How a family spends away $500K per year

[ultimatebob]

1.5 million dollar house? Unless this person lives in San Francisco, they're spending too much on housing.

Scratch that... almost EVERYONE who lives in San Francisco spends too damn much on housing.

 

[ultimatebob]

Oh... these guys are spending more on charity every year than what I spend on rent. Crazy.

 

[Exterous]

That can be the case initially, but within reasonable time, those people come to their senses after a few purchases. Those who don't and continue to spend, for example on a lease for 2 luxury cars, have been used to overspending IMO. $500k spent in a year including charity, etc. doesn't sound like they are newbies with money.

Children's pending habits have more to do with parental guidance than parental spending habits. Absent that guidance there is maybe a tenuous relationship with observance but there are a preponderance of data points on both sides of the equation. Given that the savings\retirement deposits of the high income earners don't tend to be that much larger as a percentage of income (although the savings $ amounts are larger) ascribing different psychological traits simply based on income doesn't seem to be a good fit. Generally we all trend towards overspending and there is a fair bit of discussion as to why that is. For example the language you speak looks to be a better indicator of your savings level than what sort of spending background you come from:
http://www.anderson.ucla.edu/faculty/keith.chen/papers/LanguageWorkingPaper.pdf

 

[Red Squirrel]

What sucks big time are neighbors, they just live way too close and everything they are doing will irritate you to certain degree. If I would argue why not to live in apartment it would be impossibility to escape from your neighbors, they are just behind the wall.

That would be my biggest pet peeve too. I like my privacy as well, living that close to others just feels too... wrong. I like my own "escape" so to speak. An insulated wall, and a bunch of outside air, and then another wall (the next house's), between me and other people. I don't want to hear other people's business but I don't want to have to worry that I'm making too much noise and other people can hear mine. So it kind of goes both ways.

I would do it as a temporary basis, like if I would have had to go out of town for school or if I scored a super good temp gig or something I'd put up with it, but I would hate for it to be a permanent thing.

Though I can see how it could end up cheaper in the long run as there are lot of expenses that come with owning a house. But guess that goes with anything nice.

 

[Sho'Nuff]

where do you live? when my sister was in Boston she was paying 30-40k for 1 kid, that was within the past 10 years

Not questioning the numbers you quoted but that seems a bit high to me. Back in 2009 my wife and I were in Boston and it cost us $24000/year to have our infant son in daycare. When we moved to new hampshire the cost of daycare dropped by 50%, but it was still $12000 a year per kid. Can't wait until next fall when my daughter enters kindergarten and we only need before and after care for our two kids.

 

[Sho'Nuff]

Is NYC really that expensive? 42k a year for childcare seems steep to me. Three vacations a year totaling 18k might be a little excessive to. I would probably cut back on the 18k donations to charity to but that's just me.

Three vacations a year is a lot. But it is not hard to spend $6,000 for a week long vacation for a family of 4. Flights and hotel alone will be $3000, if not more. I'm trying to plan a vacation to a national park this year and unless I stay in New England (which I would prefer not to do) I can't find anywhere I can take the family that will cost us less than $3000 for a week (between food, travel, and hotel expenses).

 

[Capt Caveman]

Oh... these guys are spending more on charity every year than what I spend on rent. Crazy.

Based on how much they make, it's not very much at all. Plus, it's tax deductible.

 

[purbeast0]

A stock market crash can wipe out half or more of that 401k, hell the only reason your 401k doesn't get completely wiped out is because of government bailouts..

I'm not sure what your point is.

 

[purbeast0]

Three vacations a year is a lot. But it is not hard to spend $6,000 for a week long vacation for a family of 4. Flights and hotel alone will be $3000, if not more. I'm trying to plan a vacation to a national park this year and unless I stay in New England (which I would prefer not to do) I can't find anywhere I can take the family that will cost us less than $3000 for a week (between food, travel, and hotel expenses).

I just spent around that much for a week in Aruba for a family of 3, although we did also help out my mother in law a bit while we were there too. And that was paying only taxes for the flights ($210 total for 3 people) and using points for the flights. Had I had to pay for flights, it would have been about another $1400 or so.

 

[Genx87]

Two lawyers and they cant figure out how to not pay the max tax rate?
Anyways this is pretty amusing. Though not all of it is bunk. A buddy of mine and his wife make good money. I think combined close to 300k. They pay for child care for their two young children at 32K a year.

 

[MrSquished]

Three vacations a year is a lot. But it is not hard to spend $6,000 for a week long vacation for a family of 4. Flights and hotel alone will be $3000, if not more. I'm trying to plan a vacation to a national park this year and unless I stay in New England (which I would prefer not to do) I can't find anywhere I can take the family that will cost us less than $3000 for a week (between food, travel, and hotel expenses).

I'm flying to Cyprus from Newark NJ and its 6 grand plus a bit for myself, sister, brother-in-law and 5.5 year old niece. $1,500 apiece. 4 tickets.

My 1 year old niece is not getting her own seat. We bought these tickets last week for travel in July, so booked decently in advance.

 

[JackBurton]

Sounds like if they didn't have any kids, they'd have a ton more money for vacations.

 

[kage69]

Holy crap that's a lot on candles. I think the most I ever paid for candles was the one I bought from Virginia Hey (Farscape fame) at a con. Super nice lady, and she made a very exquisite candle.

You bought a candle from Zhaan? Wow.

 

[Insomniator]

Doesn't look that crazy. The gov stealing 190k is the most criminal thing on that list.

Plus they are saving 36k, giving away another 18k and paying 30k in loans so its not like they are frivolously blowing all of the money.

 

[dave_the_nerd]

"stealing"

 

[Homerboy]

LOL $60K in mortgage
THREE vacations a year
BMW AND a Land Cruiser?

I wish I could suffer like these people.
Here's an idea -- drive a normal car. Buy a cheaper house. Go on 1-2 less vacations. And MAYBE one of you could stay home and raise your kids (also saving $42K on childcare then too.)

Gotta have the latest and the greatest though. Gotta live the American dream.

 

[rh71]

Three vacations a year is a lot. But it is not hard to spend $6,000 for a week long vacation for a family of 4. Flights and hotel alone will be $3000, if not more. I'm trying to plan a vacation to a national park this year and unless I stay in New England (which I would prefer not to do) I can't find anywhere I can take the family that will cost us less than $3000 for a week (between food, travel, and hotel expenses).

To put it in perspective, a Turks & Caicos / Sandals trip for 4 is minimum $6k including almost everything and we know how lavish that can be. You don't have to spend $6k each vacation. A family of 4-5 to Disney is around $4.5k from our experience. How many people here do 3 Disney-type epic trips a year?

You can do airbnb getaways around the states surrounding you for so much cheaper and it will still feel like a vacation. 1 big vacation a year and a lot of smaller ones like that can be just as nice. This year we've already done a 5-hr trip down to DC and have a Memorial Day weekend trip down to the Poconos. Still planning the main one for August or thereabout. Total cost is going to be less than $8k for the year. Last year was even cheaper but eventful - a week-long roadtrip up to Maine with 4 stops along the way.

If you have a lot of money to spend, of course you can just tell the travel agent to throw a dart on the board and price you out 3x a year. What do they care right? Then they tell people $18k/yr in vacation is about avg.

 

[Fingolfin269]

This blows my mind. Look I get the idea that some people will be drawn to certain areas and therefore, in their minds, the cost of living there is worth it. That doesn't explain the need to have a BMW and/or Land Cruiser though. Once you start going down that path you have no room to complain about anything imo (though one might argue that doing so actually fits the stereotypical BMW owner... so chicken/egg I suppose).

 

[Sho'Nuff]

To put it in perspective, a Turks & Caicos / Sandals trip for 4 is minimum $6k including almost everything and we know how lavish that can be. You don't have to spend $6k each vacation. A family of 4-5 to Disney is around $4.5k from our experience. How many people here do 3 Disney-type epic trips a year?

You can do airbnb getaways around the states surrounding you for so much cheaper and it will still feel like a vacation. 1 big vacation a year and a lot of smaller ones like that can be just as nice. This year we've already done a 5-hr trip down to DC and have a Memorial Day weekend trip down to the Poconos. Still planning the main one for August or thereabout. Total cost is going to be less than $8k for the year. Last year was even cheaper but eventful - a week-long roadtrip up to Maine with 4 stops along the way.

If you have a lot of money to spend, of course you can just tell the travel agent to throw a dart on the board and price you out 3x a year. What do they care right? Then they tell people $18k/yr in vacation is about avg.

Oh I agree. There is a reason my family has a seasonal campsite on a lake in Maine. It costs us $3000/year for the site fee and we get use of it for the whole summer (we average 45 days up there in the summer).

That said there is something to be said for taking a nice getaway vacation. We can ridicule the folks in the OP all we want, but its there money to spend not ours.

 

[purbeast0]

The ATOT consensus, where you are allowed to make a lot of money but you are not allowed to spend it, only save it, so that when you are old and crippled you can then go out and travel the world, only to realize you are too old to do all that shit.

 

[ponyo]

Spending $18k or 6.5% of net salary on vacation isn't that bad for family of four. It's higher than the avg of 2% for most Americans but given their income bracket, it's not outrageous. According to one study, avg American with $1 million or more asset spends around $13k a year on vacations.

 

[evident]

How the hell do you feel average driving a 5 series, LC, have a $1.5 home and take 3 vacations a year?

 

[Pantoot]

The ATOT consensus, where you are allowed to make a lot of money but you are not allowed to spend it, only save it, so that when you are old and crippled you can then go out and travel the world, only to realize you are too old to do all that shit.

Coupled with; someone using your spending as an example turns you into a whiny entitled complainer.

 

[Red Storm]

How the hell do you feel average driving a 5 series, LC, have a $1.5 home and take 3 vacations a year?

Yeah that's definitely not average. Seems like they're living the life. If I were in their shoes I would do the same. Enjoy the finer things and traveling the world with my family at a younger age than as an old person.

 

[purbeast0]

How the hell do you feel average driving a 5 series, LC, have a $1.5 home and take 3 vacations a year?

To be fair though, the couple the article is about never said that. The person who created the article is the one that is making the claim.