current Monthly savings -
Retirement Savings - $1500 for me / $1250 wife (includes company match for both)
Non-Retirement savings - $3500

Expect a upward trajectory in our HHI. Since we are planning on having kids in the near future, there will be childcare expenses (daycare+food+misc) we have to account for. This is my main concern - will we be able to afford our dream home and start a family in this home. Appreciate the help.