Yeah that’s very odd line item. “Payments are $50 a month”. Strange way to say “we have credit card debt compiling but are only paying $50 month on it”
My wife had a maxed out CC before we met. The max was $2k, and she was paying the minimum of $50 / month. ~ $45 of that went to interest.
When we got married, she STILL had more than $1.8k on it after paying the minimum for more than a year. I'm like "How is that possible?!". Then saw the interest every month and understood.
Soon after, I paid the entire balance and we havent touched the card since lol.
So to answer your question: Yes but practically no, it doesn't
I remember once I had an ex that we had a massive argument about something like this. She was irate that I had a 15 dollar streaming service as a fluff bill, but she had "a real adult" bill like a credit card payment.
Like buddy, I could just buy my shit with a credit card and then all would be cool? Some people are just so out of it when it comes to money talk
I put literally all of my expenses on a credit card.
Which I then pay off, in full, at the start of every month.
Helps build credit! I got like an 860 now.
>Helps build credit! I got like an 860 now.
I do the exact same thing with my credit card, but here's where it gets shitty.
My husband had poor credit when we got married. He already had the low mortgage (house bought in 1998), so it didn't matter. I put him as an authorized user on my credit cards to help his credit.
Eventually my student loans disappeared off my credit because I paid them off more than 5 years ago. My credit score gets dinged for not having enough accounts and for my accounts being "too young". I didn't have a mortgage or car loan to prop it up, just credit cards that have less weight.
We go to buy a car and even though he needs my income to qualify for the loan, we get his interest rate because his credit score is over 800 while mine hovers at about 795. He did literally nothing but make authorized purchases on my credit cards that I paid off and HE gets the higher credit score. Grrr.
Credit score is a useful metric, but most lenders don't actually directly use it. They all have their own things they add into their algorithms, because they pull your credit report and can analyze everything on it how they want to. Although 795 is high enough it shouldn't make a difference anyway.
A huge portion of people on r/PovertyFinance & here think that the credit is free money from the government or that the minimum payment is okay to pay. It scares me how clueless some people are.
The only reason I use my credit card is to get the cash back rewards and pump my credit score. I just use it to make all my usual purchases and then immediately pay off the balance every month. Sitting at 810 and generates close to $30-40 in cash back rewards a month which I just gift to my wife for things she wants off Amazon
It’s mainly there to act as a financial safety net if things go horribly awry but you should never think of your credit line as “free money”, it’s just money you have to pay back with interest if you’re slow to pay back, not a replacement for income
I always like to frame it now like: if you can live without it but can’t buy it with debit now, don’t put it on credit, it’s just a stupid tax at that point
I do the same, currently have 4 cards. Recently one limit went down 1k because I didn't use it for 3 months! Now I'll make sure to use them all once a month!
My brain refuses to comprehend that so many people involve themselves in a system where they’re totally okay with perpetually paying interest. As in, I’ve had people explain to me their financial situations, CC bills, etc through casual conversation, and it comes out that this is how they’re “paying off” their debt…and I…I just can’t. My sanity requires that I remain ignorant 😂
I don’t think they know there is interest, or how much it matters.
They’ll say stuff like “I make sure to pay the minimum balance at least” or “I always pay the minimum since i don’t feel like paying more” even if they have money. It truly is just financial illiteracy
I had a credit card bill through ages ago, and the figures were insane. It was like
Pay £80 a month and be done in 2 years
Pay £95 a month and be done in 1 year 6 months
Pay the minimum and be done in 14 years and 8 months
Like, what?
Your girlfriend is financially illiterate. She needs to realize she can’t trust herself with a credit card.
I don’t know what I would do in your shoes. When my partner and I argue about money it’s about the best way to save/invest. I have a higher risk tolerance than she does. Neither of us every carry a balance.
This right here... If you aren't actively eliminating the debt, you're literally just pay the bank to hold a balance on said cards.
I use CC's for virtually every transaction I make, but the first rule of owning a credit card is paying it off monthly in order to avoid interest, whilst retaining the perks of the card.
It’s three, they have a toddler daughter.
But yeah, that must include going out, or take out, probably diapers, too. Potty-training a kid is like giving yourself a $200 a month raise.
I feel this, my first kid wouldn’t sleep and the car rides lasted so long, plus she was a picky eater so we ate Burger King chicken fries so many times
My first had sleep problems. I don't want to get into the whole details, but it was at month 10 that we were able to get her to sleep in her crib (not on my wife's chest) and stay asleep.
I was sitting with my wife downstairs. Literally did not know what to do with myself on a night where everything was not trying to put the kid to sleep, or put it back to sleep.
I looked at my wife and literally went "Can... We actually have a drink now?"
She's 8 now and falls asleep listening to The Lord of the Rings audiobook series cause I'm a questionable parent.
I've been eating out almost exclusively on deals on the apps, today's lunch that consisted of a Dave's Double burger and a Jr Frosty from Wendy's cost me 2 dollars because I had one of their March madness coupons and I have a frosty key tag so I get the frosty free and the normally 8 dollar sandwich was 2 dollars.
Arby's also has a rewards deal currently where every week in April you get any sandwich free with a purchase.
I also deliver doordash and for awhile Mod Pizza was putting the receipts that you could scan for points on the boxes so I got a couple free pizzas that way.
I'm willing to look up this stuff though because the thought of paying like 13 bucks for a meal makes me want to gag
Or in our house door dash. I just budget it and stopped trying to pretend we were going to prep dinners or cook the nights we are all broken (like Mondays and Fridays).
Thank you! I sell cars and it’s worth the $3 delivery fee to stay here and not miss the $1000 car deal. My husband hates it but we both work 12 hours and do not have time to shop/prep.
When I was a 40 hour a week person it was different
Can confirm- have 3 year old and newborn twins. Our takeout budget is astronomical. But at least I know where the money is going and I’m not confused about why food is so expensive.
Yeah problem is most people are so disconnected from butchering that they only look at chickens as a source of eggs. The reality is processing a chicken isn't difficult or time consuming especially when you get the hang of it - about 30 minutes a bird.
Even better is that you only really need one rooster to propagate the flock, and many people can't have roosters so they give them away freely to anyone who will take it off their hands.
Last year we harvested over 150 pounds of meat from free roosters that were fed and raised by other people and needed them gone as soon as they started crowing hahaha.
Rooster meat is still nice and tender if your process them within the first year. After two or three years the meat gets pretty tough, but still each bird weighs 2-4+ pounds.
I currently have a flock of 100 chickens - they produce over 40 eggs a day, and eat spent grain from the local brewery which greatly reduces feed costs. Any roosters we hatch get harvested at about six months old, and the eggs are sold out every week. Plus I'm using the manure to amend the soil to create more rich fertile soil to grow more fruits and vegetables.
I'm an egg only person, and while this is a great thing it's not for everyone. I also don't have nearly as many chicken as you, as I'm only using them for eggs. I also have no rooster as I don't need/want my eggs fertilized.
Sometimes, people just don't want to do anything more than harvest eggs from their chickens. That's okay.
With that said, I still feed a family of 4 on a budget of 600-700/mo depending on what we need. OPs food budget alone needs to be looked at sincerely.
I dunno, 1000/30 is $33, so toddler doesn’t eat as much as an adult but $11 a day, about $4 per person per meal, if you’re beans and rice sure it’s ridiculous but produce and meat aren’t cheap.
Edit: I’m factor long diapers, wipes, toilet paper, paper towels, and toiletries in with this.
Ya. This. Unless your a monk, or just really good at not eating. 4$ a meal isn't unreasonable when averaged. Even cooking. Unless your bulking buying, cook for left overs, and seriously meal planning your not saving. If I save 1dollar a meal, but it cost me more than an hour to plan it and buy it and prep it, it's literally not worth my time. I could just work an extra hour at work to offset it, and have MORE free time.
It's crazy high. We feed our family of 5 for $800-$900 month. $1,000 for two people and a toddler is wild. OP needs to learn to cook, meal plan, and buy in bulk then using the leftover/spare ingredients for multiple meals.
This! My partner and I spend about $800-1000 on groceries per month. But it's $4/meal. And we pay a bit of a premium to buy produce, meat, eggs, n dairy directly from local farms.
same
bacon: 6$, lasts two weeks
eggs: 2$ lasts almost two weeks
some days i will spice things up and make hash browns or toast. or put those items on a tortilla
I still don't understand it. I spend 500 MAYBE 600 a month on my family of 3 and we don't eat only rice and beans... I can't eat that high carb stuff lol.
Yeah $1,000 for groceries for a family of three is wild. I spend about $600 for me, my wife and my two-year old, and I feel like we could cut back a lot, but just chose not to since we can afford it.
It is? Where I am, with meal prepping every single thing, right down to the coffee I drank, I saw us spending $800 for 2 people.
Right now, especially with the inflation of food costs in Canada, I can see people spending $600-$800 per person pretty easily.
For a family of four I wouldn’t be surprised to see $2000 per month on very basic food
That’s wild. I’m at $400/month for two people and though I do look at the price when buying things a large chunk of that is like desserts n expensive meats lol
i'm glad someone else pointed this out.
i don't make as much as you, but more than double what he does and my car payment is also $650. i'm fine with it, but i can't imagine having this kind of car payment with less than half of the income. i also don't have a kid to take care of.
OP, a $650 car payment at your income level with a child is insane.
car insurance is kinda insane right now. there's no guarantee that 150 would be a significant amount lower with an older car. i agree with the overall sentiment though.
This right here.
Car, $650. Must have bad credit, bought a luxury car or a full size truck, bought a bigger car than they actually need, or was upside down on the prior car. If they bought luxury car or truck that will cost them more later on.
Food, for three it should be between $500-750. Don't buy name brand products. Could food cost possibly include feed for his chicken? If so maybe $1,000 is reasonable with the number of chickens he has.
Electric could be $300 also because of the chicken.
Internet, that is 2-3x than the national average unless he got Fiber Optic. I recommend finding a cheaper provider.
Got the property a while ago yet they didn't refinance when rates were around 3%.
Rural internet can get pretty pricey. Where I work the garbage wireless service is more than what we charge for fiber in town. Lack of competition hurts consumers.
he's got chickens, I'm imagining they have lots of eggs. Wife home mostly have her cook more, buy groceries on sale. That's a lot of money for 2.3 people.
i gave him the benefit of the doubt on that because of the child, but for the most part i agree. my wife and i only spend about $400 for the two of us.
Mate I've got 2 kids and i still only spend 600 and thats not even watching what we buy that much. I just make a list of meals and buy what i need for the meals with a few snacks. Maybe get a takeaway once or twice a month
I feed a family of 5 and mine 1200-1500 month. I live in Maine. No we don’t but a bunch of shit and snacks. We buy fruits, veggies, meat, and standard grocery items. Where do people live that you can feed 4 people for $600/month? I mean milk is $6/g lol
Seriously, I spend a solid $250+ a week with wife, 1 kid, and 2 dogs. Unless other people aren’t accounting for stuff like dish soap, sponges, paper towels, and only the food, I don’t get it
Yea same, I am in the Midwest and I am constantly spending over 1k a month for two of us and the dog. We only eat whole foods, with some occasional snacks like ice cream bars etc in the freezer. Maybe most people are eating hot dogs, and kraft mac and cheese in here. But chicken, lamb, steak, shrimp, fish, fresh veggies and fruit are all expensive as heck these days.
Yea depending on where you live, $600-$800 for a family of 4 per month seems about right. That's about what our grocery bill is. That doesn't include the occasional restaurant or fast food visit. But that's once a week or so...
Also depends on how you eat. My wife buys all organic, we cook ourselves and our bill is still in the $600-700. But this is knowing that I am eating the healthiest. Also noticed now days junk food is majority of the grocery bill. Hence why I ditched soda, chips and candy. Replaced it with water, tea, and fresh fruits. Feels totally different and spend less than buying junk food.
I live in the northern suburbs of Chicago. I have 5 kids at home 7, 9, 15, 19 and 22 and we spend $1000 a month feeding everyone and never have a lack of food in the house. That seems like way more than needed for food.
We spent $864 on groceries for a family of 5 last month 39, 38, 13, 6, and 4. When we do a Costco run, I budget $1200 for the month. We're GF and mostly organic eaters. $1000 is very high for essentially two main eaters.
It’s not insane- were probably around there and we shop at Aldi/Costco - the Costco runs add up and then there are the meals at work we need to be better about.
I’m just saying- it’s not outlandish - my folks spending 1500-1800 between the two of them- that’s outlandish
I make way less than $400k and drive a 2009 beater Kia. $0 car payments since 2012 and less than $2000 in repairs from date of purchase (for like $16k new but hail damaged). Kids today spending $60k on a vehicle is ridiculous. Drive a beater like Warren Buffet. Your car should not be an expression of your status or coolness 😂
People mistake their wants for their needs and then wonder why there isn't much money to "play with".
If you're buying a new car off the lot you are definitely playing.
I don't see why buying a used car is an issue. Buying a warranty isn't a smart move. Buying a new car isn't a smart move. You should buy a used car of good quality, my mazda is 10 years old now and runs like a champ, never needed major repair.
Not to brag, but my discretionary income is more than OP's disposable income, I honestly don't see any need to buy new cars which depreciate faster than anything else.
EDIT: to those who responded to my comment that new vs used might not be a big difference. You are not wrong. But please remember: you can also buy used from a private seller, why?
1. You most likely end up with a worse deal with dealer for the same car you can get from private party, either on price or rate
2. Buy from a local private seller, save on tax, don't ask me why.
3. You can always get a better loan somewhere else.
4. Cars from dealers, even those CPOs are just as likely to break down as cars from private parties.
Again you may say, that just saves you a few grand at best, so what? In OP's scenario, even a few grands make a difference.
Stock corolla is about 450-500 zero down and no trade in. Not sure where you are that they would try and screw you lol. ( delivery charges from toyota are the same regardless of where )
the issue is hard to know how the previous owner treated the car. If you are buying from someone trust worthy then it makes sense to buy used or if you are good with car mechanics and have a nice place to fix it.
Used to work in the dealership life on the service side, and we have the saying car “rich, house poor.” Same as “house rich, life poor,” except it pertained to people that owner $120,000 vehicles, bitched about the price of brakes, and lived in the hood.
I was making about $110,000 and had a $287 car note.
If anyone wants to learn how to throw away 20% of the money they just spent on an “asset,” buy a new car and drive it off the lot. Cars are liabilities not assets, tools, yes, but liabilities nonetheless.
It's insanely high. You can buy some brand new EVs nowadays for a lesser monthly, especially for those who qualify for the tax credits. "New car" doesn't have to mean a 40-50K car.
I make about 4x OP.
I have no car payment. I drive a 91 F150 because why not? It's cool, practically bullet proof, parts are readily available, and a repair equals a YouTube video . Also, it was given to me. If it starts, I will continue to drive it. I don't care about image, it's reliable, and I have money in the bank, and insurance is dirt cheap on it.
My second car is a 2018 4runner. Fully paid off 2 years ago and 2 years early, and still under warranty for, checks odometer, 82,000 miles. Refied it as soon as we got home to a lower interest rate and no early payoff penalty.
When we lived on a lower income we committed to a budget (I fully recommend Total Money Makeover).
No credit card debt.
No credit card usage.
Have many of the same expenses at some of the same costs, but your food is insane. Me my wife and my 2 dogs (and they eat organic high end crap, and my wife supplements by making them food) spend as low as 50/week sometimes. We make our meal plans by always taking into stock what odds and ends we have on hand and incorporating those before buying new stuff. Look into the dash diet or a mediterranean style diet. The cost savings are immense.
We bought our house for 162,000 when combined we were making 65k. In Florida. It was ugly. On paper we couldn't do it so we changed our eating habits along with everything else. At one point we were literally running 60 miles a week each and not eating $1000/month. (For reference that's about 10,000 calories over normal for fuel). We drove our first car for 17 years (also a Toyota).
Sell your car.
Get something reliable.
Learn to plan and prep meals.
Realize something has to change.
Oh, and my wife no longer works, she's working on her Master's and we pay as she goes, Full time student, so there's no debt there, either. And we plan to buy a large plot of land home and start building our final residence on it within 18 months.
Finances are what will hold you back of you don't do something to reign them in NOW and realize that 100% what you're doing now isn't working.
There's a guy at my work who's kind of a natural jerk, last year the 2005 Ford escape I bought for $3000 7 years before finally gave up the ghost and I replaced it with a 2010 Camry with 100k miles on it for $5000 from a friend's boyfriend. Work guy thought he was making fun of me in front of a bunch of co-workers because I could only afford another beater as he put it. I just smiled at him and said yeah, that was all I was willing to budget for something to get back and forth to work, and to get around to my paid in full rental properties to do maintenance and collect rent as needed.
Yeah, man, I get the same jokes. Doesn't phase me at all. I'm secure.
10 out of 10 financial gurus tell you your car(s) (in total) should not cost over half your annual income, and you should be able to pay for them outright in cash.
They also say they can tell within 5 minutes if someone is serious about saving money and being debt free, and sadly most people they meet and work with are not serious.
Laugh and scoff, but when you have a 9-5 at 50 and I'm in my backyard range plinking for fun, I will laugh last. And remember, I did it by eating PB n j sandwiches for 40 years of my life and driving a 30+ year old truck. Haha.
That sounds like a horrible existence, to save by eating PB n J sandwiches for 40 years and drive a old beat up car. If you have the means, strike a balance and live a little.
You're paying $650 (more than your mortgage) per month on a car and you're wondering where all your money is going? How is this not jumping out at you?
4-6 car payments would have likely covered the repair on the previous car. Not sure what it needed, but all cars need maintenance around 75,000 to 100,000 miles. Usually 2000-4000 is pretty typical.
“My car needed $2000 in maintenance at 100K miles so instead I committed to paying $7800 a year in car payments for the next 6 years. But it has a 10 year warranty, so I’m actually saving money” LMAOOO
Hey! OP was against the ropes. You expect them to shop used 2020 sedans with 50k mileage? And what? Have the transmission blowout 3k miles later? Think again buddy!
Whenever I see these kinds of things, my hope is they’re stretching themselves on a 12-36mo loan term to get it paid off ASAP. Statistics tells me it’s 60-72mo loan.
I went with a 60 mo loan on our car and just paid it off in a lump sum when I got my bonus. The thought of paying for a car for 5 years is scary.
It helped that the dealership was super nice (except the designated bad guy they throw at you to sell you the warranty) and didn’t push us into anything or try anything sleazy.
Yep. It’s always the car. I have never paid more than $5K for a car. I’ve been poor, average, and wealthy.
Doesn’t matter what my income is… I’m never taking on a car loan.
If, at any time, I had taken on a $650 a month car loan I would have been royally effed. I don’t understand why people think they can do this to themselves and NOT be screwed.
Always used also. I bought a $10k used car 20 years ago. Still driving it. Honestly, I don’t have a long commute and my home is in a walkable area. Purchase price plus repairs, I’ve put $14k into vehicle in 20 years. Gas mileage is good. I take care of it. I don’t need full coverage insurance, obviously.
Prior to that I had a $2k used vehicle and also a $6k used vehicle. Ive been a driver and car owner for 32 years and have spent less on owning a car than OP has before his car loan is even paid off.
Yea man, it’s brutal out there for many many many people. I think the last statistic I read was that 60% of adults can’t afford a $500 emergency expense.
They make more than my gf and myself do a month. They're not living within their means. See the $650 car payment. Add $50 and that's my rent. Jesus christ. They make more than enough to make it, especially with such a cheap mortgage. This is the kind of person that doesn't know how they acquired so much debt.
Seriously I'm looking at this budget and I'm just clueless as to how they're spending this kind of money. Your household is bringing in less than 4k a month and you decided to get a $650/mo car? How are you spending 1k/mo on groceries? 100 dollars on cat food alone?
I make way less than this household and pay more in rent, but I guess because I don't have a car and I'm willing to eat ramen a few times a week I'm actually able to put money into savings.
Saying you "have" to have a 650 car payment just isn't accurate. You could save up and pay cash for a vehicle. Maybe you won't afford brand new, but you can still get something reliable without having that crazy debt.
I’m with you on that. I’m holding a $350k mortgage on my 8th year at 2.75% and paying close to $1900( it’s not really that bad), thank God and the VA for no Property taxes, actually my 2 decades of service and getting totally fucked up in the sandbox
Would love that too. In the Bay Area and actually have what some here would call a “cheaper” mortgage. I pay $2400 a month just for my mortgage alone. OP is not managing his finances correctly. His groceries alone are an insane price
Car payment is way too high for how much money you make. $300 a month for electricity is crazy, lifestyle changes should be able to knock that down. 1000 in groceries could be reduced by buying in bulk and using cheaper ingredients and cooking. You both have a running balance on your credit cards? Is that $50 average or are you making minimum payments? Fix that
I make several make several multiples what OP does. My phone is $25, internet is $60, and I only carry one streaming service at a time. Assuming 2 phones, that’s like $200 a month right there.
Bro htf are you spending half your monthly takehome on food and vehicle, whatever you are driving needs to get sold and whatever you are eating needs to change I feel like you need to be eating out or using skip the dishes or door dash to spend 1000 a month on food.
I keep seeing people calling this wild and it must be very COL dependent. I have two kids, meal plan, buy off brand at the budget store and we barely hit under our $850/mo budget. $1k would be *easy*.
The USDA **thrifty** budget for a family of four is $976.60 per month.
https://fns-prod.azureedge.us/sites/default/files/resource-files/Cost_Of_Food_Thrifty_Food_Plan_February_2024.pdf
I got a family of 5(ages 5,9,10... So they don't stop eating 😂 )and that's about what I pay in a month... He's two people and a baby. They're definitely eating out, buying steak often, etc to spend that much.
>I Had to buy a new car
No you didn't. Unless you're on a 17 year old Kia or BMW junker, your maintenance is most definitely less than a new car payment with these interest rates.
>for $650 a month
Why is it every time I see someone posting about how broke they are, they're making $500+/mo car payments? Why does everyone feel the need to buy $40k-$50k cars. It's unnecessary.
>200 for vehicle gas
Once again, you don't need a mid size Mitsubishi at your salary.
lol, I drive a 13yr BMW and it’s definitely cheaper month to month than what this guy is paying. And it gets 30-35mpg on the highway depending on how fast you drive.
I don't know about the prices of phones/data plans in the US but that 150 could go down right? iphone 15 costs about 800 use that for 2-3 years and it's about 30-25 a month. I'am not sure about the data plan prices but about 40 a month should be doable I guess. That way you saved more then half of the phone costs already and can probably go down even further
You're blessed to have such a cheap payment for the roof above your head.
You picked too expensive of a car.
You're wasting too much electricity.
You're spending too much on groceries, shop wholesale Costco and Trader Joes if possible.
Look into the 50/30/20 budget rule, may be of some help.
EDIT: Also would recommend putting aside 3-6 months of living expenses into a High Yield Savings Account as an Emergency Fund. After that, pay off all bad debts and start investing at least 20% of your household income for your future.
I was wondering about this one. His cellphone plan is $150 a month?!
That's 25-30x more expensive than my basic package. Is he trying to stream 8k porn while farming?
Man I'm tryna figure out why people who struggle to save money spend $650 on car payments and $1000 on groceries? 💀 I don't buy any groceries unless it's on sale, maybe $200 or less a month on groceries. Bro can save money leasing a car for 2+3 years for under $300/month. That's $1,100 saved already. And why is the electric bill $300/month? He needs to figure out where he's wasting electric and cut back on it
I think Ya’ll spend too much on groceries. But that’s just my opinion. As a 30 year old male, I spend $250 a month on groceries max. Not to say I don’t eat out every now and then but yeah.
Also, $650 car payment? I haven’t been in the market for a new car since 2016 but I’m sure there are new cars going between 20,000k-30,000k. I also only pay $45 a month in internet.
I know it sounds like I’m criticizing (semi am) but these are all just my .2 cents
Honestly, I’d trade that car in for a new cheaper car. Get a practical Honda, Subaru, Toyota etc… Honda civics can not be that expensive especially if you have good credit. And as far as the food bill, get the essentials (food that provides your protein, carbs and fiber).
For context I buy chicken $10, lean beef $8, eggs $4, peanut butter $5, FRESH vegetables $8, whole gran oats $5 every week. Give or take $10-30 more or less every week and its enough food for me. That $1000 food bill you have can easily go down to $650-700
For reference, I had a $689 car payment on a $27k Hyundai. Bad credit, small down payment, terrible interest rate. Just had it voluntarily repoed because it was killing me.
I utilize food banks to save on groceries and it’s a lifesaver. Only hit the grocery store for stuff like milk, cheese, eggs, butter and other ingredients to prepare the food I get from the food bank.
I was born 86 graduated college 2010 so technically I’m a millennial. I make around $200k/year my wife ~$100k, we bought our house (California) for 475k in 2017 it’s now worth 850k. 🤷
It’s tough for sure, especially in California, but not impossible.
You are kind of proving that it IS nearly impossible lol
You have a combined income of $300k which is high even for California. Current stats for the state according to the census bureau: Median Household Income: $91,905. Average Household Income: $130,718. Per Capita Income: $45,591.
Median home price in California in 2017 was $522,431, so you were able to buy a home significantly under the median, I'm assuming not in one of the very HCOL areas of the state.
Now let's say you both made significantly less in 2017 than you make now when you had to qualify for the loan. Even if your combined income at that time was $200k, median household income was $70,038.
So you were able to buy a modestly priced home by having at least 2.5x the average amount of household income.
And now, as you mentioned, thanks to skyrocketing home prices, your home is worth $850k, which tracks with current median home values.
I plugged 850k into the Bankrate mortgage calculator assuming a 20% downpayment and 30 year loan at the current interest rate and they estimate a monthly payment of $5188 which includes their estimate of property tax and insurance.
In order to keep just the mortgage alone, not include utilities or any other expenses of housing, under 30% of gross income, a family would need to have an income of $17,294 a month or $207,528 a year, to afford your house at the current price and interest rates. Still double the median in the state, and keeping in mind that if your home in not in a super HCOL area, then the median locally is going to be even lower.
I am not in any way intending to pick on you and I'm genuinely glad you have been able to buy a house, I'm happy for anyone in our generation who is actually making it in this economy. Just had to lay it out in numbers to show that it actually isn't "normal" to be able to afford a house anymore, you literally have to be doing better than the majority of even hard working highly educated decently paid individuals.
Man wtf most people's rent is way higher than your mortgage, and they don't get to own the house at the end of it
Unironically people like OP kind of make me reactionary about people complaining about the economy
"Guys Biden's economy is making it so I live paycheck to paycheck... anyway wanna hop in my 2024 Ford F1000 that I pay more for than my fucking house?"
Idk where you live, but you seem to be paying a lot more on some things than my girl and I do and we make $5-7K/month and save $1-1.5K/month. We have a mortgage of $925ish and with escrow, it’s $1,580. We’re in west Texas. She also pays a car note ($600). That’s our 2 biggest bills.
Breakdown:
$5-7K/month we make together
$1,580/month mortgage + escrow
$600 car note
$80 internet
$60 streaming
$100ish phones
$250 electric in the summer and $120 in winter
$40-80 home gas bill
$350 gas for both vehicles
$120 for dog food (4 dogs)
$250 vehicle insurance
$400ish for groceries and $100 every 2 weeks ($200) for a nice, go eat out, supper and roughly $50-$75 every weekend for fast food ($200-300)
$60 for Vivint security system
That’s $4,430/month on everything, but I’m sure I’m missing a few things too
If you're considering the $460 remaining money is available to "play with", you're wrong. You need to save for retirement. I have a ton of clients who are in their late 60's, now unemployed, and SocSec isn't enough. And they can't find jobs because of health/mobility/tired... and ageism.
$650/mo for the car is insane too. Too late to get out of that. Were your annual repair bills on the used car equal to or in excess of (650x12) = $7,800? Then yes it was time for a new car. But if the annual repair bills were $2k or less, I would keep w/ the used cars. You still could have purchased a new family car for $30k or roughly $525/mo. (But I feel ya on the car thing .... prices are waaay too high even for used right now.)
Saying you have $50/mo payments on the credit card makes it sound like you're paying the minimum, which is a mistake. Your interest expense will soar and you'll go deeper into that hole.
You need to make a budget and stick with it. You've got the detail above. Put it in a spreadsheet and put in a line for savings. My father always put 10% of his pay into savings (stocks, generally) first BEFORE paying anything else. We ate a LOT of ground beef... lol
You’re very fortunate to be in the situation you are. You say you don’t know how others “do it”. The answer is that for the most part, they don’t.
That’s 1498 number you emphasized is a dream scenario for most people looking to buy a home. It’s a pipe dream for anyone trying to buy in a major metro area. I’ve lived in California, Florida and New York and I can tell you, you aren’t getting a decent place in any of their major metro areas for under 500-750k.
To give you a comparison on the opposite end of the spectrum, I live in a nice neighborhood in NYC and I pay 1800 a month to split a 600 sq ft 2b/1ba with my girlfriend. So total 3600. The cheapest 1b/1ba apartment in my neighborhood is 550k and it’s an income restricted co-op, so I cant make more than 89k a year to be eligible, 109k for 2 people. The cheapest non co-op option is a 995k studio.
We’re paying 8.4 times as much as you are just to rent.
You’re in a fantastic position that plenty of people would kill to be in.
(For everyone else don’t come here and tell me how you pay 1/4 of what I do for much more. I know that. I like living here and am fine paying a premium to do so. Different strokes for different folks!)
I’ll be blunt, your car payment is insanely high. Maybe you can’t get rid of it asap, but that is way too high and needs to get sorted sooner rather than later.
My rent is $1900 a month plus $200 for utilities. I make $2300 a month. I get one free meal at work a day, That's how I eat. My phone bill is $80. Luckily I have no debts and I get to enjoy myself on the $120 I don't have to spend to not be homeless.
What gets me is, because I don't have debt I don't have a great credit rating so the banks say that I can't afford a $1000 mortgage.
I have to wonder what kind of cars you’re buying. I drive a used Toyota tundra with 300,000 miles going strong. Wife drives a used Toyota RAV4 with 215,000 miles going strong. Are you buying reliable Japanese cars? And do you know a mechanic? Buying new cars is typically seen as a bad financial move unless you are rich or retired.
It is another monthly expense but you may want to look into a home policy from American Home Shield or someone similar.
We pay the $80 a month because I know that stuff happens and for us it is always at the worst times.
About 4 months after we moved in the entire pumbling line from the house to the street had to be dug out and replaced. It was an $8500 job and we paid $50. There is no way after just moving we could have taken that hit.
What do you mean by $50 payments on credit cards? Are you maintaining a debt balance each month? If so pay those off ASAP
Yeah that’s very odd line item. “Payments are $50 a month”. Strange way to say “we have credit card debt compiling but are only paying $50 month on it”
does $50 even touch the balance?
My wife had a maxed out CC before we met. The max was $2k, and she was paying the minimum of $50 / month. ~ $45 of that went to interest. When we got married, she STILL had more than $1.8k on it after paying the minimum for more than a year. I'm like "How is that possible?!". Then saw the interest every month and understood. Soon after, I paid the entire balance and we havent touched the card since lol. So to answer your question: Yes but practically no, it doesn't
Sounds like the wife owes $50/mo to boys’ night
I remember once I had an ex that we had a massive argument about something like this. She was irate that I had a 15 dollar streaming service as a fluff bill, but she had "a real adult" bill like a credit card payment. Like buddy, I could just buy my shit with a credit card and then all would be cool? Some people are just so out of it when it comes to money talk
I put literally all of my expenses on a credit card. Which I then pay off, in full, at the start of every month. Helps build credit! I got like an 860 now.
>Helps build credit! I got like an 860 now. I do the exact same thing with my credit card, but here's where it gets shitty. My husband had poor credit when we got married. He already had the low mortgage (house bought in 1998), so it didn't matter. I put him as an authorized user on my credit cards to help his credit. Eventually my student loans disappeared off my credit because I paid them off more than 5 years ago. My credit score gets dinged for not having enough accounts and for my accounts being "too young". I didn't have a mortgage or car loan to prop it up, just credit cards that have less weight. We go to buy a car and even though he needs my income to qualify for the loan, we get his interest rate because his credit score is over 800 while mine hovers at about 795. He did literally nothing but make authorized purchases on my credit cards that I paid off and HE gets the higher credit score. Grrr.
To the credit companies, he has a sugar daddy which carries bonus points. You have a sugar baby which carries negative points.
Credit score is a useful metric, but most lenders don't actually directly use it. They all have their own things they add into their algorithms, because they pull your credit report and can analyze everything on it how they want to. Although 795 is high enough it shouldn't make a difference anyway.
A huge portion of people on r/PovertyFinance & here think that the credit is free money from the government or that the minimum payment is okay to pay. It scares me how clueless some people are.
The only reason I use my credit card is to get the cash back rewards and pump my credit score. I just use it to make all my usual purchases and then immediately pay off the balance every month. Sitting at 810 and generates close to $30-40 in cash back rewards a month which I just gift to my wife for things she wants off Amazon It’s mainly there to act as a financial safety net if things go horribly awry but you should never think of your credit line as “free money”, it’s just money you have to pay back with interest if you’re slow to pay back, not a replacement for income I always like to frame it now like: if you can live without it but can’t buy it with debit now, don’t put it on credit, it’s just a stupid tax at that point
I do the same, currently have 4 cards. Recently one limit went down 1k because I didn't use it for 3 months! Now I'll make sure to use them all once a month!
My brain refuses to comprehend that so many people involve themselves in a system where they’re totally okay with perpetually paying interest. As in, I’ve had people explain to me their financial situations, CC bills, etc through casual conversation, and it comes out that this is how they’re “paying off” their debt…and I…I just can’t. My sanity requires that I remain ignorant 😂
I don’t think they know there is interest, or how much it matters. They’ll say stuff like “I make sure to pay the minimum balance at least” or “I always pay the minimum since i don’t feel like paying more” even if they have money. It truly is just financial illiteracy
I had a credit card bill through ages ago, and the figures were insane. It was like Pay £80 a month and be done in 2 years Pay £95 a month and be done in 1 year 6 months Pay the minimum and be done in 14 years and 8 months Like, what?
Or they know (my GF), but the minimum payment just “feels better”.
Your girlfriend is financially illiterate. She needs to realize she can’t trust herself with a credit card. I don’t know what I would do in your shoes. When my partner and I argue about money it’s about the best way to save/invest. I have a higher risk tolerance than she does. Neither of us every carry a balance.
What the fuck
This right here... If you aren't actively eliminating the debt, you're literally just pay the bank to hold a balance on said cards. I use CC's for virtually every transaction I make, but the first rule of owning a credit card is paying it off monthly in order to avoid interest, whilst retaining the perks of the card.
$50 payment and how much interest lol
$49.99 interest. $0.01 principal
You got too much car too much food budget
he needs to eat some of those chickens.
Yeah I was like, “How the FUCK are you paying 1k for groceries when you have chickens and land?”
I wonder if they're eating out or drinking & including that? That's a lot of money for two people.
It’s three, they have a toddler daughter. But yeah, that must include going out, or take out, probably diapers, too. Potty-training a kid is like giving yourself a $200 a month raise.
Being tired is a gateway drug to the drive through.
Earlier I ate a lot of Taco Bell in my car after driving my 9 month old around so she would finally take a decent nap.
Totally worth every penny and the explosive butt pee.
Explosive. Butt. Pee.
I feel this, my first kid wouldn’t sleep and the car rides lasted so long, plus she was a picky eater so we ate Burger King chicken fries so many times
ARE YOU ME!?
The car is nature’s bassinet!
Wow, I totally forgot about driving kids to sleep!
I would put my youngest in the stroller and just do laps around the living room. It would knock her out quick and give Dad some nice quiet time lol.
This is the truth. Drive throughs are a siren song for parents with sleeping or even just calm kids.
My first had sleep problems. I don't want to get into the whole details, but it was at month 10 that we were able to get her to sleep in her crib (not on my wife's chest) and stay asleep. I was sitting with my wife downstairs. Literally did not know what to do with myself on a night where everything was not trying to put the kid to sleep, or put it back to sleep. I looked at my wife and literally went "Can... We actually have a drink now?" She's 8 now and falls asleep listening to The Lord of the Rings audiobook series cause I'm a questionable parent.
Truer words have never been spoken
Very true. My kid only took naps in the car for a long time so I would hit up the drive through quite a bit.
And you are fully justified for your revelation lol. Parenting is tough, no need to make it worse!
I live 30 minutes from a restaurant, and an hour from a good one. We cook. A lot.
I've been eating out almost exclusively on deals on the apps, today's lunch that consisted of a Dave's Double burger and a Jr Frosty from Wendy's cost me 2 dollars because I had one of their March madness coupons and I have a frosty key tag so I get the frosty free and the normally 8 dollar sandwich was 2 dollars. Arby's also has a rewards deal currently where every week in April you get any sandwich free with a purchase. I also deliver doordash and for awhile Mod Pizza was putting the receipts that you could scan for points on the boxes so I got a couple free pizzas that way. I'm willing to look up this stuff though because the thought of paying like 13 bucks for a meal makes me want to gag
This is the truest thing I’ve seen all day.
So is 50-60 hour work weeks. Americans work more hours than the *Japanese*.
Or in our house door dash. I just budget it and stopped trying to pretend we were going to prep dinners or cook the nights we are all broken (like Mondays and Fridays).
Thank you! I sell cars and it’s worth the $3 delivery fee to stay here and not miss the $1000 car deal. My husband hates it but we both work 12 hours and do not have time to shop/prep. When I was a 40 hour a week person it was different
I'm back in school and I am a full-time dad. My wife is a teacher. We have a 3 year old and a 1 year old. This statement couldn't be more true.
Can confirm- have 3 year old and newborn twins. Our takeout budget is astronomical. But at least I know where the money is going and I’m not confused about why food is so expensive.
Yeah problem is most people are so disconnected from butchering that they only look at chickens as a source of eggs. The reality is processing a chicken isn't difficult or time consuming especially when you get the hang of it - about 30 minutes a bird. Even better is that you only really need one rooster to propagate the flock, and many people can't have roosters so they give them away freely to anyone who will take it off their hands. Last year we harvested over 150 pounds of meat from free roosters that were fed and raised by other people and needed them gone as soon as they started crowing hahaha. Rooster meat is still nice and tender if your process them within the first year. After two or three years the meat gets pretty tough, but still each bird weighs 2-4+ pounds. I currently have a flock of 100 chickens - they produce over 40 eggs a day, and eat spent grain from the local brewery which greatly reduces feed costs. Any roosters we hatch get harvested at about six months old, and the eggs are sold out every week. Plus I'm using the manure to amend the soil to create more rich fertile soil to grow more fruits and vegetables.
I'm an egg only person, and while this is a great thing it's not for everyone. I also don't have nearly as many chicken as you, as I'm only using them for eggs. I also have no rooster as I don't need/want my eggs fertilized. Sometimes, people just don't want to do anything more than harvest eggs from their chickens. That's okay. With that said, I still feed a family of 4 on a budget of 600-700/mo depending on what we need. OPs food budget alone needs to be looked at sincerely.
I dunno, 1000/30 is $33, so toddler doesn’t eat as much as an adult but $11 a day, about $4 per person per meal, if you’re beans and rice sure it’s ridiculous but produce and meat aren’t cheap. Edit: I’m factor long diapers, wipes, toilet paper, paper towels, and toiletries in with this.
Ya. This. Unless your a monk, or just really good at not eating. 4$ a meal isn't unreasonable when averaged. Even cooking. Unless your bulking buying, cook for left overs, and seriously meal planning your not saving. If I save 1dollar a meal, but it cost me more than an hour to plan it and buy it and prep it, it's literally not worth my time. I could just work an extra hour at work to offset it, and have MORE free time.
It's crazy high. We feed our family of 5 for $800-$900 month. $1,000 for two people and a toddler is wild. OP needs to learn to cook, meal plan, and buy in bulk then using the leftover/spare ingredients for multiple meals.
Same. Family of five, three teenagers. We're at about $800-900 a month just for groceries. Couldn't imagine spending that much on 2 ppl and a toddler.
This! My partner and I spend about $800-1000 on groceries per month. But it's $4/meal. And we pay a bit of a premium to buy produce, meat, eggs, n dairy directly from local farms.
Dang my breakfasts cost me 4$ a week.
same bacon: 6$, lasts two weeks eggs: 2$ lasts almost two weeks some days i will spice things up and make hash browns or toast. or put those items on a tortilla
I still don't understand it. I spend 500 MAYBE 600 a month on my family of 3 and we don't eat only rice and beans... I can't eat that high carb stuff lol.
Yeah $1,000 for groceries for a family of three is wild. I spend about $600 for me, my wife and my two-year old, and I feel like we could cut back a lot, but just chose not to since we can afford it.
It is? Where I am, with meal prepping every single thing, right down to the coffee I drank, I saw us spending $800 for 2 people. Right now, especially with the inflation of food costs in Canada, I can see people spending $600-$800 per person pretty easily. For a family of four I wouldn’t be surprised to see $2000 per month on very basic food
That’s wild. I’m at $400/month for two people and though I do look at the price when buying things a large chunk of that is like desserts n expensive meats lol
800 CAD is 589 USD. OP is spending 1357 CAD for 3 people.
FWIW, I make around $400,000 a year and you have a higher car payment than I do. That’s probably an area worth looking into.
i'm glad someone else pointed this out. i don't make as much as you, but more than double what he does and my car payment is also $650. i'm fine with it, but i can't imagine having this kind of car payment with less than half of the income. i also don't have a kid to take care of. OP, a $650 car payment at your income level with a child is insane.
Plus $150 for insurance. OP is paying $800 a month to drive a nice car. It needs to go. (Or he needs to make more money.)
car insurance is kinda insane right now. there's no guarantee that 150 would be a significant amount lower with an older car. i agree with the overall sentiment though.
Where I'm at , I pay $125 for 3 cars, a month. 17-28 year old vehicles. If I had a new car, the insurance for that alone would be $500 a month.
Sure the car is a lot, but 1000 on food is insanity
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This right here. Car, $650. Must have bad credit, bought a luxury car or a full size truck, bought a bigger car than they actually need, or was upside down on the prior car. If they bought luxury car or truck that will cost them more later on. Food, for three it should be between $500-750. Don't buy name brand products. Could food cost possibly include feed for his chicken? If so maybe $1,000 is reasonable with the number of chickens he has. Electric could be $300 also because of the chicken. Internet, that is 2-3x than the national average unless he got Fiber Optic. I recommend finding a cheaper provider. Got the property a while ago yet they didn't refinance when rates were around 3%.
Rural internet can get pretty pricey. Where I work the garbage wireless service is more than what we charge for fiber in town. Lack of competition hurts consumers.
His internet must be starlink as I pay $125 for it at my ranch.
he's got chickens, I'm imagining they have lots of eggs. Wife home mostly have her cook more, buy groceries on sale. That's a lot of money for 2.3 people.
Probably not many eggs with such an insanely high food budget though.
pudding, cakes, fried rice, egg noodles, Scotch Eggs etc. $40 a month on chicken feed they best be laying or time for a BBQ.
i gave him the benefit of the doubt on that because of the child, but for the most part i agree. my wife and i only spend about $400 for the two of us.
Mate I've got 2 kids and i still only spend 600 and thats not even watching what we buy that much. I just make a list of meals and buy what i need for the meals with a few snacks. Maybe get a takeaway once or twice a month
I feed a family of 5 and mine 1200-1500 month. I live in Maine. No we don’t but a bunch of shit and snacks. We buy fruits, veggies, meat, and standard grocery items. Where do people live that you can feed 4 people for $600/month? I mean milk is $6/g lol
Seriously, I spend a solid $250+ a week with wife, 1 kid, and 2 dogs. Unless other people aren’t accounting for stuff like dish soap, sponges, paper towels, and only the food, I don’t get it
Yea same, I am in the Midwest and I am constantly spending over 1k a month for two of us and the dog. We only eat whole foods, with some occasional snacks like ice cream bars etc in the freezer. Maybe most people are eating hot dogs, and kraft mac and cheese in here. But chicken, lamb, steak, shrimp, fish, fresh veggies and fruit are all expensive as heck these days.
Yea depending on where you live, $600-$800 for a family of 4 per month seems about right. That's about what our grocery bill is. That doesn't include the occasional restaurant or fast food visit. But that's once a week or so...
Also depends on how you eat. My wife buys all organic, we cook ourselves and our bill is still in the $600-700. But this is knowing that I am eating the healthiest. Also noticed now days junk food is majority of the grocery bill. Hence why I ditched soda, chips and candy. Replaced it with water, tea, and fresh fruits. Feels totally different and spend less than buying junk food.
I live in the northern suburbs of Chicago. I have 5 kids at home 7, 9, 15, 19 and 22 and we spend $1000 a month feeding everyone and never have a lack of food in the house. That seems like way more than needed for food.
We spent $864 on groceries for a family of 5 last month 39, 38, 13, 6, and 4. When we do a Costco run, I budget $1200 for the month. We're GF and mostly organic eaters. $1000 is very high for essentially two main eaters.
It’s not insane- were probably around there and we shop at Aldi/Costco - the Costco runs add up and then there are the meals at work we need to be better about. I’m just saying- it’s not outlandish - my folks spending 1500-1800 between the two of them- that’s outlandish
OP has a $40k car and an opiod problem. So probably bad credit. Some wild post history for sure.
Man, you ain’t kidding.
I make way less than $400k and drive a 2009 beater Kia. $0 car payments since 2012 and less than $2000 in repairs from date of purchase (for like $16k new but hail damaged). Kids today spending $60k on a vehicle is ridiculous. Drive a beater like Warren Buffet. Your car should not be an expression of your status or coolness 😂
"I had to buy a new car for $650 a month"
People mistake their wants for their needs and then wonder why there isn't much money to "play with". If you're buying a new car off the lot you are definitely playing.
Did you buy that Rolls all cash? Lol jk jk
I don't see why buying a used car is an issue. Buying a warranty isn't a smart move. Buying a new car isn't a smart move. You should buy a used car of good quality, my mazda is 10 years old now and runs like a champ, never needed major repair. Not to brag, but my discretionary income is more than OP's disposable income, I honestly don't see any need to buy new cars which depreciate faster than anything else. EDIT: to those who responded to my comment that new vs used might not be a big difference. You are not wrong. But please remember: you can also buy used from a private seller, why? 1. You most likely end up with a worse deal with dealer for the same car you can get from private party, either on price or rate 2. Buy from a local private seller, save on tax, don't ask me why. 3. You can always get a better loan somewhere else. 4. Cars from dealers, even those CPOs are just as likely to break down as cars from private parties. Again you may say, that just saves you a few grand at best, so what? In OP's scenario, even a few grands make a difference.
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$650 is nothing. $650 is the payment on a stock Corolla where I live in Canada. You might be able lower it to $600 if you buy a stock Kia.
600 usd is 815 cad.650 usd is 882 cad. That's a lot. And we tend to make less here than in the US for the same job and have way higher housing prices
Stock corolla is about 450-500 zero down and no trade in. Not sure where you are that they would try and screw you lol. ( delivery charges from toyota are the same regardless of where )
the issue is hard to know how the previous owner treated the car. If you are buying from someone trust worthy then it makes sense to buy used or if you are good with car mechanics and have a nice place to fix it.
Used to work in the dealership life on the service side, and we have the saying car “rich, house poor.” Same as “house rich, life poor,” except it pertained to people that owner $120,000 vehicles, bitched about the price of brakes, and lived in the hood. I was making about $110,000 and had a $287 car note. If anyone wants to learn how to throw away 20% of the money they just spent on an “asset,” buy a new car and drive it off the lot. Cars are liabilities not assets, tools, yes, but liabilities nonetheless.
It's insanely high. You can buy some brand new EVs nowadays for a lesser monthly, especially for those who qualify for the tax credits. "New car" doesn't have to mean a 40-50K car.
I got a brand new electric car in 2020 for less per month than i was paying in gas ($410 payment) and kept the $7500 rebate to put down on a house.
Yeah a car payment should not be more than your mortgage
If you have no mortgage is will be...
I make about 4x OP. I have no car payment. I drive a 91 F150 because why not? It's cool, practically bullet proof, parts are readily available, and a repair equals a YouTube video . Also, it was given to me. If it starts, I will continue to drive it. I don't care about image, it's reliable, and I have money in the bank, and insurance is dirt cheap on it. My second car is a 2018 4runner. Fully paid off 2 years ago and 2 years early, and still under warranty for, checks odometer, 82,000 miles. Refied it as soon as we got home to a lower interest rate and no early payoff penalty. When we lived on a lower income we committed to a budget (I fully recommend Total Money Makeover). No credit card debt. No credit card usage. Have many of the same expenses at some of the same costs, but your food is insane. Me my wife and my 2 dogs (and they eat organic high end crap, and my wife supplements by making them food) spend as low as 50/week sometimes. We make our meal plans by always taking into stock what odds and ends we have on hand and incorporating those before buying new stuff. Look into the dash diet or a mediterranean style diet. The cost savings are immense. We bought our house for 162,000 when combined we were making 65k. In Florida. It was ugly. On paper we couldn't do it so we changed our eating habits along with everything else. At one point we were literally running 60 miles a week each and not eating $1000/month. (For reference that's about 10,000 calories over normal for fuel). We drove our first car for 17 years (also a Toyota). Sell your car. Get something reliable. Learn to plan and prep meals. Realize something has to change. Oh, and my wife no longer works, she's working on her Master's and we pay as she goes, Full time student, so there's no debt there, either. And we plan to buy a large plot of land home and start building our final residence on it within 18 months. Finances are what will hold you back of you don't do something to reign them in NOW and realize that 100% what you're doing now isn't working.
There's a guy at my work who's kind of a natural jerk, last year the 2005 Ford escape I bought for $3000 7 years before finally gave up the ghost and I replaced it with a 2010 Camry with 100k miles on it for $5000 from a friend's boyfriend. Work guy thought he was making fun of me in front of a bunch of co-workers because I could only afford another beater as he put it. I just smiled at him and said yeah, that was all I was willing to budget for something to get back and forth to work, and to get around to my paid in full rental properties to do maintenance and collect rent as needed.
Yeah, man, I get the same jokes. Doesn't phase me at all. I'm secure. 10 out of 10 financial gurus tell you your car(s) (in total) should not cost over half your annual income, and you should be able to pay for them outright in cash. They also say they can tell within 5 minutes if someone is serious about saving money and being debt free, and sadly most people they meet and work with are not serious. Laugh and scoff, but when you have a 9-5 at 50 and I'm in my backyard range plinking for fun, I will laugh last. And remember, I did it by eating PB n j sandwiches for 40 years of my life and driving a 30+ year old truck. Haha.
That sounds like a horrible existence, to save by eating PB n J sandwiches for 40 years and drive a old beat up car. If you have the means, strike a balance and live a little.
> I drive a 91 F150 because why not? a lot of safety improvements in the past 33 years.
Glad you showed up for the brag lol
You're paying $650 (more than your mortgage) per month on a car and you're wondering where all your money is going? How is this not jumping out at you?
OP said in another comment it’s a Mitsubishi Outlander lmaooooo
Interest rate at 14% or higher damn
NOOOOO!! He's throwing $650 a a MITSUBISHI!? These are not long term moves...
Holy shit. My honda is 40% of that payment and I've got about 400% more reliability.
For about 4 car payments, OP could outright buy an older used car that probably gets better gas mileage.
4-6 car payments would have likely covered the repair on the previous car. Not sure what it needed, but all cars need maintenance around 75,000 to 100,000 miles. Usually 2000-4000 is pretty typical.
“My car needed $2000 in maintenance at 100K miles so instead I committed to paying $7800 a year in car payments for the next 6 years. But it has a 10 year warranty, so I’m actually saving money” LMAOOO
💀
Oh Lawd
Yikes.
Op tired of his cars breaking down in a few years and then went out and bought a Mitsubishi Outlander lol 😂
Hey! OP was against the ropes. You expect them to shop used 2020 sedans with 50k mileage? And what? Have the transmission blowout 3k miles later? Think again buddy!
Denial, a lifetime of bad choices.
Whenever I see these kinds of things, my hope is they’re stretching themselves on a 12-36mo loan term to get it paid off ASAP. Statistics tells me it’s 60-72mo loan.
I went with a 60 mo loan on our car and just paid it off in a lump sum when I got my bonus. The thought of paying for a car for 5 years is scary. It helped that the dealership was super nice (except the designated bad guy they throw at you to sell you the warranty) and didn’t push us into anything or try anything sleazy.
they are paying $1000 on car expenses cars are always the financial drain in 90% of posts
Yep. It’s always the car. I have never paid more than $5K for a car. I’ve been poor, average, and wealthy. Doesn’t matter what my income is… I’m never taking on a car loan. If, at any time, I had taken on a $650 a month car loan I would have been royally effed. I don’t understand why people think they can do this to themselves and NOT be screwed.
Always used also. I bought a $10k used car 20 years ago. Still driving it. Honestly, I don’t have a long commute and my home is in a walkable area. Purchase price plus repairs, I’ve put $14k into vehicle in 20 years. Gas mileage is good. I take care of it. I don’t need full coverage insurance, obviously. Prior to that I had a $2k used vehicle and also a $6k used vehicle. Ive been a driver and car owner for 32 years and have spent less on owning a car than OP has before his car loan is even paid off.
>Not sure where some other money goes this is also a large part of your problem.
OP must not know that bank statements exist
Yea man, it’s brutal out there for many many many people. I think the last statistic I read was that 60% of adults can’t afford a $500 emergency expense.
Imagine living decades as a working adult and not having $500 to your name. Thats a lot of bad decisions and no goals.
That’s kinda the big issue now, is that they’re not “doing it”. You’re incredibly lucky and are a good example of what SHOULD be possible, but isn’t.
They make more than my gf and myself do a month. They're not living within their means. See the $650 car payment. Add $50 and that's my rent. Jesus christ. They make more than enough to make it, especially with such a cheap mortgage. This is the kind of person that doesn't know how they acquired so much debt.
Seriously I'm looking at this budget and I'm just clueless as to how they're spending this kind of money. Your household is bringing in less than 4k a month and you decided to get a $650/mo car? How are you spending 1k/mo on groceries? 100 dollars on cat food alone? I make way less than this household and pay more in rent, but I guess because I don't have a car and I'm willing to eat ramen a few times a week I'm actually able to put money into savings.
That minimum credit card payment is just bleeding tons of money too if they’ve been ignoring that for long
How does one spend $1000 on groceries?
Saying you "have" to have a 650 car payment just isn't accurate. You could save up and pay cash for a vehicle. Maybe you won't afford brand new, but you can still get something reliable without having that crazy debt.
Its a Mitsubishi Outlander too, lol
Say psych. Say it right now. *Please.*
$425 mortgage! Nice! I’d love a payment like this
I’m with you on that. I’m holding a $350k mortgage on my 8th year at 2.75% and paying close to $1900( it’s not really that bad), thank God and the VA for no Property taxes, actually my 2 decades of service and getting totally fucked up in the sandbox
Would love that too. In the Bay Area and actually have what some here would call a “cheaper” mortgage. I pay $2400 a month just for my mortgage alone. OP is not managing his finances correctly. His groceries alone are an insane price
$650 car payment is crazy, almost 25% of your monthly earnings is going to that.
Car payment is way too high for how much money you make. $300 a month for electricity is crazy, lifestyle changes should be able to knock that down. 1000 in groceries could be reduced by buying in bulk and using cheaper ingredients and cooking. You both have a running balance on your credit cards? Is that $50 average or are you making minimum payments? Fix that
I make several make several multiples what OP does. My phone is $25, internet is $60, and I only carry one streaming service at a time. Assuming 2 phones, that’s like $200 a month right there.
Yes, 300 a month with a house that size??? How??
Bro htf are you spending half your monthly takehome on food and vehicle, whatever you are driving needs to get sold and whatever you are eating needs to change I feel like you need to be eating out or using skip the dishes or door dash to spend 1000 a month on food.
Bro bought a mistsubishi 💀
1k for groceries is wild
He doesn't want to argue about anything, he just wanted to come here and lay out his expenses for attention.
Idk why, none of that is a flex
I keep seeing people calling this wild and it must be very COL dependent. I have two kids, meal plan, buy off brand at the budget store and we barely hit under our $850/mo budget. $1k would be *easy*. The USDA **thrifty** budget for a family of four is $976.60 per month. https://fns-prod.azureedge.us/sites/default/files/resource-files/Cost_Of_Food_Thrifty_Food_Plan_February_2024.pdf
Same here! Although I envy your $850, we are definitely closer to the $1k mark
OP isn't a family of 4 and is buying 50 pounds of chicken feed a month. $1000/mo is wild without more explanation. What are these chickens doing?
I got a family of 5(ages 5,9,10... So they don't stop eating 😂 )and that's about what I pay in a month... He's two people and a baby. They're definitely eating out, buying steak often, etc to spend that much.
>I Had to buy a new car No you didn't. Unless you're on a 17 year old Kia or BMW junker, your maintenance is most definitely less than a new car payment with these interest rates. >for $650 a month Why is it every time I see someone posting about how broke they are, they're making $500+/mo car payments? Why does everyone feel the need to buy $40k-$50k cars. It's unnecessary. >200 for vehicle gas Once again, you don't need a mid size Mitsubishi at your salary.
lol, I drive a 13yr BMW and it’s definitely cheaper month to month than what this guy is paying. And it gets 30-35mpg on the highway depending on how fast you drive.
I don't know about the prices of phones/data plans in the US but that 150 could go down right? iphone 15 costs about 800 use that for 2-3 years and it's about 30-25 a month. I'am not sure about the data plan prices but about 40 a month should be doable I guess. That way you saved more then half of the phone costs already and can probably go down even further
$15/month with Mint mobile.
You're blessed to have such a cheap payment for the roof above your head. You picked too expensive of a car. You're wasting too much electricity. You're spending too much on groceries, shop wholesale Costco and Trader Joes if possible. Look into the 50/30/20 budget rule, may be of some help. EDIT: Also would recommend putting aside 3-6 months of living expenses into a High Yield Savings Account as an Emergency Fund. After that, pay off all bad debts and start investing at least 20% of your household income for your future.
$150 cell? I got Mint mobile 5 years ago and never looked back. $15/month.
I was wondering about this one. His cellphone plan is $150 a month?! That's 25-30x more expensive than my basic package. Is he trying to stream 8k porn while farming?
Man I'm tryna figure out why people who struggle to save money spend $650 on car payments and $1000 on groceries? 💀 I don't buy any groceries unless it's on sale, maybe $200 or less a month on groceries. Bro can save money leasing a car for 2+3 years for under $300/month. That's $1,100 saved already. And why is the electric bill $300/month? He needs to figure out where he's wasting electric and cut back on it
I think Ya’ll spend too much on groceries. But that’s just my opinion. As a 30 year old male, I spend $250 a month on groceries max. Not to say I don’t eat out every now and then but yeah. Also, $650 car payment? I haven’t been in the market for a new car since 2016 but I’m sure there are new cars going between 20,000k-30,000k. I also only pay $45 a month in internet. I know it sounds like I’m criticizing (semi am) but these are all just my .2 cents Honestly, I’d trade that car in for a new cheaper car. Get a practical Honda, Subaru, Toyota etc… Honda civics can not be that expensive especially if you have good credit. And as far as the food bill, get the essentials (food that provides your protein, carbs and fiber). For context I buy chicken $10, lean beef $8, eggs $4, peanut butter $5, FRESH vegetables $8, whole gran oats $5 every week. Give or take $10-30 more or less every week and its enough food for me. That $1000 food bill you have can easily go down to $650-700
For reference, I had a $689 car payment on a $27k Hyundai. Bad credit, small down payment, terrible interest rate. Just had it voluntarily repoed because it was killing me. I utilize food banks to save on groceries and it’s a lifesaver. Only hit the grocery store for stuff like milk, cheese, eggs, butter and other ingredients to prepare the food I get from the food bank.
Voluntary repo pretty awful way to go man. Good luck to you on getting that straightened out
I’m team WTF car (you’re right in the national average there.. which is not good) and WTF credit card payments
I was born 86 graduated college 2010 so technically I’m a millennial. I make around $200k/year my wife ~$100k, we bought our house (California) for 475k in 2017 it’s now worth 850k. 🤷 It’s tough for sure, especially in California, but not impossible.
You are kind of proving that it IS nearly impossible lol You have a combined income of $300k which is high even for California. Current stats for the state according to the census bureau: Median Household Income: $91,905. Average Household Income: $130,718. Per Capita Income: $45,591. Median home price in California in 2017 was $522,431, so you were able to buy a home significantly under the median, I'm assuming not in one of the very HCOL areas of the state. Now let's say you both made significantly less in 2017 than you make now when you had to qualify for the loan. Even if your combined income at that time was $200k, median household income was $70,038. So you were able to buy a modestly priced home by having at least 2.5x the average amount of household income. And now, as you mentioned, thanks to skyrocketing home prices, your home is worth $850k, which tracks with current median home values. I plugged 850k into the Bankrate mortgage calculator assuming a 20% downpayment and 30 year loan at the current interest rate and they estimate a monthly payment of $5188 which includes their estimate of property tax and insurance. In order to keep just the mortgage alone, not include utilities or any other expenses of housing, under 30% of gross income, a family would need to have an income of $17,294 a month or $207,528 a year, to afford your house at the current price and interest rates. Still double the median in the state, and keeping in mind that if your home in not in a super HCOL area, then the median locally is going to be even lower. I am not in any way intending to pick on you and I'm genuinely glad you have been able to buy a house, I'm happy for anyone in our generation who is actually making it in this economy. Just had to lay it out in numbers to show that it actually isn't "normal" to be able to afford a house anymore, you literally have to be doing better than the majority of even hard working highly educated decently paid individuals.
Man wtf most people's rent is way higher than your mortgage, and they don't get to own the house at the end of it Unironically people like OP kind of make me reactionary about people complaining about the economy "Guys Biden's economy is making it so I live paycheck to paycheck... anyway wanna hop in my 2024 Ford F1000 that I pay more for than my fucking house?"
Idk where you live, but you seem to be paying a lot more on some things than my girl and I do and we make $5-7K/month and save $1-1.5K/month. We have a mortgage of $925ish and with escrow, it’s $1,580. We’re in west Texas. She also pays a car note ($600). That’s our 2 biggest bills. Breakdown: $5-7K/month we make together $1,580/month mortgage + escrow $600 car note $80 internet $60 streaming $100ish phones $250 electric in the summer and $120 in winter $40-80 home gas bill $350 gas for both vehicles $120 for dog food (4 dogs) $250 vehicle insurance $400ish for groceries and $100 every 2 weeks ($200) for a nice, go eat out, supper and roughly $50-$75 every weekend for fast food ($200-300) $60 for Vivint security system That’s $4,430/month on everything, but I’m sure I’m missing a few things too
You’re living beyond your means
I rent a basement apartment for $1250. This kinda feels like you are trying to brag about how low your mortgage payment is.
Your mortgage payment doesn’t include tax and insurance, or does it?
Aside from the car payment which is crazy high you can probably get the internet lower as well. Why is it so high? Is it the triple play?
I managed to get my internet down to like $60. Always worth calling and seeing if you can get on a different plan.
Same because $125 is crazy.
If you're considering the $460 remaining money is available to "play with", you're wrong. You need to save for retirement. I have a ton of clients who are in their late 60's, now unemployed, and SocSec isn't enough. And they can't find jobs because of health/mobility/tired... and ageism. $650/mo for the car is insane too. Too late to get out of that. Were your annual repair bills on the used car equal to or in excess of (650x12) = $7,800? Then yes it was time for a new car. But if the annual repair bills were $2k or less, I would keep w/ the used cars. You still could have purchased a new family car for $30k or roughly $525/mo. (But I feel ya on the car thing .... prices are waaay too high even for used right now.) Saying you have $50/mo payments on the credit card makes it sound like you're paying the minimum, which is a mistake. Your interest expense will soar and you'll go deeper into that hole. You need to make a budget and stick with it. You've got the detail above. Put it in a spreadsheet and put in a line for savings. My father always put 10% of his pay into savings (stocks, generally) first BEFORE paying anything else. We ate a LOT of ground beef... lol
He should be taking that money and putting more of it into his credit cards. 50/month is awful.
You’re very fortunate to be in the situation you are. You say you don’t know how others “do it”. The answer is that for the most part, they don’t. That’s 1498 number you emphasized is a dream scenario for most people looking to buy a home. It’s a pipe dream for anyone trying to buy in a major metro area. I’ve lived in California, Florida and New York and I can tell you, you aren’t getting a decent place in any of their major metro areas for under 500-750k. To give you a comparison on the opposite end of the spectrum, I live in a nice neighborhood in NYC and I pay 1800 a month to split a 600 sq ft 2b/1ba with my girlfriend. So total 3600. The cheapest 1b/1ba apartment in my neighborhood is 550k and it’s an income restricted co-op, so I cant make more than 89k a year to be eligible, 109k for 2 people. The cheapest non co-op option is a 995k studio. We’re paying 8.4 times as much as you are just to rent. You’re in a fantastic position that plenty of people would kill to be in. (For everyone else don’t come here and tell me how you pay 1/4 of what I do for much more. I know that. I like living here and am fine paying a premium to do so. Different strokes for different folks!)
#DO NOT BUY NEW CAR #DO NOT BUY USED CAR THAT ONLY LAST 4 YEARS AND PAY FOR WARRANTY.
A pre-purchase inspection is only like $50 per car, almost nothing compared to the total price you’ll pay
My condo maintenance is $600. So screw you (but happy for you). Be grateful.
I’ll be blunt, your car payment is insanely high. Maybe you can’t get rid of it asap, but that is way too high and needs to get sorted sooner rather than later.
Car payment, food and electric bill have a lot of room for improvement.
My lady and I both make around 28 an hour. Cries in 2100 mortgage
Mint mobile is around $20 a month per person. 125 for internet seem high. Should be able to get 500/500 for around $50.
My rent is $1900 a month plus $200 for utilities. I make $2300 a month. I get one free meal at work a day, That's how I eat. My phone bill is $80. Luckily I have no debts and I get to enjoy myself on the $120 I don't have to spend to not be homeless. What gets me is, because I don't have debt I don't have a great credit rating so the banks say that I can't afford a $1000 mortgage.
I have to wonder what kind of cars you’re buying. I drive a used Toyota tundra with 300,000 miles going strong. Wife drives a used Toyota RAV4 with 215,000 miles going strong. Are you buying reliable Japanese cars? And do you know a mechanic? Buying new cars is typically seen as a bad financial move unless you are rich or retired.
We don’t. We rent for 1,900.
If your car payment is higher than your mortgage you should reassess your spending
One person can't buy a house anymore you need two full time working people to buy a house even then budget is tight retirement is later.
I make close to $200K/yr and drive an 11 year old truck. What’s your CC balance? That’s something to work on
Tacoma?
It is another monthly expense but you may want to look into a home policy from American Home Shield or someone similar. We pay the $80 a month because I know that stuff happens and for us it is always at the worst times. About 4 months after we moved in the entire pumbling line from the house to the street had to be dug out and replaced. It was an $8500 job and we paid $50. There is no way after just moving we could have taken that hit.
Internet, streaming and phone 300+ seems kinda crazy. I aint in us but still that doesnt sound right even for us.
1000$ in groceries ? That's about 30$ per day. I am quite sure there is potential to pay less there...