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Earnings completely depend on the economy and since the 2008, it has been a pretty bad time for a lot of people. Things can be made worse when local conditions (market, environment, laws, supply/demand, supplier resources, logistics, management, employees) do not make for a good business situation in some locations thus worsening the pay disparities.
Totally know what you mean, I remained in economically disadvantaged area that was losing lots of big business and then had hostile business environment started by local social factions ( wrong churches/dirty business) and area went down the toilet. Situation caused a lot of problems for the lower paid female employees and anything can go on -- many just started to work from their homes in remote internet work and had much more stable opportunities.
I HIGHLY recommend you check out book, "YOur MOney or YOur Life" by Joe Dominguez to see things from a new point of view about use of resources and employment possibilities to work in lower pay, yet more fulfilling work. Highly recommend you invest your money in somewhat liquid assets for a PURPLE PARACHUTE so you will have some business flexibility to move jobs and maybe self employment to maximize your experience, assets and local business environment. Could be excellent opportunity to talk to a local business coach or job coach in a desirable relocation spot to unlock more opportunities and better use your time/talents.
WITH THAT SAID, I do agree with some of you on here that one major reason why my earnings have not rapidly increased throughout my career so far is attributable to the fact that I've had too many job changes in a short period of time. Some were voluntary and some were involuntary (laid off, discharged). If I were to go back in time, believe me, I would have done things differently. I would have aimed to keep most of my jobs for at least 5 years. If I had done that, I would have been on my 3rd or 4th job now instead of my 6th.
A huge part of both your past and current struggles.
I probably have a few good years left until the market slows down. Keep in mind I live in Socal so COL is very high. I have good income, but very little assets, retirement, and liquidity.
I probably have a few good years left until the market slows down. Keep in mind I live in Socal so COL is very high. I have good income, but very little assets, retirement, and liquidity.
Why are your assets so little and how do you classify little? Did you start your own business and have debt?
If we had your numbers we would be very close or have reached our retirement savings goals. We live in the Seattle area and our COL is probably comparable to LA at this point.
I have a house worth about $1.2 million and a loan balance of about $400,000. That is pretty much my only asset besides a paid off minivan. I only have about $100,000 in my 401k account. I don't carry any credit card debt. I got myself in trouble with debt and have been playing catchup ever since. My goal is to payoff my house within 5 years but in order to do that I probably need to make 300 to 400k for the next 5 years.
I'm not good with money :-( Its tough to raise a family in socal or other HCOL areas after taxes. I'm 42 years old so I guess my prime is in my early 40's.
I have a house worth about $1.2 million and a loan balance of about $400,000. That is pretty much my only asset besides a paid off minivan. I only have about $100,000 in my 401k account. I don't carry any credit card debt. I got myself in trouble with debt and have been playing catchup ever since. My goal is to payoff my house within 5 years but in order to do that I probably need to make 300 to 400k for the next 5 years.
I'm not good with money :-( Its tough to raise a family in socal or other HCOL areas after taxes. I'm 42 years old so I guess my prime is in my early 40's.
Oh okay. I understand lifestyle creep is rampant and hard to resist.
Just for comparison... we are early 40's and late 30's and our HH income is around $170k + bonuses/stocks and we save between $7-9k each month. We paid off our mortgage in less than 4 years. We started late with savings too, but we've been maxing out our IRAs and 401k over the last five years and our accounts are collectively above $200k. We had children.
How in the world do you save 7 to 9k each month? I'm living paycheck to paycheck but thats because I'm doubling my mortgage payments as well as paying down principal whenever I can. Thats pretty impressive if you can save that much.
I would say I spend too much on my kids lessons (sports/music) as well as eating out too much.
Winix42: they say no matter how much money you earn, you will spend what you earn.
If I had your numbers for just 5 years, I'd be able to retire, I guarantee you.
You have to live below your means and save often FIRST, then figure out a way to live on the rest.
I'd back off the mortgage, and sock some away, then resume the mortgage payoff. And I'd not make double payments hoping to pay it off quicker, but rather make the regular payment and add all of that extra payment strictly for principal pay down. I can't really run your numbers, but I think that'd pay it off quicker that way.
We bought a house in fall '15. We started rapidly paying it down via my method, plus more, but now that we are close to owning half the house, we've decided to back off and save it more towards retirement. We can still have it paid off by retirement and save more towards retirement too.
It's all in how you manage it.
We definitely practice the "pay yourself FIRST" routine.
Spend less than you make, save for yourself first.
BTW, we have no where near your income, and we have four incomes through 3 jobs plus my SSDI.
But we make it work. Our income is about 1 1/2 months of yours! Actually about 5 weeks of yours!
Oh and our col is not expensive, but does require the 3 jobs and SSDI to maintain.
It's all relative.
The former prime earning years have now become the prime years for a force-out by your employer!
Regardless of Federal Laws, age discrimination is extremely prolific and under reported. Everyone needs to position themselves to survive if this happens to them in their mid-fifties. Strategies include being financially ready to retire 5-10 years earlier than the norm, keeping all job skills and certifications up to date for ease of finding another job, frequently interviewing to maintain those skills, keeping your Resume current (both your experiences and the style/format of the document), earning an appropriate advanced degree in your forties, etc.
How in the world do you save 7 to 9k each month? I'm living paycheck to paycheck but thats because I'm doubling my mortgage payments as well as paying down principal whenever I can. Thats pretty impressive if you can save that much.
I would say I spend too much on my kids lessons (sports/music) as well as eating out too much.
Have you heard of Frugalwoods and Mr. Money Mustache? We've basically copied their lifestyles (as they are now or how they once were as they were accumulating wealth). I will brake it down for you. Understand that three categories make up something like 80% of an average family's budget: transportation, housing and food.
Transportation: We downsized to a one car family last year. Our car was paid for in cash, is small and fuel efficient. My husband takes the bus to work and the bus pass is covered by his employer. I ride an electric bike for my job in the neighborhood. The kids walk and ride the bus to school. We are (still remarkably) on schedule to use less than $50 in fuel each month for 2017. Most months we spend less than $30 (making up for it this summer... ouch!). We live in a special neighborhood that provides all our basic needs within a .5 mi radius: doctors, hospital, dentists, grocery, dining, movie theater, various retail, bus transit center and most of my clients. The average family spends $9500 or so on transportation a year. We are on track to spend about $1200.
Housing: We were approved to buy a $500k home, but we stayed under $360k. We also lucked out and bought at the bottom on the housing crash. We paid off the mortgage in less than 4 years. Our housing expenses have returned to the same costs as when we lived in Michigan and Wisconsin when our income was less than half as it is today. We spend as much as the average family in housing.
Food: We eat economically. We don't eat red meat other than an occasional burger. We rarely drink alcohol. We frequently do the eating at home, but go out for coffee which serves as a substitution for "eating out". Still our food bill is average.
Lifestyle:
-We don't buy new clothing. I only buy used or donated clothing and I always use a 30% off discount for buying used clothing.
-I don't pressure my kids to get frequent hair cuts. They get about 3-4 a year. I cut my own hair.
-We don't do many extracurricular activities with the kids right now. I'm not convinced that most activities really make a difference in terms of economic output later in life. We've done some of the tech camps and found them underwhelming. We don't, and will not, do team sports. I think one of our kids is getting along just fine without anything, but our autistic child needs more organized engagement (in what I have no clue).. fortunately he'll be in high school in a year and many more club opportunities will be available at that time.
-We don't socialize much and choose more passive forms of entertainment. Hiking, social media, movies, video games, visiting the library.. that's kinda all that we do most of the time.
This lifestyle is not for everyone and in the long term it's not going to be sustainable. Something will eventually give, but I don't know when or what that will be.
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