http://www.financialsamurai.com/scraping-by-on-500000-a-year-high-income-earners-struggling/

Pretty interesting article. I don't see anything egregious about this budget. Two cars in NY is a waste, and THREE vacations for the family and lessons for the kid is a luxury (though hardly outrageous). I would say you can't afford to give that much to charity.


Probably not that surprising - NYC is nearly 2.5X the COL index of Columbus. Still pretty shocking to see how a family of four lives in NYC (Brooklyn, actually) for $500k a year.

Of course, things change dramatically if one or both eventually makes partner at the law firm. On the other hand, it changes dramatically in the other direction if there's an up-or-out policy and neither makes partner - where they then fight for a limited number of corporate jobs with a decent pay cut.

These morons need to STFU and move to New Jersey.

Automatik;1844409 wrote:These morons need to STFU and move to New Jersey.

They'd save some on housing (although they already live in Brooklyn), and a little on taxes. But with jobs in NYC, there's no escaping the hefty amount of federal and state tax on their incomes.

Maybe $30k, and they could easily squeeze another $30k out doing away with some luxuries. Still wouldn't make them "rich", despite earning half a million a year.

Those taxes are obscene.

I'm just not buying this sob story.

My coworker lives on the Upper West Side. Has two toddlers. Combined, they aren't sniffing 500k total income. They also have one car.

Automatik;1844417 wrote:I'm just not buying this sob story.

It's not really a sob story. It was a research piece done by a journalist to illustrate the higher costs of living that come with earning more money. Yeah, they have some room to tighten the belt, but it's nowhere close to "livin' large".

justincredible;1844416 wrote:Those taxes are obscene.

I think what is misleading by all of it is the second income is $250k, but the "hidden" costs stemming from that result in "only" kicking in like $80-$90k to the pot.

42k for childcare? I feel like it's expensive here and it's 1000 to $1200 a month per kid. I guess don't live in NYC? Why do they have a $1.5M house?
I guess I'd trade in a higher salary (which I do) for living in a place that doesn't cost that absurd amount. I also find the example salaries way too high for "right out of business school" even if it's a top 10 school and a "couple years" out of law school.
Live within your means. Don't keep up with the joneses, and save as much as possible to retire sooner.


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gut;1844423 wrote:It's not really a sob story. It was a research piece done by a journalist to illustrate the higher costs of living that come with earning more money. Yeah, they have some room to tighten the belt, but it's nowhere close to "livin' large".

Then what is "living large"?

They have 2 kids, 2 cars, give 18k to charity, 3 vacations, etc. in one of the most expensive cities in the fucking world.

Automatik;1844428 wrote:Then what is "living large"?

They have 2 kids, 2 cars, give 18k to charity, 3 vacations, etc. in one of the most expensive cities in the fucking world.

They wouldn't make $500k living in Cbus.....and $18k to charity is only about $11k out-of-pocket at their tax rates, and the author said that's pretty typical for those incomes. I mean, you're really going to hate on them for giving that much to charity?

They live on $500k BECAUSE they live in one of the most expensive cities in the world. But they're clearly not rich.

We may have different definitions, but to me "livin' large" would be a house in the top 5-10% of where I live, an $80k+ car, $20k+ dining out every year, several vacations in the $10-$20k neighborhood....easy enough to do in many cities on $500k, just not in NYC.

iclfan2;1844427 wrote:I guess I'd trade in a higher salary (which I do) for living in a place that doesn't cost that absurd amount. I also find the example salaries way too high for "right out of business school" even if it's a top 10 school and a "couple years" out of law school.
Live within your means. Don't keep up with the joneses, and save as much as possible to retire sooner.

That's very reasonable housing cost in Brooklyn....think they said it was 1700 sqft. I think good areas of Manhattan now are running over $2000 per sq. ft.

And those salaries for b-school grads is in the ballpark....specifically said Banking and Private Equity, which 3 years out will top $400k. But it's a small percentage from top schools that make VP in banking, or go into private equity.

That's part of the reason so many from top schools go do banking or management consulting for a few years, but most burn out or just don't cut the mustard.

LOL I know a decent amount of people who live in NYC and even grew up in NYC. Their families are easily getting by without making 500K. NYC is ridiculously expensive, but 500k is more than enough to get by. Give me a fucking break.

That article was tough to read. So fucking stupid.

gut;1844446 wrote:They wouldn't make $500k living in Cbus.....and $18k to charity is only about $11k out-of-pocket at their tax rates, and the author said that's pretty typical for those incomes. I mean, you're really going to hate on them for giving that much to charity?

They live on $500k BECAUSE they live in one of the most expensive cities in the world. But they're clearly not rich.

We may have different definitions, but to me "livin' large" would be a house in the top 5-10% of where I live, an $80k+ car, $20k+ dining out every year, several vacations in the $10-$20k neighborhood....easy enough to do in many cities on $500k, just not in NYC.

No I'm hating on this article. They picked an outlier family that fits their narrative perfectly. It's garbage.

"Scraping by"

"Paycheck to paycheck"

DONATES $18,000 TO CHARITY. LOL

Let's keep going....

3 full week vacations. A Toyota Landcruiser and a BMW 5 series, not an easy to maintain, practical sedan....a fucking 5 Series. The horror!

Automatik;1844472 wrote:No I'm hating on this article. They picked an outlier family that fits their narrative perfectly. It's garbage.

"Scraping by"

"Paycheck to paycheck"

DONATES $18,000 TO CHARITY. LOL

Let's keep going....

3 full week vacations. A Toyota Landcruiser and a BMW 5 series, not an easy to maintain, practical sedan....a fucking 5 Series. The horror!

I agree with you, they should have labeled the article something like 500k doesn't go as far as you think in NYC, not "scrapping by".

Limit the vacations to 1 and boom, 12K extra, limit the cars as most people in NYC use public transportation anyway and you save at least $5k. I am not dissing the $18k in charitable donations, that is only like 3% of their gross, not a huge amount.

Their car insurance could be dropped in at least half (see above), no reason to spend $10k/year on clothes for 4 people. Seriously, even in NYC that is absurd if you are "scraping by". Knock that down to $5k and all the sudden you are saving $30k/year on that budget, and I didn't even touch the piano lessons...

gut;1844423 wrote:It's not really a sob story. It was a research piece done by a journalist to illustrate the higher costs of living that come with earning more money. Yeah, they have some room to tighten the belt, but it's nowhere close to "livin' large".

One person's need is another person's poor choices. The lifestyle in question doesn't "come with" the income. One could live very nicely and still have significantly more to invest with better decisions. Even in NYC.

I'm with some other posters on here, you can't do everything on $500k a yr in one of the most expensive cities in the world. They do everything today, and sacrifice tomorrow. Balance between that is crucial, these nincompoops are one sided on that scale.

queencitybuckeye;1844482 wrote:One person's need is another person's poor choices. The lifestyle in question doesn't "come with" the income. One could live very nicely and still have significantly more to invest with better decisions. Even in NYC.

Yes, but again they aren't THAT wasteful....you could go from $20k leftover to maybe $40-$50k. That's not rich, and that's the point of the article that $500k in NYC does not make you rich.

$30k student debt each year to pay for the education that got them those $250k jobs. The point I would make is they actually aren't getting much return on that second $250k income given the cost/taxes/investment. Basically mom goes and gets a $250k job so you can send your kids to private schools, and that's about all you get out of it.

The couple (who are most likely fabricated) are fuckheads.

Stop being a fuckhead apologist.


Also, newsflash: 500k here isn't considered rich. Who made that claim in the first place?

Hell, a 100k salary in Ohio and you've "made it" right? Not here.

gut;1844521 wrote:Yes, but again they aren't THAT wasteful....you could go from $20k leftover to maybe $40-$50k. That's not rich, and that's the point of the article that $500k in NYC does not make you rich.

$30k student debt each year to pay for the education that got them those $250k jobs. The point I would make is they actually aren't getting much return on that second $250k income given the cost/taxes/investment. Basically mom goes and gets a $250k job so you can send your kids to private schools, and that's about all you get out of it.

I can save them close to $36k a yr be eliminating Charity and Vacations. Going to PR is nice, but doesn't need to happen 3 times a yr. Pick up hiking, cheap and easy fun. Stop being an idiot with your car choices. Not that difficult.

gut;1844521 wrote:Yes, but again they aren't THAT wasteful....you could go from $20k leftover to maybe $40-$50k. That's not rich, and that's the point of the article that $500k in NYC does not make you rich.

Depends on your goals. Mine would not be to "live rich" which can be income-based, but to become rich in a relatively short period of time. I easily took $50,000 out of the expenses without a significant change in lifestyle. Some of the justifications in the article are ludicrous. People who spend $12K on their little dullards' hobbies will end up with at least one kid sucking dick in a Greyhound station bathroom. The notion that one has to spend $10K to get a couple of reliable cars is laughable. Even if it were true, the notion that they can't be bothered to take the car in for maintenance or repairs is actually kind of pathetic, in a "living the rat race" kind of way.

queencitybuckeye;1844526 wrote:Depends on your goals. Mine would not be to "live rich" which can be income-based, but to become rich in a relatively short period of time. I easily took $50,000 out of the expenses without a significant change in lifestyle. Some of the justifications in the article are ludicrous. People who spend $12K on their little dullards' hobbies will end up with at least one kid sucking dick in a Greyhound station bathroom. The notion that one has to spend $10K to get a couple of reliable cars is laughable. Even if it were true, the notion that they can't be bothered to take the car in for maintenance or repairs is actually kind of pathetic, in a "living the rat race" kind of way.

Jesus!

many of the b-school grads that opt for NYC careers in the financial industry have effectively lost the plot in life (my opinion). They often get into that work not for any particular passion for it, but because they hope to make obnoxious amounts of money and gain status among other similarly situated people. That is sad, because that world is very small and limiting with terrible values. I would guess many have drug and alcohol problems because they work with assholes, the pressure it high and no matter what they earn, there will always be someone who earns more and has bigger toys.

^^^ding ding ding!

I have a friend who makes 300k+. He's miserable and socially awkward.

That being said, I have another friend in the same field, who's crushing it in all facets of life.