With a wife and 2 kids, how much money do you need to make before you stop worrying about your budget?

Come on. You can find the simple joy in shorts, running shoes, and your own hard work, but can't apply that to the rest of your life.

I echo everything already said about living within your means.

Forgo your next $ raise and negotiate a shorter work week. If no one is managing your household then your only way to resolve issues is with $. If you can handle things yourself it is more rewarding and cheaper.

Move to a mid-sized town (100-500K metro area). One with it's own employment center - no bedroom communities. Lower cost of living, higher quality of life. People talk to each other.

Hide $ from your wife. Women will always spend every cent they make + half your take. This is scientifically proven.

Oh, to anyone who posted just to fluff about their salary. Congrats, you're a white male in America. Your six figures is the time equivalent of a 20:00 5K. Enjoy your finisher medal

This is an excellent post. A little (stress little) over the top with women spending EVERY cent though. I also hunk the thing about negotiating few hours is possibly short sighted in many cases.

Yeah I get it. If you live anywhere cool you probably have a fairly high mortgage. If you have a wife that works you pay for childcare. If your wife works (real job that makes decent money) she is probably cool. If you live somewhere cool childcare is expensive, so yeah,between mortgage and childcare, a budget that feels tight or restrictive even making 150-200K is realistic. But hey, at least you have a cool wife and live somewhere cool.

This thread is obscene. But I will contribute. My wife and I make 119,000 per year. Here is a breakdown of our major spending this year-

19.5% toward retirement

20% taxes

7.5% toward student loan

-----

53% remaining = 63k

Of that, 38% goes to mortgage, leaving 39k remaining

So that's like $19.5k per person. That doesn't feel luxurious when we haven't counted food, gas, utilities, etc. yet. Hell, we'll blow 10% of that 39k on heating oil & electricity this winter.

I guess the major luxuries are big retirement savings (when others have none), and the $2,000 mortgage (when others struggle to pay rent of a couple hundred bucks).

Luckily the student loan is gone soon, so that will free up some cash.

God we are all ridiculous people on this thread. We should be ashamed for whining.

Uptight Spender wrote:

Wife and I make a combined ~$180k a year. Two kids ages 12 and 14. It always seems like we're living tight, even though we both have very reasonable salaries. Mortgage payments, car loan payments, cell phone bill, groceries, Internet bill, etc. All compounded by trying to make sure we save enough for our kids' college educations. It's just very frustrating at times. Wanted to buy a new pair of running shoes today but needed to make sure it was within our budget first. How do you need to make before you stop worrying about your budget before buying a damn pair of running shoes?

Pal your cell phone bill should be under $1k a year no matter what. Ditto for internet. That leaves you with $178k a year to play with. Put it this way, if you've got money problems on 180k, then you could drop your cell phones, drop your internet, and probably eat at a soup kitchen and you'll still have money problems.

You see what I'm saying? If you're serious about budgeting, make a pie chart of where your money goes. If a sliver is so thin you can't see it, then stop worrying about it and start focusing on what matters.

I'm serious about the pie chart. Go through your statements for the last 3 months, make a couple categories of types of spending and saving, add up the total for each category, stick it in excel and see what it looks like. As others have said, sounds like your mortgage and/or car loans are probably beyond your means, or else there is some big discretionary spending going on, or something. Put the data down on paper and find out.

I figure $2mm-$3mm is the comfortable number with maybe $6-$8mm in existing assets. So maybe mid 30s when you decide to settle down

Asset Base (presuming you didn't have a lot of expenses when younger, saved money and invested wisely)

-House: $4mm ($6mm home with $2mm mortgage)

-Liquid assets $4mm (retirement, earmarked money etc)

At $2mm gross you take home $1mm

-$200k mortgage

-$120k kids education (private school tuition, music lessons, tutors, etc)

-$100k home/car maintenance, groceries

-$100k nanny (payroll taxes, medical insurance add up)

-$180k club memberships, vacations, entertainent, etc

-$300k additional savings

You are insane if you "struggle" with 180k a year. I make 150k a year (granted I'm single and don't have kids) and I can't spend my money if I tried. I have no problem paying my car loan, mortgage, and other bills. I put away 15% of my income towards retirement. I also spend my weekends either taking a girl on a fancy date (which I pay for entirely) or at the bar trying to pick up a new one (which is easily $100 a night). I basically waste as much money as possible and I never have to worry about expenses. If you can't seem to make 180k work each year then you're doing it wrong. It shocks me that there are people in this world that make that much money and are completely incompetent at life.

Also, don't stress over saving for your kids college. That's what student loans are for. Instead spend the time and money encouraging them to get a scholarship. If you raised them right, then they should survive just fine. My parents didn't give me anything for college and now I'm living the American dream. I contribute my success to my parents for never spoiling me and teaching me the value of hard work. That nothing will ever come for free in life and the path to success will not be paved for you.

I agree with all the people who say you are out of touch. I make 130K a year and my wife stays home with our 3 young children. We put college & retirement money away every month and are doing just fine. Do we buy $5 lattes every day? No. Do we buy new clothes every month? No. We do go on vacation every year and a few small trips here and there. We don't buy extravagant stuff but our kids are in a great school district and basically get whatever they need. We also aren't one of those families that buys every kid a DS, an ipod, and a ipad. Our kids play sports and are outside with their friends in the neighborhood.

ball so hard wrote:

You are insane if you "struggle" with 180k a year.

Can you and everyone else criticizing this guy show me where he said he struggles? He said he's frustrated by the fact that he needs to think about his budget before buying running shoes. My wife and I make $250k combined with 4 kids and I have to think about the same things. He's right; it is frustrating.

OP, you might be able to cut a huge chunk of monthly bills with some careful planning. I'd guess you're leaking a lot of cash that you don't need to be unknowingly. Some ideas to cut costs:

*Get a low cost phone carrier. I pay $14/month (including taxes) for unlimited text/calling from Republic Wireless (there are other similar carriers out there). No contract, and about $150 up front for the new phone. You can unlimited calling, texting, data for $25/month if you need the internet everywhere.

*Get rid of cable tv. Netflix is about $10 per month. Libraries have huge selections of movies and tv shows (including brand new releases).

*Call your internet provider and threaten to move to their competitor if you're outside of a monopoly. There are always deals to be had.

*If your interest rate on the car loan is high, get rid of it for a cheaper one. Get rid of it if you can't pay it off in the short term and buy something cheaper. Until you have your budget under control, never again take an interest bearing loan for anything other than a house.

*Food: make it a special occasion to eat out. Find an interesting cookbook and cook your way through every recipe. If you don't cook often, you'll quickly realize that it's pretty easy to make food on par or better than the vast majority of restaurants. Plant a garden next summer if you have a lawn. It's very easy to grow a ton of produce in a small footprint.

*Buy the majority of your clothes at Kohl's, Target, etc.

*Drive as little as possible. Driving is flat out expensive and an easy way to unwittingly burn through money.The IRS mileage rate is $0.56/mile.

key to saving- cut back on eating out, and get digital antenna(we get most channels and barely watch tv). This helps us save a ton. I have friends with 150$ cable bills. How often do you even watch tv? boom- new shoes right there each month.

Sure we spend a lot of money - we like to live life. But we are pretty good savers too. We put right at 50% of take home into retirement/college/weddings. Like I said, we are always on a tight budget, but that is our choice.

laughing, 220, wife at home wrote:

Revolving Door wrote:

OP, it never stops. MY wife and I are both 32 with a combined income of $315K.

We're always on a tight budget between the mortgage, monthly expenses, three kids in private school, saving for retirement/college/weddings, etc.

It was the same when we were making only $200K and I'm sure it will be the same at $400K.

Hilarious.

There is just no amount of money you can't spend on frivolous crap, I take it.

This thread is kind of shocking to me. I applaud all of you who earn that much money.

To be honest with you, I take home about £1500 a month - about $2400.

I don't feel like I'm scraping by. I'm single, female, no kids. My car was £6000 but I borrowed the money interest free and paid it back with a monthly payment (thank god that's gone though).

I have enough money to buy the food I like. I'm lucky that my bills are very low (e.g. gas + electricity is £50 a month total on direct debit).

Cell phone - unlimited everything for £15 a month

Internet - £15 a month

My biggest problem is petrol (gas) and car insurance. I feel wealthy compared to other points in my life, but I know things would be very different if I had kids, or even if I had a partner as they'd probably want to do more expensive things. I tend to do a lot of things cheaply.

Don't save for your kids college, if it's too much of a strain on the family/marriage.

My parents had four kids. No money, no savings, immigrants.

Oldest got a full-academic. 2nd got a full-athletic to DI (running). 3rd got a full-athletic to DI (running). 4th got a full-athletic DI (running).

As a parent now, I realize how their philosophy worked. They made it clear to us from the start (transparency) that they were not going to pay for college but that they had invested every penny in our education (private schooling) and that we had potential for greatness in whatever we did.

We believed them and worked hard in the class and in our sports and graduated with no debt from major universities. Obviously, I don't think this is typical, but am instilling the same in my children.

Stay out of debt. That's key.

This thread has to have trolls. I mean, right? Seriously, what kind of jobs do you people have if you're making a few hundred thousand dollars a year and you're in your early 30s. I don't think that's even possible.

Revolving Door wrote:

Sure we spend a lot of money - we like to live life. But we are pretty good savers too. We put right at 50% of take home into retirement/college/weddings. Like I said, we are always on a tight budget, but that is our choice.

I always found spending so much on a wedding ridiculous. Yes, they are a great opportunity to bring people together, create a memory, and celebrate love. But at the cost of a new car, house down payment, solid bedrock for savings or investment account, a number of great vacations, and various other more practical expenses or investments, is a weekend of fun worth all those? Are not the memories you create before and after the wedding more important?

vivalarepublica wrote:

I always found spending so much on a wedding ridiculous. Yes, they are a great opportunity to bring people together, create a memory, and celebrate love. But at the cost of a new car, house down payment, solid bedrock for savings or investment account, a number of great vacations, and various other more practical expenses or investments, is a weekend of fun worth all those? Are not the memories you create before and after the wedding more important?

^^Flagpole in disguise.

Lots of good stuff in this thread. Good ideas, pretty good back and forth, kudos to letsrun.

One thing I don't understand is the saving for kids college. That should be on them. It was for me and I can't begin to explain how that matured me faster than my peers who had it paid for. I think people need to consider this when planning household budgets.

This may lead to more frugal decision making when it comes to entering the industrial academic complex, and hopefully, a complete reimagining of what higher education is, as well as where, when, and how it happens.

The "I'm going to pay 250k for 4 years of school and watch the tuition go up 10% every year right when my kid graduates high school" model is outdated, corrupt, and needs to end.