No, I believe it is only the last 3 months of interest you give up if you cash out within 5 years. I assume this locks up money no more than a mortgage pay downXXXVII said:GE said:Given where interest and inflation rates are going, consider diverting your $500 extra mortgage payment to I-bonds if you haven't already reached the limit on those.XXXVII said:
My wife and I make well over $250k combined. I max out my 401k to save for retirement and reduce our current tax burden. I also pay $500 extra on our mortgage each month. Before 2022 we could save $5000 per month by living below our means. This year it is getting difficult to save more than $2000 each month without making additional sacrifices.
Does that lock up my money for at least 5 years if I don't want to lose the interest?
One-Third of Americans Making $250,000 Live Paycheck-to-Paycheck, Survey Finds
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Last: 1 mo ago by redassfella2024
Might sound obnoxious but I probably spend $20K a month. Seems like it's always something. Have to go somewhere, something breaks, someone needs something.
You don’t trade for money, you trade for freedom.
YouBet said:Well, I said you could if you are single, but you aren't going to be living large. And that may not be a priority at all which is cool. You will need to figure out healthcare for a few years until Medicare kicks in. That may not be cheap and may not cover what you need.LMCane said:au contraire mein AggieYouBet said:I hate to tell you this but you aren't retiring in 6 years if you only have $700K right now and expect to live to the normal statistical age or beyond it.LMCane said:GE said:LMCane said:
but at the same time I am on pace to retire a millionaire by age 57. (6 years)
so I have $700K in savings/401K/personal brokerage/crypto (not including half million dollar house) but only a few hundred dollars in cash
Only way you pull that off is if you are single and you plan on living in a box eating ramen every meal, or crypto skyrockets to lotto levels.
I am single, with an additional $105,000 in equity already in my house in Maryland that I am not counting on.
I just put $40,000 into the stock market at years long lows
you don't think a single person with no kids can retire on a million dollars in savings, $3445 a month in social security, and a house nearly paid off?!?!
agreed. I also have Israeli citizenship and they have more inexpensive health care from ages 60-65 until Medicare kicks in.
with Social Security trust fund running out now in 2034 (as of yesterday) I will start taking benefits the earliest possible date (not sure if this is at 62 or possibly 60)
Income between 250-350k depending on the year.
I cannot imagine how anyone has a problem making ends meet each month. We come up short in many months that we buy furniture or do upgrade/update to house or cars ... for reference, my housing cost is 6k and one 400 dollar car note.
My only thought is people eat out far too much or have expensive car / boat. At this level a vacay home is out of picture for most part.
Our money is typically wasted on my wifes clothes. Other than that we are fully operating adults.
I cannot imagine how anyone has a problem making ends meet each month. We come up short in many months that we buy furniture or do upgrade/update to house or cars ... for reference, my housing cost is 6k and one 400 dollar car note.
My only thought is people eat out far too much or have expensive car / boat. At this level a vacay home is out of picture for most part.
Our money is typically wasted on my wifes clothes. Other than that we are fully operating adults.
I was at a party last night and a few of us were sharing our incredulity about all of the houses going up in DFW that are $2M. Everyone confused where the money is coming from. And this is a well off group.
Even factoring the California immigrants it seems impossible. My wife actually has an employee building a house around the corner from us that's a $2M mansion and we are just in awe because she obviously knows what his income is and what his wife does. There is no way in hell their income can afford that house.
So we all came to conclusion that much of this must be the boomers dying off and a lot of people are building with inheritance or gifted money. I just wonder how many of these people are factoring the TCO of these homes.
Even factoring the California immigrants it seems impossible. My wife actually has an employee building a house around the corner from us that's a $2M mansion and we are just in awe because she obviously knows what his income is and what his wife does. There is no way in hell their income can afford that house.
So we all came to conclusion that much of this must be the boomers dying off and a lot of people are building with inheritance or gifted money. I just wonder how many of these people are factoring the TCO of these homes.
When we were young and growing a family (at times on 1 income), the major concession we made was very little travel.
I've never been to Vegas. Never been to Hawaii. Never been to NYC. Never been to Europe. Our vacations were almost always a few days in Padre, Galveston or the Hill Country and we'd split the cost of a rental with family. We never did weekend getaways and almost never flew.
Every five years or so, we'd splurge and take the kids to Disney World.
We also stayed in our "starter home" for more than 20 years, until we were busting at the seams and it was almost paid off.
And we drove old, inexpensive used cars until they were falling apart. Then we'd buy another old, inexpensive used car. When I finally starting making a little money, I started buying nicer cars, but they were always used. To this day, I don't buy new cars.
I don't regret any of those choices. I'm trying to catch up on some of what we missed out on now, and we certainly don't pinch pennies anymore. But that's how we got by.
It ain't easy, but if a young couple today is willing to forego some of what others deem "necessary," they can do it.
I've never been to Vegas. Never been to Hawaii. Never been to NYC. Never been to Europe. Our vacations were almost always a few days in Padre, Galveston or the Hill Country and we'd split the cost of a rental with family. We never did weekend getaways and almost never flew.
Every five years or so, we'd splurge and take the kids to Disney World.
We also stayed in our "starter home" for more than 20 years, until we were busting at the seams and it was almost paid off.
And we drove old, inexpensive used cars until they were falling apart. Then we'd buy another old, inexpensive used car. When I finally starting making a little money, I started buying nicer cars, but they were always used. To this day, I don't buy new cars.
I don't regret any of those choices. I'm trying to catch up on some of what we missed out on now, and we certainly don't pinch pennies anymore. But that's how we got by.
It ain't easy, but if a young couple today is willing to forego some of what others deem "necessary," they can do it.
sure looks like it
no everyone has to be a doctor to be making mid six figures household.OasisMan said:
yep
"mo money, mo problems"
income goes up, peoples lifestyle goes up, with a majority of people trying to max out lifestyle
im a doc, still living in the house i was in in residency, my truck is paid off, wife just bought a corolla in cash,
and i wonder all the time how all these people are affording 80+k trucks and 750+k houses on non-doc salaries
We, combined, pull in around $375k... professional degrees help these days.
People also have different lifestyle decisions. I quit judging people either way. Just because you have a nice house, doesn't mean you are beyond your means. Same if you have a nice car, or a boat, etc.
Had a coworker rant to me about how terrible new car prices and loans are, and how dumb anyone who buys one is (he'd fit in well here), about 10 minutes after telling me he joined a country club for $75k, no type of equity in it, fee that he loses if he quits his membership.
Life sucks if all you do is work and sit at home. People have different ideas of what they want to spend their money on for enjoyment. Who am I to judge either way. My coworker spends his money and time on golf. I have a nicer car and have some cheaper hobbies, such as running. Neither my coworker nor myself are right or wrong. We just disagree.
Had a coworker rant to me about how terrible new car prices and loans are, and how dumb anyone who buys one is (he'd fit in well here), about 10 minutes after telling me he joined a country club for $75k, no type of equity in it, fee that he loses if he quits his membership.
Life sucks if all you do is work and sit at home. People have different ideas of what they want to spend their money on for enjoyment. Who am I to judge either way. My coworker spends his money and time on golf. I have a nicer car and have some cheaper hobbies, such as running. Neither my coworker nor myself are right or wrong. We just disagree.
In principle, totally agreed. No need to worry about other people's lifestyle choice. And I think the concept of tradeoffs is spot on. Our family sacrifices nice vacations because we like having a nicer home. We drive used cars, but spend more on other toys. It'd be easy to judge individuals who have it 'together' by elements of their lifestyle. Probably not fair on a case-by-case basis. I'm sure we'd be judged by our home by many in our circles.
However, the statistics for net worth and retirement savings across the population are awful. A couple of practical concerns about people living beyond their means:
- I think we'll continue to see social policies ramp up. Case in point, student loan forgiveness. I worked and sacrificed to pay off my student loans. Do people do the same today? I think most people on this board would agree that recent graduates have a higher quality lifestyle than previous generations of recent graduates. And many, like myself, are concerned about footing the bill and enabling said lifestyle.
- Similarly, I think there's a cliff in the future for retirement savings, and sadly, I think there's a real chance that social policies will continue to punish those who saved and sacrificed diligently over their working careers.
- Finally, and this is just my opinion, I think people have inflated certain goods by purchasing above their ability. For example, do you really think most people buying new cars can really afford them? And, do you think new trucks would be $80k if people weren't buying them en mass?
However, the statistics for net worth and retirement savings across the population are awful. A couple of practical concerns about people living beyond their means:
- I think we'll continue to see social policies ramp up. Case in point, student loan forgiveness. I worked and sacrificed to pay off my student loans. Do people do the same today? I think most people on this board would agree that recent graduates have a higher quality lifestyle than previous generations of recent graduates. And many, like myself, are concerned about footing the bill and enabling said lifestyle.
- Similarly, I think there's a cliff in the future for retirement savings, and sadly, I think there's a real chance that social policies will continue to punish those who saved and sacrificed diligently over their working careers.
- Finally, and this is just my opinion, I think people have inflated certain goods by purchasing above their ability. For example, do you really think most people buying new cars can really afford them? And, do you think new trucks would be $80k if people weren't buying them en mass?
One of the biggest issues hurtling towards us is long-term care. No one is talking about and vast majority have no idea how insanely expensive it is.
And everyone is living longer. Couple that with little savings in this country and it's time bomb.
Context: FIL pays $8k+ per month to live in memory care. People have no clue what's coming.
And everyone is living longer. Couple that with little savings in this country and it's time bomb.
Context: FIL pays $8k+ per month to live in memory care. People have no clue what's coming.
oh certainly, did not mean to imply thatChoppinDs40 said:no everyone has to be a doctor to be making mid six figures household.OasisMan said:
yep
"mo money, mo problems"
income goes up, peoples lifestyle goes up, with a majority of people trying to max out lifestyle
im a doc, still living in the house i was in in residency, my truck is paid off, wife just bought a corolla in cash,
and i wonder all the time how all these people are affording 80+k trucks and 750+k houses on non-doc salaries
We, combined, pull in around $375k... professional degrees help these days.
But 375k household income is a national outlier
Expensive cars + expensive houses are not outliers
Eh, I saw the response before the wipe, and understand/agree with the sentiment.
Yeah...this is frightening honestly. Wife and I comfortably bring in over 300k per year, but my mom lives with us and has a paltry IRA and has zero plan for LTC when needed, just assumed she'd qualify for Medicaid or whatever because of her lack of income.YouBet said:
One of the biggest issues hurtling towards us is long-term care. No one is talking about and vast majority have no idea how insanely expensive it is.
And everyone is living longer. Couple that with little savings in this country and it's time bomb.
Context: FIL pays $8k+ per month to live in memory care. People have no clue what's coming.
username does not check out$30,000 Millionaire said:
Might sound obnoxious but I probably spend $20K a month. Seems like it's always something. Have to go somewhere, something breaks, someone needs something.
Is it okay to live paycheck to paycheck if I plan on inheriting 5 million in cash and another few in assets? Asking for a friend
No. Are you planning on continuing your bad money habits with that $5M? Then no again.tlepoC said:
Is it okay to live paycheck to paycheck if I plan on inheriting 5 million in cash and another few in assets? Asking for a friend
California equity and inheritance probably explains a lot of it. What I don't understand is how people are paying the note on a $2M house and the property taxes on it. A $2M house in North Dallas has to have $40K+ per year in property taxes.YouBet said:
I was at a party last night and a few of us were sharing our incredulity about all of the houses going up in DFW that are $2M. Everyone confused where the money is coming from. And this is a well off group.
Even factoring the California immigrants it seems impossible. My wife actually has an employee building a house around the corner from us that's a $2M mansion and we are just in awe because she obviously knows what his income is and what his wife does. There is no way in hell their income can afford that house.
So we all came to conclusion that much of this must be the boomers dying off and a lot of people are building with inheritance or gifted money. I just wonder how many of these people are factoring the TCO of these homes.
Personally, I think the next couple of years could get spicy in many areas as people didn't factor taxes into their house calculation.
Property taxes are one reason I'm probably going to be in my current house as long as I live in Houston. Every time I get the itch to look at a new house I can't get over what the increase in property taxes would be. In most cases the taxes alone would be more than our current P+I+Escrow amount, and I'd much rather save that money to invest or travel.
It absolutely does.Stymied said:California equity and inheritance probably explains a lot of it. What I don't understand is how people are paying the note on a $2M house and the property taxes on it. A $2M house in North Dallas has to have $40K+ per year in property taxes.YouBet said:
I was at a party last night and a few of us were sharing our incredulity about all of the houses going up in DFW that are $2M. Everyone confused where the money is coming from. And this is a well off group.
Even factoring the California immigrants it seems impossible. My wife actually has an employee building a house around the corner from us that's a $2M mansion and we are just in awe because she obviously knows what his income is and what his wife does. There is no way in hell their income can afford that house.
So we all came to conclusion that much of this must be the boomers dying off and a lot of people are building with inheritance or gifted money. I just wonder how many of these people are factoring the TCO of these homes.
Personally, I think the next couple of years could get spicy in many areas as people didn't factor taxes into their house calculation.
What will happen is that we are going to go back in time where elderly parents move back in with their kids like you are doing. Families will have to take care of their own. This is what used to happen before modern America came along.Pahdz said:Yeah...this is frightening honestly. Wife and I comfortably bring in over 300k per year, but my mom lives with us and has a paltry IRA and has zero plan for LTC when needed, just assumed she'd qualify for Medicaid or whatever because of her lack of income.YouBet said:
One of the biggest issues hurtling towards us is long-term care. No one is talking about and vast majority have no idea how insanely expensive it is.
And everyone is living longer. Couple that with little savings in this country and it's time bomb.
Context: FIL pays $8k+ per month to live in memory care. People have no clue what's coming.
The only reason we are able to have my FIL in memory care is because he did well for himself in life so we are just bleeding off his estate to cover it. There is no way we could afford to do this otherwise and I can't freaking imagine having someone who is now full blown Alzheimer's in our house. We would do it if we had to but my gosh what a hardship for families coming.
My mom's mom lived with us growing up, so it's not a foreign thing for us, biggest hurdle is she lives in our basement and as she ages getting up and down those steps will be an issue. Moving really isn't an option at the moment so hopefully she can stay healthy enough to maneuver around (she's only 70 so knock on wood).
Well, kudos to you for doing this.Pahdz said:
My mom's mom lived with us growing up, so it's not a foreign thing for us, biggest hurdle is she lives in our basement and as she ages getting up and down those steps will be an issue. Moving really isn't an option at the moment so hopefully she can stay healthy enough to maneuver around (she's only 70 so knock on wood).
you're not kidding. Throw in a refinance at historic lows and I feel like I may be trapped in my house forever.jh0400 said:
Property taxes are one reason I'm probably going to be in my current house as long as I live in Houston. Every time I get the itch to look at a new house I can't get over what the increase in property taxes would be. In most cases the taxes alone would be more than our current P+I+Escrow amount, and I'd much rather save that money to invest or travel.
I've been avoiding this thread because I knew it would make me ill.
I'll gross closer to $200k this year than ever before (but won't quite make it). Single, one kid. I do max out my 401k and HSA, so net is significantly less.
No car payment and my mortgage (not including taxes and insurance) is $1500/month.
And I'm sitting here worried about my utility bill doubling and my property taxes going up. And I felt slightly guilty for paying $350 to upgrade us to business class on our 5 hour overnight flight.
Geez…I'm doing it wrong.
Like others, I'm wondering where the $ for real estate is coming from. My 'hood has always been on the high end…lots of $500-$700k homes with 2-3 kids and SAHMs. But those houses are now $900-$1M. I'm a PhD engineer and do well for my education/years of experience. Lots of neighbors work in the same industry as I do. It's hard for me to imagine someone in engineering/finance who isn't a VP is making much more than that. But maybe I'm way off.
There was a 2400 sq ft just up from me that recently went under contract in two days for $700k+
I'll gross closer to $200k this year than ever before (but won't quite make it). Single, one kid. I do max out my 401k and HSA, so net is significantly less.
No car payment and my mortgage (not including taxes and insurance) is $1500/month.
And I'm sitting here worried about my utility bill doubling and my property taxes going up. And I felt slightly guilty for paying $350 to upgrade us to business class on our 5 hour overnight flight.
Geez…I'm doing it wrong.
Like others, I'm wondering where the $ for real estate is coming from. My 'hood has always been on the high end…lots of $500-$700k homes with 2-3 kids and SAHMs. But those houses are now $900-$1M. I'm a PhD engineer and do well for my education/years of experience. Lots of neighbors work in the same industry as I do. It's hard for me to imagine someone in engineering/finance who isn't a VP is making much more than that. But maybe I'm way off.
There was a 2400 sq ft just up from me that recently went under contract in two days for $700k+
South Platte said:
I feel like I'm the only one of my friends/acquaintances that isn't living in a $500,000+ house. I can't believe the number of people in their 30's living in homes pushing toward $1m. Maybe family money?
A lot of it is family money, but not necessarily in the form of "they bought the house for them" (though that does happen more than people really think), but also in the form of downpayment assistance as well as people who "rented" from one of their parents extra homes for their first few years out of college and then were allowed to pocket the sale price of the house when they bought their first home.
South Platte said:Do you live in MD or is that an investment property? I discourage people from including primary home equity in their net worth calc because you have to live somewhere.LMCane said:au contraire mein AggieYouBet said:I hate to tell you this but you aren't retiring in 6 years if you only have $700K right now and expect to live to the normal statistical age or beyond it.LMCane said:GE said:LMCane said:
but at the same time I am on pace to retire a millionaire by age 57. (6 years)
so I have $700K in savings/401K/personal brokerage/crypto (not including half million dollar house) but only a few hundred dollars in cash
Only way you pull that off is if you are single and you plan on living in a box eating ramen every meal, or crypto skyrockets to lotto levels.
I am single, with an additional $105,000 in equity already in my house in Maryland that I am not counting on.
I just put $40,000 into the stock market at years long lows
you don't think a single person with no kids can retire on a million dollars in savings, $3445 a month in social security, and a house nearly paid off?!?!
Yup. Being a "millionaire" is rather diluted these days because people include where they live in that calculation.
If you're a "millionaire" including a $500k house in that calculation, well that ain't really that hard anymore.
ChoppinDs40 said:jtraggie99 said:1300 in car payments a month? That's insane man.ChoppinDs40 said:ding ding ding... call $250k = $16k month after health insurance and taxesbmks270 said:
In a high cost of living area it's very easy to blow 250k on rent, luxury cars, and eating out, especially with kids.
"Pay check to pay check" isn't well defined. I bet most of these people have decent savings and can afford unexpected expenses pretty easily.
$750k house... call it $4k mortgage.. $400 utilities, $1,300 in car payments, $300 car insurance, $400 gas (now)...
2 kids in day care is at least $2,000, $1,500 in food. That's $10k right there for living/commuting...
TV? entertainment? vacation? 401k savings? HSA savings? wife getting her nails done and hoohah waxed? it goes quick.
2x $650 car payments isn't insane. That's a $40k car note over 6 years at 2% (ask me how I know)
Want to go in a nice vacation or 2 a year? I just looked at flights to cancun in November from DFW… $750 a piece!!!
2 nice vacations a year for a family of 4 is easily over $10k… so there's another 1k in monthly savings…
Stuff ain't cheap.
Like JetBlack said… it's the American Dream but a $12 whataburger combo and $4.50 gas is killing that dream
A family of 4 taking 2 Cancun vacations a year was never the American Dream.
A lot of Americans have just been sold that by advertising and wanting to keep up with those in their friend group who actually can afford it.
You can take a family of 4 down to Port Aransas for a week for $1500. Even cheaper if you are frugal about where you eat/stay.
this is true.Proposition Joe said:ChoppinDs40 said:jtraggie99 said:1300 in car payments a month? That's insane man.ChoppinDs40 said:ding ding ding... call $250k = $16k month after health insurance and taxesbmks270 said:
In a high cost of living area it's very easy to blow 250k on rent, luxury cars, and eating out, especially with kids.
"Pay check to pay check" isn't well defined. I bet most of these people have decent savings and can afford unexpected expenses pretty easily.
$750k house... call it $4k mortgage.. $400 utilities, $1,300 in car payments, $300 car insurance, $400 gas (now)...
2 kids in day care is at least $2,000, $1,500 in food. That's $10k right there for living/commuting...
TV? entertainment? vacation? 401k savings? HSA savings? wife getting her nails done and hoohah waxed? it goes quick.
2x $650 car payments isn't insane. That's a $40k car note over 6 years at 2% (ask me how I know
Want to go in a nice vacation or 2 a year? I just looked at flights to cancun in November from DFW… $750 a piece!!!
2 nice vacations a year for a family of 4 is easily over $10k… so there's another 1k in monthly savings…
Stuff ain't cheap.
Like JetBlack said… it's the American Dream but a $12 whataburger combo and $4.50 gas is killing that dream
A family of 4 taking 2 Cancun vacations a year was never the American Dream.
A lot of Americans have just been sold that by advertising and wanting to keep up with those in their friend group who actually can afford it.
You can take a family of 4 down to Port Aransas for a week for $1500. Even cheaper if you are frugal about where you eat/stay.
We were a solidly middle class family growing up and I don't remember getting on a plane for a vacation until college. There were six of us, so that was part of it, but there are plenty of vacations to be made that are affordable for anyone.
Never made that much and my bi-weekly paycheck was net 6% to $401k and $800 to savings yet was able to live in high rise in Dallas.
Retired 4 years ago.
But I guess if I was in NYC or much more expensive locals I am sure it would be different. But just because they are paycheck to paycheck they could be putting a substantial amount into a savings retirement account
Retired 4 years ago.
But I guess if I was in NYC or much more expensive locals I am sure it would be different. But just because they are paycheck to paycheck they could be putting a substantial amount into a savings retirement account
Saw an article today, this may not be exact, but the gist was 50% of Americans with kids can no longer afford food for their family with out the child tax credit, which ended a few months ago.
Proposition Joe said:South Platte said:Do you live in MD or is that an investment property? I discourage people from including primary home equity in their net worth calc because you have to live somewhere.LMCane said:au contraire mein AggieYouBet said:I hate to tell you this but you aren't retiring in 6 years if you only have $700K right now and expect to live to the normal statistical age or beyond it.LMCane said:GE said:LMCane said:
but at the same time I am on pace to retire a millionaire by age 57. (6 years)
so I have $700K in savings/401K/personal brokerage/crypto (not including half million dollar house) but only a few hundred dollars in cash
Only way you pull that off is if you are single and you plan on living in a box eating ramen every meal, or crypto skyrockets to lotto levels.
I am single, with an additional $105,000 in equity already in my house in Maryland that I am not counting on.
I just put $40,000 into the stock market at years long lows
you don't think a single person with no kids can retire on a million dollars in savings, $3445 a month in social security, and a house nearly paid off?!?!
Yup. Being a "millionaire" is rather diluted these days because people include where they live in that calculation.
If you're a "millionaire" including a $500k house in that calculation, well that ain't really that hard anymore.
I would guess that that vast majority of younger people with $500k houses still owe $300k-$400k on them. It would be harder to actually have the mortgage fully paid off for most people.
DeSantis 2024
FJB, FJB, FJB, etc
FJB, FJB, FJB, etc
Many of you are giving people too much credit. Most don't have a pot to piss in.
I'm not going to lie, it's getting very tight. A weird business world and major business transition has resulted in significant debt on my part.
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