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Money/Assets Benchmarks

Tanzigrrl

Brilliant_Rock
Joined
Sep 17, 2010
Messages
735
Hi All,
More of a philosophical/opinion question than anything else, but, what do you think is a viable amount of liquid assets to have by the time someone is 30, 40, 50 years old? Of course these things depend on income, goals, etc. but with all of the changes to our economy in the last few years, what would YOU think would be reasonable and/or desirable goals for someone at each of these three ages to have in both cash (savings, CDs, etc.), and assets (real estate, certain stocks, 401Ks, etc.).

Has the downturn in the economy affected what your answer is now versus what your answer may have been some number of years ago? Why?
 

Abril

Shiny_Rock
Joined
Apr 1, 2008
Messages
197
You certainly would accumulate more assets the older you get (at least you should hope so). We just try to keep 3-6 months of expenses worth as an emergency fund. The rest of the assets are allocated in an 80/20 split between stocks and bonds. As for real estate, I don't think of it as an investment (kind of a money sink and doesn't appreciate as fast as stocks). Most of the value is that we get to live in it.

I don't know what the benchmarks are for each decade of life, but as 40-year-olds, let's just say that we have a Lotto-sized net worth, not including real estate.
 

natascha

Brilliant_Rock
Joined
Aug 10, 2010
Messages
644
It think it depends on what country you live in and what pension plan, disability insurance, etc you have. I live in Sweden where you have a strong social security ( If everything went to hell you would at least get enough to cover housing, food, the basics, heck you get more on benefits than what the normal student lives on), you don't pay for the majority of your medical bills ( about $20 for a doctors visit and $40 for specialist including operations, $10 a day if you are interned, etc), child care is income based, etc.

So in this case I believe 6 months of expenses should be the basic goal for everyone. If you own a house 25% equity should be a goal, depending on where you live, paying off your mortgage completely is not really an option for many. The reason why you need equity is that here mortgages are personal, if the house is sold for less than your loans amount to you are left with the difference in loans even though you don't have a house. They way you can just leave your house if you have negative equity and walk away from the debt in the US scares me. Are you not supposed to take responsibility for your debts?

Then I think that by 50 you have to have sufficient control over your economy that you either live under the amount you would get in pensions or you have enough savings to complement your pension.

I don't really believe in different benchmarks for different ages, everyone is different with different needs and possibilities.
 

Haven

Super_Ideal_Rock
Joined
Feb 15, 2007
Messages
13,166
This is a really interesting question.

I think DH and I approach these things differently than most.
Our goal is always to spend only half (or less) of what we take in at any given time.
We've been able to build up some assets, which is nice, but it's nicer to live in a way that doesn't require nearly as much as we earn.

For us, the goal is to maintain freedom of choice throughout our lives. For example, if DH decides he no longer wants to run his business, instead he'd like to go back to school, then we can support that choice immediately because we don't require his income to continue living in our current style.
 

dreamer_dachsie

Super_Ideal_Rock
Joined
Dec 16, 2007
Messages
24,364
I have no clue but the question reminds me of how when DH and I went to get a line of credit (for emergencies and such) the bank created a spread sheet of our net worth and we were shocked when they told us we were doing very well for our age (early 30s). Most of it was the equity in our home and retirement plans. Anyways, I bring this up only because it made me think that most other people must be very poorly indeed because, frankly, I do not think our finances are in great shape at all, no where near where I would like them to be (hopefully soon though).
 

Dancing Fire

Super_Ideal_Rock
Premium
Joined
Apr 3, 2004
Messages
32,399
natascha|1317074529|3026225 said:
So in this case I believe 6 months of expenses should be the basic goal for everyone. If you own a house 25% equity should be a goal, depending on where you live, paying off your mortgage completely is not really an option for many. The reason why you need equity is that here mortgages are personal, if the house is sold for less than your loans amount to you are left with the difference in loans even though you don't have a house. They way you can just leave your house if you have negative equity and walk away from the debt in the US scares me. Are you not supposed to take responsibility for your debts?
yeah,tell me about it,as a taxpayer i am paying my neighbor's mortgage!!... :angryfire:
 

yssie

Super_Ideal_Rock
Premium
Joined
Aug 14, 2009
Messages
21,101
Haven|1317079016|3026293 said:
This is a really interesting question.

I think DH and I approach these things differently than most.
Our goal is always to spend only half (or less) of what we take in at any given time.
We've been able to build up some assets, which is nice, but it's nicer to live in a way that doesn't require nearly as much as we earn.

For us, the goal is to maintain freedom of choice throughout our lives. For example, if DH decides he no longer wants to run his business, instead he'd like to go back to school, then we can support that choice immediately because we don't require his income to continue living in our current style.
Haven we're newer to it, but we're going the same route. Our earnings are similar, so it's convenient to live and play on one (DH's in this case, he objects far less to the bills!) and to just bank mine. Of course that means we sacrifice in some ways - we bought far less house than we could have, for example, but the peace of mind of knowing we're doing everything we reasonably can to safeguard ourselves (and therefore have nothing to gain by worrying any more about it!) is well worth it.
 

centralsquare

Ideal_Rock
Joined
Jan 18, 2009
Messages
2,201
We, too, live off of one income. I figure it's like we're "buying" peace of mind and the ability to sleep well.
 

Miss Sparkly

Brilliant_Rock
Joined
Jan 2, 2010
Messages
1,664
The economy hasn't so much effected my answer as watching my mom try to steal money from my dad during a divorce :angryfire:

My philosophy has always been that if a person is living comfortably, doesn't want for anything (big things like a fancy car, larger house, bigger diamond, etc don't count) and puts away what they can for retirement then they are doing good for themselves. My personal goal that I see happening is to have all of my debt paid off by the time I am 30 (I'm 25). We have two cars that will be paid off by then and our credit cards - two that we sadly maxed out during a period of cutbacks and layoffs ;( Did I hope for more by now? Yes. Am I happy anyway? Yes.
 

Miss Sparkly

Brilliant_Rock
Joined
Jan 2, 2010
Messages
1,664
Dancing Fire|1317080541|3026319 said:
natascha|1317074529|3026225 said:
So in this case I believe 6 months of expenses should be the basic goal for everyone. If you own a house 25% equity should be a goal, depending on where you live, paying off your mortgage completely is not really an option for many. The reason why you need equity is that here mortgages are personal, if the house is sold for less than your loans amount to you are left with the difference in loans even though you don't have a house. They way you can just leave your house if you have negative equity and walk away from the debt in the US scares me. Are you not supposed to take responsibility for your debts?
yeah,tell me about it,as a taxpayer i am paying my neighbor's mortgage!!... :angryfire:
I agree. The main reason that we have so much CC debt is because I didn't want to walk away from our house. It was such a massive failure for me and heartbreaking to say that I made a mistake and I could no longer afford it because of our job situation. It was even more heartbreaking to watch the once beautiful subdivision that I had lived in go to hell because it turned into mostly abandoned foreclosures. One thing that I would love to see come out of the housing crisis is mandatory counseling for first time home buyers. Sadly, I don't think that will happen.
 

rosetta

Ideal_Rock
Joined
Jan 7, 2010
Messages
3,417
Ive certainly not met any of my financial goals yet. Still haven't bought a house (having realised it would cost over $2 million to buy a decent house in our preferred area!) and I've got less in savings than I would like (still enough for 6 months expenses though)

Am looking forward to husband finishing his training next July so he can earn some decent money. I've got 2 more years to go at least.

Honestly, we are bad at saving. Seeing as our combined income is well into six figures, I really think we should be doing better than we are. But we have no assets except for bonds, our cars and some stocks husband has lost money on. ;(
 

NewEnglandLady

Ideal_Rock
Joined
Jul 27, 2007
Messages
6,299
I'm in the same boat as a lot of PSers (who I think are more fiscally conservative than most). We have a six month emergency fund, we invest (both short and long term), we live on one salary, we put more than 20% down when we bought our house with the goal of paying it off early, we don't have debt, we pay cash for cars to save money, etc.

I am personally willing to make sacrifices in order to have financial freedom because the stress of not having liquid assets at my fingertips seriously stresses me out. We drive crappy vehicles. I only shop clearance racks. I've been TALKING about buying a dining room table for over 6 months, but haven't bought it because I hate letting go of the cash. Now, if we were wealthy, I probably wouldn't make the same sacrifices because I wouldn't need to--but as it stands, in order for me to feel financially comfortable, it means making some sacrifices.

What makes a big difference for me is what Haven said--having enough freedom so that one person can quit his/her job without it being devastating. A couple of years ago my husband was really stressed with his job to the point that it was really unhealthy. He ended up taking 6 months off and I'm glad he was able to do that for himself without us having to worry about bills. He ultimately decided to go back to his job (though he insisted on some changes) and now is much happier. Having the freedom to do that is very important to me.

We do have financial goals that we try to reach each year, but I am not upset if we don't achieve them. I'm a planner by nature, so I like having goals, but there are so many variables. Over the past two years, we've hit some unexpected financial set backs that have kept us from reaching our goals. Also, the market has not been kind, which is another barrier. But because we have a significant cushion between the money coming in and the money going out, those setbacks aren't as uncomfortable as they could be.
 

dreamer_dachsie

Super_Ideal_Rock
Joined
Dec 16, 2007
Messages
24,364
Yssie|1317086701|3026452 said:
Haven|1317079016|3026293 said:
This is a really interesting question.

I think DH and I approach these things differently than most.
Our goal is always to spend only half (or less) of what we take in at any given time.
We've been able to build up some assets, which is nice, but it's nicer to live in a way that doesn't require nearly as much as we earn.

For us, the goal is to maintain freedom of choice throughout our lives. For example, if DH decides he no longer wants to run his business, instead he'd like to go back to school, then we can support that choice immediately because we don't require his income to continue living in our current style.
Haven we're newer to it, but we're going the same route. Our earnings are similar, so it's convenient to live and play on one (DH's in this case, he objects far less to the bills!) and to just bank mine. Of course that means we sacrifice in some ways - we bought far less house than we could have, for example, but the peace of mind of knowing we're doing everything we reasonably can to safeguard ourselves (and therefore have nothing to gain by worrying any more about it!) is well worth it.
You are both fortunate to live in areas where it is possible to live on one salary, or to earn enough to afford it! We could not do so and own a home -- any home at all, even a condo -- where we live, and we earn good money. I don't even think we could do so and rent either, even radically changing our lifestyle. But it is a good way if you can swing it!
 

Haven

Super_Ideal_Rock
Joined
Feb 15, 2007
Messages
13,166
Dreamer--I don't really live in an affordable area. We're in a suburb on Chicago's North Shore. DH and I can live the way we live now because we made the very conscious choice (separately, incidentally, and long before we met each other) to live very frugally for many years before buying our home. I lived with my parents for a very long time after college, DH lived in a tiny little condo in the city for a decade, and we pinched our pennies until we saved the $$$$ we needed to put enough down on our small ~1300 sq ft ranch home so that we could live off of one income.

I have no idea what homes cost in your area, and it may be a more expensive place to live than mine, but regardless of where anyone lives I think two middle class people can make the choice to live on one salary. It just depends on how long you're willing to scrimp and save before you buy that house, and what type of lifestyle you are willing to experience. In fact, we would have done this anywhere, no matter the cost of homes. Or we just wouldn't have bought a house to ensure that we could live off of one salary.

(I'm not trying to pick a fight with you, Dreamer. I hope this doesn't come across that way.) I DO think many people have the misconception that they can't live off of one salary in a high-price area, when the reality is that most are unwilling to design their lifestyle in a way that would make it possible in a high-price area. Or, to move.

Those of us who are lucky enough to have the education and financial freedoms to make decisions about where and how we want to live our lives have a huge amount of control over them. I think some people don't exert that control, and they end up believing that they are stuck in a situation that they, themselves, actually created. (Again--I'm NOT talking about you, Dreamer. Just about people, in general, who may fit this description.)

For background, a Wiki article about my 'hood:
http://en.wikipedia.org/wiki/North_Shore_(Chicago)
 

NewEnglandLady

Ideal_Rock
Joined
Jul 27, 2007
Messages
6,299
Dreamer, it is very frustrating living in a high-cost area. My family is in the midwest and the cost of living is SO much more reasonable (though I would put Chicago in a different category). When we were renting, we could live on either D's or my salary, but after buying (and all the fun costs that come with it), we could only afford to live on D's salary. I still feel thankful for that, but it stresses me out that we could no longer live in my salary if needed.

I also forgot to include goals, since that is what you mention, Tanz. I'm 30 and close to my age-30 goal. I would have loved to have paid more of my mortgage off, but I'm letting that one go. I wanted to have >20% equity in a home, have a 6-month emergency fund and be putting >10% of our salaries into retirement. All that is done. But our debt (mortgage) still outweighs our assets (retirement and liquid assets) and I hate that. Like, a lot.

By 40, my goal is to have our house paid off, still be on track for retirement and have at least some of our kids' college funds funded.

By 50, I hope to be in very good shape for retirement (close to retirement), possibly have a second home somewhere with no mortgage. I feel like that goal is lofty, but we'll see. It's so far off that I don't want to over-plan, but that's the goal.

As for liquid vs. assets. The 6 month emergency is liquid (now) and everything else is equity or in the market. Until the house is paid off, I think that's how it will stay. The only thing D and I arent agreeing about is how the kids' college funds will be handled. I say liquid, he says market. We haven't started yet, so the argument continues.
 

rosetta

Ideal_Rock
Joined
Jan 7, 2010
Messages
3,417
Dreamer_D|1317138803|3026872 said:
Yssie|1317086701|3026452 said:
Haven|1317079016|3026293 said:
This is a really interesting question.

I think DH and I approach these things differently than most.
Our goal is always to spend only half (or less) of what we take in at any given time.
We've been able to build up some assets, which is nice, but it's nicer to live in a way that doesn't require nearly as much as we earn.

For us, the goal is to maintain freedom of choice throughout our lives. For example, if DH decides he no longer wants to run his business, instead he'd like to go back to school, then we can support that choice immediately because we don't require his income to continue living in our current style.
Haven we're newer to it, but we're going the same route. Our earnings are similar, so it's convenient to live and play on one (DH's in this case, he objects far less to the bills!) and to just bank mine. Of course that means we sacrifice in some ways - we bought far less house than we could have, for example, but the peace of mind of knowing we're doing everything we reasonably can to safeguard ourselves (and therefore have nothing to gain by worrying any more about it!) is well worth it.
You are both fortunate to live in areas where it is possible to live on one salary, or to earn enough to afford it! We could not do so and own a home -- any home at all, even a condo -- where we live, and we earn good money. I don't even think we could do so and rent either, even radically changing our lifestyle. But it is a good way if you can swing it!
Yeah, I live in London. It's very hard to live on one income here, and still pay a mortgage.

We don't have an extravagant lifestyle: we both drive modest cars over 5 years old each, we don't jet off on holidays willy nilly (last one was in early 2010 and we haven't had a honeymoon yet), all our electronic gadgets are over 2 years old, I shop for clothes about three times a year. Our parents paid for our wedding: we could never have afforded it. We spend a lot of money on attending conferences and courses relevant to our jobs, we aren't reimbursed for this by our employers. We pay huge professional indemnity fees.

Don't get me wrong: we live confortably. But we have to live in an very expensive area of London, in order to be close to our patients. House prices have skyrocketed: we can't afford to live in the houses our parents lived in anymore. A decrepit 1500 sq foot Victorian terraced house in our area sold last month for £850,000. Thats about $1.3 million. It was nothing special, and rather cramped, and needed a complete overhaul. But actually, we couldn't get a mortgage for that amount anymore despite our combined salaries. Ok, we are looking at good areas of London: there are plenty of places where you can buy a cheaper house but they tend to be where the crackheads hang out and no decent schools nearby. Leaving London is not an option for us: due to my highly specialised work I have to stay here.

So yes, if two doctors can't get a mortgage for a small home in a London suburb, then I can certainly believe that it's very, very hard for families on one AVERAGE income to live in some places, despite seriously downsizing their lifestyles. Despite all the will in the world.
 

swingirl

Ideal_Rock
Joined
Apr 6, 2006
Messages
5,660
Sparkly Blonde|1317094002|3026566 said:
I agree. The main reason that we have so much CC debt is because I didn't want to walk away from our house. It was such a massive failure for me and heartbreaking to say that I made a mistake and I could no longer afford it because of our job situation. It was even more heartbreaking to watch the once beautiful subdivision that I had lived in go to hell because it turned into mostly abandoned foreclosures. One thing that I would love to see come out of the housing crisis is mandatory counseling for first time home buyers. Sadly, I don't think that will happen.
What do first-time home buyers need to know? I remember my first home loan and I definitely knew I had to pay back the mortgage. The loan agent made that clear. Bank gives you money, you pay it back. Appreciation or depreciation of the property wasn't a condition.

So what do you wish you would have known and what would you have done differently?
 

yssie

Super_Ideal_Rock
Premium
Joined
Aug 14, 2009
Messages
21,101
Dreamer_D|1317138803|3026872 said:
Yssie|1317086701|3026452 said:
Haven|1317079016|3026293 said:
This is a really interesting question.

I think DH and I approach these things differently than most.
Our goal is always to spend only half (or less) of what we take in at any given time.
We've been able to build up some assets, which is nice, but it's nicer to live in a way that doesn't require nearly as much as we earn.

For us, the goal is to maintain freedom of choice throughout our lives. For example, if DH decides he no longer wants to run his business, instead he'd like to go back to school, then we can support that choice immediately because we don't require his income to continue living in our current style.
Haven we're newer to it, but we're going the same route. Our earnings are similar, so it's convenient to live and play on one (DH's in this case, he objects far less to the bills!) and to just bank mine. Of course that means we sacrifice in some ways - we bought far less house than we could have, for example, but the peace of mind of knowing we're doing everything we reasonably can to safeguard ourselves (and therefore have nothing to gain by worrying any more about it!) is well worth it.
You are both fortunate to live in areas where it is possible to live on one salary, or to earn enough to afford it! We could not do so and own a home -- any home at all, even a condo -- where we live, and we earn good money. I don't even think we could do so and rent either, even radically changing our lifestyle. But it is a good way if you can swing it!

Unlike you Haven we are fortunate in that sense - upstate NY cost of living is SO much less than back in Cali! Our mortgage is literally half what our rent used to be...

We also have more freedom than many couples our age because neither of us has student debt - well, we did, but it was trivial - something like 40k combined. It's really only after graduating that I realize how amazingly lucky we both were to have parents who were able and willing to pay for our educations in full!

Edited*
 

Matata

Ideal_Rock
Premium
Joined
Sep 10, 2003
Messages
7,372
I remember meeting with a financial planner when I was in my early twenties and his advice was to plan backward. He challenged me to think about what type of financial security and lifestyle I wanted when I retired, add in life goals along the way and their projected costs (education, kids, homes, etc.) and save as much as I could along the way to reach that end goal. I laughed hard enough to snort. I couldn't imagine scripting my life to such a degree.

His words stayed with me, though, and as the decades passed, they carried more significance. With a lot of hard work and a dash of luck DH and I are fortunate to have a significant amount liquid and a significant amount in assets. We still don't feel secure. We are now in our mid-50s/early 60s and both sides of our families live long. DH's side has Parkinson's and related dementia. My FIL's wealth supported him and his wife's long slow decline with these illnesses and gave them both the luxury of live-in home care until they died. We know that one catastrophic or long-term illness can have a huge financial toll so we still live and save with those thoughts in mind.

My long-winded point from the perspective of one who is closer to the end of life's journey is 1) focus as steadfastly on what happens after retirement as you do on the present and near future; 2) plan for contingencies; 3) be flexible with life and financial goals; 4) meet with a planner who can help establish your benchmarks; 5) Continue to save through the hard times -- even it's only $5 per month.
 

MissStepcut

Brilliant_Rock
Premium
Joined
Jun 29, 2011
Messages
1,720
I'd like us to retire with around $20 million in assets. That's my personal goal. It would require both of us to stay on a pretty ambitious track throughout our careers, but it's also possible if we do. I recognize bumps in the professional road might put that totally out of our grasp, but that's my idea of "success."
 

ksinger

Ideal_Rock
Premium
Joined
Jan 30, 2008
Messages
5,078
natascha|1317074529|3026225 said:
It think it depends on what country you live in and what pension plan, disability insurance, etc you have. I live in Sweden where you have a strong social security ( If everything went to hell you would at least get enough to cover housing, food, the basics, heck you get more on benefits than what the normal student lives on), you don't pay for the majority of your medical bills ( about $20 for a doctors visit and $40 for specialist including operations, $10 a day if you are interned, etc), child care is income based, etc.

So in this case I believe 6 months of expenses should be the basic goal for everyone. If you own a house 25% equity should be a goal, depending on where you live, paying off your mortgage completely is not really an option for many. The reason why you need equity is that here mortgages are personal, if the house is sold for less than your loans amount to you are left with the difference in loans even though you don't have a house. They way you can just leave your house if you have negative equity and walk away from the debt in the US scares me. Are you not supposed to take responsibility for your debts?

Then I think that by 50 you have to have sufficient control over your economy that you either live under the amount you would get in pensions or you have enough savings to complement your pension.

I don't really believe in different benchmarks for different ages, everyone is different with different needs and possibilities.
Yes, but to judge by the double-standard we seem to have for bailing out corporations and financial institutions in the US, I'd say, why should an individual be held to a different standard?

Maybe walking away from an upside down mortgage sounds immoral, but strategic bankruptcy is an accepted and common non-guilt laden practice for corporations. Logically, why should individuals be held to a different standard. We've spent the last 140 years with corporations stumping to become immortal "people"(and winning legally), with all the rights of breathing humans. Yet they don't bear the moral imperative that seems to fall on those of us who are flesh and blood.

For the record, I would not do that myself, but from a strictly logical standpoint, there is a vast double-standard in play in the US. I merely point that out.

Also, from a US standpoint (one of them anyway, it would not be my personal stance) many would look at you in Sweden and consider you a leech on the public money. I mean yeah, you end up stuck with the house bill, cause honestly, how can you even GET in debt when you have no medical bills, controlled child-care costs, and receive a living-wage stipend regardless of your ability to work? What a deal! I mean, you're handed everything else, why shouldn't your feet be held to the fire on a house screw-up? (Again, not my personal view - I think your system is delightful - but many hold it I assure you) And pension? What is this pension of which you speak? I've heard of them, but they seem to be a relic of a now-distant past in the US....

Just to drive home how bad it is here, I had a minor outpatient surgery on my hand to remove a very benign but very painful, increasingly-faster-growing tumor that had just gotten to a point I felt I couldn't deal with it anymore, and I was afraid it was going to eventually impair my hand function. It was in and out in about 3 hours. The combined doctors' and facility bill topped out at over $20,000. :-o Without insurance, I'd have been seriously hosed. I just couldn't have afforded it, period. And in this case, it was painful but I probably could have soldiered on, but what about something more serious? You get the idea.

But back to the subject at hand - hubs and I are on target to have the house paid off in 2 more years - so by the time I'm 51, I hope to be done with house payments. We are not currently putting money in MY 401 because we feel it is better utilized killing the mortgage, and given the market volatility and outlook and how much I've already lost this year from "investment" (aka - gambling), it feels a darn sight better than sending it down the stock rathole, I can tell ya.

Even now, we could live indefinitely on one salary, or maybe - if healthcare costs are ever controlled. This is the fly in the ointment for a lot of people my age - if not for skyrocketing healthcare premiums and copays, we could probably hunker down and live decently on single income, but not if this continues.
http://www.nytimes.com/2011/09/28/business/health-insurance-costs-rise-sharply-this-year-study-shows.html

Oh well, one worry at a time: we'll still get the house paid off! Woot!
 

Phoenix

Ideal_Rock
Premium
Joined
Oct 5, 2006
Messages
9,364
rosetta|1317142827|3026948 said:
[Yeah, I live in London. It's very hard to live on one income here, and still pay a mortgage.

. House prices have skyrocketed: we can't afford to live in the houses our parents lived in anymore. A decrepit 1500 sq foot Victorian terraced house in our area sold last month for £850,000. Thats about $1.3 million. It was nothing special, and rather cramped, and needed a complete overhaul. But actually, we couldn't get a mortgage for that amount anymore despite our combined salaries. Ok, we are looking at good areas of London: there are plenty of places where you can buy a cheaper house but they tend to be where the crackheads hang out and no decent schools nearby..
I hope you don't mind my asking this and pls feel free not to answer it. Which area you guys live in (generally only, not asking for specifics)? I ask because I'm just about to exchange contracts on my 500 sq ft flat in Limehouse for a "grand" (not) total of 244,000 pounds. And it's in decent condition. I've had it upgraded from time to time and maintained it regularly - which costs I've not even taken into consideration yet in calculating the dismal profit from the purchase made 11 yrs ago. I'm also getting rid of it incidentally cos I'm sick of having to deal with all the BS issues stemming from being an overseas landlord. :knockout:
 

Octavia

Ideal_Rock
Joined
Oct 28, 2007
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2,660
This is a really difficult issue for me right now, because even though I don't have hard and fast goal numbers, I'm way behind where I'd like to be. If I consider the "us" situation, DH and I are doing pretty well, but personally I am disappointed with my contributions. Basically, my DH went straight from college to grad school, had negligible debt, and started a fairly high-paying job right away. He lived...not exactly frugally, but still well below his means. So he came into the marriage with significant assets and a job that pays more than I ever expect to earn. I, on the other hand, took a job at a nonprofit after college. I lived frugally and paid off almost a quarter of my student loan debt, saved what I could. My job was good entry-level experience but pretty dead-end after that, and I left after three years to attend law school. I had a full-tuition scholarship but incurred a bunch more student loan debt for books and living expenses. Got a job afterward that pays decently, have been working really hard to save for retirement, pay down my loans faster, and put more aside...and now I'm about to leave because my DH has taken a new job across the country, and I have no idea what the future holds for me, career-wise. Don't get me wrong, it is a good move for us in many ways, but I am frustrated that I've always tried to be responsible about handling my money and making the most of what I had at the time, and I still feel like I have nothing to show for it -- almost everything we have has come through my hubby. It's nothing to sneeze at, although we don't own a house but we could live comfortably for at least 3 years on our current assets. But it doesn't feel like any of it is my accomplishment. I really hope I can actually start a viable career and start really contributing soon...at almost 30, I feel like it's about time.
 

NewEnglandLady

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I don't want to thread jack, Octavia, just want to tell you I COMPLETELY understand. I went to a private college and lived on rice and beans after college to pay off debt, but still came to the marriage with debt while my hubby had worked his bum off to avoid going into debt for school and came to the marriage with assets. I can't tell you how guilty that made me feel. Like I wasn't a true partner (I still feel that way since I make less). I'm sure everybody tells you that you're married so you have to stop thinking of it as "his" and "mine", but I have trouble doing that. Just chiming in to say I can relate.
 

Octavia

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NewEnglandLady|1317148721|3027061 said:
I don't want to thread jack, Octavia, just want to tell you I COMPLETELY understand. I went to a private college and lived on rice and beans after college to pay off debt, but still came to the marriage with debt while my hubby had worked his bum off to avoid going into debt for school and came to the marriage with assets. I can't tell you how guilty that made me feel. Like I wasn't a true partner (I still feel that way since I make less). I'm sure everybody tells you that you're married so you have to stop thinking of it as "his" and "mine", but I have trouble doing that. Just chiming in to say I can relate.
I'm so glad you understand! It's actually not so much about the numbers themselves for me, but about the fact that some part of my self-worth is attached to being a contributing partner. Even though my DH knows and appreciates how hard I've actually worked over the years we've been together, the fact that most of it has been unpaid (schoolwork, internships, housework, etc) makes it hard for me to look at our situation and assign any tangible value to it. I mean, even if the money belongs to both of us once it's in the accounts, it still had to come from somewhere, and I'd be happier if more of it had funneled in through me.

And because I realized my personal anecdote didn't really answer the OP's question at all, I think my ideal number at 30 would be at least $20-25K net worth. I haven't come up with numbers for future ages, but I'd like to retire with a minimum of $5 million in assets.
 

dreamer_dachsie

Super_Ideal_Rock
Joined
Dec 16, 2007
Messages
24,364
Median homes in my city are $650k. Pricey! 8)

I hear you Haven but still think you are fortunate to have accomplished what you have, and clearly things aligned to allow it. Have you read Outliers? It is a simplified argument, but I think that the root premise is true: We give too much credit to the individual when they achieve success and do not give enough credit to their circumstances and environment.

And I am not trying to pick a fight either, Haven, but this issue just hits a nerve with me. I think it is too sweeping a statement by far to suggest that *anyone anywhere* can choose to live on one income. It feels a little to me like the old "Anyone can succeed in the good old US of A if they try hard enough" line that has been used for so long to explain away poverty by blaming lack of effort. My family is not poverty stricken -- now -- but I still think these types of finanical beliefs follow a similar vein.

And I had written a long rant but decided to delete it because, well, it is neither here nor there.
 

Laila619

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11,613
centralsquare|1317093120|3026555 said:
We, too, live off of one income. I figure it's like we're "buying" peace of mind and the ability to sleep well.
We do as well. We live off my husband's income while I stay at home with our son. We rent though, so that's why it's easy for us to do. If we had a mortgage, I think it would be much more difficult, but still (probably) doable. DH and I are both very frugal and hate spending money, lol. It's like a game to us, finding all the little ways to save and get deals and use coupons. I don't like to buy anything unless I feel like I got a deal. I'm so glad my husband is the same way. We also have very generous family members who are constantly showering our son with college fund money, so we have a nice head start on that.
 

Miss Sparkly

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Messages
1,664
Swingirl, I bought my house right after I turned 20. Yes I understand that you pay it back. What I didn't understand is how expensive upkeep would be. I thought I did the right thing by basing my mortgage on 30 percent of my income. One year later that 30 percent turned into 60 percent due to job cuts. Now I can see where I messed up but I couldn't then.
 

rosetta

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Phoenix|1317144659|3026977 said:
rosetta|1317142827|3026948 said:
[Yeah, I live in London. It's very hard to live on one income here, and still pay a mortgage.

. House prices have skyrocketed: we can't afford to live in the houses our parents lived in anymore. A decrepit 1500 sq foot Victorian terraced house in our area sold last month for £850,000. Thats about $1.3 million. It was nothing special, and rather cramped, and needed a complete overhaul. But actually, we couldn't get a mortgage for that amount anymore despite our combined salaries. Ok, we are looking at good areas of London: there are plenty of places where you can buy a cheaper house but they tend to be where the crackheads hang out and no decent schools nearby..
I hope you don't mind my asking this and pls feel free not to answer it. Which area you guys live in (generally only, not asking for specifics)? I ask because I'm just about to exchange contracts on my 500 sq ft flat in Limehouse for a "grand" (not) total of 244,000 pounds. And it's in decent condition. I've had it upgraded from time to time and maintained it regularly - which costs I've not even taken into consideration yet in calculating the dismal profit from the purchase made 11 yrs ago. I'm also getting rid of it incidentally cos I'm sick of having to deal with all the BS issues stemming from being an overseas landlord. :knockout:
Sorry Phoenix, I don't wish to be more specific: its in a very small area

Properties in east London haven't realised the prices that were predicted so I see why your Limehouse flat hasn't made you a huge profit.

There are expensive pockets in London that are just getting more and more expensive: those are the areas to buy in as they grow steadily in price. Ok, you don't get a major profit, but you are less likely to lose in real terms.
 

yssie

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Aug 14, 2009
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21,101
Sparkly Blonde|1317154120|3027139 said:
Swingirl, I bought my house right after I turned 20. Yes I understand that you pay it back. What I didn't understand is how expensive upkeep would be. I thought I did the right thing by basing my mortgage on 30 percent of my income. One year later that 30 percent turned into 60 percent due to job cuts. Now I can see where I messed up but I couldn't then.
That's what we were advised to do as well just a couple of months ago, and that was the "conservative" figure - that such irresponsible advice is being given to people looking to buy their first house is horrifying.
 
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