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I'm talking about families as they are raising their children and the areas I'm talking about are nice, safe, quality areas to raise a family. What people don't understand is that there are places out there, many places, where you can have a nice lifestyle without needing 6 figure salary or more.
I certainly don't question that there are many places where one can live quite well for little money. However, I would really appreciate if you could share a budget or a little more detail. Even with a 20k house...I'm suspicious. You keep referencing 40k, but maxing a 401k drops you to 22k. That leaves 1833/month gross (not even net). With 4-5 people....I'm still not seeing a situation where that is even mildly comfortable.
Again, not trying to call you out - I'd just be really interested to see a budget that actually made that work in a sustainable way.
I'm talking about families as they are raising their children and the areas I'm talking about are nice, safe, quality areas to raise a family. What people don't understand is that there are places out there, many places, where you can have a nice lifestyle without needing 6 figure salary or more.
i am not disagreeing these places exist . i am saying i have no interest in them , my family is right here .
we live here for quite a few reasons .
like i said , retirement budgets are what you want them to be , not what they have to be unless you have no choices in life . the discretionary spending part can be as big as you want and is very much an important part of the budget not filler as you call it .
your budget can be as little or as much money as you can get your hands on in many places .
I certainly don't question that there are many places where one can live quite well for little money. However, I would really appreciate if you could share a budget or a little more detail. Even with a 20k house...I'm suspicious. You keep referencing 40k, but maxing a 401k drops you to 22k. That leaves 1833/month gross (not even net). With 4-5 people....I'm still not seeing a situation where that is even mildly comfortable.
Again, not trying to call you out - I'd just be really interested to see a budget that actually made that work in a sustainable way.
In a 20K house at 5% interest, you are looking at a house payment of $107. Insurance on that house is going to be maybe $20/month, taxes, maybe another $20, so let's round to $150/month for housing. Then consider these are smaller towns, generally safer and free of major crimes so car insurance rates are pretty low, so on a newer car, maybe $35/month. Utilities and such are also going to be lower, smaller house, etc. Transportation costs, gas to get to/from work minimal, likely you can even walk. Even things like groceries are going to cost less, plus, if you don't have an hour of commuting time, you have more time to make meals at home. Heck, we can go out for burgers and drinks with 4 adults for about $40. It costs more to eat at McDonald's than it does at the sit down restaurants, add in $3.00 pitchers of beer for those that like beer.
The other thing to consider is if you live in a low cost of living area, you probably don't need to max out your 401K so no, most people probably are not doing that, but it would be possible. Let's look at a more expensive house in a smaller town 711 W 1st St, Pella, IA 50219 - realtor.com®
Cute town in Iowa, college town with a major employer that people may be familiar with . This house could use some decorating, but it's a cute house, walkable town, shopping, theater, events at the college, etc. all right there for a house payment under $500/month, easily doable on a 40K salary, with putting away a comparable amount into a 401K. Using some online calculators, to get a comparable 40K salary in retirement you would need to put away about 12% not including social security. If you have a company match of say 6%, you would need to put away $200/month. Doing some Social Security estimates, almost all of your retirement needs would be take care of with an assumption of a 25 year old making 40K and never getting a raise and 3% inflation. Now, we never figured in Social Security into our retirement plan, but others might.
Like I said in another post, people are conditioned to think they need two incomes and all of these extras when more often than not, they would have more disposable income scaling back and living in a lower cost of living area--seems obvious, but it's hard to make the leap. I was just talking to a prospective employee the other day and we were talking salary range--he was in a very high cost of living area and when I tossed out the starting range based on his experience, he was pretty offended and his immediate reaction was "I couldn't even afford a 1 bedroom apartment on that"...well, no in San Francisco you couldn't, but here, you could buy the most expensive house in town on that salary thanks .
Also don't forget, the average household income in the US is in the 50K range.
In a 20K house at 5% interest, you are looking at a house payment of $107. Insurance on that house is going to be maybe $20/month, taxes, maybe another $20, so let's round to $150/month for housing. Then consider these are smaller towns, generally safer and free of major crimes so car insurance rates are pretty low, so on a newer car, maybe $35/month. Utilities and such are also going to be lower, smaller house, etc. Transportation costs, gas to get to/from work minimal, likely you can even walk. Even things like groceries are going to cost less, plus, if you don't have an hour of commuting time, you have more time to make meals at home. Heck, we can go out for burgers and drinks with 4 adults for about $40. It costs more to eat at McDonald's than it does at the sit down restaurants, add in $3.00 pitchers of beer for those that like beer.
The other thing to consider is if you live in a low cost of living area, you probably don't need to max out your 401K so no, most people probably are not doing that, but it would be possible. Let's look at a more expensive house in a smaller town 711 W 1st St, Pella, IA 50219 - realtor.com®
Cute town in Iowa, college town with a major employer that people may be familiar with . This house could use some decorating, but it's a cute house, walkable town, shopping, theater, events at the college, etc. all right there for a house payment under $500/month, easily doable on a 40K salary, with putting away a comparable amount into a 401K. Using some online calculators, to get a comparable 40K salary in retirement you would need to put away about 12% not including social security. If you have a company match of say 6%, you would need to put away $200/month. Doing some Social Security estimates, almost all of your retirement needs would be take care of with an assumption of a 25 year old making 40K and never getting a raise and 3% inflation. Now, we never figured in Social Security into our retirement plan, but others might.
Like I said in another post, people are conditioned to think they need two incomes and all of these extras when more often than not, they would have more disposable income scaling back and living in a lower cost of living area--seems obvious, but it's hard to make the leap. I was just talking to a prospective employee the other day and we were talking salary range--he was in a very high cost of living area and when I tossed out the starting range based on his experience, he was pretty offended and his immediate reaction was "I couldn't even afford a 1 bedroom apartment on that"...well, no in San Francisco you couldn't, but here, you could buy the most expensive house in town on that salary thanks .
Also don't forget, the average household income in the US is in the 50K range.
Fantastic....but...Pella is a town of 10,000....and the only other town close by is Des Moines (1 hour drive) - the biggest in Iowa at a bit over 200,000. It might be tough to find good paying job in such a rural setting but it you want to (as a couple) both drive an hour to work...cool. That might be less attractive with kids and not sure what the school situation is like.
Yes, it's easy to find cheap real estate...even cute houses...but there has to be jobs to go with them.
In a 20K house at 5% interest, you are looking at a house payment of $107. Insurance on that house is going to be maybe $20/month, taxes, maybe another $20, so let's round to $150/month for housing. Then consider these are smaller towns, generally safer and free of major crimes so car insurance rates are pretty low, so on a newer car, maybe $35/month. Utilities and such are also going to be lower, smaller house, etc. Transportation costs, gas to get to/from work minimal, likely you can even walk. Even things like groceries are going to cost less, plus, if you don't have an hour of commuting time, you have more time to make meals at home. Heck, we can go out for burgers and drinks with 4 adults for about $40. It costs more to eat at McDonald's than it does at the sit down restaurants, add in $3.00 pitchers of beer for those that like beer.
The other thing to consider is if you live in a low cost of living area, you probably don't need to max out your 401K so no, most people probably are not doing that, but it would be possible. Let's look at a more expensive house in a smaller town 711 W 1st St, Pella, IA 50219 - realtor.com®
Cute town in Iowa, college town with a major employer that people may be familiar with . This house could use some decorating, but it's a cute house, walkable town, shopping, theater, events at the college, etc. all right there for a house payment under $500/month, easily doable on a 40K salary, with putting away a comparable amount into a 401K. Using some online calculators, to get a comparable 40K salary in retirement you would need to put away about 12% not including social security. If you have a company match of say 6%, you would need to put away $200/month. Doing some Social Security estimates, almost all of your retirement needs would be take care of with an assumption of a 25 year old making 40K and never getting a raise and 3% inflation. Now, we never figured in Social Security into our retirement plan, but others might.
Like I said in another post, people are conditioned to think they need two incomes and all of these extras when more often than not, they would have more disposable income scaling back and living in a lower cost of living area--seems obvious, but it's hard to make the leap. I was just talking to a prospective employee the other day and we were talking salary range--he was in a very high cost of living area and when I tossed out the starting range based on his experience, he was pretty offended and his immediate reaction was "I couldn't even afford a 1 bedroom apartment on that"...well, no in San Francisco you couldn't, but here, you could buy the most expensive house in town on that salary thanks .
Also don't forget, the average household income in the US is in the 50K range.
You still don't have a way to pay for health insurance, clothing for the growing kids, or other vehicle costs (depreciation, maintenance, repairs, etc.) or day care. And your house never needs any repairs....?
I'll even let you assume the house is bought in cash. It's still too much of a stretch. Even child care plus health insurance alone, forget everything else, approaches or even exceeds $20k/year for many families especially with multiple children.
I have noticed several people saying they would not do something like funding kids' college or paying debt off unless they were maxing their 401k. What is the reason for thinking you need to put in the absolute maximum allowed by law, instead of simply an amount that is appropriate for your expected expenses, age, etc.? Not all of us want to have a super-lavish retirement at the expense of a somewhat better life now.
edit: Mods can move to Personal Finance, I meant for it to go there.
Getting old is bad enough. Getting old and being poor or broke will be a lot worse.
You still don't have a way to pay for health insurance, clothing for the growing kids, or other vehicle costs (depreciation, maintenance, repairs, etc.) or day care. And your house never needs any repairs....?
I'll even let you assume the house is bought in cash. It's still too much of a stretch. Even child care plus health insurance alone, forget everything else, approaches or even exceeds $20k/year for many families especially with multiple children.
you know how these forums work , no budget is to small to live a nice life on providing you are the one not having to do it with your family in that particular area on that budget . usually if it is you , it is far more of a struggle making ends meet .
Fantastic....but...Pella is a town of 10,000....and the only other town close by is Des Moines (1 hour drive) - the biggest in Iowa at a bit over 200,000. It might be tough to find good paying job in such a rural setting but it you want to (as a couple) both drive an hour to work...cool. That might be less attractive with kids and not sure what the school situation is like.
Yes, it's easy to find cheap real estate...even cute houses...but there has to be jobs to go with them.
Several large employers in town...
Quote:
Originally Posted by ncole1
You still don't have a way to pay for health insurance, clothing for the growing kids, or other vehicle costs (depreciation, maintenance, repairs, etc.) or day care. And your house never needs any repairs....?
I'll even let you assume the house is bought in cash. It's still too much of a stretch. Even child care plus health insurance alone, forget everything else, approaches or even exceeds $20k/year for many families especially with multiple children.
Day care??? We are talking one income...so that means, no day care costs. You are also missing the point, again, that you don't HAVE to spend that kind of money and still have a very nice life...try it sometime, you might be surprised
and Math...been there, done that, did just fine thanks
Fantastic....but...Pella is a town of 10,000....and the only other town close by is Des Moines (1 hour drive) - the biggest in Iowa at a bit over 200,000. It might be tough to find good paying job in such a rural setting but it you want to (as a couple) both drive an hour to work...cool. That might be less attractive with kids and not sure what the school situation is like.
Yes, it's easy to find cheap real estate...even cute houses...but there has to be jobs to go with them.
Quote:
Originally Posted by Qwerty
Several large employers in town...
Yup - Pella Windows - 2,200 and the hospital - 800.
you know how these forums work , no budget is to small to live a nice life on providing you are the one not having to do it with your family in that particular area on that budget . usually if it is you , it is far more of a struggle making ends meet .
I (single I'll admit, but I feed the GF about 1/2 the week since I like to cook and my income is more than hers) live on LESS THAN $2K/month.
Average income in the closest town (I'm out on the boonies) is under 25k for men, and $2-4k for women.
I'm not disputing that quite a few are dual income households.
But many aren't. (I know more than a few)
And yes, I:
1. Live on this income by choice (save ~ 52% of my income)
2. It's no struggle.
In fact I eat (good) steak 1x/week (sometimes with GF) eat out several times a month, have seafood boils or grilling parties a couple times a year, import fresh seafood from the gulf coast, 2 cars insured rather than one, etc.
Morgtage is $324/month.... moreso more land than more house
Needs must, I could shave it under $1,500 pretty easily, but I see no reason to.
Not all of us live in one of the most expensive places (with government rent frozen (controlled) housing!) In the country.
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. This house could use some decorating, but it's a cute house, walkable town, shopping, theater, events at the college, etc. all right there for a house payment under $500/month, easily doable on a 40K salary, with putting away a comparable amount into a 401K. Using some online calculators, to get a comparable 40K salary in retirement you would need to put away about 12% not including social security. If you have a company match of say 6%, you would need to put away $200/month. Doing some Social Security estimates, almost all of your retirement needs would be take care of with an assumption of a 25 year old making 40K and never getting a raise and 3% inflation. Now, we never figured in Social Security into our retirement plan, but others might.
