Post # 76
bougainvillea : Yeah its kinda hard, we had to move to an area we could afford because we couldnt have got on the property ladder where we grew up at all, so we had to make that sacrifice. We also bought a house we are having to do up, again becuase its just our only option. I would have loved to have been able to buy somewhere “ready” so to speak but we would have needed an extra £25k on our wages to even get looked at for a mortgage. Sometimes sacrifices just have to be made. I wouldnt say we live in a low cost area though, its average and we are left with less than 25% of our income as “free” money after we have paid for everything.
To live the life i do, with a roof over my head thats mine and a dog and food on the table i dont buy myself things. I get my hair cut and coloured once a year, i dont have manicures or any beauty treatments, i go abroad maybe every few years if we can save enough up andf other than that its weekends camping, i dont have nice handbags or fancy shoes, i buy to replace things i need and then its with coupons and from the sale rack, but it just is what it is. I value healthy food and any form of home, even if it isnt great, over those things so i dont have much of a choice.
I only dream of a higher income to take the pressure off, so we dont have to have the heating off 9 months of the year, and so we could go out to dinner once a month instead of just our birthdays and our anniversary. It would just be nice to not worry and get to the end of the month with less than £5 left haha.
Post # 77
It is absolutely insane to me that you would need a $350k income to live well with two adults and no kids. I live in one of the most expensive cities in the world also and it doesn’t cost anywhere near that to have the lifestyle you have described.
Our household income is the upper end of your lowest bracket and we afford our mortgage, eat out several times a week, go on several trips abroad each year and also save a big chunk of our income. To have a nice lifestyle with kids it would probably only need to increase to £100k and that is being idealistic and i’m not remotely saying you can’t live a nice life under that. I actually feel ridiculous saying you would need £100k a year to have two kids since that obviously isn’t true, but if I was to put a figure on a nice lifestyle with kids in a HCOL I would say it is about that.
Post # 78
zzar45 : *just to reiterate I do not currently earn even a 6 figure salary*
Without kids I think I only need 200k, not including my husband’s income. I’ll try and breakdown a rough estimate of large expenses and divide shared assets into 2 between me and my hubby (although it obviously doesn’t work that way)
1. House: 175k for deposit and stamp duty (my “half”)
mortgage: 40k a year (my “half”)
2. Car: 70k once every 5 years
3. Holiday: 4k each (to be honest I probably spend double this currently)
4. Food: 7k
5. Clothes, makeup, cosmetic procedures: min 10k annually; add in 1 designer bag and it’s 5k more
6. Student debt: 12k
7. Insurance/other fees: 5k
The above adds up to roughly 95k already (not including putting my house deposit down) and doesn’t include other things like utilities and smaller things that add up. And I think I’m grossly underestimating my clothing/cosmetics expenditure.
For children; private school and day care would set us back around 25k each and I would ideally like 4 (although realistically 2-3) which is 100k a year, not including music lessons/ballet/language school etc.
Ideally I would save at least 50% of my take-home salary so that would be another 95k; bringing my total salary post-tax to 190k. Tax is 45% so I’m looking at easily over 200k.
Post # 79
bougainvillea : *just to reiterate I do not currently earn even a 6 figure salary*
Without kids I think I only need 200k, not including my husband’s income
These are just really bizarre numbers that you have plucked from the air considering you don’t currently earn enough to spend like this.
Are you likely to have a 550k household income? If you currently don’t earn anywhere near close to 100k it seems like you are setting yourself up for disappointment by allowing yourself to believe that if you aren’t able to spend like this then you aren’t living well.
Post # 80
notmeeither : I am surrounded by miserable people living in mansions, driving luxury cars and complaining that they are too poor. I know you can be rich and miserable. The issue is when expenses follow your income as it increases.
If given a choice, EVERYONE would prefer to be happy and earn an average wage, versus miserable but a multimillionaire. I guess I’m hoping to both be happy AND wealthy. I don’t think they are necessarily mutually exclusive. Surely I can earn 200k, have a great relationship with friends, family?
For me, I need the money to provide for my (future) children ie housing and education. I want them in private school, extra tuition if needed, support their extracurricular activities and travel the world with them.
I am trying to be grateful for my current situation while also pushing forward, setting goals and achieving them. I don’t want to just settle for my current life.
Post # 81
zzar45 : I spend money from my husband’s income, which we view as our money.
Post # 82
bougainvillea : 2. Car: 70k once every 5 years
What kind of car are you buying? Lol. We spent 25k on my car and we’ll drive it for probably 7-10 years. To be fair it sounds like you live in a high cost of living area. But I could definitely live well without a brand new 70k car every 5 years.
Post # 83
The awkward moment my low salary didn’t even make the poll…
Post # 84
That car budget is insane. We bought a Caddie Escalade that was only a few years old for only like 11k and would have driven it for at least a decade (totaled by a deer).
I’ve always felt like we lived well, when we were super poor but young and in love living in a craphole, we spent our time going to parks, reading books, and trying to be inventive cooks on a shoestring budget.
10 years later I’m a Stay-At-Home Mom to two littles and my husband is a Dr making v good money (we feel rich now having Just paid off both our student loans), we rarely splurge, I still cut everyone’s hair in the family, we cook our meals at home. We have lots of activities for our kids, though. We are really quite happy and make less than 200k a year living outside a very large city.
Post # 85
I think my sweet spot was 65k pre tax. well below average in my city but enough to comfortably afford my mortgage on a modest house, save a bit and buy the occasional new dress or dine out without worrying about money. We also prioritise our annual overseas holidays. I find too much responsibility/higher positions increase my stress level too much to enjoy the extra income.
Post # 86
The figures on this poll are absolutely bizzare to me. I live in the UK and the vast majority of the country earn below or within the first bracket.
I live in a very HCOL area and if both Darling Husband & I each had an income within the first bracket we’d definitely feel like we’re living comfortably.
A good work life balance is way more important to me than loads of money (and I love my job). No one lies on their deathbed and wishes they’d spent more time working.
Also, buying brand new cars is not a good financial decision even if you can afford it.
Post # 87
5. Clothes, makeup, cosmetic procedures: min 10k annually; add in 1 designer bag and it’s 5k more
In the nicest way possible… Are you certifiably insane! You think you will need to spend apparently your entire current salary on clothing/makeup/etc to “live well”? Are you so miserable now on your current salary and current waredrobe that you think that will make life that much better? You need a new Chanel or Birken like every year?
2. Car: 70k once every 5 years
I mean, some people are car people ok… but this is pretty insane to most people I think. Cars are just a money pit and unless you’re just keepig up with the Jones trying to look rich, it just seems like a huge waste. My car is 5 yrs old and still feels “new” to me. Even my flashiest of friends don’t do this and they have the kind of salary you’re talking about. I only know of 2 or 3 people that got new cars 5 years or less and they were insanely wealthy, worth 100’s of millions.
I think your definition of “well” is more like living “lavishly”, at least to most people. That kind of spending is for the truely “rich” imo.
And for the kids, why private school? Such an expensive house in a nice area doesn’t buy you good public schools? what’s the point then? If you were going to spend money on private school, why spend the premium on such an expensive neighborhood… school quality is typically what drives prices, right? And if you had 4 kids, they wont all be needing day care at once so it would never be 100k… and at that point, woudln’t a nanny be cheaper? (Though that can be pricy too, i know of a few people that pay 50-70k/year for nanny.. but taht’s still not close to 100k).
Post # 88
bougainvillea : You haven’t really indicated your earning potential or any mapped plan for how you will achieve these numbers. While I don’t disagree with the figures themselves (we spend in similar amounts), I do not see any indicators that this is a viable plan vs. a numbers fantasy of a future you would “like.” This is why I brought up financial comfort not equating to “living well.” In your mind, you’ve already pre-planned the spending of money you don’t earn and “needing more” already. This mindset is one of the causes of an “unhappy millionaire,” and the reason for my caution. I certainly do not think that living comfortably damages all interpersonal relationships. But, if you feel the need (before you have money to spend) to keep up a certain level of lifestyle or project a certain image, that certainly will not go away once you have achieved that income bracket.
The issue is when expenses follow your income as it increases.
There is actually no set rule that you need to purchase a home in a certain neighborhood, select the most costly private school (or private school at all), have a Dysport/lip injection regiment, or a yearly mid-tier designer bag. You probably should have been more specific about either, “how much does it cost for you to live in this specific fashion in your area of the world,” or “what are the markers of living well, to you?”
It sounds like a lot of your goals focus on providing a comfortable home for children with as many advantages as you can offer them, and that is a kind and lovely mindset for anyone to take. I think most of us worry about providing the best situation we can to our kids.
Post # 89
bougainvillea : I’m not trying to beat you up here, I just don’t follow your logic, it seems incredibly naive and unrealistic. Your assumption of salaries you and your husband will need to be making are well out of range of even most professional salaries. And if you consider $40k/year toward ‘your share’ of an exhorbitant mortgage a plan- I’m sorry honey but this is a house of cards that would collapse in an instant if one of you got sick, hurt, downsized etc, even if you did manage to tuck some savings away.
Even if we view this from a purely financial, material set of values, you’re not looking to live ‘well’, you’re actually looking to be part of the wealthy, affluent elite. Sadly I think you’ll likely either be bitterly disappointed or lose yourself in the rat race of trying to reach these goals.
Post # 90
bougainvillea : Haha sure. I live in the US… Tennessee. Houses here can range from piss poor prices to millions here… but cost of living is not high.
My story? I did not have a dime saved. I had ~$26k in school loans living in an apartment. But because I handled money well for many years (good credit) I was able to get a conventional 30 year loan with no money down. No PMI. Not a thing. My interest rate wasn’t the bomb… 4.3% or something… because of the no money down.
I bought a completely renovated 1948 home for $90,900 in 2016 (new homes can cost just as much). Wasn’t a single thing wrong with it… massive yard… all the bells and whistles. I also looked around at new homes and I could afford up to $160k or brand new… but didn’t want to set my budget too high because I like knowing I have no worries.
But anyways. I was able to pay off the stupid school loans finally by having a mortgage and not much higher rent for a tiny apartment. I eventually sold that house and moved into fiances. Doing that caused me to pay off the $26k school debt in 1.5 years.
I don’t think it really matters how much you make sometimes. I am middle class in my city. And it might sound pitiful compared to wherever you live but I bought a house, saved up $40k in less than 5 years, paid off that debt in 1.5 and living very comfortably.
Our house is a brick two bedroom two bath, our cars are pretty old, but if you want newer things with higher tags… you gotta make more and pay cash for it… not pull out loans and call that wealth.
We now follow Dave Ramsey’s advice. He wasn’t what we used for school debt… but we will be rich anyways someday even at our lower incomes.