Affluence and the perception thereof

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Dovetailing off the US Presidential Election thread, just giving us a place to discuss wealth (especially middle and middle-upper class) versus the perception of wealth.

I'll repost my own feelings from that thread:

I live alone, so looking at the personal income rates in the US, I'm in the top quintile (I make a bit above $50k annually gross income). I may not be able to spend lavishly, but I certainly can spend reasonably, and if I want to take a vacation I just need to save up for a while. Currently my car is paid off, which has freed up a nice chunk of my monthly budget, but I probably should start saving more towards another vehicle within the next few years (the A/C is blown on my car, and mechanically it's going to start hitting the point where regular repair needs will start cropping up more frequently, plus I would prefer to migrate to a hybrid or much more fuel-efficient vehicle in the near future).

Unfortunately I don't own a home, due to a number of f*cked-up factors in my life for the last several years. But I would like to move into home ownership within a couple years.

So no, I'm not swimming in cash, but I'm certainly comfortably within the middle class, because I live reasonably within my means. My biggest expenses are rent and medical bills, followed by student loans (I fell behind on those for a few years) and various utilities/insurance. I live in a nice neighborhood but certainly not nice enough to be considered "upscale" (safe to walk around in the daytime, moderately safe at night, and I don't fear for my car to be broken into aside from teenagers being dumbasses).

I am quite happy with my income and the buying power of my money. Now, in my case, I grew up poor. Food stamps for part of my childhood, shared a single bedroom with my sisters until we were in late elementary school, that kind of thing. So I spent my pre-adult life solidly in the lower class (by the end I'd say we were lower-middle).

My adult life once I hit the age of 25, I was very solidly in the middle class as a single adult. For several years I lived with my significant other, and my income perception dropped as we were then using only a little more than my single income to support the two of us and partially support her kids. Since I've been single again, I've felt reasonably well off.

The question from me is, why is there so much sentiment vocalized by households in the $100k+ range (i.e. in the top 15% of US households) that money is tight and/or they "don't really make that much" when the vast majority of the nation gets by with less (or even far less)?

Quite frankly, any household earning $200k+ annually gets absolutely no sympathy from me for money problems barring major medical issues, because at that income, you have the power to live well within your means and eliminate any money problems. So yeah, I'm a little judgemental there, but I feel it's within logical reason.

I do not understand it either. For perspective, my dad makes around $50,000 a year, yet acts like he is struggling day by day. I've averaged $5,000 a year, yet I do quite alright. Sure, I share a place with someone else, but ultimately, that at most drops my living costs by 1/3rd to 1/2th. Some people, like my dad, have absolutely no conception of how to manage their finances. It is never enough for them. They will always struggle to make ends meet because they live in a different reality.

People are often bad at appreciating what they already have, but good at appreciating what others have. It's far easier to put a number on your current liquid assets than on your consumption rate.

Also, I suspect the champagne taste/beer budget principle applies in a number of cases, and as one's income grows, his tastes don't necessarily pause to let the budget catch up.

I'm making ~$70k a year and feel quite comfortably well off. I have paid off my student loan debt. I do not own a house. I do not own a car. I don't have a family, but I believe that if I did I could comfortably support it on this single income. I am able to eat out all the time, buy pretty much any cool thing that catches my eye, and still save money. If I budgeted as my sister has to do to keep her family in the black, I would be able to save a [em]lot[/em] of money. (As it is, since I have no debts at all I think most people would consider my savings to be very large already. On the flip side, I have no non-cash assets worthy of the name.)

I can conceive of how a family with a combined income in the area of $100k living in an expensive area with multiple kids about to hit college might feel stressed out about money. I cannot comprehend how a family with a combined income of $200k or more should have trouble, though. (Aside from spending money on luxuries like multiple homes, etc., in which case I think the solution should be obvious.)

I think it is a fair question and a very interesting conversation topic. With my wife, we make above the 100k mark combined - but really don't feel like we have very much extra cash. Mostly that is due to the 150+ we owe in student loan debt, combined with the higher number we owe on our mortgage has all our cash going to debt rather than savings. We have a very austere lifestyle compared to others in our socio-economic group (no vacation, new, but cheaper new cars, older clothes), but there still isn't much to go around.

Without our student load debt, we would be in a completely different situation. I often wonder if higher education was the right answer.

I'll throw out a couple thoughts here. If you make $200k+ a year you're generally doing something that either requires continuous learning or putting your own money towards your job. In the case of my wife and I it helps for us to have a nice apartment where we can have work colleagues over. My wife needs to have nicer clothes for work than she needed a few years ago. She has to be able to cover her own dinner / lunch with customers at a moment's notice just to keep up appearances. She has to roll with the cost. For my part, as a software engineer, I need to buy tech books, take classes here or there and buy the required computers, etc. to do learning in my free time. If you work well over 40 hours a week you frequently need to buy dinner out or hire someone to come by and clean the house once in a while so you can unwind. Getting time to exercise is hard so often you have to find ways to make time for that. Jobs that pay you well are also often stressful.

You also pay a ton of taxes. More than you might think. And most deductions (housing deductions, student loan deductions) aren't available to you. My wife and I aren't even at that level and we have no meaningful deductions. It's quite interesting when you realize that you're paying the normal tax rate throughout the year and then come April you need to write a $5,000+ check to the government. You need to have that money available.

That doesn't add up to us living hand to mouth. Far from it. We travel extensively, save money and buy what we want and have a great life. We both feel very blessed and life right now is better than when we were at the start of our careers. But it's also not an exponential curve. Making $100k a year doesn't mean you literally make twice as much as you made at $50k a year. Between taxes, expenses, etc. that gets whittled away a bit. In other words I don't know why someone would live paycheck to paycheck at over $200k+. But you're also by no means 4 times as wealthy as when you made $50k/year in the net.

SallyNasty wrote:

Without our student load debt, we would be in a completely different situation. I often wonder if higher education was the right answer.

Our combined debt is roughly in the same ballpark. We both came from very poor backgrounds and rising above that station in life wasn't free. We had to pay in the form of hard work and student loans. I still think going to college was the right choice. But when your family is below the poverty line the climb out of that can be expensive unless you somehow get a full ride scholarship.

DSGamer wrote:
SallyNasty wrote:

Without our student load debt, we would be in a completely different situation. I often wonder if higher education was the right answer.

Our combined debt is roughly in the same ballpark. We both came from very poor backgrounds and rising above that station in life wasn't free. We had to pay in the form of hard work and student loans. I still think going to college was the right choice. But when your family is below the poverty line the climb out of that can be expensive unless you somehow get a full ride scholarship.

Yes, I ultimately wouldn't change anything - but when those numbers dig so deeply into your take home, you sure do feel it!

Contrariwise, there are other ways that a person making $200k/year is more than four times as wealthy as when you made $50k/year. And I'd say that a $200k/year income is absolutely more than eight times as wealthy as a person who supports a family on $25k/year, and has no ability to save any money whatsoever (much less acquire training, travel, etc.)

Also: Just as a note, a cleaning service is absolutely a luxury. My sister works well over 40 hours a week and I'm sure she'd love a chance to let someone else clean up for her once in a while so she can relax—but she has to do it herself, because she already has to occasionally ask me for help paying the bills and buying groceries.

Making less money doesn't mean you do less work.

Edit: And to be clear, I don't mean that as a criticism. Just as pointing out some of that perspective we're talking about: from the bottom, you look at things and say "that's just a waste of money" about things like keeping up appearances. From the top, you look at things and say "I couldn't live without this" about things that help reduce you stress. Both are right, and both are wrong. The division between professional necessities and luxuries isn't always that clear, and there are a lot of people who have no choice but to deal with situations that we'd all avoid if we could. (And therefore, demonstrate that it's possible.)

Jobs that pay you well are also often stressful.

The point you seemed to be getting at was that there are reasons why being in a job that makes more money is not twice as good as a job that makes half that money because of these other factors. Between $50k/yr and $100k/yr you may be right as the $50k/yr person is probably doing alright, but that comparison doesn't hold up at other levels since the stress of the high paying job is in no way greater than the stress of a low wage earner just trying to get by.

I've seen both stresses affect people in my life and I'd never turn to one who was struggling to pay bills and say that the person making twice as much as them doesn't really have it that much better because of the stress in their life.

Farscry wrote:

The question from me is, why is there so much sentiment vocalized by households in the $100k+ range (i.e. in the top 15% of US households) that money is tight and/or they "don't really make that much" when the vast majority of the nation gets by with less (or even far less)?

While I am not at that line yet, I am closer to it than I am to your income range. I think part of the perspective difference is related to housing costs. I spend about double on mortgage+insurance+taxes than I did on apartment rent+insurance, and I rented a decent place in a good neighborhood. Factor in maintenance and general costs of keeping up with the neighbors(landscape care, for example, not buy a new boat), and you can burn cash quickly. And a lot of it is invisible to most people. A quality neighborhood can be 30%+ more expensive than one that looks very similar half a mile down the road, but the intangible benefits are worth the price difference.

Another factor is the perception of wealth. People who earn in the $100k range generally don't have to worry about things like (non-medical) bills, grocery costs, occasional restaurant/movie/etc. visits, or making car/home payments(assuming those were purchased with foresight/sanity). But that doesn't cover the things that society has put the 'wealthy' stamp on. Extended vacations, being able to drop $10k+ on an event or non-critical remodel, buying your kids new cars on their 16th birthdays, a fancy house with a view and professional landscaping, and the other things that get shown off in movies and tv shows.

Also, people who earn $100k can be just as bad with money(cars, meals, electronics, travel) as anyone else. So there is always that to consider.

Personal example time. I make $70k-80k a year. I own a nice house, 2 (paid for) cars, have no outstanding debts other than the mortgage, and support my wife(currently unemployed). The home we purchased last year was a steal (paid $60k less than assessed market value), but we've had to spend a good $12k in repairs on the house in that time period. I could do all that by virtue of being frugal over the past 5 years (since I graduated). We cook most of our meals, shop at cheaper grocery stores, buy in bulk, buy clothing at outlet stores/on sale, and generally make do with less in the entertainment category. The effect of this is that I don't have a lot of cash to throw around, but we don't have to worry about affording the bills(including medical stuff that has happened) and the few things we do really want. The net effect is that I don't feel rich as defined by our culture, since I can't just go buy new electronics/go on cruises/remodel the house at will/eat out at $texas restaurants at will. I know that I am certainly comfortable in terms of financial security, but security and wealth are not the same thing. The one real advantage my wife and I have over someone like SallyNasty is that neither of us have debt from college, thanks to our parents.

Hypatian wrote:

Also: Just as a note, a cleaning service is absolutely a luxury. My sister works well over 40 hours a week and I'm sure she'd love a chance to let someone else clean up for her once in a while so she can relax—but she has to do it herself, because she already has to occasionally ask me for help paying the bills and buying groceries.

Making less money doesn't mean you do less work.

I think this is where the thread can easily go off the rails and we could end up demonizing our friends here. Please take care with judging the lives of other people based purely on income. I understand that making less money doesn't mean you work less. But making more money often means you do work more. That you're expected to be on call constantly. My wife has been doing 12 hour days most of this year. She was in Australia on business travel for 3 months total last year. When she's home she often works 8 to 8. If she wants to exercise she honestly has to pay someone else to clean the house so the deep cleaning doesn't get ignored.

Feel free to judge, but it's that whole thing about walking in another mans shoes, etc.

Edit: And to be clear, I don't mean that as a criticism. Just as pointing out some of that perspective we're talking about: from the bottom, you look at things and say "that's just a waste of money" about things like keeping up appearances. From the top, you look at things and say "I couldn't live without this" about things that help reduce you stress. Both are right, and both are wrong. The division between professional necessities and luxuries isn't always that clear, and there are a lot of people who have no choice but to deal with situations that we'd all avoid if we could. (And therefore, demonstrate that it's possible.)

I appreciate the clarification. And believe me, when I was in my 20s I felt exactly the way you describe. Now that I'm in between being in the poor house and being in the 1% I realize that there are all kinds of random costs that pop up. Do we have better lives now? Yes. Unequivocally less. We just got back from 3 weeks in Europe. We're going to Turkey in November. I know we're blessed and have great lives and I'm always thankful that hard work and some breaks led us to this point. But it's by no means an exponential rise in quality of life.

Not sure if this applies in the US but.... Personally, my general biggest gripe is the tax haven called "marriage". WTF is that about? I pay more tax as a single person than a married person plus my expenses are more because I you can reduce costs by being in multiple. Then there's all the little gifts for making babies as well. Seriously, I'm not only contributing more to the economy but I'm also reducing the overpopulation problem in the world! Where's MY tax breaks?!

Spoiler:

This post was only semi-serious.

DSGamer wrote:

I appreciate the clarification. And believe me, when I was in my 20s I felt exactly the way you describe. Now that I'm in between being in the poor house and being in the 1% I realize that there are all kinds of random costs that pop up. Do we have better lives now? Yes. Unequivocally less. We just got back from 3 weeks in Europe. We're going to Turkey in November. I know we're blessed and have great lives and I'm always thankful that hard work and some breaks led us to this point. But it's by no means an exponential rise in quality of life.

Regardless of quality of life, if you're going overseas for pleasure multiple times in a year, you are "wealthy" from the point of view of the vast majority of Americans.

DSGamer wrote:

You also pay a ton of taxes. More than you might think. And most deductions (housing deductions, student loan deductions) aren't available to you. My wife and I aren't even at that level and we have no meaningful deductions.

What kind of deductions are you expecting? The typical $50k worker takes the standard deduction, I believe.

I think you may be overstating the difference in taxation. You will pay the same marginal rates up to $85k in income as the $50k worker, and only a 28% rate on income above that point. It's not going to be a big difference.

Hypatian wrote:
DSGamer wrote:

I appreciate the clarification. And believe me, when I was in my 20s I felt exactly the way you describe. Now that I'm in between being in the poor house and being in the 1% I realize that there are all kinds of random costs that pop up. Do we have better lives now? Yes. Unequivocally less. We just got back from 3 weeks in Europe. We're going to Turkey in November. I know we're blessed and have great lives and I'm always thankful that hard work and some breaks led us to this point. But it's by no means an exponential rise in quality of life.

Regardless of quality of life, if you're going overseas for pleasure multiple times in a year, you are "wealthy" from the point of view of the vast majority of Americans.

Absolutely. And we feel wealthy in terms of our quality of life. But we don't have kids, so that makes that easier. And we have to work hard for this. So I guess I don't know where this is going other than to demonize people who make more money. Yes I have it better. Yes I'd much rather be where I am now than in my 20s. But do I feel twice as rich? No. That's my perspective sitting where I am in my own shoes having gone through all the levels of income from making $10/hr. my first job out of college to where I am now.

Funkenpants wrote:
DSGamer wrote:

You also pay a ton of taxes. More than you might think. And most deductions (housing deductions, student loan deductions) aren't available to you. My wife and I aren't even at that level and we have no meaningful deductions.

What kind of deductions are you expecting? The typical $50k worker takes the standard deduction, I believe.

I think you may be overstating the difference in taxation. You will pay the same marginal rates up to $85k in income as the $50k worker, and only a 28% rate on income above that point. It's not going to be a big difference.

"What kind of deductions were you expecting?"

*sigh*

Perhaps I should just bow out. I'm trying to give my perspective on life at a certain level. Apparently that's not what this thread is for. It's to piss all over people who make more money. I wasn't expecting anything. I'm simply stating a fact that deductions go away as you make more money. That's all. When my wife and I were in our 20s we'd always get money back at the end of the year. Especially when we had a home. We'd get a tax refund. Now we write a $3000 - $7000 check to the government every April depending on income fluctuations. We can't deduct anything really. Whereas we used to qualify for the housing deduction and the student loan deduction. That's all.

DSGamer wrote:

Jobs that pay you well are also often stressful.

I disagree with that. Low wage jobs often involve just as much stress and at the same time, you make far less money so you have even more stress. There is no security in low wage jobs. You are often someone's bitch in low wage jobs. And you are treated like you are garbage.

Duoae wrote:

Not sure if this applies in the US but.... Personally, my general biggest gripe is the tax haven called "marriage". WTF is that about? I pay more tax as a single person than a married person plus my expenses are more because I you can reduce costs by being in multiple. Then there's all the little gifts for making babies as well. Seriously, I'm not only contributing more to the economy but I'm also reducing the overpopulation problem in the world! Where's MY tax breaks?!

Spoiler:

This post was only semi-serious.

I agree with the sentiment. And I am completely serious. I shouldn't have to subsidize people's marriages or baby making.

Well it comes down to this. American culture is a culture of living AT your means. That even goes to millionaires. 401k, Medicare, Social Security, IRAs, etc are geared at perpetuation that after retirement. It is also a culture brought up that there will ALWAYS be another paycheck next week.

Now I am going to state some assumptions. A person in the top 10 percent or so of income has a mortgage on a house, likely a 500,000 dollar + house. That mortgage payment is likely, or was likely, the highest bill they paid. I am going to surmise that they bought or leased cars on credit as well, so figure in that as the second highest bill. A little gravy went into stocks, a mutual fund, etc. Now that all ends. Your house is now valued at less than 100k, your retirement mutual fund is belly up but Morgan Stanley got their bail out. The company you work for, maybe own is doing half the business it once was. Your take home salary is less than half, your group health plan costs are doubling every 2 years. Credit has dried up. Any money you put into that 401K, Stocks, Mutual Fund is essentially locked away by the capital gains tax (the price we pay for wanting tax exempt retirement funding BTW).

Any person living AT their means, be they making 200k or 30 k who faces that will be in deep crap.

I personally feel that living just below your means or less is a much better way to go. I like having cash in the bank. I like being able to say, f*ck the chicken is still frozen let's go get sushi. But that is for another day.

In my opinion, very very few people are proposing to tar and feather top earners in the US (unless you watch fox news and then we are reacting like Pod People). To say wealthier people are suffering along with poorer people does nothing. If everyone is suffering, fix the f*cking problem. The outrage comes when Republicans largely talk about the top 1% being the answer to our problems, the millionaires and billionaires. Anything we do for them or their companies at the expense of the general population trickles down so the myth goes as if we are getting water from Mount Olympus. We get that the schools (public) that the poor and middle class go to are a major problem, but to fix them we go private or home school. The roads, power grid, information grid is crumbling around us. The very top earners we give breaks to are shipping the work the middle and poorer classes do over to Mexico and China. Lower government jobs which represent a large number of the jobs going to low class minorities and women are seen as evil big government and expendable. That is why poor people get upset. Lift up the very rich, cut my job, and I may get some run off.

But when all is said and done, when everything is talked about. Rich, poor, student, professional, blue collar; you all have a god damned iPhone.

In terms of taxes, the student/tuition deduction is pretty substantial. I married my wife while she was still a student, and that saved me a lot of money in taxes that year. Now, we get the 2x standard deduction for being married and the mortgage interest deduction. The difference in raw dollars back between the mortgage and the student deduction is pretty substantial. If you are an independent adult going to school, taxes are actually not that bad. That is by design. As a real grown-up, they are much worse. In pure dollars involved, that is simple fact.

Not at all trying to demonize. Just trying to point out that no matter how you feel, there are tons of places you could cut corners if you really had to.

I think my personal definition of "middle class" probably stretches from around $50k to $250k income. With the upper end counting as wealthy, but not yet rich.

And yeah, things would surely be tighter for you if you guys had kids.

Anyway, the key things I'm focusing on are: 1) people making much less don't actually have less stress before money (I do think though that middle middle class has a nice area that's probably less stressful than upper middle class or lower middle and below.) And 2) Even counting those upper-middle class stresses, people at the bottom of and below middle class at all have things way way worse. There's just no safety margin there.

There's nothing bad about being in a good position--but I do think you're minimizing the situation of people with less, while emphasizing the problems where you are. So, I won't shrink from criticizing that. But it's natural for anyone to have a better handle of their own situation than that of others. It's just something for us all to try to remember.

DSGamer wrote:

*sigh*

Perhaps I should just bow out. I'm trying to give my perspective on life at a certain level.

Why are you *sighing*? Tax policy involves numbers. If you allege that you pay more taxes, then it should be based on reality. Whether you get a refund depends on how much you ask the government to withhold, not on how much tax you pay.

Losing deductions on debt is also a good thing because you aren't in debt and are no longer having to pay the cost of debt. This is a good thing. We can talk about renting versus home ownership, because one has a tax advantage over the other, but renting has other cost advantages.

You may be much better off than you perceive yourself to be.

Kraint wrote:

IThe difference in raw dollars back between the mortgage and the student deduction is pretty substantial. If you are an independent adult going to school, taxes are actually not that bad. That is by design. As a real grown-up, they are much worse. In pure dollars involved, that is simple fact.

If you want to increase the size of your tax deductions, you can buy a giant expensive house. But all that means is that you're getting a discount on the interest rate you're paying. You're still forking over money to the bank.

Funkenpants wrote:
DSGamer wrote:

*sigh*

Perhaps I should just bow out. I'm trying to give my perspective on life at a certain level.

Why are you *sighing*? Tax policy involves numbers. If you allege that you pay more taxes, then it should be based on reality. Whether you get a refund depends on how much you ask the government to withhold, not on how much tax you pay.

How is it not based on reality? We pay a higher rate in taxes and we lost two major deductions. I've argued against the housing deduction (and the married and child deduction) in the past, but that's neither here nor there. The fact is simply that we pay more in taxes simply by making more income.

Funkenpants wrote:

Losing deductions on debt is also a good thing because you aren't in debt and are no longer having to pay the cost of debt. This is a good thing. We can talk about renting versus home ownership, because one has a tax advantage over the other, but renting has other cost advantages.

You may be much better off than you perceive yourself to be.

Actually we're right where we perceive ourselves. I've said this numerous times if you would read my posts that we're doing great and feel blessed. I'm simply saying that a person who makes 200k is not necessarily 4X as rich as someone making 50k. That is literally all I'm saying. And I'm trying to explain why.

I wrote:

We both feel very blessed and life right now is better than when we were at the start of our careers.

I wrote:

Absolutely. And we feel wealthy in terms of our quality of life.

I wrote:

Do we have better lives now? Yes. Unequivocally less.

DSGamer wrote:
Hypatian wrote:
DSGamer wrote:

I appreciate the clarification. And believe me, when I was in my 20s I felt exactly the way you describe. Now that I'm in between being in the poor house and being in the 1% I realize that there are all kinds of random costs that pop up. Do we have better lives now? Yes. Unequivocally less. We just got back from 3 weeks in Europe. We're going to Turkey in November. I know we're blessed and have great lives and I'm always thankful that hard work and some breaks led us to this point. But it's by no means an exponential rise in quality of life.

Regardless of quality of life, if you're going overseas for pleasure multiple times in a year, you are "wealthy" from the point of view of the vast majority of Americans.

Absolutely. And we feel wealthy in terms of our quality of life. But we don't have kids, so that makes that easier. And we have to work hard for this. So I guess I don't know where this is going other than to demonize people who make more money. Yes I have it better. Yes I'd much rather be where I am now than in my 20s. But do I feel twice as rich? No. That's my perspective sitting where I am in my own shoes having gone through all the levels of income from making $10/hr. my first job out of college to where I am now.

Funkenpants wrote:
DSGamer wrote:

You also pay a ton of taxes. More than you might think. And most deductions (housing deductions, student loan deductions) aren't available to you. My wife and I aren't even at that level and we have no meaningful deductions.

What kind of deductions are you expecting? The typical $50k worker takes the standard deduction, I believe.

I think you may be overstating the difference in taxation. You will pay the same marginal rates up to $85k in income as the $50k worker, and only a 28% rate on income above that point. It's not going to be a big difference.

"What kind of deductions were you expecting?"

*sigh*

Perhaps I should just bow out. I'm trying to give my perspective on life at a certain level. Apparently that's not what this thread is for. It's to piss all over people who make more money. I wasn't expecting anything. I'm simply stating a fact that deductions go away as you make more money. That's all. When my wife and I were in our 20s we'd always get money back at the end of the year. Especially when we had a home. We'd get a tax refund. Now we write a $3000 - $7000 check to the government every April depending on income fluctuations. We can't deduct anything really. Whereas we used to qualify for the housing deduction and the student loan deduction. That's all.

For once, I agree with you about mini-modding:). I am interested in this thread because I am interested in hearing about other's experience - not to be criticized for income. I realize my luck/favored position - but from this side of the fence, the grass isn't as green as I had expected it to be. I think that is what you are getting at as well.

Funkenpants wrote:
Kraint wrote:

IThe difference in raw dollars back between the mortgage and the student deduction is pretty substantial. If you are an independent adult going to school, taxes are actually not that bad. That is by design. As a real grown-up, they are much worse. In pure dollars involved, that is simple fact.

If you want to increase the size of your tax deductions, you can buy a giant expensive house. But all that means is that you're getting a discount on the interest rate you're paying. You're still forking over money to the bank.

Easy, killer. I'm just observing that the student tax benefit is big, while the mortgage is not(compared with the dollars going down the mortgage interest hole). Saying that taxes go up when you go from student to working stiff is not a judgment, nor is anyone here demanding more tax breaks.

Hypatian wrote:

Not at all trying to demonize. Just trying to point out that no matter how you feel, there are tons of places you could cut corners if you really had to.

We don't need to cut corners, though. Who is talking about being under economic duress? I feel like you're using someone else's situation to argue against me. I've said over and over that we're fine. We're good. We save, we pay our bills and we have money left over. That's all fine. It's just not 4x better than we were earlier in our lives. That's all. Literally.

Hypatian wrote:

Anyway, the key things I'm focusing on are: 1) people making much less don't actually have less stress before money (I do think though that middle middle class has a nice area that's probably less stressful than upper middle class or lower middle and below.) And 2) Even counting those upper-middle class stresses, people at the bottom of and below middle class at all have things way way worse. There's just no safety margin there.

You're mostly right, but that's not the entire picture. I was unemployed for a year two years ago. Unless I wanted to commit career suicide I had to wait for a job in my field to become available. I didn't feel terribly safe there minus the fact that we had savings.

Hypatian wrote:

There's nothing bad about being in a good position--but I do think you're minimizing the situation of people with less, while emphasizing the problems where you are. So, I won't shrink from criticizing that. But it's natural for anyone to have a better handle of their own situation than that of others. It's just something for us all to try to remember.

No, I'm really not minimizing the situation of people with less. My brothers make far less than I do and we regularly help them with stuff. We have college funds setup for our niece and nephews because we know they won't be able to afford it. My father is a blind veteran who has to take a 2 hour bus ride to get to the doctor. I'm in touch with poverty.

And this is fairly recent for us. We're professionals in our mid-30s. We've moved up slowly and both remember vividly being poor. Especially me.

DSGamer wrote:

I've said this numerous times if you would read my posts that we're doing great and feel blessed. I'm simply saying that a person who makes 200k is not necessarily 4X as rich as someone making 50k. That is literally all I'm saying. And I'm trying to explain why.

And I'm not saying you don't feel blessed. I'm saying that unless you calculate the figures, how do you know that you're not 4x as wealthy?

SallyNasty wrote:

For once, I agree with you about mini-modding:). I am interested in this thread because I am interested in hearing about other's experience - not to be criticized for income.

Oh, for chrissake. I am not criticizing anyone for having too much money. I live in Connecticut. We pave the roads with rich people.

I'm going to apologize beforehand for a bit of a rambling post...

I'll be the counterpoint to anyone who makes 100k+ and doesn't feel wealthy.

My wife and I pull in a little over $150k per year. This year will be less since she's taking 6 months off after the birth of our daughter. We could pull in more if she worked full-time, but there's no need. When we first graduated from school, we had a tiny apartment in Seattle, made pretty decent money, and saved a little. Our saving was impacted by eating out all the time, having two new cars (nothing fancy - a Civic and Ranger), and generally being in our early 20s. Now we're in Hawaii (higher cost of living), have a house here as well as a house in Seattle (not by choice - market crashed and we were way underwater on it, so we're renting it out), now have a third car (2012 Prius II - neither old car was big enough for a car seat) that we paid cash for, and don't have any debt other than the two houses. Basically, while I don't consider us to be rich, we're in the very upper-end of middle class. Or at least that's how I feel about it.

We didn't save much right out of school, and it seemed like we had a lot of debt with the student loans and cars, but we felt pretty comfortable then. Now we don't have student or car loans, but we do have mortgages (and hurricane insurance - basically doubles our insurance payment) and a newborn. We manage to save a lot more now than we did then. Sure - having more money, we could buy nicer cars. We could go out to expensive dinners often (we have plenty of friends who do - and do live nearly paycheck-to-paycheck despite making ~100k). We could hire a landscaping company and a house cleaner and a nanny. But we don't, we save that money instead.

Oh - and to back up DSGamer - it was a bit of a shock when we first went over the $150k line and suddenly lost a few of the deductions we had been eligible for. Like, we used to be able to writeoff the sizable loss we take every year on our Seattle-area rental, but now we can't. Hopefully that market turns around so we can get rid of that house. But our overall tax rate was still just 16% and at the level that we don't even notice that the money is missing from our paychecks.

As for working harder - I'm in the same job that I was in straight out of college. I have more responsibility, but I also have more experience. I don't feel like I work any harder. My wife has a much easier job (still a nurse, but no longer at Harborview Hospital in Seattle).

Anyway - point being - I think it's all about perspective. Maybe it's because I grew up relatively poor. We didn't use food stamps or anything, but we relied on our grandparents for groceries at the end of every month. Because of that, I feel pretty well off now. And certainly much more well off than we were even just out of school.

Not trying to attack you DS, I think it's just a matter of tone. I liked the way Hypatian stated it, so I have nothing else to say there.

KingGorilla had a great point earlier, that I've noticed for a long time. Our standard of living in this country is ridiculously high, too high. Too high for our incomes. I could easily live with 3 roommates or more in my apartment (doubling up in already small bedrooms, not counting living room space which could probably hold 3 or 4 more if we were really cramming it in), but I have the luxury of living alone and burning that pile of cash for my own benefit. People don't make wise decisions at almost ANY level of income. Essentially we should all probably look at our household and discretionary spending and cut it in half.

The very poor have no choice because they've hit the rock bottom of housing cost by necessity and the very, very rich usually have outgrown their spending ability or appetite. Not all, of course, see actors and elite athletes who buy huge houses and then need an income boost because they didn't budget for it. Hell, look at Michael Jackson's finances before he died.

In the end this is not an American question, but one as hold as the concept of wealth and humanity in general. To do it justice we should really try to suss out which parts of this question are particular to our countries situation before we go down that rabbit hole.

I'm not sure what my tone was. I've been defensive after the initial responses to my post. I admit that isn't helpful. But otherwise I've simply been trying to give one perspective on why someone who makes more money might not perceive themselves to be as wealthy as they are. I thought I was contributing to the OP by explaining that there are things that happen to some people as they move up the ladder that chip away at that perception.

Jolly Bill wrote:

KingGorilla had a great point earlier, that I've noticed for a long time.

No love for the iPhone crack?

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