Hard to live on 100K per year ?

[Sunset]

Twice now I've heard stories on NPR about how tough it is to live on $100,000 income per year for a family.

Since this is almost twice the median family income, I wonder what poor folks are doing ?

We are struggling along on about $56,000 this year and could only afford:

• one week in FL,
• a week Caribbean cruise
• two week European river cruise
• a month long trip in Canada

I'm not sure if we would have the energy to spend another $44,000

https://www.cnbc.com/2017/12/01/living-on-100000-in-america-but-not-feeling-upper-middle-class.html

How do folks go on the air/news to report they are suffering along on $100,000/yr

 

[REWahoo]

Haven't we had a couple of posters saying they were having problems making it on $250K per year? All depends on your perspective of what "making it" entails.

 

[RunningBum]

$100K..less income and FICA taxes...less retirement and college savings...other costs associated with kids. Not as much as you might think. Not saying they aren't spending on things they shouldn't, but $100K working wage is not the same as $100K retirement withdrawals which may be lightly taxed.

 

[Senator]

What do you pay your housekeeper? Your lawn maintenance people? Your day care? Your TV service with all the channels? Your golf club membership?

What about the costs to maintain your boat? And your 3-cars for two people? And when you go out every night, how much do you spend?

What about costs of ...

 

[flintnational]

I think it is a "Millionaire Next Door" moment. Either you can LBYM (whatever that is) or you spend all that you make (whatever that is). Of course, this assumes you are above some base level income that allows you to save, if you choose.

 

[garyt]

My wife and I never made anywhere near $100K in any year yet we've managed to save close to a mil, and take nice vacations. No kids, though. Two nephews who don't make $100K and both have two kids seem to be doing fine. I know the one is saving well, the other no idea. We live in Mi, I'm sure it's much harder in NY or Cali

 

[Surewhitey]

Twice now I've heard stories on NPR about how tough it is to live on $100,000 income per year for a family.

Since this is almost twice the median family income, I wonder what poor folks are doing ?

We are struggling along on about $56,000 this year and could only afford:

• one week in FL,
• a week Caribbean cruise
• two week European river cruise
• a month long trip in Canada

I'm not sure if we would have the energy to spend another $44,000

https://www.cnbc.com/2017/12/01/living-on-100000-in-america-but-not-feeling-upper-middle-class.html

How do folks go on the air/news to report they are suffering along on $100,000/yr

$100k in Cali is $71,435 after FICA, Federal and State...still a lot for me and DW (if we still lived there). One kid didn't cost us much additional since she attended county / state college and didn't gouge us on her wedding...

We live comfortably on about $43k (after tax) this year in a no-income tax state...taxed up I'm looking at needing about $50k pre-tax

 

[Jerry1]

Of course the article is about working people and families. That changes the equation a bit. What bothers me most about the article is that while it does direct the reader to start saving, it says nothing about controlling spending. Unless you're in a high cost of living area and have a significant mortgage, $100,000 is still a lot of money. However, it can be spent just as easy as $50K or $500K. Saving is an important brake on spending (if you don't have it or see it you won't spend it), but the mentality to live below your means is critical. Right along with prioritizing spending (kind of the same thing). DW and I use the term "selectively broke" for many of these folks. Never money for savings or important things, but always money for entertainment, Starbucks, beer and a host of other things.

 

[kcowan]

When I see the shows on HGTV, I am amazed that the people only use their modern kitchens to reheat pizza unless they are holding a dinner party. One such person I know personally had a $750/mo communications budget for the family. He was paying for 5 cell phone plans, high end TV service, etc.

 

[Sojourner]

Twice now I've heard stories on NPR about how tough it is to live on $100,000 income per year for a family.

...

https://www.cnbc.com/2017/12/01/living-on-100000-in-america-but-not-feeling-upper-middle-class.html

That article is so generic and shallow it reads like it was written by Capt. Obvious. Oh, some people who make a fair amount of money don't feel rich? Really?

If the reporter had done even a minimal amount of digging, there's no doubt the people quoted in the story would have been revealed to be classic spendthrifts, allocating every dime of current income to spending and placing near zero emphasis on saving or frugality. And, yes, having a couple of kids to support through their college years does cost a heck of a lot of money. Is that really a surprise to anyone?

 

[Bigdawg]

DW and I use the term "selectively broke" for many of these folks. Never money for savings or important things, but always money for entertainment, Starbucks, beer and a host of other things.

I choose to be selectively broke. I max 401K, back door ROTH IRA, 2K into taxable each month and pay extra on the mortgage. After all that I end up broke a day before the next check hits the account. Well, only if I forget about the couple grand stashed in the gun safe, the zero balance on the credit card and the "other" checking account that I rarely look at (emergency fund). I work with a few people who make 100K plus and they aren't really strugling but are pretty much pay check to pay check with little to no travel.

 

[NW-Bound]

My nephew, a pharmacist in NYC, last year bought a 1-BR, 1-BA condo in Queens and paid close to $600K. I have not visited him, but his parents have and said they could not see paying that much for such a place, but that is the going price. He was tired of having to move every couple of years. I learned that it cost him $7K once to hire a broker to find a tiny studio.

Now, imagine if you have kids in school. The sky is the limit for a budget to live in places like that, or in SF.

 

[Pilot2013]

My nephew, a pharmacist in NYC, last year bought a 1-BR, 1-BA condo in Queens and paid close to $600K. I have not visited him, but his parents have and said they could not see paying that much for such a place, but that is the going price. He was tired of having to move every couple of years. I learned that it cost him $7K once to hire a broker to find a tiny studio.

Now, imagine if you have kids in school. The sky is the limit for a budget to live in places like that, or in SF.

That won't change, until people choose not to live there. I never have understood it myself.

 

[Nemo2]

This year we anticipate our expenditures coming in at around $47k Canadian, (~$37k US), which is high for us and includes property tax but not income tax.

And...once in a while...we get to do a little traveling.

 

[Midpack]

If you live in Wash DC or NYC like most of the NPR gang and guests, $100K is probably tough...

 

[Bigdawg]

My nephew, a pharmacist in NYC, last year bought a 1-BR, 1-BA condo in Queens and paid close to $600K.

Too bad they only hire pharmacists in HCOL areas like NYC. Wouldn't it be nice if a pharmacist could get a job in a LCOL area maybe an hour or two from NYC? Imagine if we had freedom of choice like that.

 

[daylatedollarshort]

We used to spend too much without really living the high life and then stumbled across the Consumer Expenditure Survey. It was a real eye opener for us. We realized if we could get our spending down we already had enough to ER and live a nice life. It has been pretty cool. We used to be like the people in the articles and just woke up one day and revamped our spending. We live in the same house and actually bought nicer cars and go out more than we used to on a much lower run rate.

 

[NW-Bound]

That won't change, until people choose not to live there. I never have understood it myself.

Many people like crowded cities, because they think it is fun. Not too many are like me, who has a main home in a Southwestern suburb, and still bought a 2nd place up in the high-country boonies.

My two homes together cost less than one tiny home in San Francisco, where I read that it is tough to get anything for less than $1M. Well, there are, but they are in less desirable neighborhoods, and are only 1BR, 1BA.

 

[Amethyst]

They are loath to use anything for fear the kitchen will look "used," and will turn off future buyers! Kitchens must be pristine!

When I see the shows on HGTV, I am amazed that the people only use their modern kitchens to reheat pizza unless they are holding a dinner party.

 

[Sojourner]

Too bad they only hire pharmacists in HCOL areas like NYC. Wouldn't it be nice if a pharmacist could get a job in a LCOL area maybe an hour or two from NYC? Imagine if we had freedom of choice like that.

+1

 

[97guns]

I live in the heart of the SF Bay Area with an income of around $70k, more than I ever made yearly working non college degree jobs and live very comfortably with money to save but I don’t.

The key for me is having the home I live in paid off, free and clear

 

[Car-Guy]

If I eliminated the cost associated with my hobbies, I could easily live on 60 to 70k a year and be comfortable in my chosen lifestyle.

 

[NW-Bound]

Too bad they only hire pharmacists in HCOL areas like NYC. Wouldn't it be nice if a pharmacist could get a job in a LCOL area maybe an hour or two from NYC? Imagine if we had freedom of choice like that.

But it is not "fun" living outside the city.

 

[MarieIG]

In our (middle class neighborhood on LI, a teacher can easily make more than that in our school district). As a still working couple, our income is well in excess of that. Our only "vacation" in the past few years was to fly to Pensacola to see his son get his Wings, so the money is not going there.

A large portion of our income goes to income tax (Fed, State). We get hit with the AMT as we had high deductions based upon State & property tax).

Our overhead for our primary (paid off mortgage) 1780 foot house on a 70 by 100 lot (with property tax) is over $26,000 a year.

LIRR commuting expense (approx $300 per month);

We paid our kiddos college tuition (State University) out of pocket. When needed paid tutors out of pocket. Until kiddos were established we were also carrying the costs of their cars (insurance / maintenance). No kiddos were given new cars, and there was no co-signing of loans).

We fund our 401(k)s and I am funding a non-deductible IRA.

Auto insurance is about $509 a month.

Life insurance.

Lately (vet) bills.

Auto-maintenance.

Home repairs.

We mow our own lawn and clean our own house.

We do buy good food (although not in Robby's class) from the supermarket and once and a while, local health food stores.

I am spend money (on vitamins and supplements) today buying my DH some glucosamine & chondroitin for his aching joints.

DH & I are driving 10 & 11 year old Hondas, respectively.

No, we are certainly not starving but are living a solidly middle class existence, without the "frills."

Our retirement income will be much less, however that will save us on taxes which is our biggest expense. We will no longer be funding the 401(k)s and IRA, and also plan to trim costs somewhat by moving to a lower cost of living area, which should further reduce expenses. DH wants to buy one high priced vehicle, and the money will be earmarked for that.

We do hope to travel more (and anticipate an increase in vacation expense as we will finally be able to take them) to visit the kiddos, and maybe even "real" vacations like noted by OP, however hope to fly during cheaper time frames and look for bargains for other vacations.

It will be a "new normal" for us.

 

[Sunset]

In this story the family doesn't live in CA or NY, both high cost areas. They live in St. Paul, Minnesota.

I found the radio interviews pretty fluffy, in that they didn't ask to many hard questions, even of the family that declared bankruptcy, and moved to MA so her hubby could take a $100K job and they rent an apt.