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Wow most people will never even be able to afford to fantasize a six figure income. It is an evil travesty when people making the median income for an area can barely even rent let alone buy. More than half of people will never even see a 60k salary in their life
You gotta be a one percenter or already bought in before it went up and sold high and bought a new house with a wad of cash. Thw direction we are heading is a nation of majority homeless.
Ha. 1%er, I wish. I was your typical millennial that graduated up to his eyeballs in debt. $50K in debt to be exact. My parents were no help either as neither graduated from HS and I have photos of my childhood of myself and sisters playing with dirt and rocks in the yard.
I give the 2009 crash a lot of credit to how I got to where I am today. Straight income is one thing, but investment income is another. I didn't know anything until stock investing until the 2008/2009 crash. I did a lot of reading and research and decided to take a huge risk and toss $5-7K into the market. I could have lost my job just as easily as anyone else but I rolled the dice and the rest, as they say, is history.
Last edited by BostonMike7; 06-25-2018 at 11:25 AM..
I never bought a $400,000 house, and I certainly never bought a house worth over $900,000, either.
I paid a lot less for my home; however, the market has driven up the value of my house so much that I must look in a similar price range ($900k and more to move up in a desirable metro) in order to stay in moderate-climate areas of California.
Many of us have grown into a "$400k+" house without ever having bought one.
You're actually very fortunate to live in such a lovely area.
From where I sit, properties are lucky to appreciate along with inflation. Many actually lose ground relative to inflation.
Patently untrue. We wanted a small house, as do our friends, much like the one you pictured, but the “starter homes” out there required more liquid cash than we had to remodel/revamp the plumbing and electrical and flooring to make it habitable (I’m disabled). Instead, we were forced to look at ugly, big new-builds we didn’t want to live in or keep clean, simply because that was the next cheapest option. We got REALLY lucky with the house we bought; the day we took possession I was outside chanting the locks and someone pulled up to ask if it was for sale. We put in our offer <12 hours after it listed, it was frantic trying to secure a reasonably priced and sized home for a FTB — which leads me to conclude a lot of people want them!
Everything is harder when you're disabled; I recognize that. I'm not disabled but I'm not handy, although sometimes I pretend to be. We bought a substandard 1893 Victorian house in a fancy area and tried to bring it up to standard. My wife was on her belly stripping baseboard; a local teenager stripped the stair rail; I built archways where they should have been built originally; I can use a paintbrush and hang wallpaper. My father-in-law did a lot of the handyman work. A professional crew refurbished the basement, electric, and plumbing. After 25 years we had the money to add two rooms so we did that instead of moving. We now have a highly customized house that is average sized for our neighborhood, about 2200 square feet. It's fine for an aging couple. We'll never live like the rich folks down the street, but we like our house the way it is.
I hate to go against every financial expert in the country, but the trick was to spend way more than we could afford in our middle twenties. My income was rising at 15-20% a year, and I could have waited, but everybody has to live somewhere so we quit renting and bought a place that was a little out of reach. We didn't have much money left after paying the mortgage. But my income kept rising, interest rates eventually came down so we refinanced, and the house was paid off in my early 50s.
This can still be done by (1) buying a cheap place with potential, (2) making improvements as you get the money, (3) building relationships with local handymen and contractors, and (4) enjoying your life although your house is a bit of a mess. You'll never live like the guy on the top of the hill who owns the bank, but you'll have a nice place, financial peace of mind, and some stories to tell the grandchildren as well as practical skills to teach them.
Last edited by Larry Siegel; 06-26-2018 at 04:54 AM..
Everything is harder when you're disabled; I recognize that. I'm not disabled but I'm not handy, although sometimes I pretend to be. We bought a substandard 1893 Victorian house in a fancy area and tried to bring it up to standard. My wife was on her belly stripping baseboard; a local teenager stripped the stair rail; I built archways where they should have been built originally; I can use a paintbrush and hang wallpaper. May father-in-law did a lot of the handyman work. A professional crew refurbished the basement, electric, and plumbing. After 25 years we had the money to add two rooms so we did that instead of moving. We now have a highly customized house that is average sized for our neighborhood, about 2200 square feet. It's fine for an aging couple. We'll never live like the rich folks down the street, but we like our house the way it is.
I hate to go against every financial expert in the country, but the trick was to spend way more than we could afford in our middle twenties. My income was rising at 15-20% a year, and I could have waited, but everybody has to live somewhere so we quit renting and bought a place that was a little out of reach. We didn't have much money left after paying the mortgage. But my income kept rising, interest rates eventually came down so we refinanced, and the house was paid off in my early 50s.
This can still be done by (1) buying a cheap place with potential, (2) making improvements as you get the money, (3) building relationships with local handymen and contractors, and (4) enjoying your life although your house is a bit of a mess. You'll never live like the guy on the top of the hill who owns the bank, but you'll have a nice place, financial peace of mind, and some stories to tell the grandchildren as well as practical skills to teach them.
This is a great post.
You really rolled the dice in your 20's, but the great additional trick was to stay in the house for many years, and make it your own, rather than to move every few years banking on appreciation to cover your finances. If people could accomplish longevity in residence and accomplish contentment as you did, they would see the benefits of stability.
We are in the same house for 16 years now, the longest I have lived under the same roof, and no immediate plans to move. It has paid off nicely.
This is a great post.
You really rolled the dice in your 20's, but the great additional trick was to stay in the house for many years, and make it your own, rather than to move every few years banking on appreciation to cover your finances. If people could accomplish longevity in residence and accomplish contentment as you did, they would see the benefits of stability.
We are in the same house for 16 years now, the longest I have lived under the same roof, and no immediate plans to move. It has paid off nicely.
Thank you. That is the nice thing about being young. If you decide you've made a mistake, you have the time and energy to do something about it.
The data show the low income family percentage is declining while both middle class and upper class percentages are increasing.
Per capita (adults only) the middle class is shrinking
1970 60% middle class
1991 55%
2001 53%
2011 50%
2016 49.5%
Per capita lower income
1970 25%
1991 27%
2001 28%
2011 29%
2016 29%
Per capita upper income
1970 14%
1991 17%
2001 20%
2011 20%
2016 21%
So the upper class has gotten larger but so has the lower class. and the middle has gotten squeezed. Also of note the percentage of income going to that top 20% has gotten much larger while the middle and bottom have been stagnant. So there is good and bad there but saying the middle class is getting better and thriving just isn't the case. Instead we have a slightly larger upper class doing extremely well.
At the same time, among my daughter's non-STEM peers in their mid- to late- 20s, everyone is earning north of $100K. One was an art history major, another an anthropology major, another an econ major, another a lit major... the list goes on. She and many of her college friends work in business development & inside sales. Her high school best friend graduated as a lit major and now makes about $200K as a technical recruiter in San Francisco. Another high school friend, decidedly non-technical who can't spell C++ makes $150K as a recruiter.
There is one extreme outlier among her long-time friends - a high school friend was given a pre-emptive offer to work at Facebook instead of going off to Harvard. He's in the over $250K group, never having gone to college. He's a one-in-a-million guy, of course.
That would make the group a statistical anomaly. at 28 years old anything above 100k a year would be you in the top 5% of income earners for that age group. 150K would be top 2% and 200k at 28 would but you deep in one percenter.
My daughter's kindergarten teacher made $50k. That was 25 years ago in Yardley, Lower Makefield Township, PA.
I can't imagine what those teachers are being paid today!
Here in CT it averages near 70K. But most teachers making that have advanced degrees so considering the amount spent on education not that great of a deal.
Not 1%-er. Not by a long shot. We’ve spent the past 15 years riding out one hardship after the next, scrimping and saving (while paying NY rents) enough to put down to make a 400k-range home affordable. Really, we have no desire to spend that much, but that is what it costs to get into the size home for our long term needs. After changing apartments 3 times in 5 years, we have zero desire to buy a “start home” and trade up later; the house we buy is the one we intend to die in.
Ha. 1%er, I wish. I was your typical millennial that graduated up to his eyeballs in debt. $50K in debt to be exact. My parents were no help either as neither graduated from HS and I have photos of my childhood of myself and sisters playing with dirt and rocks in the yard.
I give the 2009 crash a lot of credit to how I got to where I am today. Straight income is one thing, but investment income is another. I didn't know anything until stock investing until the 2008/2009 crash. I did a lot of reading and research and decided to take a huge risk and toss $5-7K into the market. I could have lost my job just as easily as anyone else but I rolled the dice and the rest, as they say, is history.
You could afford rocks and dirt?
That's not a terrible thing. You learned to use your imagination and creativity.
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