Fam of 4 moving to peninsula from midwest. Areas? Schools? Living small on 140k Salary? (Fremont: cheap apartments, lease)

[pranapearl]

Originally Posted by Ruth4Truth

My question still stands. Why would $4500/month not be enough to live on, after rent? Do you eat expensive organic groceries and deli items? Do you expect to spend a lot on kids' bikes, computers, video games, expensive shoes, etc? Or are you assuming utilities will be as high as in the snowy climes you're coming from? I'm not seeing a problem here at all, unless you guys are spendy, or have a fleet of cars, or something.

I agree with you. Not being able to make ends meet on over 1k a week seems INSANE to me. We do it ok now on 850/week, but again, keep hearing that we are completely underestimating COL there.

No fleet of cars here! Mine is 06 volvo and paid for and hubby's got an 04 audi also paid for. We do eat pretty clean, but even then, we only spend about 220/wk on groceries. (Probably another 100/mo on wine. )
$300/mo goes towards student loans and a credit card that is almost paid off. Student loans are about 2 years away from being done and we pay more than the minimum. Our utilities are as follows: About $80/mo for city utilities (water/sewer/recycling/trash), $100 avg both gas and electric for our 2400sq ft house. $120/mo on cell phones. $50 on wi fi, I'm over-guestimating $250 on gas (DH works 5 minutes away) and any potential car maintenance, $60 car insurance, $100/mo supplemental life insurance and investment accounts. I'll throw in another $400 misc. expenses which includes entertainment, kids' needs for school, incidentals. Which all comes to around 2600k. We did make a lump sum payment for tuition from savings this year so that we don't have that monthly payment.

I don't know. When I see all my expenses laid out- it's overwhelming. gah. Still seems like 2000k/mo flex-room is enough for incidentals out there. Plus, we will be paying a bit less for health insurance premiums.

[pranapearl]

Thanks again. You guys are making great points and I truly appreciate this discussion. Also, I am not factoring in anything I make out there... I do freelance work and also teach pilates. Assuming there is a bigger market for private pilates clients out there, I think I can make another $500 if I do both freelance and teach pilates. Also hoping our utilities will be less for gas and elec. in a smaller house than in our large, drafty, 75 yr old home!

[likealady]

Originally Posted by pranapearl

Thanks again. You guys are making great points and I truly appreciate this discussion. Also, I am not factoring in anything I make out there... I do freelance work and also teach pilates. Assuming there is a bigger market for private pilates clients out there, I think I can make another $500 if I do both freelance and teach pilates. Also hoping our utilities will be less for gas and elec. in a smaller house than in our large, drafty, 75 yr old home!

Yeah, definitely look into working part-time more. It never hurts to have the buffer. Honestly, I think you'd be ok. I have no idea what the costs are like for raising your kids, but if you think it's not too much of a stretch, go for it. Your utilities bill will be much less out here and the San Mateo/Foster City area is super nice for families. Don't listen to anyone telling you to look into East Bay housing. Long commutes aren't good for anyone. Good luck.

[comingbacktocali]

Originally Posted by Ruth4Truth

Did you read the part where she says they'll send the kids to public schools?

yes, i saw that. just offering up info she might not already have. and considering she does not know where they will live or what the school situation might be, it could be good info to have.

[clongirl]

You can do it on his income. I know- my family has done it on less---with four kids and on one income. As most have mentioned, it's the rental costs that have through the roof and have become very competitive lately.

When my family rented (back in 2007-ish), we paid 3100$ month on a 4 bedroom house in Pleasanton. We paid cash for one used car and one new car (we were just moving back after a few years abroad).

We weren't suffering at all, still managed to go out for drinks/dinner once in a while, etc. Just keep it tight with meal planning and as someone mentioned before--look into something smaller (like a condo/or large apartment) in the inner East Bay (like Castro Valley/Fremont) since rents are less expensive there. Most cities have a parks and rec dept. for much less expensive children's activities and there are TONS of free/discounted activities/places to go.

Frankly, the hardest part of moving somewhere like the Bay Area (which may or may not be the case for you) is not having family/friends around and getting used to the idea that buying a house probably won't happen any time soon. Also, many people that move here from other states romanticize living here, then get upset that it's not the paradise they'd expected it to be. Don't set up super high expectations and you'll be okay! Good luck with your decision!

[CC12345]

I think you'll be just fine. The hard part is when people move out here expecting to be able to afford the house, the yard, the after school activities and such. It sounds like you've already readjusted your expectations on where you'll live and how much space you'll have, so I'm sure you'll be fine.

I would caution that I'm not sure your take home will be that much. If you assume, say, 15% for fed income tax, 6% for state, 5% for ssi, and another 1-2% for Medicaid and california SDI, that's between 25-30%. Keep in mind you won't have a mortgage deduction. If it's closer to 30%, that's about 8200/month before accounting for insurance or 401k. I assume you'll want to max his 401k since you won't have one. That takes it down to something like $6800/month. Then subtract for insurance ($300?) and you're at 6500 take home.

Obviously, only you know your tax situation. It just seems like your estimate may be on the high side if you're contributing to retirement for two people.

[jade408]

Originally Posted by Ruth4Truth

Cutting back to something like a 2 br. condo in the beginning is the only way to make it work. Then, presumably, your husband's salary would increase after 6 months to a year, if the start up does well. Also, you'll have annual income from those stocks, too. Don't forget that. After a year or two, depending on how the income situation shapes up, you could get a bigger place. I don't understand why you can't sell your place, or were you planning to do that at some point?

The peninsula is beautiful, and norCal weather is the best! Traffic can be overwhelming, especially anywhere within an hour+ of commute hours, but there's public transport. The beach is within an easy drive. Redwood forests for hiking.

If you can handle taking a risk, and if you can handle a condo for the 1st year or two, try the big adventure. But if you love your home, neighborhood, schools and lifestyle where you are, well....why mess with success?

At the series A stage those options are meaningless. Rarely will a startup exit sooner than 5 years from now. It has zero impact on your income.

Honest, in my book, family of 4, 140k is not enough. It isn't that much. In some peninsula towns 120k for a family of 4 is enough to get you into the home buyer's assistance programs. The change in quality of life is too great. And although potentially 100k shares is a good chunk of equity, you can't hope to have it pan out any sooner than 3 years. And there is no guarantee.

[jade408]

Originally Posted by pranapearl

I am not disagreeing with you, but would you expand a little more on this? I keep reading so many different opinions on here and not really sure what they are based on. From our estimations, we'd NET around $7500/mo. Take away 3k for rent and that still leaves 4500 a month for utilities/gas/bills/entertainment. Since you understand midwest COL and bay area COL, would you say $4500 is not enough for a family of 4? It's a surplus of around $1k or $250 a week more than we have here. Again- honest question. Very curious. Thanks!

That net feels a little high, particularly if you have to pay health insurance (likely) or add to retirement savings. Taxes here are pretty brutal. You should use a number more like $6800 as your monthly net.

[pranapearl]

Originally Posted by jade408

Honest, in my book, family of 4, 140k is not enough. It isn't that much. In some peninsula towns 120k for a family of 4 is enough to get you into the home buyer's assistance programs.

Seriously?? On 120k? Which ones? Maybe that's where we should be looking.

Thanks for your thoughts- appreciated!

[CC12345]

Where you're looking (san Mateo county) has such a program.

Homebuyer Loans | HEART of SMC

They're intended to help people of moderate means buy a home through down payment help. Of course, the total loan can't be more than something like $521,000, so you'll still have a hard time finding something for that in the cities you mention. Still, it's an option.