Budget Breakdown Of A Couple Earning 500k/year With 7k Left Over

[Singuy]

https://www.cnbc.com/2018/05/14/budget-breakdown-of-a-couple-making-500000-but-only-saving-7300.html?recirc=taboolainternal

Using some reverse math, that mortgage looks to be a 1 million borrowed which is 2x earnings but the cost of the house being 1.5 million is 3x earnings. They had 500k down but didn't use that money on their student loans or pay cash for a car? Jesus...

Childcare looks to be private school considering they are old enough to spend 18k/year on extra curricular activities.

Those are some serious gas cost.

[Singuy]

My wife and I make similar post 401k/health insurance/tax and this is our budget for the year.

Family of 4 plus dog. 35yo, 34yo, 2yo, 2 weeks old.

Mortgage: 0
Student Loan: 0
CC debt: 0
Car payments: 0
Gas: 1400
Cell phone: 2400 (we pay for the entire extended family)
Car Insurance: 1300
Electric(Solar): 130
Water: 1000
Tolls: 600
Food: 8000
Insurance Home: 1200
Property tax: 10000
HOA(cable internet included): 2000
Family expenses+fun/vacation: 20,000

48030

We save about 20k/month for taxable accounts.

[phantom]

Childcare looks to be private school considering they are old enough to spend 18k/year on extra curricular activities.

If you read the original Financial Samurai article, the kids are only 3 and 5. They are taking lessons to help them get into a private grade school that will cost $50k/year. (It’s also “only” $12k on lessons. The $18k is charitable giving.)

[rennigade]

The food for 4 seems really inflated imo....although maybe not if they're spending a lot on eating out on date nights or whatever. Child care is accurate in a HCOL area.

They need to drop charity. Ease back on vacations. Maybe downsize on home.

They're in mid 30's...salary wise they are doing extremely well imo. Even if they're left over with $7k/year...their earning potential is only going to get better.

If they decide to change their behavior (which can be done)...or eventually when the kids no longer need daycare...student loan debt is paid off...etc etc...what it took me to save 25 years they will be able to do in 7 years...or less.

[Singuy]

I still wonder how they managed to save up 500k for a downpayment. If you can save up 500k within a short period of time then why not continue and just pay cash for everything?

I get it if they had 0% down mortgage but obviously reading the more detailed post, they purchased a 1.5million dollar apt and still left with a 1million dollar mortgage.

Were they dumpster divers for 3 years and then now decide to live it large?

[TexasHusker]

car insurance looks about right.

[corn18]

We used to spend it all. Now we save a lot. Much happier.

515,268 Total Pay
115,275 Fed Tax
19,472 State Tax
4,738 Local Tax
7,347 SS
9,904 Medicare

358,533 After Tax

20,709 Health/Life Ins
24,500 401k pre tax
17,935 401k after tax

295,389 Take Home

35,724 Mortgage
4,132 Utilities
17,207 College
3,000 Cell
1,881 Cable
762 Internet

62,707 Non Disc

10,000 Vacation
61,380 All Other

134,087 Expenses

161,302 Taxable savings

203,737 Total Savings

That's 40% of gross income, 57% of net. I'm ok with that.

[Singuy]

We used to spend it all. Now we save a lot. Much happier.

515,268 Total Pay
115,275 Fed Tax
19,472 State Tax
4,738 Local Tax
7,347 SS
9,904 Medicare

358,533 After Tax

20,709 Health/Life Ins
24,500 401k pre tax
17,935 401k after tax

295,389 Take Home

35,724 Mortgage
4,132 Utilities
17,207 College
3,000 Cell
1,881 Cable
762 Internet

62,707 Non Disc

10,000 Vacation
61,380 All Other

134,087 Expenses

161,302 Taxable savings

203,737 Total Savings

That's 40% of gross income, 57% of net. I'm ok with that.

I would love to you see your pre-savingsadvice forum spending

[corn18]

I would love to you see your pre-savingsadvice forum spending

2012 vs. 2018. Big difference is car loans, credit cards and out of control all other spending.

375,606 515,268 Total Pay
79,644 115,275 Fed Tax
15,623 19,472 State Tax
3,423 4,738 Local Tax
4,624 7,347 SS
4,921 9,904 Medicare

267,371 358,533 After Tax

13,029 20,709 Health/Life Ins
17,000 24,500 401k
0 17,935 401k

237,342 295,389 Take Home

38,004 35,724 Mortgage
4,132 4,132 Utilities
0 17,207 College
3,540 3,000 Cell
2,400 1,881 Cable
0 762 Internet
29,698 Car Loans
142,731 Credit Cards

220,505 62,707 Non Disc

7,000 10,000 Vacation
134,000 61,380 All Other

361,505 134,087 Expenses

-124,163 161,302 Taxable savings

-107,163 203,737 Total Savings

[Singuy]

Yikes, you might want to reformat what you wrote.

[corn18]

Yikes, you might want to reformat what you wrote.

[Singuy]

Holy that CC spending! 140k/year..man I wouldn't even know what to spend it on at over 10k/month.

[GoodSteward]

Holy that CC spending! 140k/year..man I wouldn't even know what to spend it on at over 10k/month.

Is that total debt or what went through the cards? Also, was that bills and foods, or was that other stuff not accounted for in the budget?

[corn18]

Is that total debt or what went through the cards? Also, was that bills and foods, or was that other stuff not accounted for in the budget?

Total debt. I paid them all off in Mar when I got my bonus and then ran them back up again to pay for the monthly deficit I ran. Good times...

[Singuy]

Total debt. I paid them all off in Mar when I got my bonus and then ran them back up again to pay for the monthly deficit I ran. Good times...

Oh wow so you did spend more than 10k/ month outside out your other expenses.

Man I buy a lot of stupid things but racking up 10k/month is pretty hard unless I end up being a hoarder. Must be some really expensive dinners?