I agree about making $500k not being really that much especially when you have two kids in private school, stay at home wife (which I am proud of) who knows how to spend money (not necessarily on herself but on the kids), vacations, dining out several times a week, etc. etc. etc. Plus putting money aside, investing in certain ventures and buying toys. Also, I can't believe someone with $95k living in a $500k house, driving an MB can do it. BTW, I am in the 4th bracket and it still doesn't seem to be enough.

 

That's sad. Net 30K a month, can't cover expenses? College for kids should have been no surprise - had 18 years to figure that out and save for. All you had to do was put away for a couple years with that salary and bam its done..

I assume someone making that money for any length of time would have their house paid for or only owe 2-300K, maybe 1-2MM house depending on area and recent appreciation. 1800 a month plus taxes, maint ins, oh hell, just call it 3K a month total

2 cars= 2200 a month
2 kids cars = 700
house = 3000
dining out = 1000
vacation svgs = 1000
investing = 3000
school not saved for = 4000
misc. "habits" = 2000
hobby.. = 500
wife shopping = 1000
kid misc = 1000
food/utils/misc = 1000
..

this leaves you with almost 10K a month to snort, light on fire, give to charity or whatever. If one had any responsibility with making that money only a couple years ago, there would be plenty of money to pay cash for everything, or even to have made more investments that generate much higher cash flow.. which would make that equation even more lax.

in all seriousness... where does it go?!?! Only thing I can think is wasting money or buying needless things. Hopefully you were speaking more metaphoricly.

 

Brav:

Interesting analysis. I can tell you as a self-employed person that sel-employment and income taxes take a bigger bite than you're giving credit for. Plus insurance, plus sending money to aging parent, plus you've got to put furniture in that expensive house, and there's always something like a sick animal or broken appliance to take care of...

And try to get out of any MB dealer for less than $500!

Oh and property taxes on a 1M house in Texas run about 20K per year - so if you had a $500 K loan your payments are more like $6500 per month for a 15 year mortgage.

 

I'm self employed too - sharpen your pencil! Or fire your CPA. Realisticly, you are gonna pay 35% or so but with deductions, etc etc its very reasonable to say you will keep 75% "real" income. Texas property taxes are pretty high - based on footage or price?? In CA - if you buy a home at 300K and its now 1MM, your tax rate is basically based on that 300K + 2% a year.. So unless you JUST bought ahouse, a tax rate based on current valyue does not apply. Someoen concerned about cash flow should not be on a 15 year mortgage. Even so - someone established like this at that point has had years to save, let alone pay off the house at this point, shou,d be fine with it and have money saved for college, etc - and outside income sources.. It is one's own choice in most cases to buy a bigger house every 3-5 years and/or not pay for college and/or not pay down your house.

Yea - I just got out of a service for breaks and some misc stuff - 501.75.

I just get pissed off when I see the top 5% of the income bracket complaining about this crap. We should be so lucky to have so many problems like "oh poor me I have to pay for my 3 benz's, my kids wooptee-do school, my 2MM house, and all the champaign and caviar we feed the dogs.." Give me a break.. people need to stop competing with the "Jone's" so much and appreaciate what they have. We are soley responsible for the standard of living we choose vs the income we have. We all wonder "where it goes" but at a certain point, come on..

Point is - one could easily scale back and still live a comfortable life with fewer expenses. For example- Drive an E500 instead of an E55 Probably saved me 8-900 in payment, gas and ins.. extend that philosophy to all your purchases and voila (sp).

 

Texas property taxes are based on current market value of your home - and they are very eager for your home to appreciate!

I'd be delighted if I could take home 75% of my income but it's not gonna happen. There just aren't many deductions in my business. I don't use the car etc for business. And self employment tax is an additional 15% for the first 90K and then there's the 3% MEDICARE TAX that's on all your income. Plus professional liability insurance - I'm an MD - which is huge.....

 

Brav:

Don't get me wrong that $500k is not enough but just does not go as far as what people think. BTW, my level of income has been so just in the last couple of years. I do sock away quite a bit more in cash, investments and money to charity so I guess that were it goes.

 

Good to hear

Actually I do know what you mean. It is a little different for me, as I am younger, but people think if you have a nicer than avg house and a benz that money is minted from your @ss and kind of label you in a way as one of "those." Where expense is no object, kinda thing. My friends are stupid - "dude, are you like a millionare -you are going to have a private jet soon." yea... they can't quite quantify reality.

I don't make quite that much, but I'll tell you, being single and 24, I would be ecstatic with another couple 100K.

 

Being single and making that much, I would have to say that you are probably better off than I am so enjoy. BTW, watch out for those gold-digger women.

 

I've been lucky thus far - last weekend the girl im seeing (college student) paid my way on a vegas trip

And I have 2 girls that live with me that pay about 1/3 of my housing expenses.. can't be that bad - just call me jack

 

Don't hate the play'a---Hate the game!

 

I think that greed is a b$%@ once you start making 500K you want more and more money. But I think that we do have a certian right to complain considering that we do account for 65-70% of all the taxes collected in the US. Come on thats saying somethng... that the rest of America gets off with almost no taxes... about 1,900 is the avg. taxes collected. WTF thats what I almost spend in gas 3 months. I am very glad to know what I have but I wouldnt mind making another 100 or 200K. Right now Im in the stock market for -200K. Thats bs is what i think... my opinion is if you have to money buy buy and buy some more. But the wife and kids can add up, not to mention a divorce. Thats by far one of the most detramenting to the income. Thank God I have a girlfriend who can hold her own. Anyways my point is that we do have a right to complain.

 

Also at those levels of income, time becomes a valuable currency itself. You will gladly pay $ for someone else to do something to free up a few hours here or there.

 

gmdebruyn: I tottaly agree with you on this sometimes I find that 24 hours in a day isnt enough.