You might be interested in this post at Financial Samurai, “Scraping By On $500,000 A Year”. It illustrates how insidious lifestyle changes and the expectations that go along with them can be.
You might be interested in this post at Financial Samurai, “Scraping By On $500,000 A Year”. It illustrates how insidious lifestyle changes and the expectations that go along with them can be.
Yeah, it’s easy to see how people get into situation, but unlike the author, I don’t think there is much excuse. Life is about tradeoffs and that family made their choices – I have little sympathy for them.
BTW this from the article as one example of a couple with $500k income:
“8) A 41 year old super frugal personal finance blogger who preaches riding a bike, doing your own home construction, and living off $30,000 a year or less and his wife.”
That has to be Mr. Money Moustache – It’s a great blog.
I suspect there are three somewhat frequent commenters here who are familiar with a set of numbers such as these. Perhaps others lurking. I would make two points.
The first is that “insideous lifestyle changes” are hardly the culprit in high expenses. The two identified taxes, income and property, vary from locale to locale but dominate the expenditures. When one considers that a large proportion of expenditures come paired with a sales tax or user fee the total fraction of income paid to government is 3-5 times the second largest expenditure, (mortgage) and can easily be half of total income. If you include charitable giving to get a picture of total “contribution to society” you can bump that ratio to 4-6.
Against that backdrop, liberals always and everywhere solution to our problems? More taxes, on “the rich” of course. Liberals are absolute wizards at advocating taxes, when they don’t have incomes to actually be the payor, or have so much money it’s practically a rounding error. Yesterday Dave pointed out the political realities which cap taxation, and Andy pointed out there aren’t enough super rich to make the funding arithmetic work. Any wonder we deficit spend?
Now, lets hear the chorus from those who think we have a taxing and not a spending problem.
BTW, there is an update to the original post:
http://www.financialsamurai.com/a-500k-redo-how-one-rich-couple-got-their-mojo-back/
We once had reflective conversation with an escrow office friend of ours. After many years of employment processing residential sales she came to the conclusion that too many people became personally entrapped to needing more and more money to pay for an increasingly demanding, expensive lifestyle -. A “keeping up with the Jones” kind of debilitating syndrome. It can creep on on those who don’t check in occasionally with balancing their needs versus their wants.
Guarneri,
We have both a taxing problem and a spending problem: too much of the former and not enougb of the latter.
Ben
We spend plenty. Don’t get much for it though. The place is run worse than some of the most poorly run businesses I’ve come upon. It’s truly a joke.
Life is about tradeoffs and that family made their choices – I have little sympathy for them.”
Except, Andy, the numbers that dominate the personal P&L are legislated.
I have often asked the question “how much of a persons income should have to be paid to the government,” but no more. A maximum. I generally hear (except for the crazies who start at 100% or “more”) numbers from 10% to 25%. They generally are reduced to incoherent responses to hear that the well off pay 25% -50%. Look at the numbers in this example.
Everyone is an advocate of more taxes to pay for “good things” in the abstract, especially if their neighbor is paying. Themselves? Not so much.