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Message
What minimum salary would be required to be part of the middle class?
Posted on 10/7/14 at 10:21 am
Posted on 10/7/14 at 10:21 am
I should probably add the adjective "upper" for middle class as I have rather expensive tastes for some things like food.
I'm currently in graduate school and was planning on going on for a PhD. But now that I have a family, I'm hoping to settle down as a non-impoverished student that can allow my wife to either work part time as a pre-school instructor or not work at all while the kids are young.
I would like to have money for savings (for emergencies), college fund for the kids, investments for retirement, and a house in a safe neighborhood (thinking the $250k range with a 10% down payment unless I can coerce my father-in-law into loaning me the other 10%).
I can go back into teaching high school ($50k with a master's), teach guitar lessons on the side (about 500 extra a month), and play a few paying gigs as a guitar player (averaging 250 a month). That comes out to roughly $59k.
Would $59k/year be doable? On a tight budget? Do I need to explore private sector careers that may pay more?
My credentials:
BA in Secondary Education Language Arts
MA in English with a concentration in Rhet/Comp with a graduate certificate in technical and professional communication
Six years of teaching experience
Two years of self-employment
Two years of collegiate teaching experience on a fellowship from a university
This post is all over the place, I know. But I thought maybe this board could offer some sound advice for a guy that is ready to be the head of the household for a family of four that has a stay-at-home mother for 4-5 years.
I'm currently in graduate school and was planning on going on for a PhD. But now that I have a family, I'm hoping to settle down as a non-impoverished student that can allow my wife to either work part time as a pre-school instructor or not work at all while the kids are young.
I would like to have money for savings (for emergencies), college fund for the kids, investments for retirement, and a house in a safe neighborhood (thinking the $250k range with a 10% down payment unless I can coerce my father-in-law into loaning me the other 10%).
I can go back into teaching high school ($50k with a master's), teach guitar lessons on the side (about 500 extra a month), and play a few paying gigs as a guitar player (averaging 250 a month). That comes out to roughly $59k.
Would $59k/year be doable? On a tight budget? Do I need to explore private sector careers that may pay more?
My credentials:
BA in Secondary Education Language Arts
MA in English with a concentration in Rhet/Comp with a graduate certificate in technical and professional communication
Six years of teaching experience
Two years of self-employment
Two years of collegiate teaching experience on a fellowship from a university
This post is all over the place, I know. But I thought maybe this board could offer some sound advice for a guy that is ready to be the head of the household for a family of four that has a stay-at-home mother for 4-5 years.
18
Posted on 10/7/14 at 10:22 am to StringedInstruments
Location location location. Cost of living is the biggest factor.
Posted on 10/7/14 at 10:23 am to kingbob
quote:
Location location location. Cost of living is the biggest factor.
Right. I should include that. Most likely Birmingham, AL as that's where our parents live. Cost of living is very low in most of the areas at least when compared to other big cities.
This post was edited on 10/7/14 at 10:23 am
Posted on 10/7/14 at 10:29 am to StringedInstruments
quote:
Would $59k/year be doable? On a tight budget?
would the 59K be the total household income?
Posted on 10/7/14 at 10:31 am to StringedInstruments
quote:
Most likely Birmingham, AL as that's where our parents live
Be sure to factor in any benefits from childcare if you have any family members that can watch your (future)kids so you can avoid paying for daycare.
Also, I have no idea if there is any money in it, but you could possibly learn how to restore or fix old/broke guitars for some additional income. Seems like a hobby you might enjoy.
Posted on 10/7/14 at 10:37 am to StringedInstruments
You'd be scraping by at $60k, pre-tax, in a $250k home and the wife not working.
$100k, minimum if you truly want to be comfortable and enjoy some finer things in life. Birmingham has a lot of great restaurants to do that.
$100k, minimum if you truly want to be comfortable and enjoy some finer things in life. Birmingham has a lot of great restaurants to do that.
Posted on 10/7/14 at 10:42 am to StringedInstruments
I was living pretty well, by myself, on 32k a year pre-tax. I would have called it lower middle class.
Now that I got a raise, I'd like to think I'm solidly in the middle class, as I can actually contribute to my own IRA and stuff.
Now that I got a raise, I'd like to think I'm solidly in the middle class, as I can actually contribute to my own IRA and stuff.
Posted on 10/7/14 at 10:47 am to TigerintheNO
quote:
would the 59K be the total household income?
Possibly.
My wife is a teacher and could get a job at a preschool. She has some connections around town.
That would also cut down on daycare costs. She would work 8-12, getting paid about $1200/month, and our daycare cost would be $550 a month for two kids. That's IF she gets the job that her friend will be leaving after next year. Not sure on the numbers at a different preschool.
Posted on 10/7/14 at 10:56 am to StringedInstruments
Any debt?
Some thoughts to consider:
1) You really need to do a pro forma budget. Try to figure out what your monthly take-home will be after tax withholdings and medical insurance (see if you can determine online what an approx insurance premium will be, generally, public school teachers have decent health insurance). Next sketch out payments for housing and utilities, cars, gas, food, everything you can think of. There are online calculators that can help with some of those numbers.
Once you get some numbers down on paper, you will have a better idea of what you are looking at. Also note that things always cost more than you think they do, so if this exercise leaves little extra money, you might be in a tight spot.
2) House - if you have good credit the bank will lend you an obscene amount, but at the absolute highest, I don't reccomend getting a mortgage for more than 2.5 times your gross annual income. For you that would be 150K. If you have no other debt, you might be able to go somewhat higher. But you are taking 4x income. That's a lot.
3) Your wife working part time vs stay at home - if you need to pay for daycare for your wife to work part time, this almost never works out financially. If it is a type of work that she can do after you get home, or, if you have family that can watch the kids, then every dollar certainly helps.
Some thoughts to consider:
1) You really need to do a pro forma budget. Try to figure out what your monthly take-home will be after tax withholdings and medical insurance (see if you can determine online what an approx insurance premium will be, generally, public school teachers have decent health insurance). Next sketch out payments for housing and utilities, cars, gas, food, everything you can think of. There are online calculators that can help with some of those numbers.
Once you get some numbers down on paper, you will have a better idea of what you are looking at. Also note that things always cost more than you think they do, so if this exercise leaves little extra money, you might be in a tight spot.
2) House - if you have good credit the bank will lend you an obscene amount, but at the absolute highest, I don't reccomend getting a mortgage for more than 2.5 times your gross annual income. For you that would be 150K. If you have no other debt, you might be able to go somewhat higher. But you are taking 4x income. That's a lot.
3) Your wife working part time vs stay at home - if you need to pay for daycare for your wife to work part time, this almost never works out financially. If it is a type of work that she can do after you get home, or, if you have family that can watch the kids, then every dollar certainly helps.
Posted on 10/7/14 at 11:03 am to StringedInstruments
$59k/yr and a $250k house would be tough, if you wanted any kind of recreational activities
Our household income is at or around $100k depending on end of year bonus. Once you factor in taxes/insurance/retirement/ect your net income will be a lot lower. My $243k house with insurance and property taxes is about $1650/mo
You realize even before taxes, $59k would leave you less then $5k/mo. after taxes you house will cost you over 35% of you monthly income, then you have food, utilities, daycare, student loans?, vacation, emergency fund/unexpecteds, ect
and how long do you want to do the side work?
Our household income is at or around $100k depending on end of year bonus. Once you factor in taxes/insurance/retirement/ect your net income will be a lot lower. My $243k house with insurance and property taxes is about $1650/mo
You realize even before taxes, $59k would leave you less then $5k/mo. after taxes you house will cost you over 35% of you monthly income, then you have food, utilities, daycare, student loans?, vacation, emergency fund/unexpecteds, ect
and how long do you want to do the side work?
Posted on 10/7/14 at 11:10 am to tigeraddict
The $59K income for a family of four is doable if you live modestly, but not with a $250K house. Why so much house? Are you buying to be in a certain school district?
It won't leave you much room for spendy vacations, nice shoes, or other such materialistic swaddle. But if you're the sort who uses the public library, doesn't have cable TV or a big cell phone bill, and values family time over a designer handbag, you'll do all right.
It won't leave you much room for spendy vacations, nice shoes, or other such materialistic swaddle. But if you're the sort who uses the public library, doesn't have cable TV or a big cell phone bill, and values family time over a designer handbag, you'll do all right.
Posted on 10/7/14 at 11:42 am to tigeraddict
quote:
and how long do you want to do the side work?
I could do it forever. It's music, so it feels recreational. Also, it's $100 a student for guitar lessons. 500 bucks is just 5 kids a week or 2.5 hours for lessons. It's really good money. Just not consistent enough to make it a career. Hell, after getting tenure, I could easily bump that number up to 10 kids a month for $1000 extra.
This post was edited on 10/7/14 at 11:45 am
Posted on 10/7/14 at 11:44 am to StringedInstruments
Keep in mind, that since you are a teacher 8% of your salary is taken out for the pension plan.
Posted on 10/7/14 at 11:44 am to hungryone
quote:
but not with a $250K house. Why so much house? Are you buying to be in a certain school district?
That's what's getting me. We've done the suburbs, drive into town thing, and we didn't like it at all. We'd like to live in a suburb close to B'ham - Homewood, Vestavia, and that's about the lower end of a decent house in those areas.
I have a year and a half left on my degree, and I have about 20 hours I could fill with a side job. I'm looking into teaching lessons now, hopefully get 10 kids for $1000 a month, and by the time I graduate have an extra $15k or so to put down on the house. But getting lessons has been difficult so far.
Posted on 10/7/14 at 11:52 am to StringedInstruments
lower middle class, but not upper.
Your take home? probably about $3500/month
Note: $1600
Elec/Gas/Water/Cable/Internet: $350
2 Cell Phones: $130
Family Insurance: $300
1 Car note: $350
2 Car Insurances: $200
Food for a family of 4? $1000...not including any date nights.
You are already over budget there and that doesn't include kids clothes, kids activities, school supplies, birthday parties, gas, vacations ect.
Your take home? probably about $3500/month
Note: $1600
Elec/Gas/Water/Cable/Internet: $350
2 Cell Phones: $130
Family Insurance: $300
1 Car note: $350
2 Car Insurances: $200
Food for a family of 4? $1000...not including any date nights.
You are already over budget there and that doesn't include kids clothes, kids activities, school supplies, birthday parties, gas, vacations ect.
Posted on 10/7/14 at 11:54 am to jsquardjj
I hate reading posts like yours 
Posted on 10/7/14 at 12:22 pm to StringedInstruments
Can you even get a loan for a 250k house on 60k a year? Seems like it would be foolish to do so, especially with children to pay for. And, I am not sure if a bank will count income gained by teaching or doing gigs towards your income.
I am pretty sure that 60k household income is a good ways away from "upper middle class", whatever that means to you.
I am pretty sure that 60k household income is a good ways away from "upper middle class", whatever that means to you.
Posted on 10/7/14 at 12:25 pm to DownSouthDave
quote:
Can you even get a loan for a 250k house on 60k a year? Seems like it would be foolish to do so,
Very foolish. OP can get a decent house for 100k in Birmingham
Posted on 10/7/14 at 12:45 pm to DownSouthDave
59k for a family of four? frick that.
Posted on 10/7/14 at 12:53 pm to StringedInstruments
quote:
We'd like to live in a suburb close to B'ham - Homewood, Vestavia, and that's about the lower end of a decent house in those areas.
No offense, but you'd be wasting your time trying to get a mortgage on a move-in ready home in Vestavia or Homewood on that salary, even with 20% down.
Couldn't you get a teaching job in one of the suburbs out further and live out there? North Shelby, Trussville, Hoover?
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