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re: Here's the budget breakdown of a couple that make $500K and still feel average
Posted on 1/27/24 at 7:48 pm to kywildcatfanone
Posted on 1/27/24 at 7:48 pm to kywildcatfanone
Of course, that’s the entirety of the post. People aren’t posting $500K incomes where folks save $250K and live a balanced lifestyle.
2
Posted on 1/27/24 at 9:09 pm to lynxcat
quote:
$500K incomes where folks save $250K
That's because you won't save that much at that income level. Hardly people in their 30s or 40s with that income will live a balanced lifestyle. They will inflate their expenses to match most of that income.
You will save more if you are older/no kids in the house or when you reach twice that level of income. Spending tends to max out at a certain point and doesn't jump again until your income allows for big upgrades on housing and vacations.
Posted on 1/27/24 at 9:49 pm to Maderan
quote:
That's because you won't save that much at that income level. Hardly people in their 30s or 40s with that income will live a balanced lifestyle. They will inflate their expenses to match most of that income.
It’s absolutely possible but I agree that people generally have lifestyle creep that makes that more difficult.
Again…even if someone is saving that kind of coin, there aren’t articles written. There isn’t an audience base for “people making a ton and saving a ton”…even on this board, downvotes rain when posts like that come up.
Posted on 1/28/24 at 6:02 pm to MrSpock
quote:
3 vacations a year
I feel this is common. Less than 3 seems a bit long between trips.
There are some other crazy items there, charity amount per year, and student loans totals. I have a lot of student loan debt but I come nowhere close to that total per year. Ill be done in 20 years from law school grad like that amt factored in.
Also, isnt an effective tax rate around 25% more reasonable than 40%?
This post was edited on 1/28/24 at 6:05 pm
Posted on 1/28/24 at 6:44 pm to lynxcat
quote:
Of course, that’s the entirety of the post. People aren’t posting $500K incomes where folks save $250K and live a balanced lifestyle.
Taxation would make this almost impossible unless you have everything paid off.
Posted on 1/28/24 at 9:15 pm to Street Hawk
Three vacations a year?
Posted on 1/28/24 at 9:21 pm to XenScott
quote:
Taxation would make this almost impossible unless you have everything paid off.
$10K living expenses a month is ballpark assumption. This does not require everything to be paid off.
$500K assuming 30% effective tax rate yields $350K take home. $10K/month in spending is $230K free cash flow. This isn’t an unreasonable reach albeit requires discipline to want to actually be that financially oriented.
Posted on 1/28/24 at 9:36 pm to lynxcat
quote:
$10K living expenses a month is ballpark assumption. This does not require everything to be paid off. $500K assuming 30% effective tax rate yields $350K take home. $10K/month in spending is $230K free cash flow. This isn’t an unreasonable reach albeit requires discipline to want to actually be that financially oriented.
You’re high by around 40k to 50k if it’s a dual income family and both earners are maxing 401k’s in Louisiana.
You can add around 20k to that 290k to 300k if you’re in Texas with no state income tax.
I forgot to add if you’re in that income bracket with no write offs and no kids you can expect to pay another 7,500 to 10,000 to federal in April but get a little kickback from the state.
This post was edited on 1/28/24 at 11:12 pm
Posted on 1/29/24 at 1:04 am to Street Hawk
3 6k vacations per year must be nice
All they need to do is cut out the 18k bs to charity and they'd be doing just fine
All they need to do is cut out the 18k bs to charity and they'd be doing just fine
Posted on 1/29/24 at 6:15 am to Rize
Assuming I wasn’t the only one that noticed, but $36k on $500k earnings is absolutely terrible as far as savings go. That should be in the 18-20%+ category. It’s possible since its husband and wife both making $200-250 that they have employer plans adding onto that, idk.
Posted on 1/29/24 at 7:48 am to Street Hawk
Geez, I probably have half of their "what's left" amount as my "what's left", and my net salary is less than a quarter of theirs.
Zero sympathy for someone that's clearly living beyond their means.
Zero sympathy for someone that's clearly living beyond their means.
Posted on 1/29/24 at 7:53 am to Cowboyfan89
quote:
Zero sympathy for someone that's clearly living beyond their means.
But they aren't
They have all their wants and needs met, including retirement savings and they still have money left over.
Posted on 1/29/24 at 10:43 am to JohnnyKilroy
quote:
But they aren't They have all their wants and needs met, including retirement savings and they still have money left over.
They’re not saving nearly enough to replace their presumed retirement spending.
Posted on 1/29/24 at 10:58 am to JohnnyKilroy
quote:
They have all their wants and needs met, including retirement savings and they still have money left over.
I guess I would agree that they aren't, but the whole point is that they feel "average". I'm not sure why they feel "average", or what their definition of average even is, but if they feel "average" with that kind of money and with what they are spending, I assume it's because they feel like there isn't much left over after all of their spending.
Posted on 1/29/24 at 11:16 am to slackster
quote:
They’re not saving nearly enough to replace their presumed retirement spending.
Kinda true but also factor in that 33% of their yearly spend is directly caused by having young kids in the house.
Most people don’t really save at all. These people at least save about 50k per year.
Posted on 1/29/24 at 11:17 am to Cowboyfan89
quote:
ut the whole point is that they feel "average". I'm not sure why they feel "average"
They feel average because that’s the feeling needed to get an article written about you.
Posted on 1/29/24 at 12:20 pm to JohnnyKilroy
quote:
Kinda true but also factor in that 33% of their yearly spend is directly caused by having young kids in the house.
Let's not forget the $45k on vacations, car payments, and charity giving.
Some of that 33% still seems excessive to me, but it's on their kids. $18k on vacations is fricking ridiculous, and practically proves that these people are oblivious to their situation if they feel "average". Average people aren't spending $18k on vacations.
This is the personification of "keeping up with the Joneses".
Posted on 1/29/24 at 2:39 pm to Street Hawk
That student loan debt is ridiculous
Posted on 1/29/24 at 4:20 pm to Hayekian serf
quote:
That student loan debt is ridiculous
Two professionals...if both are doctors or lawyers then they could justifiably have $500K in student loan debt combined.
$500K student loan debt to generate $500K annual earning capacity is still a no brainer to the upside over their careers.
Posted on 1/29/24 at 6:44 pm to lynxcat
quote:
no brainer
My wife has a masters degree in a science field and I make more than her.
I have no student loan debt.
She doesn’t have any student loan debt either and came over here from a third world nation to complete her masters. She worked for the university while completing her graduate degree.
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