Anonymous wrote:People seem to be confused. The question was UPPER MC. Not just maintaining a basic life.

We have 3 paid off properties. They are currently rentals, but when we retire one will be our winter home and the other our summer home. The other will be sold for tax free gains. We would like to have 18k/mo coming in EXCLUDING how much we will need to pay in insurance premiums which is is whole other pot of money.

Why? Because of travel. Plane tickets are not cheap. Travel is not cheap. Good food is not cheap. Additionally we will have to continue to pay taxes and maintain our homes. 18k will be a modes UMC lifestyle.

Just curious, how do you sell your rental property for tax free gains? Not trying to challenge, but genuinely curious.

Anonymous wrote:

Anonymous wrote:People seem to be confused. The question was UPPER MC. Not just maintaining a basic life.

We have 3 paid off properties. They are currently rentals, but when we retire one will be our winter home and the other our summer home. The other will be sold for tax free gains. We would like to have 18k/mo coming in EXCLUDING how much we will need to pay in insurance premiums which is is whole other pot of money.

Why? Because of travel. Plane tickets are not cheap. Travel is not cheap. Good food is not cheap. Additionally we will have to continue to pay taxes and maintain our homes. 18k will be a modes UMC lifestyle.

It's definitely different definitions of "comfortable."

I'm the one who said $50,000 for a comfortable UMC lifestyle in DC. We have a paid off nice house in a nice DC neighborhood. I think we have the markers of UMC ($300k+ family income, graduate degrees). When I think comfortable, I think able to keep the house in good shape, not worrying about going out to dinner occasionally, able to buy tickets to the theater and all the books and magazines and streaming services we want, taking trips to visit family as desired. We certainly plan to spend more, primarily on travel, but I think of that as a luxury. It's certainly a luxury I'm looking forward to, but it's not necessary to be comfortable.

$250k income is top 5% in DC per the 2019 article I posted earlier, doubt that has changed that much in 3 years. You are UC.

Anonymous wrote:People seem to be confused. The question was UPPER MC. Not just maintaining a basic life.

We have 3 paid off properties. They are currently rentals, but when we retire one will be our winter home and the other our summer home. The other will be sold for tax free gains. We would like to have 18k/mo coming in EXCLUDING how much we will need to pay in insurance premiums which is is whole other pot of money.

Why? Because of travel. Plane tickets are not cheap. Travel is not cheap. Good food is not cheap. Additionally we will have to continue to pay taxes and maintain our homes. 18k will be a modes UMC lifestyle.

It's definitely different definitions of "comfortable."

I'm the one who said $50,000 for a comfortable UMC lifestyle in DC. We have a paid off nice house in a nice DC neighborhood. I think we have the markers of UMC ($300k+ family income, graduate degrees). When I think comfortable, I think able to keep the house in good shape, not worrying about going out to dinner occasionally, able to buy tickets to the theater and all the books and magazines and streaming services we want, taking trips to visit family as desired. We certainly plan to spend more, primarily on travel, but I think of that as a luxury. It's certainly a luxury I'm looking forward to, but it's not necessary to be comfortable.

I guess I didn't view multiple homes as UMC. Unless the second home is like a shack in the woods, I view that as UC. I would also assume that your "need" for another home shifts in retirement. We have friends with lake houses -- I could see them moving to the lake house but then I'd assume the prudent thing to do would be to downsize from their SFH in the city to something smaller and easier to maintain -- a 2 bedroom condo. So this idea that UMC retirees are all maintaining two (or more!) full homes with all maintenance is kind of nuts to me. Why? Seems like a hassle.

Some of the food breakdowns seem insane to me. Like $1k groceries plus $1k in restaurants/take out for two people seems high to me, and we like to go out to dinner. But we also like to cook, and one of the things that is appealing about retirement is the ability to do more cooking instead of some of the "convenience" take out we currently get.

For me, retirement priorities are:

- Living in a nice, well-maintained home. Must be paid off (if you are still paying a mortgage in your 60s/70s, are you actually UMC?). But it doesn't need to be big. Large enough for a couple to stay with us. I guess I don't have a big interest in a vacation home because I think it would be stressful to maintain, especially as I got older. I'd rather just be able to go to hotels or rent homes when I want.

- Travel. Biggest thing for us. We didn't do as much traveling pre-kids due to family/health issues, so we are really looking forward to this. But I don't get splurging on business class and really pricy hotels every time? To me the point is to see more of the world, eat great food, experience other cultures. I'm fine flying economy and I also assume we will continue to work our rewards/miles on travel, likely more so because it will be easier to maintain status with more travel and travel-related expenditures.

- Healthcare. But I'm confused by the people acting like they won't be able to access Medicare? I assume I'll have Medicare and then we are budgeting quite a bit for additional expenses to maintain higher quality of life. But still, I don't assume we'll have super high healthcare costs until our late 70s/80s, based on our parents' experience.

Also, for us, living a little more frugally than perhaps some peopel are talking about means we leave more of what we've accumulated to our kids. I want to live well and enjoy my retirement, but my parents were able to leave us enough to help pay for kids' college much more easily than we were anticipating, so I'd love to pay that forward. If living on 100-200k per year in retirement allows us to give more to the kids, that is well worth it to me. They will need it.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I don't see how people need this much in retirement. We live on less than 10K a month now with 2 kids and a mortgage.

Def don't "need" this much to survive.

The question was how much needed for UMC retirement in DC area.

You've seen the budget breakdowns above. Which expenses seem unreasonable, given the question?

Sure, but what people are describing is LMC retirement in DC area

Argh, I meant to write LUC retirement. People's responses are outside of the realm of any middle class including UMC.

Anonymous wrote:

Anonymous wrote:I don't see how people need this much in retirement. We live on less than 10K a month now with 2 kids and a mortgage.

Def don't "need" this much to survive.

The question was how much needed for UMC retirement in DC area.

You've seen the budget breakdowns above. Which expenses seem unreasonable, given the question?

Sure, but what people are describing is LMC retirement in DC area

Anonymous wrote:I don't see how people need this much in retirement. We live on less than 10K a month now with 2 kids and a mortgage.

Precisely! "You" don't need that much as "you" live on less than 10K a month now. Not everyone does.

We can retire at 10k a month now, but do we want to ? Hell no, we are late 40's and would rather work few more years at our new higher HHI so we can spend more in retirement. Who knows where the inflation would go, if we accumulate more than we need in retirement, it could go to our kids. But, not planning on running out of money, cutting corners and asking family and friends for help if we have an option of working a few more extra years.

Anonymous wrote:I don't see how people need this much in retirement. We live on less than 10K a month now with 2 kids and a mortgage.

Def don't "need" this much to survive.

The question was how much needed for UMC retirement in DC area.

You've seen the budget breakdowns above. Which expenses seem unreasonable, given the question?

I don't see how people need this much in retirement. We live on less than 10K a month now with 2 kids and a mortgage.

We are def. MC by DCUM standards at least in lifestyle. We have one home (50 years old) worth about 800K with a 3K/month mortgage payment that will run another 20 years (at which point we will be 78/72). We live on about 120K/yr (including mortgage) and expect this to maybe reach $200k/yr in about 10 years as travel increases. One of us is done with work (I think) and the other will likely work another 5-7 years.

Point is, 200K or even 250K is not that much money when travel and usurious healthcare is involved.

Anonymous wrote:People seem to be confused. The question was UPPER MC. Not just maintaining a basic life.

We have 3 paid off properties. They are currently rentals, but when we retire one will be our winter home and the other our summer home. The other will be sold for tax free gains. We would like to have 18k/mo coming in EXCLUDING how much we will need to pay in insurance premiums which is is whole other pot of money.

Why? Because of travel. Plane tickets are not cheap. Travel is not cheap. Good food is not cheap. Additionally we will have to continue to pay taxes and maintain our homes. 18k will be a modes UMC lifestyle.

Owning 3 homes makes you upper class. Even in DC.

This is from 2019 but doubt it is that different. $250k puts you in the top 5% in DC.

https://www.cnbc.com/2019/04/12/how-much-money-you-need-to-make-to-be-in-the-top-5-percent-in-dc.html

People seem to be confused. The question was UPPER MC. Not just maintaining a basic life.

We have 3 paid off properties. They are currently rentals, but when we retire one will be our winter home and the other our summer home. The other will be sold for tax free gains. We would like to have 18k/mo coming in EXCLUDING how much we will need to pay in insurance premiums which is is whole other pot of money.

Why? Because of travel. Plane tickets are not cheap. Travel is not cheap. Good food is not cheap. Additionally we will have to continue to pay taxes and maintain our homes. 18k will be a modes UMC lifestyle.

Anonymous wrote:I'm seeing about $185k a year:
Houses (3) - $50k
Auto/transport - $10k
Food/dining - $15k
Kids - $5k
Health Insurance - $25k
Fitness - $10k
Taxes - $20k
Travel - $15k
Bills and utilities - $6k
Gifts and donations - $5k
Misc Shopping - $10k
Entertainment - $5k
Classes - $3k
Personal care - $2k
Other misc. - $3k

Fitness = a mildly expensive sport we enjoy. Obviously there is a lot of fat that can be trimmed if necessary. But this seems pretty comfortable to me.

What about RE taxes on 3 homes? My taxes on just 2 homes are $25K. And $50k sounds low to maintain 3 homes since you must need some outsourced help with maintenance, plus utilities x 3 and homeowners insurance x 3.

Anonymous wrote:For us, about $250K pre-tax initially for first 10 years of retirement; falling to $175K - $200K when we reach early to mid 70s.

Anticipated monthly expenses in retirement:

-$2K home insurance + taxes on primary residence (plan to keep for first 8-10 years of retirement, then downsize)
-$2.5K misc. other expenses (auto insurance, utilities, cell phones, streaming, lawn service, 2x/mo houseclean, etc.)
-$2K food
-$1K entertainment/leisure
-$3K periodic capital expenditures (home repairs, new cars, new clothes, furniture/appliance replacement when necessary, etc.)
-$1K out of pocket medical (guesstimate)
-$1K kids (presents, plane tix to visit us, etc.)

= $12.5K/month = $150K/yr. base expenses

Factoring in estimated taxes and travel, $250K is our number.

This is about what we have calculated as well. Our distribution of funds is a bit different, we will retire early before Medicare so 2K per month for insurance, a little less for home repairs, we are factoring in about 2K per month for that, the rest about the same so 225K pre tax until social security and Medicare kick in.

Anonymous wrote:For us, about $250K pre-tax initially for first 10 years of retirement; falling to $175K - $200K when we reach early to mid 70s.

Anticipated monthly expenses in retirement:

-$2K home insurance + taxes on primary residence (plan to keep for first 8-10 years of retirement, then downsize)
-$2.5K misc. other expenses (auto insurance, utilities, cell phones, streaming, lawn service, 2x/mo houseclean, etc.)
-$2K food
-$1K entertainment/leisure
-$3K periodic capital expenditures (home repairs, new cars, new clothes, furniture/appliance replacement when necessary, etc.)
-$1K out of pocket medical (guesstimate)
-$1K kids (presents, plane tix to visit us, etc.)

= $12.5K/month = $150K/yr. base expenses

Factoring in estimated taxes and travel, $250K is our number.

This is what I anticipate as well. We are very HHI and spend a lot too. I think we need to be realistic and $250k is $450k less than our current HHI so that could be too low