Living the American Dream

[Jay_Gatsby]

I just came across the following article on Yahoo (which links to a series of articles by Forbes), and was absolutely flabergasted by the kind of money required to live the "American Dream" in various geographic areas. Here's the link if anyone is interested:

http://biz.yahoo.com/special/live05.html

 

[Sheryl]

Pretty scary!

Quote from the article, "a nice, but not opulent, life--private schools for the kids, a large house in an upscale neighborhood, a weekend retreat, a pricey night out once a week, a couple of very nice cars."

This is what they researched. I guess it depends on your definition of "opulent" but it's no wonder there are so many people saving nothing if this is what they consider "living well."

 

[cute fuzzy bunny]

Thats an opulent life. I want to see the authors definition of a less than nice lifestyle... and a 'really' opulent one...

 

[Spanky]

I see a significant portion of the costs is vacation home, private school, and college. Another big item is home payment. I think one can live "well" even without these items. Do we really need to have a vacation home? Do we really need to send our kids to a private college when a public insititution can provide the same level of education? Do we really need to live in an expensive home?

 

[LEX]

Inflated Ego's are way too expensive and an true challenge to ER. 8)

 

[WhodaThunkit]

Wow -- the cost of the vacation home alone for someone living in Atlanta is 1,600,000. Plus a lot of vacations not using the vacation home. Probably not very realistic . . .

 

[cute fuzzy bunny]

Swell, just what I need. Another house with another roof to leak.

Every time I think about buying a little place up in Lake Tahoe or in Napa, or a boat, all I have to do is think about the maintenance and repair. Turns me off completely.

 

[Martha]

We sold our cabin about a year and a half ago. Don't miss it one bit. All houses are money pits.

 

[ladelfina]

Arrgh.. Again with Forbes.. I lived in their #2 most expensive market and my two-income friends with kids seemed to do superlatively with $100-$150k between them (including vacation homes on the Cape and vacations abroad).

Forbes's version of the American Dream consists of throwing a lot of money away on things that are advertised (surprise!) in Forbes.

The "American Dream' used to be a chicken in every pot. Now it's a Lexus in every driveway.

I cracked up laughing when I saw "vacation homes" tending to cost 10-20% more than the primary home.. This for a house where you spend what's left of your allotted vacation time after your two-weeks-plus skiing in Europe or snorkeling in the Caribbean, mind you! No-one I ever knew with kids and a vacation house ever managed to make any serious use of it on weekends, anyway.. the kids always had too many weekend 'activities' scheduled.

More than double your housing expenditure and it inflates the numbers bigtime..

They might just as well present the "American Dream" as having a 'cottage' in Newport, a la Vanderbilt.. Just another chain-yanking in my opinion.. 

"Jay Gatsby" should be able to enlighten us, no?

 

[Outtahere]

The sad and scary part is there are people that live like that now and others that aspire to live like that. I prefer to have the money in the bank.

 

[Nords]

Swell, just what I need.  Another house with another roof to leak.

Every time I think about buying a little place up in Lake Tahoe or in Napa, or a boat, all I have to do is think about the maintenance and repair.  Turns me off completely.

With so many vacation condos & rental boats available in so many different locations, it's hard to imagine why anyone would want to own one. Unless one needs to point at a possession and be able to say "mine mine mine."

One of the best features of every vacation we take is noting all the maintenance & repairs that need to be done on the place we're inhabiting. And I really enjoy walking around a cruise ship watching all the workers chasing rust... so that I don't have to!

 

[Martha]

Upper middle class? Eff me, the article is talking rich. Is rich a bad word now and Forbes won't say it?

It is kind of fun to look at examples of conspicuous consumption and get the good feeling of "I am better than them, I can resist the temptations of a material life."

 

[Jay_Gatsby]

I noticed that the assumed savings rate was less than 1%, which in my mind is completely unrealistic for even the most ardent of spendthrifts these days.  I mean, based on a $300k post-tax income, we're only talking about saving $3,000 a year?

As for aspiring to live like the people in the article, I do aspire to live like that, but I won't mortgage my ability for FIRE to pay for it.

Like (), I enjoy cruises because everything (other than the booze) is included.  You can often purchase a cruise for less than it costs to rent a room at a mediocre hotel for a night.

I think the piece was written to help people feel better about their conspicuous consumption.  If they have the trappings (but not the post-tax income) of the people portrayed in the piece, they must be rich upper middle class.  If Forbes referred to the people in the piece as rich or wealthy, there would be little personal identification with them, since people who engage in conspicuous consumption always consider themselves to be in the upper middle class (horrors of horrors if they could be considered anything less, since the middle class includes  blue collar types like plumbers).

 

[SteveR]

Upper middle class?  Eff me, the article is talking rich.  Is rich a bad word now and Forbes won't say it?

This opens up the whole conversation again about what defines Upper Middle Class from Rich.  Where does one draw that line?  

If the people in the article are rich then what about the folks that have NWs well over $10 million or $100 million.  It would seem they would be in a whole different "class" from those in this article.  

Wonder how much debt these people carry with all the toys and other expenses?  

 

[brewer12345]

Upper middle class?  Eff me, the article is talking rich.  Is rich a bad word now and Forbes won't say it?

Heh, remember this is Forbes. "Rich" to them is probably upwards of $100 million NW.

 

[Rich]

Actually, I find it remarkable how comfortably we Americans can live on a relatively modest budget. The article, while amusing, was bogus.

 

[jug]

Amazing, its all in the mind.

I live IMHO pretty well, as far as Im concerned, on about 45000K cash a year.

I go on vacations overseas if I want, I have my 2 cars, my home. enough food in my belly.

Its all relative

jug

 

[SteveR]

For some people, the American Dream as shown in this article, means having what these people have as far as luxury items and private school for kids, big chunk of $$ for "luxury colleges" and the requisite country club memberships, $60k cars and vacation homes. For others, the dream is to have enough. Many on this board fall into the "have enough" category without going to the extremes shown in this article. Some here are at the extremes too (both high and low) as far as income and luxury items owned.

How much is enough? We each measure that with our own yardstick.

 

[Arif]

If that is upper middle class then I just slipped below the poverty line

 

[laurence]

I think Chris Rock said something about the difference between rich (or as Forbes puts it - upper middle class) and Wealthy:

"Shaq is Rich - the guy who write's Shaq's check and says, 'here ya go, Shaq, now go get an Escalade with 22 inch spinners!" is wealthy!"

I will never buy a vacation home, my parents own vacation homes in Big Bear, Mammoth, and Colorado, and I have free access. We've used the Big Bear once.

 

[tryan]

Yep the imaginary people in the article are in the imaginary upper-middle-class which resides in the top 0.25-0.5% of the real world.

 

[Cut-Throat]

I think Chris Rock said something about the difference between rich (or as Forbes puts it - upper middle class) and Wealthy:

"Shaq is Rich - the guy who write's Shaq's check and says, 'here ya go, Shaq, now go get an Escalade with 22 inch spinners!" is wealthy!"

I will never buy a vacation home, my parents own vacation homes in Big Bear, Mammoth, and Colorado, and I have free access. We've used the Big Bear once.

Chris Rock also said when defining rich in terms of Oprah Winfrey:

"If Oprah woke up with only 100 million dollars, she'd probably jump out the window of a 50 story building."

 

[Mr._johngalt]

Amazing, its all in the mind.

I live IMHO pretty well, as far as Im concerned, on about 45000K cash a year.

I go on vacations overseas if I want, I have my 2 cars, my home. enough food in my belly.

Its all relative

jug

Hello jug. There are 2 of us (and 4 dogs). We take vacations,
(about anywhere we want) own 2 cars and 3 boats, 2 homes,
abd plenty (too much?) to eat and drink. Plus, we do this on about
50% of what you use up per year. Not only that, but it is pretty
easy.

JG

P.S. For those of you who have heard this story a bazillion
times, I'm just giving encouragement to those folks who
are wondering if they can ever make it.

 

[cute fuzzy bunny]

I'm creating a new "old saw".

If it has spark plugs or needs a new roof periodically, rent it!

 

[Mr._johngalt]

I'm creating a new "old saw".

If it has spark plugs or needs a new roof periodically, rent it!

Speaking of roofs, we need a new one, plus a new driveway.
These are both projects for next summer. Obviously it's going to be a trick to work these into our "bare bones" budget.
Unless I get real lucky by then (unlikely) it looks to me like
these projects may trigger a
reverse mortgage. I don't have
a "home improvement" bucket in the budget. Hell, I don't even
have a budget. Still just winging it..................

JG