'Rich' and struggling: Meet the Joneses
A hypothetical family of four making $250,000 a year has trouble making ends meet -- just about anywhere. See how their finances stack up in these 8 cities.
By The Fiscal Times
VIDEO ON MSN MONEY
I'm glad (almost) everyone sees that this article is a big load of crap! "I can't survive on $250k per year" - boo hoo! Learn to prioritize.
This article reminds me of a story 20/20 did a couple of years ago about a family of 4 that was struggling to make it on their $250k+ income. The recommendation of the financial advisor was for the family to sell their 2nd home and stop taking ski junkets to Aspen every year. Come on! Can't you find someone in the real world to write about/profile?
Wait a minute.... $5,000 a year on house cleaning (that's $417 a month), $4,000 on child "activities", maxing out TWO retirement plans, saving for college.....How would someone making 1/6th of the $250K (the US average) be able to do this? Adding in sales tax, property tax, (but not Payroll taxes - 7.65% for a couple making $100K, 3.89% for the $250K couple)??? Try telling us how a $50K (each) couple would fair under the same rules.
The article is sooo slanted it's laughable. A $750,000 home is frugal? No wonder they don't have any money left....an "average" person wouldn't be able to do 1/6th of this.
Give me a freggin break.
As for the "redistribution", that's a load of Republican right-wing BS. Republicans just want to "redistribute" it to different folks. Working hard is a fine trait but it doesn't mean someone making $50K doesn't work just as hard.
Yes everything is relative. Yes, it depends where you live cost of living may or maybe higher in your chosen place to live. That being said. If you make $250,000.00 a year that means you make $20,833.33 a month! That's $20,833.33 a month, yes, before taxes. That means in 2 months you make more than most people make in a full year. That's $41,000.00 + in just 2 months. That usually takes some (if not most) people make in one full year.
I don't begrudge anyone making a lot of money. If you dedicated yourself, worked hard, and received the necessary education to get you in the position to make $250K a year you should be applauded, but don't insult my sense of integrity and say your not well to do. Just my humble opinion.
So . . . the not-really-rich are trying to get sympathy from the other 90% of us who are making do with 1/6 of what they are making? I'm sorry--does someone have a bad case of Marie Antoinette syndrome?
Most of the "being in the red" that this family would experience comes from trying to keep up with the individuals in the next class up--that is, this "poverty" is self-imposed. In this case, it really wouldn't matter how much a person was making--one can never keep up with the next class up. I am sure that someone who is one slot below Bill Gates feels as if s/he is not-really-rich.
Try comparing these individuals to one class below--pick a smaller home that will cost less to have a maid to clean. Get a slightly less nice car. Go out to slightly less pleasant restaurants. One will have money to spare.
I would accept that this family is not "rich"--but $250K is not the threshold for "rich"--it is the threshold for "affluent." That is, people who have enough money to cover their expenses and still live a very comfortable life--though they do still have to work and cannot spend money as if it grows on trees.
If people who make 6 times the average income cannot cover their expenses--that is, if each of them, individually, can't live on what a whole household usually lives on with two more incomes to spare--exactly how are the rest of us supposed to be able to survive?
It amuses me that people claim that the "poor" are "poor" because they "spend"--but when we look at these individuals, you try to justify several extremely ridiculous expenses (the children's "activities" are taking up more money than many people make in terms of take-home income). Yes, if these people are "not rich"--it is because they are spending their money rather than budgeting well. The criticism of the "poor" works in this case--so, yes. This is self-imposed poverty.
This is not the same thing as "not being rich." They are still affluent and can afford the extra tiny bit of taxation. Seriously--get a life. More importantly--get a real life.
My heart just bleeds for those who cannot make it on $250,000 a year. Try raising a family on $30,000 a year and without help. It can be done. I did and managed to put a little back for retirement (very little).
What aggravates most people is those who make $250,000 or more a year and still can't make it and complain about taxes. It is just simply mismanagement of the resources and money they have. It is no wonder this country is in trouble financially.
Anyone who is smart enough to get a job paying that much money should be smart enough to figure out that if you're in the red, you cut out the luxury expenses like a cleaning service, take your lunch to work more often, sell your car & get something even slightly less luxury (even a new Ford vs. a new Lexus!) and try just a little harder to cut your energy bills. The author should also know it's obvious most people aren't spending that much on medical & dental expenses - "average" does not mean "median" because a few high-expense anomalous households with cancer skew the average severely to the high end. Even more obvious: if you make $250k, you're probably towards the end of your career, at your highest earning power, probably in your 50s. So you probably don't have a toddler running around the house needing daycare.
And WHY does the wife only have an undergraduate degree if her husband has a master's? I thought this was supposed to be the "ideal," "average" family? Doesn't the author know that women now earn 60% of all master's degrees and 50.4% of doctoral degrees? This would push the wife's income higher, but may also push the student loan debt higher - however the increased income probably would offset this in most cases.
It is so simple that I am amazed that folks can't survive on $250,000 per year. It is obvious if you spend more than you earn you will not make it.
So what is one to do? Be realistic and spend less than $250,000 after taxes. Live in a less mortgaged home etc. Don't buy the Mercedes, buy a Buick. I get it and hope others will too.
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