400k and still be broke?

[rh71]

24k in property taxes are cheap. Our taxes are 16k and home value about 600k (and we are only in a typical colonial).

home maintenance at $25k/yr? If you're lazy and outsource EVERYTHING maybe.

utilities at $15k/yr? Way overestimated considering that's $1250/mo.

If you make $400k/yr and don't care where the money goes, then yeah you could spend that much... because you couldn't care less. And that's on you.

 

[PottedMeat]

i still want to know how someone would be spending 25k a year on house maintenance, not counting some capital improvement or renovation

also the food is just stupid, thats like 600$ a week

$600/wk food -> extreme toilet clogs -> plumber $150/3x week -> $23,500

 

[ponyo]

$600/wk food -> extreme toilet clogs -> plumber $150/3x week -> $23,500

$600 week on food I can understand. Family of 4 shopping at high end grocers like Whole Foods, boutique mail order food sites, and eating out could hit that number pretty easily. I'm cheap on lot of things but food is my exception. There's nothing better than eating good food. Maybe sex but food is close second.

 

[Kaido]

The 283k after tax from 400k sounds off as well if you do state and federal and payroll.

~200k after all taxes are taken at that level.

Yeah I was gonna say, here in CT your takehome is always about half of what you make. Making $100k a year doesn't mean squat in this state because it nearly gets cut in half & then you have to pay tax on everything - house, car, etc. I mean, I drive a Kia and my car tax is $400 a year, it's ridiculous!

 

[Attic]

Yeah I was gonna say, here in CT your takehome is always about half of what you make. Making $100k a year doesn't mean squat in this state because it nearly gets cut in half & then you have to pay tax on everything - house, car, etc. I mean, I drive a Kia and my car tax is $400 a year, it's ridiculous!

Yep, I figure I have to earn ~$2 to spend $1.

It chances my considerations for desires to spend $2.

 

[Strk]

Yeah I was gonna say, here in CT your takehome is always about half of what you make. Making $100k a year doesn't mean squat in this state because it nearly gets cut in half & then you have to pay tax on everything - house, car, etc. I mean, I drive a Kia and my car tax is $400 a year, it's ridiculous!

While state taxes vary, there are really only a couple of states with income taxes, plus federal, that will hit 50%. And even then, you're talking, if I remember correctly anyways, around $2 million a year to hit that.

Now once you add in other taxes, that's a different story (property, excise etc)

 

[Jumpem]

This is the dumbest list possible. 30K\year in food expenses? 25K\year in house maintenance? I grew up in a home more expensive that that. My dad never put 25k\year into the house. Im not even sure if he has put 25K in the house in its 22 years of existence. 9K\year in car insurance? lol wat?

This is nearly as bad as those sob stories of people destitute after quitting 6 figure jobs to go get a useless degree and refusing to work in any other line of work but the new degree. And at the same time buying a house and cars they cant afford.

$25k into a house is easy. And I have ever only owned small modest houses. At my first house, I put $35k into it over five years. In my current house, it has been $26k in three years.

 

[brianmanahan]

$25k for 2 nice vacations is not crazy if you have a family of four and traveling international.

i spent about 25$k TOTAL last year

 

[Anubis]

$25k into a house is easy. And I have ever only owned small modest houses. At my first house, I put $35k into it over five years. In my current house, it has been $26k in three years.

yes but not 25k per year every year

i would expect a million dollar house is not gonna need much in terms of maintenance or large home improvements

 

[brianmanahan]

It seems like people are spending more and more on vacations (and weddings for that matter) on the idea that 'they deserve it' and 'it needs to be perfect'.

oh gosh, weddings. people i know took out a loan so their kid could have a 30$k wedding. i think the average cost is about 25$k now.

people in my family have spent no more than 2-3$k for a wedding

 

[brianmanahan]

i would expect a million dollar house is not gonna need much in terms of maintenance or large home improvements

if its a million dollar home in the SF area, theres a very good chance it will need repairs. i have seen several posts recently on bogleheads or /r/personalfinance where someone is considering buying a calif. house for around 1$ million and expects to need several hundred $k in repairs

 

[Engineer]

If you're not doing OK (or well) on $400,000, you're doing it all wrong. No excuse....your own fault.

List from the video is insane.

 

[pontifex]

so wait, this article said you were married. is your wife not working either or is that 400k combined? Thye make it seem like 400k is just the husband's salary.
utilities for that house might be pretty damn expensive as i bet it's a large house. electricity and heating/cooling costs would probably be high. Is lawncare/landscaping under house maintenance or utilities? If under maintenance, that could explain the high cost there as I bet they have a large beautiful lawn and other landscaping that needs to be cared for.

 

[Strk]

$25k into a house is easy. And I have ever only owned small modest houses. At my first house, I put $35k into it over five years. In my current house, it has been $26k in three years.

That's a little short of the $200k they think you should have spent.

 

[Mide]

such a bullshit article. 2 hella expensive vacations a year? Try just 1 and only spend 3k to go to hawaii...

a 60k car every 4 years? fuck that as well. get a used fun car for 4k.

main house expense...fuck that as well, just rent...no mortgage and no property tax. Lemme tell you I can live quite well in chi-town w/ 400k

 

[CLite]

There is no place in this country where anyone pays 50% of their gross in (federal/state) taxes. You have to remember 401k, medical, and other things first come off. Then you have a slew of deductions on top of those pre-tax items. They probably only pay (federal/state) taxes on 300k'ish after all of these items. A lot of tax calculators show % taxes based on the amount after 401k/medical/etc., which is misleading.

The best part of the video was first listing the absolutely absurd expenses (house maintenance/insurance/etc) and then in bold the screen showed "discretionary expenses" when moving to the next segment as if the previous list wasn't discretionary.

 

[Anubis]

such a bullshit article. 2 hella expensive vacations a year? Try just 1 and only spend 3k to go to hawaii...

a 60k car every 4 years? fuck that as well. get a used fun car for 4k.

main house expense...fuck that as well, just rent...no mortgage and no property tax. Lemme tell you I can live quite well in chi-town w/ 400k

your first part is wrong. buying 4 tickets to pretty much anywhere outside the US is gonna cost you 2-3k by itself unless you happen on the airline deal of a lifetime

just did a search, for a random week in Jan, Chicago to Hawaii. 2 adults 2 kids, cheapest is 900 per ticket

 

[LegendKiller]

such a bullshit article. 2 hella expensive vacations a year? Try just 1 and only spend 3k to go to hawaii...

a 60k car every 4 years? fuck that as well. get a used fun car for 4k.

main house expense...fuck that as well, just rent...no mortgage and no property tax. Lemme tell you I can live quite well in chi-town w/ 400k

Yeah, don't pay your own mortgage, pay somebody else's mortgage for them, and give them a profit on top of it! Do you think people just rent places to others for the fuck of it?

It's insane how stupid some people can be. I think this is even more stupid than the OP.

 

[LegendKiller]

The article only highlights how poorly people manage their money. "modest" contributions to the 401k? I've maxed out my 401k contribution for the last 7 years. We also put a ton of money into 529s, IRAs, and have a pretty large rainy day fund. It isn't all that hard to do for somebody making even 150k. That's even with a huge amount of student loans.

But this is how people get trapped in their imagined wealth - I see it all of the time. People think a 60k car is wealth and exemplifies "doing well" (like the idiot here that supposedly bought an M3). I laugh at them while driving my Accord. I'll retire at 55 and pay for my 4 kids entire college without taking out loans. They'll be working into their late 60s and their kids will be shackled with student loans.

This is a marathon, not a sprint.

 

[rh71]

People think a 60k car is wealth and exemplifies "doing well" (like the idiot here that supposedly bought an M3). I laugh at them while driving my Accord. I'll retire at 55 and pay for my 4 kids entire college without taking out loans. They'll be working into their late 60s and their kids will be shackled with student loans.

Too much generalization here. But I will generalize that people will laugh at you if you enjoy your Accord over an M3. And they are usually leased even by wealthy people because they could invest with the rest of the money. Not everyone with an expensive car means they are poor everywhere else or even spent an actual $60k so not sure why you even bring up cars. I feel like people who don't buy these cars are more quick to judge wealth of others than anyone looking to show them off as a sign of wealth.

Life is about enjoying every day, actually. You limit yourself so you can retire at 55 which is old and others are enjoying their life when they're still young. Your view is way too narrow.

BTW, day care costs are more than college in many states so I'm hardly worried about student loans for our kids' college.

 

[LegendKiller]

Too much generalization here. But I will generalize that people will laugh at you if you enjoy your Accord over an M3. And they are usually leased even by wealthy people because they could invest with the rest of the money. Not everyone with an expensive car means they are poor everywhere else so not sure why you even bring up cars.

Life is about enjoying every day, actually.

BTW, day care costs are more than college in many states so I'm hardly worried about student loans for our kids' college.

Yeah, the guy in the M3 is enjoying his life so much more in stop/go traffic going to work.

Life is about enjoying every day, but it's also about making sure you can enjoy retirement and make sure you set your kids up to have a better life than you did. Wealth creation isn't done by buying expensive cars when you could invest the money. It figures though, you live in LI, that mentality is pervasive there.

I don't work with a single person who leases their cars and the average salary is probably ~350k. Top is in the several million. The most expensive car is a Panamera S Turbo. Most people who make ~500k drive Hondas, of the senior PMs, two drive Pilots, another drives an S4. That's it. One drives a 15yr old CRV. It's because they realize that wealth, and "enjoyment" isn't encapsulated in a depreciating asset that has no real utility beyond conveyance.

Part of the problem with America today is that too many people think like you. The big wealth aggregators are gone or are getting old, what remains are the short-term thinkers who would rather spend money than build it, enjoy it, and then pass it along to more aggregators who aren't spoiled but are driven to push forward.

Too many Paris Hiltons and not enough JP Morgans.

As far as child care - I've got that solved - my wife stays home. She could make more than we would pay in child care (Although with 4, who knows), but it's better than handing our kids off and letting somebody else raise them.

But too many people are too focused on their M3 than raising kids, or affording child care, or having a spouse stay home and raising kids. It's all "me me me me me". I know a number of people who would rather send their kids to a worse ranked school, pay less in property taxes, and drive a "nice" care. "me me me me me". Pretty sad really.

 

[zerocool84]

Yeah I was gonna say, here in CT your takehome is always about half of what you make. Making $100k a year doesn't mean squat in this state because it nearly gets cut in half & then you have to pay tax on everything - house, car, etc. I mean, I drive a Kia and my car tax is $400 a year, it's ridiculous!

Lol hahaha sorry but some from CT cannot complain about taxes. Try living in CA buddy.

 

[waggy]

$25k into a house is easy. And I have ever only owned small modest houses. At my first house, I put $35k into it over five years. In my current house, it has been $26k in three years.

why are you bringing up you spent $35 in 5 years? or 26k in 3 years? neither of those are close to $25k EVERY YEAR.

if you are spending $25k a year on a house you are a fucking idiot.

 

[Kaido]

Lol hahaha sorry but some from CT cannot complain about taxes. Try living in CA buddy.

I'm from San Diego, I feel your pain

 

[Hugo Drax]

$9000/yr auto insurance?
This article is lame.

If you drive a used m3 the maintenence itself is like 9k a year.