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Started By
Message
1
Posted on 2/7/19 at 9:45 am to Epic Cajun
quote:
I will tell you what I have learned and wish that I had put into place for myself financially. ...
1. Pay cash for a used cheap 4 cylinder car that gets really good gas mileage.
2. Max out all contributions to a retirement account
3. Buy a modest house at a really good price.
4. Don't go out to eat.
Do this and you will be far ahead at 40. It's the long term pay off that matters
I think it's wise to save
I also think this line of thinking is arse backwards. Live like a pauper in your 20s/30s so you can finally enjoy life when you're middle aged? Life is short.
Posted on 2/7/19 at 9:48 am to Epic Cajun
quote:
If you're making 80K and paying 1K rent - thats nuts.
But you have to understand 80k a year means your take home pay after you pay your portion of insurance and stuff is probably ~2200 bi-weekly.
That would mean to be safe you want a 1100 a month mortgage.
Now you could spend much more if you wanted/needed but the question was what is confrontable.
Posted on 2/7/19 at 9:49 am to Beessnax
quote:
1. Pay cash for a used cheap 4 cylinder car that gets really good gas mileage.
2. Max out all contributions to a retirement account
3. Buy a modest house at a really good price.
4. Don't go out to eat.
Do this and you will be far ahead at 40. It's the long term pay off that matters
frick that. A long life isn't guaranteed. I busted my arse in school so that I could enjoy nice things throughout the entirety of my life, not just the back half.
There is a middle ground between doing what you suggest and spending every cent. That middle ground is far more enjoyable
Posted on 2/7/19 at 9:51 am to LNCHBOX
Mid 20s friends text you to go eat and get drinks
"Going to have to pass guys. Need to up my retirement contributions this month".
"Going to have to pass guys. Need to up my retirement contributions this month".
Posted on 2/7/19 at 9:52 am to NIH
Posted on 2/7/19 at 9:58 am to Arch Madness
Yeah $80k per month sounds about right
Posted on 2/7/19 at 10:01 am to KG6
quote:
You are likely sending your kids to the same schools, diving relatively similar vehicles, and probably not too far off on house value at 120k and 200k. Yeah, 200k family may have the LTZ Tahoe compared the LT, and their house might cost 75k more, but it's in the same realm. Therefore they can be tied to that class. Is it distinctly different from lower middle class.....no doubt about it. But it's not rich yet.
I know this is the OT and what not, but the 92nd percentile for household income is well into upper class and is an income that affords you to live a relatively rich lifestyle.
This is all relative to the average Joe, by the way. Being poor compared to the elite is still rich.
Posted on 2/7/19 at 10:08 am to Lsuhack1
quote:
But you have to understand 80k a year means your take home pay after you pay your portion of insurance and stuff is probably ~2200 bi-weekly.
That would mean to be safe you want a 1100 a month mortgage.
Now you could spend much more if you wanted/needed but the question was what is confrontable.
I was confused because he acted like 1k rent was a lot for someone making 80k, unless I completely misunderstood what he meant by "thats nuts".
Posted on 2/7/19 at 10:13 am to KG6
quote:
I never said it wasn't comfortable at all. I was replying to the "rich" statement. And I stand by that. It is not by any means rich. You aren't driving G-wagons and living in million dollar homes. You are doing well and living a comfortable life. But it ain't rich.
I guess it depends on what your definition of "rich" is. Can mean different things to different people
Posted on 2/7/19 at 10:16 am to slackster
Your only argument is to compare income to everyone else. What other people make generally has no bearing on your ability to live and spend money. You ignore all other variables. To you, 200k with a family of 3, living in Jackson, MS, is just as rich as 200k with a family of 7, living in Boston. "Rich" is seeing no material difference given a change in variables. 200k isn't there at all.
You're also basically saying that if 200k suddenly put you in the 65th percentile, all else equal (e.g. cost of living), that you'd no longer be rich. That doesn't make sense to me.
You're also basically saying that if 200k suddenly put you in the 65th percentile, all else equal (e.g. cost of living), that you'd no longer be rich. That doesn't make sense to me.
Posted on 2/7/19 at 10:16 am to TheIndulger
quote:
I guess it depends on what your definition of "rich" is. Can mean different things to different people
Right, to a lower class person making 20k, 120k is probably something they classify as rich. But, even if you ask someone who is making 80k, I doubt they'd consider 120k rich.
Posted on 2/7/19 at 11:30 am to GRTiger
quote:
You're also basically saying that if 200k suddenly put you in the 65th percentile, all else equal (e.g. cost of living), that you'd no longer be rich. That doesn't make sense to me.
Well considering what that would mean for the purchasing power of a dollar, sure, you'd no longer be rich.
quote:
Rich" is seeing no material difference given a change in variables. 200k isn't there at all
To you, maybe. To me, and to the 50% of US households that make less than a third of $200k per year, $200k allows you to handle a ton of variables and still be very well off.
If you've got 7 kids in private school, you're rich. The fact your cash flow is lower doesn't change the fact you can still afford it.
Posted on 2/7/19 at 11:57 am to Lsuhack1
(no message)
This post was edited on 1/21/20 at 9:15 am
Posted on 2/7/19 at 12:02 pm to Arch Madness
Location makes a huge difference. Where I live 125k to be comfortable
Posted on 2/7/19 at 12:05 pm to cahoots
quote:
I think the 25% of take home on housing is a good rule of thumb but it really depends on what else you spend on.
It also depends on how much you make. A lot of your bills don't necessarily escalate when you have a higher mortgage. You're still going to spend the same on groceries, internet, gas, entertainment, phone, vehicles (maybe, maybe not on this one), ect...
Posted on 2/7/19 at 12:07 pm to slackster
quote:
but $200k household income is fricking rich
Depends on many factors. Family size, location, schools, etc. A family of 5, with private school tuition or college tuition, $200k doesn't go that far.
Posted on 2/7/19 at 12:08 pm to yellowfin
quote:
Not really I didn’t even notice the difference
Regardless of how you felt about it, there is an enormous difference between $120k and $200k household. Enormous.
Posted on 2/7/19 at 12:24 pm to PhiTiger1764
(no message)
This post was edited on 2/7/19 at 12:25 pm
Posted on 2/7/19 at 12:36 pm to slackster
quote:
To you, maybe. To me, and to the 50% of US households that make less than a third of $200k per year, $200k allows you to handle a ton of variables and still be very well off.
It doesn't surprise me, nor should it surprise you, that the perception of 200k to a household that makes 65k is outside of reality.
quote:
If you've got 7 kids in private school, you're rich.
No shite. You're also not making 200k. If you are, they are in public schools. I guarantee that.
Tell me this is rich:
200
-38 (401k)
-12 (healthcare premiums)
-6.7 (HSA contributions)
=143.3
-35 (taxes)
=108.3
You're at 108k after top line expenses and taxes
108
-22 (food for 6 ($10/person/day))
-13 (car + insurance)
-24 (mortgage/prop tax)
-15 (house expenses - electricity, gas, cable, phone, security, maintenance)
-24 (school for 4 kids)
-3 (student loans)
-3 (random shite that always happens)
= 4k left over. This doesn't count additional savings, elevated medical expenses, family trips, hobbies, etc.
You think you're rich if you can't have a rainy day savings, take a trip, or play a couple rounds of golf each month?
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