It now costs $350,000 a year to live a middle-class lifestyle in a big city

[Music Lover]

Quote:

Originally Posted by tb001 Take out childcare/school costs and you’re easily down to 75. Lower if you have a nanny but still want to send a child to some form of preschool a couple of days a week. Eta, then another 20k for property taxes if that 36k is towards a mortgage.

They stated that they rent for $1775 so no additional property taxes and no mortgage. A generous $30k for child care still leaves $90k+ every year.

[MarieIG]

Deleted.

TMI

[jkern]

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Originally Posted by karen1972 I have no doubt they all this money, the question is since when did private schools become middle class lifestyle, when did eating out all the time become standard middle class lifestyle, etc. The reality is they are upper middle class which is fine, but I think calling these things "middle" class is a far stretch than what the majority (which use to middle class) lives... ie mean middle class use to mean middle of the overall population. I do not believe that the "middle" of the population even in the most expensive places actually has a $1.8M house in the US. The median home price in Manhattan from what I could find is $1M, if that is true then this 'example" family has a house significantly more expensive than that. Which also means their property tax is also significantly higher.

I grew up in San Mateo and what virtually everyone would consider a middle class house is priced between $1.3M to 1.8M. Probably not the middle of the population living in them unless they were purchased long ago.

[jkern]

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Originally Posted by 24601NoMore Here are just a few of the howlers that jumped out at me.. - Childcare plus occasional babysitting for 2-year old...$29,400 (!) - Preschool for 4 year old - $24,000 (SERIOUSLY?!!) - Food for 4 ($70/day average) - $25,548 - are they eating Wagu beef every day? Our food budget for 2 is ~$500/mo and even that is high when tracked against actual expenses..and we eat pretty darned well. - Entertainment - $6,000/yr (really? $500/month?) Anyway..

That's actually pretty close to our entertainment budget. It's very easy to go through that much per month. I include dining out as entertainment because that's what is to us. I also include hosting a party and weekend getaways in this category.

[W2R]

I am fine with living a middle class lifestyle.

But frankly, I don't think it would be worth $350,000/year to live anywhere on the face of the earth, much less in one of our largest, and probably filthiest, US cities. I mean really, feces on the sidewalk? I could go on. The only reason I can think of to live in a big, expensive city like that would be if a relatively high paying job was there for me, and if I could not possibly earn that much pay living elsewhere because my capabilities are not sufficient to demand it. I think that is probably the case for many who live there. If a middle class person with a mid level job is making $350K/year, it's not unreasonable to expect that he/she might spend $350K/year.

Life is easier in retirement.

We are lucky to be living in New Orleans, a small city. Yes, it has its disadvantages too, and this is definitely not the place to come for a high paying job. Still, we have a lot of the advantages that big cities have; art, theater, history, the food, and OMG the music here! It's amazing. No wonder so many music genres were born here. Countless musicians end up living and playing their music here at some point. You can hear them playing for free on many corners throughout the French Quarter. Similarly, there are a plethora of artists that are painting and selling their art for peanuts in Jackson Square and elsewhere, not to mention mimes, dancers, and so much more. There is more high quality art and entertainment here than you can shake a stick at.

Most middle class people here send their kids to Catholic schools whether they are Catholic or not. There are a few other private schools but not many. Some middle class kids attend public magnet schools.

Many great people grew up hanging around on Bourbon St. and the like, and despite that they somehow managed to turn out to be productive, law abiding citizens. Nevertheless I do not think that this is a great place to raise kids and I would not choose to live here if I had kids at home. Most of my co-workers with kids chose to live way up on the north shore of Lake Ponchartrain and endure the commute from h*ll back and forth across the 23 mile long Causeway Bridge. Up there, public schools are supposedly better and the environment is apparently a healthier one for kids. I wouldn't know.

[Major Tom]

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Originally Posted by HawkeyeNFO although I will say it ain't cheap to live near SF/NY/DC.

Tell me about it. For the last 10 years, I've been living in the SF East Bay (Oakland, to be precise) on $17K - $18K/yr. Now, because I purchased a used campervan, my annual COL is going to go up to something in the region of a whopping $24K - a veritable fortune! To be fair, I'm single, with 3 cats and cheap rent (for the area). On top of that, I am satisfied with a very modest material standard of living. Sometimes, I look at what is termed a middle-class standard of living, and it looks quite luxurious.

Sorry if this post seems a little like inverse snobbery - that wasn't the intent. It just doesn't take much to make me happy, which can be considered both an advantage and a flaw. I'm sure that if I had a partner, kids, and a house, my annual spend would be much higher.

[Finance Dave]

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Originally Posted by Midpack Chicago is a bargain compared to San Fran...

True, and smalltown USA is a bargain compared to Chicago LOL.

There is usually somewhere less expensive. I'm very happy with our COL in my small Indiana town, but admittedly there's not as much to do in small towns like ours.

[Finance Dave]

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Originally Posted by Mr. Tightwad It's easy to accumulate wealth if you don't get married.

Not sure where you get that from. My wife earned nearly as much as I did during our careers, which allowed us to save a lot more.

2 incomes, one house, one dishwasher, one refrigerator, etc....many expenses are "fixed" whether for 1 or two people. You must be alluding to some other facet of marriage that you've not explained.

[W2R]

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Originally Posted by Finance Dave True, and smalltown USA is a bargain compared to Chicago LOL. There is usually somewhere less expensive. I'm very happy with our COL in my small Indiana town, but admittedly there's not as much to do in small towns like ours.

You could go to a larger town like New Orleans, where there is lots to do. But also there is probably more crime and more corruption in a place like this. It's always a trade-off.

[NW-Bound]

My wife worked and earned less than I did.

If I were single, would I have more money? Hard to say. Would I be even more frugal by myself, or blow all the dough because I had no dependents who relied on me?

It's hypothetical, and I never ponder this question till reading the above posts about marriage and wealth accumulation.

[W2R]

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Originally Posted by NW-Bound My wife worked and earned less than I did. If I were single, would I have more money? Hard to say. Would I be even more frugal by myself, or blow all the dough because I had no dependents who relied on me? It's hypothetical, and I never ponder this question till reading the above posts.

I have had lots more money as a single than I did while married. But see, it's all in how you define it. When I was married, we spent a lot more money but a lot of that was on things I really didn't want (like his hobbies, his repair projects, his fancy-schmancy conversion van, his boat, his flying lessons, and so on). Now, if I don't want it, I don't have to pay for it.

I think it's not so much in having more MONEY as a single. It's in having more CONTROL of how the money is spent. We dare not talk about control much in forums like this, but it is central to this issue IMO.

Some people say that relationship issues are all about control, and that money is central to most arguments in marriage. I agree.

F and I give each other complete control over our own money and we just enjoy our conversations and loving companionship, without having to steer each other's financial ship (so to speak). Takes all the pressure off.

[NW-Bound]

My wife is quite frugal, more than myself.

I suspect that if I were single, my stash would be smaller than it is now.

In any case, I am doing quite OK despite having two children. It all works out OK. Nothing to regret. I would not change a thing.

[daylatedollarshort]

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Originally Posted by jkern That's actually pretty close to our entertainment budget. It's very easy to go through that much per month. I include dining out as entertainment because that's what is to us. I also include hosting a party and weekend getaways in this category.

We spend close to $500 per month on entertainment as well and also include dining out. But since we're retired we go out often so our per event price is still usually pretty frugal. $100 - $200 of that includes going out with friends who spend more than we usually do for a night out or a $100 event with one of our senior clubs. This week DH went out to lunch with friends - $20, we saw a play at preview prices and bought wine $29, and are seeing a tribute band with Goldstar half price tickets for $35. We had to cut it for time, but I also had seat filler tickets for another tribute band concert. The tickets were free with my annual membership but after paying for train fares and drinks still would have been $30, adding up to $112 for the week.

[Vacation4us]

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Originally Posted by Music Lover If I read your comment correctly, you support 3 homes on a little less than $350k. If you upgraded your $1775 a month to $3k and didn't support 2 other places you'd be very well off on your income. Say $300k income less $90k taxes, $50k retirement, $36k rent leaves you $124k a year or over $10k a month AFTER taxes, housing, and retirement savings.

Unfortunately yes. We support 3 homes. We rent in the Bay Area ( not fans and not worth selling the 2 down south to buy 1 dog in hell). My DH was transferred when promoted and I followed 2 yrs later.

Our plan is to return home once retired in 15 months. I still support my DD who lives in my house. DH has his own home, we are both previously divorced.

We don’t struggle to meet our obligations but we are by no means rich. We wouldn’t have an income near 300k if we both didn’t work in the Bay Area. I am a nurse and I am still shocked how much I make in this area. I worked for the highest paid hospital in SoCal and I still got a $25 dollar per hour raise by working here at one of the lowest paying hospitals.

This area is expensive and our apartment is old, small, and not in a middle class neighborhood. Think laundromat, which we do use. A means to an end. An average home here is easily 1.3 million and that’s out in Suburbs with a hellish commute cause traffic up here is insane.

Not us but 6k in housing 2 cars and 2 young kids and 10k after taxes is not rich. A family of 4 could not find a place to rent for 36k a year.

For us what we spend on 3 homes is a short term problem. In 15 months we will have no rent, 1 paid for home, and 1 house payment and a fraction of our income. Retirement bliss. We might feel rich then!

[GravitySucks]

If I didn't marry well I'd have had an extremely LCOL. Free food and they don't charge rent in jail.

Quote:

Originally Posted by NW-Bound My wife worked and earned less than I did. If I were single, would I have more money? Hard to say. Would I be even more frugal by myself, or blow all the dough because I had no dependents who relied on me? It's hypothetical, and I never ponder this question till reading the above posts about marriage and wealth accumulation.

[bolt]

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Originally Posted by GravitySucks If I didn't marry well I'd have had an extremely LCOL. Free food and they don't charge rent in jail.

A friend got married and became a millionaire after the divorce.
They used to be a multi-millionaire.

Writers must write,
When will they see the light?

[Dtail]

Quote:

Originally Posted by daylatedollarshort We spend close to $500 per month on entertainment as well and also include dining out. But since we're retired we go out often so our per event price is still usually pretty frugal. $100 - $200 of that includes going out with friends who spend more than we usually do for a night out or a $100 event with one of our senior clubs. This week DH went out to lunch with friends - $20, we saw a play at preview prices and bought wine $29, and are seeing a tribute band with Goldstar half price tickets for $35. We had to cut it for time, but I also had seat filler tickets for another tribute band concert. The tickets were free with my annual membership but after paying for train fares and drinks still would have been $30, adding up to $112 for the week.

We are at 400 monthly for entertainment, which includes entertaining friends.
It does not include dining out. It also includes entertaining the grandchildren.

[TriumphTR3fan]

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Originally Posted by candrew A Bay Area Rapid Transit janitor who makes $234,000 plus $36,000 in benefits I have to tip my hat to that janitor. According to the article, his base salary for a 40 hour week is about $56K. Dude picked up O.T. hours on an almost daily basis that other janitors turned down. He probably worked most holidays, as well. Good on him!

Where I worked there usually were overtime opportunities each day including mandatory overtime for some employees. It was cheaper for management to pay overtime rather than hire enough employees for the workload & pay benefits. I found that those employees that worked more than a couple of hours of overtime were not as good employees due to chronic exhaustion. Some employees worked overtime 40 hours a week. The janitor featured in the article appeared to be someone who essentially worked another full time job in OT. What we don’t know is his motivation for example was he supporting an extended family? What I can tell you from my experience is that relationships suffer. If you need to work those numbers of overtime to survive you really need a better job paying a higher wage. This janitor worked for years with overtime. It literally wears him out.

[LarryMelman]

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Originally Posted by Mr. Tightwad the author of the article specializes in clickbait journalism. I gave up on him a long time ago.

Yup. I'm learning quickly who the cheerleaders of the "FIRE movement" are. Most aren't retired at all, they merely shifted careers into writing how-to books and giving lectures and writing clickbait. And shout "retirement police!" at anyone who dares point that out.

[Taxman59]

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Originally Posted by 24601NoMore I just saw a linked article on a couple in NYC that earns $500K/yr and "still end up with very little besides 401K money". https://www.cnbc.com/2018/03/06/budg...cant-save.html Where to even start..what's this guy trying to accomplish? His credibility is seriously diminished with articles like these.

Looked at the tax calculation. In N?YC, with the $500k income, $38k 401K, mortgage taxes, charity, total tax should be about $154k, not $185k. There's another $31k for after tax savings! These articles are simplistic and stilted to make a political point. Total waste of time to read.