4 people who earn six figures and still feel broke

[CPA]

You absolutely cannot beat the Midwest when in comes to housing and cost of living. We experienced the housing bubble too, but the gap between housing and wages didn't narrow nearly as much as it did in the rest of the country.

I grew up in a 3 bedroom house that my parents paid $60k for in 1979. They sold it for $120k in 1992. Today it's probably worth around $160k. $300k gets you a VERY nice house in some very nice suburbs. The prices that a lot of people are paying in similar suburbs in other parts of the country will be $500k+ for those houses.

Tons of employment opportunities, too. The only real downsides are the weather and lack of culture/diversity.

Try Houston. Acre and a half, semi-secluded, 2 story, custom built for less than $350K. Houston area has some of the most affordable housing, particularly for a large city, in the country.

 

[OCGuy]

Any American male who isn't going into college should already have high-tailed it to the Bakken oil fields gold-rush. You would have to be out of your mind to not put a couple years in there before you have family.

 

[Daverino]

The most important part of making six figures is the first number.

 

[dmcowen674]

We make less in indiana than we used to in NYC and LA and SD. We used to have more at the end of the month because we dont have any car payments, Our house is payed off. We pay off the cards every month.

Then we got surprised by triplets and now we budget and make do just fine. Sure my wife bemoans not traveling like we used to but w/e I am happy at home with my family. Triplets are more expensive than bigger house and three car payments lol

Wow, triplets. Now that I moved to Indy I know where Carmel is. We are neighbors, I'm only a few blocks from Zionsville/Carmel border.

 

[Markbnj]

You don't feel rich because you are not rich. Making 6 figures today is not what it was even 10 years ago, much less 20. 100k in 1980 was a hell of a lot more money than it is now.

Not least of all because salaries for the middle class have been stagnant for a decade or more now, while the cost of living continues to rise 2-4% a year.

 

[IndyColtsFan]

Wow, triplets. Now that I moved to Indy I know where Carmel is. We are neighbors, I'm only a few blocks from Zionsville/Carmel border.

Run while you can manimal!

I thought you told me you were on Georgetown Rd? Or is that where you work? At any rate, Zionsville/Carmel are wealthy suburbs. Are you "rich," Dave?

 

[KeithTalent]

Can definitely relate to this at times. This city is expensive!

KT

 

[skyking]

If you need to work near the big city for your big bucks, you either spend a significant amount of your life commuting from a low cost neighborhood or you spend a significant part of your salary staying close in.
I don't have kids but I think the school district thing is a bust. Kids learn more from their parents than anybody else, period. If you are busting ass and have no time for your kids, don't expect Uberschooldistrict to take up the slack.

 

[Gunslinger08]

In general, your personal standard of living rises to meet your means (more money, more problems). Six figures isn't a magical plateau that solves all of your problems and pays the debt you've accrued. If you continue to spend more than you earn (or even 80-90% of what you earn), you're never going to feel "well off." As others have said, six figures also doesn't mean much in a lot of metropolitan areas, due to a higher standard of living. $100k might be $6k/month after taxes in the average area. If you live somewhere that costs $3-4k a month for an appropriate home for your family, that doesn't leave "much" for all of the other expenses a family has.

 

[7window]

I think it goes far beyond how much you earn - where you live can have a huge impact. We too are a pretty solid 6-figure household income - teacher in NY & nurse in administration of a hospital. I'm pretty sure I'd feel broke living in San Fran or NYC on this income, though of course, if I lived in those cities, our household income in the same occupations would be higher - significantly so for my wife.

I'm fortunate enough to live in an area with a vast range of house prices (decent houses). Our first mortgage broker was very surprised that we weren't looking in our "proper price range." We were very happy with a smaller house (especially since we knew in a few years it would just be the two of us; as it is now), though with plenty of land & barns. So, instead of getting a house that was a multiple of our combined salary, we purchased a house that is a fraction of either of our annual salaries. This weekend, we're going to purchase a new car. Though, instead of new, I'm getting a 2 year old vehicle off of fleet or lease. I could "afford" a, say, a brand new M3, but instead will be just as happy to drive around in a Fusion or even a Fiesta as the daily driver. I have no one to impress, and my personal preference is to spend that expendable income on things like dining out, nicer meals at home (filet mignon rather than hamburgers - I HATE cleaning the George Foreman grill when making hamburgers.) If I drove the M3, I'd look wealthy. Because I don't, I feel wealthy. Apologies, if it applies to anyone here, but I don't have a lot of sympathy for people who choose to drive $40k SUVs and feel broke.

aluminum foil and some pam oil on foil no need to wash george foreman.

 

[Mxylplyx]

I make just under six figures in Alabama, which is enough to comfortably support a family and a stay at home mom, though I could certainly use alot more. I'm not putting near 15% of my income away for retirement, and entirely funding my sons education, or really funding it much at all, would have been damn near impossible had we not received a life insurance payout from my wifes estranged father. I also drive a 2001 Honda. I'm counting on eventual inheritances to make up for any shortfall in my retirement savings, which I'm sure is pretty risky.

 

[Kaido]

Like others here, I am financially stable because my family lives way below its means.

I think it's kind of 2 factors:

1. Live (stably - house, car, etc.) below your means
2. Have a buffer

The best definition of wealth I ever heard was "how many months you can survive into the future". If your average monthly expenses are $2,000, then you have 1 year's worth of wealth if you have $24,000 in savings. I had a friend who did this...he just took a year off work to travel the country with his family because he had the buffer to cover his bills & travel, then come back and find a new job with time to spare. Genius.

 

[Blackjack200]

I have a question for the people in this thread that mentioned living in an expensive area because the school districts are better. Did you consider living in a cheaper area and just putting your kids in private schools? Or does that not really make sense? Genuinely curious...

 

[Genx87]

It is the same story with these people. Spending more than they make. Living in a high living cost area. Poor financial decisions. The American way.

 

[Jimzz]

I have a question for the people in this thread that mentioned living in an expensive area because the school districts are better. Did you consider living in a cheaper area and just putting your kids in private schools? Or does that not really make sense? Genuinely curious...

Private school does not guarantee success. Many get their good ratings due to the fact they kick out the "bad" kids.

IMO as long as crime is not a issue any smart kid can get a good education even at a bad school, as long as the parents are involved.

Me and my wife read to our son every night, make him write things out, and go over what he did at school every day. If all parents did things like that with their kids then the "bad" schools would look much better IMO.

 

[mammador]

A good income is relative, and affected by local/national living standards, individual needs, and frankly spending patterns.

If a person earns $200,000 a year but then buys superfluous crap, has 8 Gold credit cards and maxed them out, then what's to be said? Everybody should live in his or her means, even if "means" is subjective. Credit cards should really be outlawed though, they caused the Great Recession.

 

[mammador]

I have a question for the people in this thread that mentioned living in an expensive area because the school districts are better. Did you consider living in a cheaper area and just putting your kids in private schools? Or does that not really make sense? Genuinely curious...

Cheaper area may be less safe, be further from work, or have shittier housing/amenities.

 

[7window]

Try Houston. Acre and a half, semi-secluded, 2 story, custom built for less than $350K. Houston area has some of the most affordable housing, particularly for a large city, in the country.

doesnt property tax get you?

 

[BoberFett]

I make just shy of six figures ($98k-ish) and after taxes and child support my actual take home is only about 45% of gross. I'm not hurting, but I'm hardly rich. I live in a decent place (2-bedroom townhome) and rent consumes about a third of that. Drive an average car (2012 Camry), including payments, taxes and insurance and there's another 15% of take home. Other assorted bills, utilities, groceries, etc. there isn't really a whole lot left each month. Not hurting by any means, but only an idiot believes that being in the top 5-10% of income automatically means it's easy street.

 

[Eug]

I have a question for the people in this thread that mentioned living in an expensive area because the school districts are better. Did you consider living in a cheaper area and just putting your kids in private schools? Or does that not really make sense? Genuinely curious...

I live in an average area with a not bad rated elementary school, and a very well rated high school.

If I lived across the street, we'd be in a different school district. The elementary school is rated a bit lower, and the high school is rated poorly and is known to be a rough school. In that context, I would have considered moving my kid to a private school when she's of age.

No, private schools don't guarantee success, but crappy schools make success even less likely. And if private schools do better partially because they kick out the "bad" kids, that's fine by me... as long as my kid isn't one of them of course. Selfish but that's me being honest.

 

[7window]

I have a question for the people in this thread that mentioned living in an expensive area because the school districts are better. Did you consider living in a cheaper area and just putting your kids in private schools? Or does that not really make sense? Genuinely curious...

Doesnt matter what school its the parents

 

[OCGuy]

What a bunch of privileged clueless bourgeoisie pretending that all public schools can achieve the same results as long as the parents are involved.

Haha.

 

[BikeJunkie]

IMO as long as crime is not a issue any smart kid can get a good education even at a bad school, as long as the parents are involved.

I wholeheartedly concur, and this is what I'm trying to convince my wife while we look at our options. Keep the kids away from crime, gangs, and drugs; the rest is on the parents and the values/habits they instill in the kids.

We have great kids. They have excellent study habits and they're both very smart (our son is friggin' off the charts smart). So the need to find the absolute best schools just isn't there. I'd rather take this opportunity to introduce them to somewhat minimal living, become better outdoorspeople, and learn to live modestly and actively.

 

[Jeff7]

No sympathy for those "wanting nice things". The idea of doing good making six figure is to live like you're making $40-50k.

Don't we have a resident AT member, M3 driving, six-figure earner who has money trouble?

This.
If you're somewhere with a high cost of living, either move somewhere else, or understand and accept that you're living in such an area for some reason - if that reason is good, then it should be considered a worthwhile expense.
(Perhaps easier said than done, especially with a family coming along.)


I'm making what I think to be decent money for someone living on his own. I also live in the same apartment I was in during college (cheap rent), and haven't gotten terribly extravagant with purchases. I'm also shoehorning 40% of my gross pay into available retirement accounts. But that's still a hefty chunk of the available money - yet because of being able to keep costs under control, I don't ever feel broke. That's a source of stress I just don't want to have to deal with.
I'm sure I could get a loan to buy a new M3 or something similar, and I could even buy a weight set and start to lift, bro, but that'd put me thoroughly in debt for something I don't really need, which is bought for a bad reason: Bad spending habits. (Though a spray-on tan should be fairly cheap. :hmm

 

[AznAnarchy99]

Six figures aint what it used to be.

It really isn't if you live on the coasts and have a family. But if you're single... time to pop bottles baby WOOO