Forbes Mag: what it costs to live well

[farmerEd]

Either I am so completely out of touch with reality, or the people that write these articles are....I am starting to think it is me.

Here are just two cities in my area where they explain how much you need to "live well"....this isn't "living well" to me...and note the 1% savings rate.

What It Costs To Live Well: Northeast Boston, Massachusetts 02108
Net Income After Taxes $407,200
Primary Home Cost $2,600,000
Annual Home Payments $144,059
Vacation Home Location Nantucket, Mass.
Vacation Home Cost $1,900,000
Annual Vacation Home Payments $105,438
Cars $18,500
Dining Out $12,480
Food at Home $12,480
Travel $21,500
Health Care $4,600
Utilities $5,600
Private School $26,000
College $30,300
Other $22,100
Savings $4,100
Local/State Taxes 10.1% 



What It Costs To Live Well: Northeast Portland, Maine 04105

Net Income After Taxes $212,000
Primary Home Cost $650,000
Annual Home Payments $36,278
Vacation Home Location Kennebunks, Me.
Vacation Home Cost $800,000
Annual Vacation Home Payments $44,544
Cars $17,600
Dining Out $8,320
Food at Home $8,320
Travel $21,500
Health Care $5,000
Utilities $6,000
Private School $10,000
College $30,300
Other $22,100
Savings $2,100
Local/State Taxes 11.0%

Edit: Here is the link http://biz.yahoo.com/special/live05.html

 

[windsurf]

Aassuming that the home payments are financing, there is not even a line for maintenance of the two,  Mcmansion and  some sort of "country house (no explanantion as to whether that's a cabin-type or full-blown home; I assume they are not talking double-wide).    Both locations use the same figure for "other."  Beyond eating out and traveling, the "other" would have to emcompasss clothing, all miscellaneous expenses, charities, gifts to relatives, lawn and garden, etc. etc.  The built-in assumption must be that to afford the high-end accomodations, wheels, prestige private schools and eating out more than in, these working stiffs would be totally consumed, burned-out and without energy to care about major toys and entertainment beyond the cars and crashing early every night in nice digs.   All work and no play......Glad I saved by driving those boring cars and allowing my daughter to slog through public school (she did great) and by sacrificing huge by not having that country place, oops, forgot; by living on the edge of the metro area, we did live in the country all the time. What a half-assed piece of crap article. 

 

[farmerEd]

The things that really jumped out at me (besides the housing/vacation housing costs), were the assumption that to "live well" in Boston, you'd need to budget $250/per week for groceries for a family of four (we spend less than that for 6 people) but ALSO another $250/week for eating out....

 

[Dawg52]

Well I guess I better delay my retirement. Didn't realize it would cost anything like that to live well.   Oh I almost forgot, I live in Mississippi. I can live on about 10% of the income stated in this article and feel like I'm living well.  Think I'm gonna stick with my 12/31/06 retirement date. 

 

[tozz]

Or that some presumably intelligent couple making $250K in a state that ranks down with Mississippi in per capita income would decide to buy an $800K vacation home 25 minutes down the Maine Turnpike (with traffic!) from their $650 primary home...

The things that really jumped out at me....

 

[retire@40]

I lived my whole life in the northeastern part of Boston.

I worked my whole life in the northeastern part of Boston.

That income is way above the income you need to live "well" in the northearn part of Boston. I would say you could live very well with $100K gross income a year. The cost of a good single-family home is about 1/4 to 1/5 what that article says, and the rest of the numbers are all made up too.

 

[SteveR]

The incomes in this article are all AFTER TAX, that means these mythical people have to be making at least 30% more in Fed. Tax, plus SS, plus Medicare, plus State tax and any local taxes. Yikes! That would put these folks in the top 1% of incomes in the US.

It would be nice to have that kind of income but to not save (unless you count the realestate as savings) more than 1% is a crime. I am at about 25% savings rate and will be until ER. How are this folks going to ever be able to retire? The realestate taxes alone will quickly eat up their meager savings in short order much less the maintence and utilities etc on these places.

I think the author was just crunching a bunch of numbers he ran across and then created a way to make a sensational article with them without any real intent on accuracy to real life.

Glad I have a 3D life and am not living the one this guy sees.

 

[maddythebeagle]

"sensational article" - isnt that what everybody does anymore on just about every issue. People have a point of view and then stretch the facts or make up their own to match their beliefs.

I still dont understand who Forbes is selling to? I read some online articles from them on dividend investment plans. I mean a lot of those are great, but they are for folks that want to invest 25 bucks a month in a company. Does this match up with these "high life, high debt, no investment articles"?

- by the way, good job Steve for saving 25%.

 

[MJ]

I thank the stars for the common sense that is expressed here.
For pure selfish reasons, I'm happy to see these type of financial articles. It keeps the majority of Americans working until the age of 75 to continue building their nest egg to reach these lottery dreams.

We need the American people to support our LBYM lifestyle to assure the continuance of future SS monthly payments.

 

[jerryo]

Actually, if you subtract out the cost of ridiculously expensive housing (how many New Yorkers are paying for $4million primary residences and $2million vacation homes) and the cost of private school and college tuitions you end up with about $100k for a "very comfortable" lifestyle in Boston, DC and NY....(including two fancy cars, etc., etc.)....probably NOT all that unrealistic.....

 

[renferme]

What it costs to live in the Pittsburgh area:

Net Income After Taxes <100,000 (really a lot less than this)
Primary Home Cost less than 200,000
Annual Home Payments $15000 or less, if both husband and wife are retired, it should be 0
Vacation Home Location (not req'd): Phoenix area
Vacation Home Cost (not req'd) $170000
Annual Vacation Home Payments $12000 or 0 if no vacation house
Cars $4800
Dining Out $2500
Food at Home $3000
Travel $3000
Health Care: mostly paid for by Bayer, but about 1500 / year for UPMC or Blue Cross coverage, etc.
Utilities $2500
Private School 0
College 0
Other $2000
Savings $1000
Local/State Taxes 4 %, but no state/local taxes on pensions here.


Really, you could live well for a lot less than what I've stated above; those are just wild a#s guesses.

 

[LEX]

Forbes just doesn't get it, and i suggest many of their target readership do not as well. 

My wife and i spent that last two weeks in Novgorod, a 15th century city that costs little to live in and has more historical charm than most of europe.  I would strongly advise that there are those in that ancient city that have more fun than anyone in the country club set will ever know.  Its all in the mental and cultural perspective of the consuming citizen.

Forbes does no one a real service with surveys such as this.  They confuse those who measure the quality of life by such obtuse standards as ego tripping status symbols.   

 

[Nords]

Forbes does no one a real service with surveys such as this.

I wouldn't be so sure of that-- check the advertiser's index for the real beneficiaries...

 

[treypar]

I think that the article was just wrong. May be the ultra rich needs that much but it does not take that much to live well. Plus the neede to make more to have any savings.

 

[GTM]

What It Costs To Live Well: Northeast Boston, Massachusetts 02108
Net Income After Taxes $407,200
Primary Home Cost $2,600,000
Annual Home Payments $144,059
Vacation Home Location Nantucket, Mass.
Vacation Home Cost $1,900,000
Annual Vacation Home Payments $105,438
Cars $18,500
Dining Out $12,480
Food at Home $12,480
Travel $21,500
Health Care $4,600
Utilities $5,600
Private School $26,000
College $30,300
Other $22,100
Savings $4,100
Local/State Taxes 10.1% 





Edit: Here is the link http://biz.yahoo.com/special/live05.html

And that's without the cost of Red Sox tickets. (They are overpriced anyway)

 

[newellcr]

I thought it was pretty entertaining. Thanks for the link.

Cheers,

Chris

 

[BUM]

And that's without the cost of Red Sox tickets. (They are overpriced anyway)

I saw a cute T shirt today at the flea market. " I support 2 MLB teams. The Yankees and anyone who beats the Red Sox."


Most, not all, NY'ers I know don't really hate the Red Sox. Its just something to do. Like sticking pins in a voodoo doll.