800k household income - does not feel rich

Harambe wrote:

Igetit wrote:

I can relate to this post. AGI the last 4 years has averaged out to around 850k but is probably closer to 1m now. We also have 3 young kids and live in a VHCOL area. Here is how our budget breaks out from a monthly expense/cashflow standpoint.

* Daycare = $6500 + 1 in public school

* Car = $1k (1 car bought cash, minivan has a loan on it)

* Groceries = $3000 (easy to do with a big family and running moderately high mileage)

* Mortgage = $13800 (3.2m home)

* Entertainment = $3500 a month (averaged out/including vacations)

* Other miscellaneous = $1000

Basically this leaves us with 1-2k of extra monthly cashflow to save or invest.

The kicker though is that we are pulling in probably 200-500k a year in bonuses and stock vests which we completely bank and invest. Every couple of years we all seem to get some sort of weird liquidity event which seems pretty common with people at this income bracket.

I would say that your car expenses are hilariously over the top. I can't imagine spending 3k on cars. That is also a lot of money on schooling but if that is something you value then I get it. Entertainment looks bad on the surface but if it includes vacations then I get it too.

In short, you definitely aren't poor but a big family in a VHCOL area is tough and while I am sure finances aren't a stressor for you I can certainly understand why you don't feel rich. I don't know how old you are or what your asset level is but I will say that once our liquid asset level got up into the mid to high 7 figures we did start to feel a bit more affluent.

Your expenses sum to ~350k/yr. Unless you're voluntarily paying a 60% effective tax rate then this math doesn't check out. Looking more like 150-200k of FCF a year.

Unless you mean that 200-500k of your AGI is in bonus+RSUs that you immediately save in which case you are saving at a very impressive rate and have only yourself to 'blame' for such conservative financial choices.