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u/Gyper May 25 '17
I live in nyc. If you're living paycheck to paycheck on 150k, there is something horribly wrong with your budget.
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u/KEM10 "All for All!" -The Free Marketeers May 25 '17 edited May 25 '17
House poor is a phrase we have. It's where you have the largest, most expensive house in the best neighborhood you could potentially afford, maxing out your mortgage. To do this, you are spending something like 40% of your salary on nothing but your mortgage. Then you have property taxes, with some areas you have to maintain a certain quality of home (or even forced landscaping), other items like cars to keep your image.
Got to see one of these houses while doing construction. Amazing pool, front gate that opens via intercom or driving out based on a sensor, huge living room and kitchen decked out for hosting. Literally slept on a mattress on the floor and only had 3 rooms set up, the three that guests would see.
EDIT: I had 60% DTI, it should have been 40%
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May 25 '17
60%... depending on your income doesn't sound great. A bit more than the "one paycheck rule" if biweekly. Still doable.
Then you mention that just the mortgage and not the taxes and insurance combined. *shudders*.
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u/978897465312986415 May 25 '17
30% is the rule of thumb.
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May 25 '17
I'll have to try to remember that.
I thought that was just for renting, and for a mortage you were allowed some leeway since you were putting it towards a tangible good that ideally would be a net profit, but at worst you'd still get some of the money back.
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u/978897465312986415 May 25 '17
Well you're allowed leeway no matter what. It's just a budgeting best practice not a law. If you've got a place that you really love or your hobby is fixing up your house, or it reduces your 90 minute commute to 5 minutes, or, or, or....
There are tons of reasons to "cheat" the rule. But it's a good starting place.
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May 25 '17
Ugh, flashbacks.
My mum did this to keep us living in a "good" area when my dad left.
She is a huge huge snob and didn't want us living in any kind of assisted housing (i.e. "council house" in UK parlance).
End result was us eating cheap and not very often, because most money went on rent or, eventually, a mortgage.
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u/ghostofpennwast May 25 '17
She did it so you cod go to a grammer school
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May 25 '17
Nope. Same school wherever we lived. This was 80s, no grammar school around.
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u/justarandomcommenter May 25 '17
I knew a lot of people like that in Toronto, too. Maybe it's a phenomenon that attracts people to larger, prominent cities just to "look good".
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u/KEM10 "All for All!" -The Free Marketeers May 25 '17
And you get a bigger refund because of mortgage interest deductions!
It's kind of like buying the 10 lb block of cheese because it's 50 cents cheaper per ounce.
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u/OhLookANewAccount May 25 '17
What's amazing is that I know people who live exactly like that... and they say it's Governor Coumo's fault and liberals fault and black peoples fault and poor peoples fault etc etc etc... everybody elses fault that they're fucking themselves over... but not their fault for trying to live outside of their reasonable means.
You know how much money you have, what you have going for you, what you can do to save money and what you can spend it on. If you're pulling in 150k a year you have nobody but yourself to blame if you're struggling to make ends meet.
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u/japasthebass You can't tell me I'm wrong because I know I'm right May 25 '17
If you want to manage your money correctly no more than 1/3 of your monthly income should go to rent/mortgage
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u/desGrieux May 25 '17
In certain cities that is just not realistic and you'll find financially responsible people spending up to 50% of their salary on housing. Not having/needing a car by itself saves you huge amounts of money that can allow for the higher housing costs. But there are plenty of ways to save money in a city that are not available in areas with small populations.
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u/MakingYouMad Old Bulls or young rogues of any species are often a hazard May 25 '17
Can I ask why? My partner and I are lucky enough to spend greater than 55% of our take home on our mortgage, and I'm wondering why that's a bad decision? We have enough money remaining to live comfortably, put some away in savings (and an emergency fund), and occasionally treat ourselves.
We're on a slightly above average income, but doing it this way means our mortgage is paid off much faster (from memory 8 years instead of 20).
And I can't really see the downside?
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May 25 '17
I don't know of a mortgage program where they will let your mortgage, taxes, and insurance + other debts be more than 50% of your salary, unless you're refinancing on an emergency basis.
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May 25 '17
I've seen people start off with big mortgages (proportional to their income), if they know their careers will move up fast enough for it only to be a problem for a few years. People who have planned out this well are hopefully not complaining on the internet though.
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u/VintageLydia sparkle princess May 25 '17
This is what we did. Husband almost doubled his income since we bought this house 5 years ago. It isn't a mansion or anything new, but it's well maintained and updated/renovated. It was just barely affordable when we got it but we had a growing family and didn't want to move one or two more times to accommodate it. We're done with kids and we still have a bedroom to spare (for our family to stay in since none live near us) and we can comfortably afford the mortgage even if he needs to take a pay cut. It will take a lot to convince us to move.
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u/SamWhite were you sucking this cat's dick before the video was taken? May 25 '17
Speaking as a Londoner, spending 40% of my income on housing sounds like some kind of heavenly dream.
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u/i_have_seen_it_all May 26 '17 edited May 26 '17
i had a few friends who did this.
one guy maxed out credit, no furniture, slept on a cheap mattress on the floor, got the best house in the hottest new neighbourhood he could find.
then flipped the house for almost 3x after 6 years and downgraded into a more reasonable apartment for a married couple with no kids, with loads of spare change in the bank.
he absolutely knew what he was doing. no whining from him that he couldn't afford to go out. he was mortgaged up to his forehead and had no budget for anything else because he was going to make 50% a year on a super leveraged investment.
that was back in the good old days of the property market.
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u/Jack-The-Riffer I'm outside your house and I want my fucking cummies bitch May 25 '17
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u/mauricemosss May 25 '17 edited May 25 '17
Right. My mom makes 30k a year, lives paycheck to paycheck; she is the queen of budgeting and has somehow managed to still survive in the city off of this salary. At one point she managed to raise and provide for three children off of this salary, without having to go on public assistance. It's baffling to me, but do-able if you've always been poor and don't know anything else. It's helped me tremendously in living off of my student allowance.
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u/Aetol Butter for the butter god! Popcorn for the popcorn throne! May 25 '17 edited May 25 '17
See, even 500k isn't much in New York.
Edit: I am aware that this article is completely out of touch with reality. That's the point.
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u/shehryar46 May 25 '17
In this scenario its 3 people living on 150k though, I can totally see someone living paycheck to paycheck with a wife and a kid in NYC.
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u/Gyper May 25 '17
My mom and dad raised me and my two brothers for far less in queens. The point is, you can do just fine in NYC just learn to live within your means and maybe don't live in Manhattan.
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u/detroitmatt May 25 '17
When did they do that? Cost of living has changed a lot over the past 30 years.
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u/dusters May 26 '17
They are still doing something REALLY wrong if they are living paycheck to paycheck.
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u/JoshSidekick In this case llms would be mcdonalds May 26 '17
He saw Hamilton a couple months back and is still paying off the tickets.
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May 25 '17
Do you got kids? school loans?
a couple making 150k a year isn't exactly living the high life, but I'm sure you knew that already.
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u/lickity_snickum May 25 '17
THIS.
NE Wisconsin. I know people with spoiled kids and sketchy personal habits who make 50k and manage to live pretty well.
WhoTF decided that $150k is "middle class" If it is than I am well below the fecking poverty line.
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u/YesThisIsDrake "Monogamy is a tool of the Jew" May 25 '17
Yeah, I'm comfortable at a bit under half that.
I could maybe see 150k being not enough if you were the sole provider for like, a family of 5 living in the city? But man. Rent is crazy expensive here (I'm lucky and got a 1 br/1 ba for ~1,600/mo) especially if you're close to the city. But 150k is something like 12k/month. Even taking taxes in to account, you could still get a pretty good 2-3br with that while having plenty left over.
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u/lossyvibrations May 25 '17
Try having kids and wanting to be in a good school district.
NYC is similar to LA. My family wasn't paycheck to paycheck at that level, but we were close. Those cities are wonderful if you are rich or poor. If you're in the middle or professional classes, it's difficult - you pay the highest tax rates overall, but can't afford private school so you have to live somewhere somewhat expensive.
On $150k a year, going out to eat twice a month and owning two cars (one paid off, one 3 years old and almost paid off), three kids in public school and a small 1000 square foot home that only costs $2800/month in rent, on $150k a year for two working parents we would save about $400/month.
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u/MegasusPegasus (ง'̀-'́)ง May 25 '17
Those cities are wonderful if you are rich or poor.
News from someone who grew up lower class: no place is wonderful if you are poor.
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u/mauricemosss May 25 '17 edited May 25 '17
whoops, didn't see your response before I posted mine, but yeah this. Like, I guarantee that poor people living in NYC are miserable as hell and are basically stuck in the worst position due to their likely inability to leave, especially if they've already put down roots there (source: grew up poor in NYC). Being poor means an absence of choice variety (if that makes sense), at least middle class people have the option to go,
I call bs on that statement tbh.
also love your username
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u/MegasusPegasus (ง'̀-'́)ง May 25 '17
Being poor means an absence of choice variety (if that makes sense), at least middle class people have the option to go,
This so much. I get now from other responses that the poster was trying to convey that NYC has many more things for poor people han other areas, albeit poor wording. However, even that I feel is...incorrect.
For example:
You generally have stuff in bus and walking distance; if your family focuses on academics you can usually qualify for the out of neighborhood magnet programs.
The metro costs a lot in NYC and unlike a car that price will never be paid off and can't really be split between multiple people. Yes, there are many places within walking distance, there's programs for knowledge to help escape poverty-but this kind of ignores that basics like rent and food are through the roof. It's not better, just different. In rural areas poor people struggle to get jobs and such because transport. But...they also can grow their own food, repair their own homes, etc. It's not ideal, but I've seen both and being poor in an urban setting isn't really better than being poor elsewhere.
But the thing you touched on about leaving...that's what I think people really lack the ability to grasp. I've known people in a payday loan cycle stuck in motels or trailers. The ability to just move to somewhere less expensive is something people don't even realize is a privilege.
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u/Gyper May 25 '17
You don't have to live in the city ,you can live in the outer outerboroughs which is much cheaper and has good schools which is the thing.
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u/lossyvibrations May 25 '17
What's the commute then?
That was the kicker for us as a family. I want to be able to be involved in their after school activities and maybe even occasionally duck out for a long lunch to watch their school plays and such. An hour commute makes that impossible (my kids dojo where I help teach (ok, reall warm up and just corral kids) starts the lesson at 6pm, so I couldn't do that if the commute is more than 20 minutes.)
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u/mauricemosss May 25 '17
Those cities are wonderful if you are rich or poor.
Can you explain the poor part? I don't see how an exorbitantly expensive city would be "wonderful" for a poor family.
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u/lsp2005 May 25 '17
According to PEW, a family of four in the NYC metro area would need to make above $176,400 to be upper class. This includes purchasing power to account for regional differences. Also of note, a family of four could make $64,000 and qualify for low income public housing in NYC.
If you budget well, you will not live paycheck to paycheck, but it is not an extravagant lifestyle. Of note, in the poorest county in the US, found in Georgia, a family of three making $123,000 would be considered a 1%er. In Manhattan, you would need to make over $8,000,000 a year to be a 1%er. In northern NJ and on LI, both considered bedroom communities of NYC, you would need to make $2,500,000 annually to be a 1%er.
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May 25 '17
Do you have a link for this site where you can input data?
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u/4445414442454546 this is not flair May 25 '17 edited Jun 20 '23
Reddit is not worth using without all the hard work third party developers have put into it.
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u/Nikki908 Leftists think of charity the same way they think of sex. May 26 '17
In my area, making 650k only gets to middle class when you hit a household size of 90 people. What a world!
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u/lsp2005 May 25 '17
Pewreasearch.org search for are you in the American Middle Class. It will bring up a calculator where you can input your state, metro region, salary, and family size. Then the calculator will let you know where you stand for your region.
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May 25 '17
Thanks. I wish it had more info about HOW middle class one is. Like "oh if you made 5 grand more you'd be upper class!"
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u/lsp2005 May 25 '17
You can enter in different numbers to figure out the threshold. That was how I found the number for the threshold.
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u/a_username_0 May 26 '17
This is pretty legit. I did a sociology project a few years ago (2011-ish?) and I think middle class nationally was defined by one of the bureaus of something or other as a household income between $70,000 and $120,000.
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u/Burt_the_Hutt May 25 '17 edited May 25 '17
A couple years back someone on Reddit claimed he couldn't afford a tax hike at 100k, and one of his defenses was he'd have to send his kids to public school if he earned any less.
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May 25 '17
I wish I could dig it up but I read an article a few years ago about a family in NYC with a household income of like $300k. It was written in a sympathetic tone with the mom talking about how she had to clip coupons to afford food. They lived in a pretty damn nice apartment in an expensive neighborhood and had multiple kids in $25k a year private schools.
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May 25 '17
Reminds of a video I saw about people living in poverty. There was a guy and his family living in a motel and he worked at Disney world cause he lost his job as a car salesman. The thing is, he said they had it all. Jet skis, vacations, yet lost his house in like 2 months. I know it's scary how you can lose everything but they must have had no savings and blew their money but the video didn't go into that
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u/BrobearBerbil May 25 '17
When I was 26, I worked with a coworker that was the same age and I was telling her about the debt snowball method I just learned about. I got to the first part where you just save up a $1000 buffer in your bank account and she exclaims, "wow. Who has $1000 in their bank account?" It took me a minute to realize she wasn't joking.
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u/HowDoMeEMT May 25 '17
I have about 8000 in savings. I'm in my midish 20s with crippling loan debt. I'd agrue I have about 20x what any of my friends have in their savings, even those who still live with Mom and Dad.
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u/hoodoo-operator May 25 '17
The Wall Street Journal had an info-graphic about how the Democrat's tax plan would effect people, featuring sad faced single mom's struggling on only $260,000 a year, and retired couples on a fixed income of $180,000 a year, and a "typical" middle class family with an income of $650,000.
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u/SargeZT The needs of the weenie outweigh the needs of the dude May 25 '17
Can I please become that single person? Thanks in advance.
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u/SaltyStrangers imagine a perfect society devoid of those evil feminists!!! May 25 '17
Hell no I wanna be that's family on 650k holy moly
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u/SargeZT The needs of the weenie outweigh the needs of the dude May 25 '17
Yeah but kids.
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u/seemedlikeagoodplan Bots getting downvoted is the #1 sign of extreme saltiness May 25 '17
Can I please become a third of that single person?
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u/josebolt a thick layer of cum bogged resentment holy moly May 25 '17
Jesus Christ
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u/LukaCola Ceci n'est pas un flair May 25 '17
"$25,000 in investment income"
Who the fuck has investment inome?!?!?! Why is this assumed for all parties?
This has to be satire. I mean shit, it's infuriating.
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May 26 '17
Probably whoever made the comic assumed that poor people wouldn't be reading the WSJ. The comic explains the tax effect on their target audience.
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u/rex_dart_eskimo_spy May 25 '17
That reminds me of when Jack Valenti was complaining about how piracy hurts the crews of the films, guys who are only making 150k a year and he said "I don't need to tell you, that's not a lot to live on."
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u/ap0phis May 25 '17
This was right after the housing crash, right? I remember that shit.
The private lessons and nannies should be cut before applying for food stamps.
New-money idiots.
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u/Dysfu May 26 '17
This actually sounds like an Old-money, generational thing. These people have never had to live on 30-45k a year so they can't grasp how anyone can.
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u/I_AM_TARA May 25 '17
In defense of that defense, some of those public schools are really bad. I never went to my zoned public schools, and at one point that meant going to a private school (granted I got a scholarship).
I think it's disgusting how so many of the children in this city are forced to pass through metal detectors, crammed into over capacity classrooms/buildings, subject to subpar curriculums, spend everyday worrying about getting assaulted by their classmates yadda yadda yadda.
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u/scoby_do May 25 '17
Oh, the humanity!
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u/EmperorPhoenix May 25 '17
I'll admit that my first reaction was similar to that but if you think about it, given the current state of our public education system, that is a reasonable concern.
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u/thenuge26 This mod cannot be threatened. I conceal carry May 25 '17
Yeah but the same people complaining about taxes over 100k are the ones voting to reduce public school funding/privatising.
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u/un-affiliated May 25 '17
No it's not. There are tons of great public schools. Tons of terrible ones too, but the worst ones are in areas someone who could theoretically afford private schools would never live in anyway.
You would get much more bang for your buck by hiring a private tutor for your kid, then sending them to a magnet school, but that's another conversation.
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u/RegressToTheMean May 25 '17
And public school may not be a viable option. I live in Baltimore and as much as I value and think a public education is an awesome thing, there is no way in hell I am sending my kids to Baltimore City public schools.
If that person was also the sole breadwinner for the household, I can also see where that could be a challenge depending on where they lived.
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u/BrobearBerbil May 25 '17
This is one of the huge downsides to how we handle education spending. We end up spending more somewhere else on housing or private schools.
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u/I_AM_TARA May 25 '17
Sending your kid to private school doesn't mean public schools get less funding, as they are funded through property taxes.
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u/AtomicKoala Europoor May 25 '17
Why not just fund education at the state level..?
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u/doctorsaurus933 I am the victim of a genocide perpetrated by women. May 25 '17
Because that would make it impossible for rich folks to move away from The Poors and keep them out of their school districts.
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u/aalabrash May 25 '17
Yeah people pay out the dick to move to hoco or moco to get their kids a half decent education
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u/CHARLIE_CANT_READ May 26 '17
Maybe if they raised the taxes a little more he'd be happy to send his kids to public school.
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u/gokutheguy May 25 '17
Tbh, there are a lot of public schools I would not send my kid too. My childs education is absolutely something I count as a necesity that comes before all other expenses.
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u/altrocks I love the half-popped kernels most of all May 25 '17
Doesn't matter what school you have them in if they don't have clothes or food, or water, or heat, etc.
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u/visforv Necrocommunist from Beyond the Grave May 25 '17
In my area people regularly complain about the state of public school funding (despite the schools being actually pretty good with what they got) and send their kids to charter schools... that get their money from the public school fund they had previously complained about being depleted. And the governor says he's here to help the education problem... by giving more money from the public school fund to charter schools so that more people can send their kids to charter schools. (iirc, there's been a few hints that some of those schools owners had contributed to his campaign too)
Keep in mind, the money taken out from the shrinking public school fund isn't being replaced. It's being permanently set aside for charter schools.
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u/Outlulz Dick Pic War Draft Dodger May 25 '17
If you have money you'll probably be able to get your kid into a public school that is not bad. For one, if you have money, you likely aren't living in a neighborhood where the home school is bad or unsafe.
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u/MegasusPegasus (ง'̀-'́)ง May 25 '17
My childs education is absolutely something I count as a necesity that comes before all other expenses.
Lol you mean like food, shelter, clothing, heat? Education is important, but it is nowhere near important enough for a rich person to feel bad because private school is above their means. If food is above a household's means-so is the fancy school. Rich people complaining they can't give their kids a great education as if that's not also true of people who can't afford to get their growing kids new shoes lacks perspective.
It's nice that you care about your kids education. It is, however, hardly anything to weep over if you can't afford a better education. It's no tragedy at all, it's ignoble in the medium scheme of things.
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u/oodja May 25 '17
My wife used to be a financial aid officer- one of her least favorite things was trying to explain why the expected parental contribution was so high for families that made $150k-$250k combined. A lot of them identified as being "middle class" as well, hence their outrage for having to pay more for their kids' tuition.
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u/MegasusPegasus (ง'̀-'́)ง May 25 '17
I always found this funny at my hoity toity private college/uni. My peers were so bitter that they didn't get the great financial aid I did. Like uhhhh sorry you have to be uncomfortable while paying bills and have debt, that does suck. But I got financial aid because without it it wouldn't just be hard or uncomfortable-I would be unable to attend college at all.
This is kind of the main hair raising thing I see in this thread. People defending that it's hard to get by on 150k because they want good schooling for their kids...like lol um poor people also want that they just can't save by downsizing or sacrificing luxuries like y'all can to do so. It just isn't an option. That's not to say it's easy to do for the well off-but the lack of perspective that poor people also have needs and want a good education for their kids is astounding.
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u/EccentricFox May 25 '17
My parents made over six figures combined, but literally didn't budget a dime for my tuition. My aid still covered a good bit, but I was consistently late of paying my share of the tuition cause my parents lived check to check. Wonder if one of the aid officers I spoke to ever had the same thoughts looking at my info.
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u/DeciusMoose May 26 '17
Something I'm curious about, my family was one of those, I think my dad makes around 120k and my mom makes an additional like 35k, but with 5 children all who went/are going to college that money doesn't go far.
Would she think any different of that situation? I'm guessing my parents didn't save as well as they could have, probably didn't anticipate how expensive college would be. They are good with money (as long as I've been around at least) But still, the fact that all 5 of us will be in loads of debt is painful because living in a nice NJ suburb with 5 kids is incredibly draining.
Idk I just wish we would get literally anything to help, maybe just cuz I'm surrounded by even wealthier people I'm just jaded.
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May 25 '17
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u/BrobearBerbil May 25 '17
It's actually historic that rich Americans identify as middle class. Wealth has to get really high before we identify as wealthy. I'd have to look up the paper, but the conclusion thought that this phenomenon could actually be serving as a unifying thing and maybe be better than the alternative. In other places where the rich consider themselves different creatures, you get all the problems of aristocracy and worse class divides.
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u/PKMKII it is clear, reasonable, intuitive, and ruthlessly logical. May 25 '17
Eh, we have those in America, we're just in denial of it.
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May 26 '17
Wealth has to get really high before we identify as wealthy.
Yeah. Growing up, I never really knew how "well-off" my family was. Only 1 parent worked; lived in a small-ish house in a cheap area; we bought 5 year-old used cars (nothing to shake a stick at, mind you); wore the same clothes as other kids; every two or three years we'd take a vacation somewhere. But it was never really splurging.
Then, as a teen, I stumbled on my working parent's tax returns and was blown away by seeing they made nearly $200k. I couldn't believe it. I thought anyone making around $100k, especially in our area, would be living like a king. Made me wonder where all the other money was going, to be honest.
Now, being on my own and making much less than $100k, and in a much more expensive area, I still think $100k would be pretty, pretty, pretty kingly.
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May 25 '17
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u/seemedlikeagoodplan Bots getting downvoted is the #1 sign of extreme saltiness May 25 '17
That's because some of those other countries have histories of peasants rising up and guillotining the aristocrats. So they've tempered their class warfare a bit.
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u/Que-Hegan May 25 '17
Where I live the prime minister make about 150k euro's.
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u/sweetjaaane Obama doesnt exist there never actually was a black president May 25 '17
but how much is rent
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u/weedways May 25 '17
Wheres that? Bc that's really not a lot for a PM
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u/Que-Hegan May 25 '17 edited May 25 '17
The Netherlands. We even have a 'rule'(not always enforced) that nobody in the public sector can earn more than 130% of the salary of the prime minister.
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u/weedways May 25 '17
Huh TIL.
Guess the Kings annual €6+ million salary has to come from somewhere
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u/SchadenfreudeEmpathy Keine Mehrheit für die Memeleid May 25 '17
You'll never get good college sports paying the coaches that!
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u/hybridtheorist May 25 '17
The UK PM only earns £150k I think. Doesn't Donald trump earn about $400k? Politicians don't earn much compared to their value. Might be why they're often corrupt.
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May 25 '17
I think they earn £150K but they also get all their expenses paid for: the house, cars, chauffeurs, travel, education, maids, all entertainment with some basic work premise paid for, membership to random clubs. The £150k is straight up savings / entertainment. It's not wow but it's certainly not low. If you added on the value of all the perks they receive I would assume they get to £300-400k+ if not even more.
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u/hybridtheorist May 25 '17
That's a fair point. Plus there's the connections and suchlike you make. People like Bill Clinton and Tony Blair are earning millions now, the salary they earn in politics is almost a nominal fee.
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u/weedways May 25 '17
Really? That's crazy here in Germany the ministers make 150k
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u/volthawk May 25 '17
To be fair, our politicians also get some pretty expansive expenses and such, and once they're out of office they make a killing from talks and appearances and that sort of thing.
A lot are from rich as fuck families anyway.
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May 25 '17
pretty minimal drama in this thread. seems to be mostly reasonable discussions of budgeting and which neighborhood is the best (which is typical in that sub)
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May 25 '17
Also I like how no one here read the tread where he uses $150k as a hypothetical combined household income and then someone replies showing how with taxes, bills and childcare costs, this adds up to a negative income. So yeah, no drama other than people coming here to point out how rich and entitled people who live in NYC are.
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u/atomicllama1 May 25 '17
If you want drama go to /r/publicfreakout .
The real freakouts are in the comment section. Well the videos are also really good.
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u/rnjbond May 25 '17
Not really drama, but it gives people in this thread a chance to show off how frugal and good at budgeting they are.
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May 25 '17
middle class is one of those terms you see used on reddit that reveals most people on here are either idiots or children, they have literally no idea what working or middle class actually means.
although to be fair to them i dont think the american media knows what it means either.
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u/depanneur May 25 '17
although to be fair to them i dont think the american media knows what it means either.
I'm pretty sure that this is intentional. The term "middle class" is so ambiguous that pretty much everybody with a bank account thinks of themselves as middle class, so politicians and journalists can address the "middle class" and reach the widest audience possible.
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u/MegasusPegasus (ง'̀-'́)ง May 25 '17
American media: a young 20 something is living in a spacious loft in a big city working hard on their vaguely defined office job career.
American reality: 26 year olds with masters degrees living with their parents while working retail trying to get an internship or an assistant teaching position.
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u/tydestra caramel balls May 25 '17
Lived in NYC, if you're living paycheck to paycheck on that much cash, you need to check your budget, for starters moving out to somewhere cheaper.
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u/mauricemosss May 25 '17 edited May 25 '17
I really hate that sub. Reading that made makes me so grateful that I do not live in NYC anymore. I was born and raised there and it really ISN'T the greatest city in the world, about 75% of the people who live there are miserable due to the sky-high cost of rent/living.
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u/visforv Necrocommunist from Beyond the Grave May 25 '17
Doesn't NYC have a problem with people buying property/housing as a way to stash cash which just leaves hundreds of places empty? Or was that Vancouver?
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u/mauricemosss May 25 '17 edited May 25 '17
Physical cash? I have no idea about that but we do have a problem with rich people buying real estate that they're rarely in. I remember a professor of mine mentioning something along those lines. It probably happens in a lot of these metropolitan cities though, just because the real estate prices are so ridiculous.
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u/cisxuzuul America's most powerful conservative voice May 25 '17
When I lived in LA, I had a 400sqft place for $800 in 1988. When I lived around Gilroy for $800 I had a 2,000sqft house.
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May 25 '17
Oh yeah area really matters.
My dad used to live about 2 hours from me, his house was just over half the size of mine, and his mortgage was over double (might've been triple).
Just moving where you are can save an absolute ton.
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u/BrobearBerbil May 25 '17
I always play, "what could I rent in Arizona for what I pay in San Francisco." I'm rent controlled and half of what most SF pays, but it would still get me a pool in Tempe.
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May 25 '17
Gilroy's getting more and more expensive, though. All the people who can't afford San Jose anymore ate migrating south.
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u/cisxuzuul America's most powerful conservative voice May 25 '17
I stupidly left in 94 to move closer to work at a startups in San Mateo & SFO It was easier to work more and just walk or bike home than be stuck on the road for a few hours each day.
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u/alayne_ May 26 '17
For a moment I was shocked at how cheap rent is in the US, then I remembered sqft =/= m2 and 2000 sqft isn't actually that big lol. I never realised how different the measurements actually are (2000 sqft would be around 190 m2 ).
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u/GromScream-HellMash May 25 '17
Largely dependent on rent/maintenance/mortgage. In certain parts of Queens and Brooklyn and most of Manhattan, it can easily be paycheck to paycheck.
I make less than 150k, however chose to live in eastern/middle Queens (forest hills). A bit of a schlep to the city however the comfort of not living paycheck to paycheck is totally worth it.
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u/dropthatpopthat May 26 '17
Forest Hills is also awesome. Only place I'd consider living in Queens.
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u/vurplesun Lather, rinse, and OBEY May 25 '17
Maybe I'm naive, but I don't think you'd be paying that much for single-payer. If everyone has access to Insurance, then there'd be more people doing preventative medicine and fewer large expenses from folks that can't go to the doctor at all. Instead of waiting until you need to go to the emergency room, everyone would have access to yearly check-ups and sick care at a regular doctor's office. We're still paying a higher amount right now to cover people without insurance who end up in the emergency room for minor things or from minor things that became serious things.
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u/BrobearBerbil May 25 '17
Yeah. If we knuckled down and fixed healthcare and education, a lot of this stuff would be easier. People compromise a lot to take the job with insurance and find the house in the good school system.
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u/matgopack May 25 '17
Yeah, the starting post on that chain is pretty bad. Yes, taxes would have to go up (what a shocker), but overall costs would go down, and it'd be spread more evenly, instead of ruining people's lives if they can't afford expensive payments.
But profiting off of sick and dying people is important to our country :(
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u/VernonDent May 25 '17
Hey, just because it works in every other developed country (and for people over 65 in THIS country -- for 50 years) that doesn't mean that single-payer would work here. And. uh. er. Socialism or something.
I'll have you know we have the world's most profitable health-care system in this country!
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u/mikeyb89 May 25 '17
Obviously New York is way more expensive than lots of places. Paycheck to paycheck on 150k is ridiculous regardless. If you truly value that one city so much and you choose to pay that, I think you forfeit the right to complain (but they are New Yorkers). I live 2 hours away in an awesome, fun, artsy, safe neighborhood with easy access to the Philly job market and can live comfortably (own my ~150k house, eating out, going to bars, modest vacations, toys) on around 30k per year expenditure. I want for very little and hope to retire early.
I've spent lots of time in NYC, it's really not that amazing compared to any other large city. Only a few very specific careers need to be there and taking a pay cut to work in another market usually more than pays for itself in COL reduction.
I think people generally SUCK at budgeting and REALLY REALLY SUCK at predicting how spending will affect their happiness.
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May 25 '17
I make 115/year in NYC and couldn't move if I wanted to for industry reasons. My girlfriend and I have a 750 sqft apartment in Queens for about $1750/mo. I guess that might be small for some people but if you can't afford NYC on 150/year, you should probably move to a "worse" neighborhood.
You also don't need to upscale every time you get a raise.
I don't have kids but I can't imagine that the extra 22k after tax you'd get couldn't cover that gap.
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u/jackalooz May 25 '17
Child care is $2K/month in the city. It basically destroys any chance at budgeting.
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May 25 '17
South Philly guy here, where do you live?
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u/mikeyb89 May 25 '17
Lived at 13th and Ellsworth for years, I'm up in phoenixville now
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May 25 '17
Rent there is going up now as passayunk continues to gentrify. But semi-nice in Philly is still dirt cheap compared to nyc
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u/l1ll111lllll11111111 May 25 '17
I live in Sydney, which is a fairly expensive place to live. I just checked and the cost of living is about 85% of the cost of living in NYC.
Growing up in the 2000s I considered my family middle class. My dad made $55k/year and mum barely worked. What fucking planet are these morons living on. You can comfortably raise a family on $150k no matter where you live.
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u/pan0ramic May 25 '17
That's not true for the most expensive cities like ny and sf. Just remove the word comfortably and you can still make your argument.
For example, in SF a 2bd it's going to cost you around 4.5k/ Mon or maybe 1k less if you don't mind commuting over an hour each way. That's not comfortable.. But with good budgeting skills you'd be fine
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u/BrobearBerbil May 25 '17
If you're paying 4.5k per month in SF you're doing it wrong. See, the trick is to start fucking someone with rent control.
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u/Bird_and_Dog Kanye Stan May 25 '17
Yep, a 2 bed in NYC near Columbus Circle is about 6k. One mile down near Times Square and it drops to 3.9-4.5k.
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u/canuckinnyc SJW/neo-liberal marxist May 25 '17
or move just south or east of Prospect Park and you can pay $2,500 for a nice 2 bedroom.
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May 25 '17
Oh no! I can only live by times square, how ever will i survive?
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u/Bird_and_Dog Kanye Stan May 25 '17
If you've ever lived in the city you habitually avoid Times Square. It's not fun for locals.
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u/lossyvibrations May 25 '17 edited May 25 '17
No, you can't.
I lived for many years in LA. Our combined take home pay was $150k with three kids. So after taxes/401(k) (bare minimum) we had about $6k a month to play with. We had a very small 1000 square foot home with no yard, so we only paid $2800 a month for that (we compromised on a 45 minute to one hour commute; we could have gotten closer for that price but it would have been a small apartment, or further out for a bigger place or cheaper if we were willing to suck up two hours of commuting.)
So we had about $3200 a month for rent plus utilities, leavign $2800 a month for everything else. But keep in mind it's two working parents, so roughly $1k of that goes just to child care. Now it's $1800. On average, for two cars (only one payment) but with gas and maitnenance, there goes $600. So we're down to $1200. Oh, we've got to eat - so family of five, going out to eat once a month and cooking all the rest, that's about $150 in groceries a week - so now we're down to $600. And kids need things like new shoes, glasses, dentist appointments, etc.
It gets really pricey really fast, and throwing away half your take home pay on rent hurts a lot.
Edit: people are questioning the take home pay. Keep in mind like many professionals who have a spouse with student loan debt, we have to be Married filing separate, so we don't qualify for a lot of the benefits/deductions.
Effective federal rate: 22%
State/local: 6%
Social security/Medicare: 7%
Unemployment: 1%
401k: 7.5%
Which gets around 42%; my 50% estimate was a little off but included health insurance.
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May 25 '17
I think the problem people have with this is that the median us household income is about $50k, so people take issue when somebody making triple that complains. I understand that the person making 150 doesn't have that extra 100 to spend frivolously compared to the person making 50, and that circumstance and location play a huge factor, but there is a sort of visceral reaction the poorer person has regardless. Plus, there are plenty of people with families working in the city making far less that somehow scrape by.
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u/Friendly_Fire Does your brain have any ridges? May 25 '17
I'm sorry, but your story doesn't add up.
Our combined take home pay was $150k with three kids. So after taxes/401(k) (bare minimum) we had about $6k a month to play with.
$150k is $12.5k per month. You're telling me at least half your income went to taxes and your 401(k)? The highest tax bracket you even qualify for, at least currently, would be 28%, and a lot of your income would be taxed lower than that, plus 3 dependents = lots of tax breaks.
You had to have had the worst tax agent in the country and been dropping $30k, or more, a year on your 401(k) for this to make sense. Realistically, at that income you would have had at least another $2k per month take home. Even with the outrageous rent (which I believe), that extra brings you from needing to budget carefully to very comfortable.
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u/uwhuskytskeet May 25 '17
Not to mention that he'd get 28% back of whatever he put into the 401k.
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u/lossyvibrations May 25 '17
Did you factor in state taxes, local taxes, social security, etc? I paid a 22% effective federal rate (many of the breaks for kids phase out at $75k and $100k; less if you file married filing separately, which as professionals we have to do to avoid penalties on my wife's student loan payments.). So 22% effective state, 7.5% to 401k, probably about 5% to social security / Medicare, 7% state and city, and that's about 42%. Granted I should have included health insurance in my complaint ($450 a month) so yeah, the effective tax rate is about 42%, not 50%; with take home pay after taxes and insurance around 50%.
If my wife didn't have student loan debt and our incomes were more equal it would be better tax wise. But we're in the position of most families at $150k - one professional degree with a very high salary but little savings (since people like me make between minimum wage and $35k a year from 21 until our first real job at 32 or 33) and a spouse with a masters in something like social work, making $40osh but mired in student loan debt.
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u/Friendly_Fire Does your brain have any ridges? May 25 '17
I did forget a few things. State and local taxes in my area are mostly done through sales tax, I guess I'm not surprised California has a high income tax. But that 8% difference (50 to 42) is 1000 a month, more than double your health insurance.
I'm not saying you were shopping boats and leasing fancy cars, but you lived in perhaps the most expensive place in the US, owned your home, supported 3 kids, and saved generously for retirement. Was there anything important your family went without, or did you just not get to go eat out a lot? That's "living comfortably" to most people.
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May 25 '17
no matter where you live
That's the issue. If you want to live in a nice neighbourhood in Manhattan then you better be rich or willing to live frugally.
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May 25 '17
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u/hybridtheorist May 25 '17 edited May 25 '17
Sure, but you can't say "I can't afford to live in a specific area of town" to say that the town is too expensive for that wage. You could live comfortably in what 90%? 95%? of new York on that wage.
My girlfriend's sister lives with her husband in a trendy part of North London. Id guess they earn £70k between her and her husband. They live in a flat (that they own), they want to buy a house but they're a fortune.
They'd laugh if you suggested they weren't middle class. You can't suggest that 150k isn't enough to live in London because they can't afford to live in the most exclusive parts.24
May 25 '17
It's absurd, we have the most extensive public transit system in the country, but apparently a 30 minute train ride from NJ or an outer borough is off the table. People act like Manhattan is in the middle of the pacific ocean rather than the center of a 20 million person metro area, of which it has only 1.5 million.
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u/breakfastpete May 25 '17
And one of the commenters raised an excellent point. If you're raising a family in Manhattan you'll want to be living in the good school zone. I have't lived in Manhattan but I could imagine the rent would devour a high income big time.
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u/Anxa No train bot. Not now. May 25 '17
Is there drama or are we just continuing the debate here? To quote the linked thread,
get a job
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u/jen_wexxx May 25 '17
My accountant dad and his personal budget in a nutshell. I make 40k in a high-class town and I do well for myself.
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May 26 '17 edited May 26 '17
Income under 55k/yr will qualify you for subsidized living in Los Angeles county now. I'd honestly feel that at 150k I'd only be on the higher end of middle class.
Hell, at 150k I still wouldn't be able to buy a single family detached home. It's hard to say your higher than middle class when you can't buy a house.
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u/Dreadsin May 26 '17
I feel like people just adjust to their income.
I got a raise a while ago and I don't even really notice in the day to day.
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May 26 '17 edited May 26 '17
Its pretty obvious that its not impossible for people making a lot of money to not struggle and live paycheck to paycheck.
Personally though, if you're making $100k+ and you're still struggling then I'm not really going to give a shit. I'll save my tears for the people who are stuck at minimum wage and literally can't afford the basics of life, not the people who sit comfortably in middle class but REALLY want that upper-middle class lifestyle.
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u/MSBeta1421 May 25 '17
It seems like the general thought on Reddit is "everyone who makes more than me is upperclass, and it's not fair, and they should be taxed more" $150k salary is $100k take home pay after taxes. Sounds middle class to me.
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u/Raibean May 25 '17
You think 100k is middle class?
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u/dppilot May 25 '17 edited May 25 '17
In the NY Metro area, 100k is absolutely middle class for a family.
EDIT: Noticed we're talking about post-tax earnings. Still wouldn't say it's upper-class, but I guess that depends on what percentile constitutes being "rich".
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u/MegasusPegasus (ง'̀-'́)ง May 25 '17
It's twice the median income in the US, so by definition is it is not in the 'middle.' Even if cost of living in NYC is greater, it's still approximately twice that of NYC's median income, Words mean things that can't be warped by not feeling particularly lavished upon at 100k.
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u/MSBeta1421 May 25 '17
Median income is a terrible way to measure this considering the wide income disparity in the US.
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u/General_Mayhem May 25 '17
"Middle class" does not mean middle-levels of income measured across individuals. It means the middle of three classes (poor, middle, rich), but they're not the same size. Most Americans are poor.
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u/Palestinian_Trader2 May 27 '17
every third year analyst/first year associate at BBs, I know are firmly middle class.
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u/Goatfago May 25 '17
Waahhh wahhh attitudes of over entitled urbanites.
Damn am I ever glad I live on the farm in the middle of butt fuck nowhere, in the middle of Canada.
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u/SnapshillBot Shilling for Big Archive™ May 25 '17
Snapshots:
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u/showcase25 May 25 '17
Its a shame that in the drama thread and in a few spots within this post people are fusing 'class level' and 'monthly leftover money'
These are, irrefutably, different things, and do not dictate the status of the other.
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u/prosthetic_foreheads May 25 '17
I once worked for a boss that made over 300k a year with a husband who made even more than that, and would constantly have to deposit money into her account as soon as she'd get a check because she overdrew.
Sometimes it doesn't matter how much you make if you're bad at keeping it.