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How can people afford multiple kids with less than $57k/yr income (1 Viewer)

dgreen said:
Not sure where you're getting this number from. It's not way off from anything I see, but just not sure where it's from.

Regardless, median household income is not the number to use if you're wondering how someone raises a family because "households" includes a bunch of singles raising no kids. Median family income is about $68k and median married-couple family income is $82k. Only about 25% of married-couple families are under $50k.

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So 40% of married households make 100k+ per year?

 
Yeah the thing about 401k type plans and IRAs is that everyone, regardless of income, can contribute only X amount of dollars per year.  In theory this is supposed to level the playing field for the average guy and the super saver, because they can only put $18k in a year just like rich guy can.  Now if Americans aren't offered any plan at all, and I think that number is around 35% of all employees, then they actually need to make an effort to use IRAs, myRA, tax-deferred investments, etc.  But what is happening is that people with plans available to them, don't contribute.  Almost half the people who have a company match don't contribute enough to get the match, thus giving away free money. 

People are so terrible at saving that companies and even government is making a 3% contribution automatic now, so you have to sign paperwork to opt out of not giving at least X amount to your retirement.  I like Dave Ramsey and he often deals with the dumbest of people who are trying to get out of a mountain of debt, but I disagree with his premise that you stop contributing to a 401k/403b/etc if you are trying to pay off a lot of debt.  You still have to contribute enough to get the match if one is offered, not doing so will impact you for the rest of your life. 

 
Gawain said:
And the super savers drag the mean up. If you look at the median (50% of people/families have more, 50% have less) it's even scarier.

50% of families that are roughly 5-15 years from retirement have less than 17K saved.
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Mean is rarely meaningful when talking about $. Data is almost always skewed.

 
Doctor Detroit said:
Well because you're wrong that's why.  $100k in the Upper Peninsula of Michigan or in Wyoming is top 5%, it's not middle class. 
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100k is middle class anywhere folks vote for Liberals in droves like big urban cities...You folks love to suppress the real numbers and cost of living. BTW...you love to scream Michigan as an example but should we take a good hard look at Detroit? You think folks want their cities to be like Detroit? Folks there used to make a good penny on the auto industry and were paid well. Life was good for a lot of people because they had money, solid middle and upper middle class salaries and wages. 

Maybe instead of begrudging people who figured out how to make themselves more valuable in the workplace in 2016, perhaps these folks should learn more about what they need to do in order to join the middle class and not settle for a path of victimization. And I'm not speaking to Michigan but more the entire country. 

 
Ministry of Pain said:
100k is middle class anywhere folks vote for Liberals in droves like big urban cities...You folks love to suppress the real numbers and cost of living. BTW...you love to scream Michigan as an example but should we take a good hard look at Detroit? You think folks want their cities to be like Detroit? Folks there used to make a good penny on the auto industry and were paid well. Life was good for a lot of people because they had money, solid middle and upper middle class salaries and wages. 

Maybe instead of begrudging people who figured out how to make themselves more valuable in the workplace in 2016, perhaps these folks should learn more about what they need to do in order to join the middle class and not settle for a path of victimization. And I'm not speaking to Michigan but more the entire country. 
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You're just one of the most disconnected people in the entire world. 

 
Doctor Detroit said:
You're just one of the most disconnected people in the entire world. 
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What a joke. Discredit the poster at all costs. Nothing most of you all post makes much sense either. If the election didn't prove who is connected and disconnected from society in here not sure what else will.

You know what I do and the types of people and lives I interact with...why do you hate me for speaking the truth? You all live in bubbles, most of  you it's all theory, no practicality, no frontline work with today's youth. 

What are you so afraid of?

 
Why do some of you seem hellbent on raising victims in this upcoming generation? Why do you enjoy watching people suffer and do things no human should be asked to do in these inner city poverty stricken areas? It's an absolute jungle in there and not a one of you gives two ####s other than whatever headline you can grab from the news and waive it in people's faces to try and prop up your faux outrage and bull#### point of view.

Im afraid to tell you how I feel

 
Ministry of Pain said:
Doctor Detroit said:
You're just one of the most disconnected people in the entire world. 
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What a joke. Discredit the poster at all costs. Nothing most of you all post makes much sense either. If the election didn't prove who is connected and disconnected from society in here not sure what else will.

You know what I do and the types of people and lives I interact with...why do you hate me for speaking the truth? You all live in bubbles, most of  you it's all theory, no practicality, no frontline work with today's youth. 

What are you so afraid of?
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I don't even know what your Detroit rant is about, or your rant about liberals.  Look at the highest cost living areas in this country like San Jose, NYC, and DC and they are liberal bastions.  What I'm afraid of is anyone like you determining the direction of my country, it's scary. 

 
Doctor Detroit said:
I don't even know what your Detroit rant is about, or your rant about liberals.  Look at the highest cost living areas in this country like San Jose, NYC, and DC and they are liberal bastions.  What I'm afraid of is anyone like you determining the direction of my country, it's scary. 
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And millions of people who don't live in big cities which was 80 to 90% of most counties in this country felt just the opposite of you or don't want places where the majority of people are poverty stricken and reliant on the government to tell them how to live their lives and the direction they want to send the country. 

I'm not surprised so many folks remain unchanged post 11/8, it sent CSTU over the Pacific Cliffs

 
This hijack brought to you by MOP reminding you not to drink n drive this holiday season. And now back to our regularly scheduled insurance visit.

 
Limp Ditka said:
No, it sent him into hiding like the welcher ##### he his
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Did the schoolyard ignore you as well when you were a kid? Last...2nd to last to be picked for kickball? Give us something, anything that explains this need to lash out at people like an angry man in a dark movie house.

 
Doctor Detroit said:
I like you MOP but sometimes you just don't make any ### #### sense. 
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I like you as well.

Here is my point. The poverty stricken inner city continues to vote for the Left even though their lives do not improve. Instead of encouraging these people to get better or brighter and work harder, certain folks have told them to settle in and the government will take care of them...lot of folks. And the rest of the country got tired of it.

100k households became the target for increasing health care costs by double and triple in a lot of cases. And everyone that argues the other side gets a massive erection when they say 20 million are now covered but they never want to try and understand who has to pay for all that because they think 100k is a lot of money or they deem it enough to live on and you really shouldn't need or want more. And that goes against a lot of the fundamentals of this country. People do not want European Socialism...we had folks here like good old Henry Ford convincing people of a living wage or an auto check from the government and stay home. 

 
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If you choose you can be quite thrifty and get by well.

Shop goodwill, etc. Buy/trade via Craigslist, estate sales etc. Shop for food at expired stores, warehouse clubs and buy bulk whole foods such as rice, beans, flour and prepare your own meals. Hunt for meat and catch fish. Chop wood, burn it for heat.  Use coupons. Barter/trade for services.

 
matttyl said:
The average employee's cost for family health insurance on a group plan is $5,277, which isn't deductible.  Throw in another $100/m for family dental and maybe vision coverage.
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It's deductible.  Any decent employer should have a 125 cafeteria plan so all insurance premiums (health, dental and vision) are pretax.  No Medicare and social security taxes either on those premiums.

 
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That seems a bit more clear than your first post.  I will say this, you are asking too much from people.  25% of people are absolute morons, in any country, anywhere.  25% just get by, 25% are your grinders and core employees, and 25% excel.  Or whatever, change those percentages to your liking but about half of the people of this earth are just here, and you have to deal with them.  Could be have a plague to make the world better?  Sure, but this is what we have so we do what we can to make their lives more comfortable.  Sure some don't deserve that treatment, but there are environmental and socio-economic factors that play into their existence. 

You can't just throw people away, no matter how much you want to or how much they deserve it. 

 
Ministry of Pain said:
Why do some of you seem hellbent on raising victims in this upcoming generation? Why do you enjoy watching people suffer and do things no human should be asked to do in these inner city poverty stricken areas? It's an absolute jungle in there and not a one of you gives two ####s other than whatever headline you can grab from the news and waive it in people's faces to try and prop up your faux outrage and bull#### point of view.

Im afraid to tell you how I feel
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tuna can - meet popcorn...

 
Doctor Detroit said:
That seems a bit more clear than your first post.  I will say this, you are asking too much from people.  25% of people are absolute morons, in any country, anywhere.  25% just get by, 25% are your grinders and core employees, and 25% excel.  Or whatever, change those percentages to your liking but about half of the people of this earth are just here, and you have to deal with them.  Could be have a plague to make the world better?  Sure, but this is what we have so we do what we can to make their lives more comfortable.  Sure some don't deserve that treatment, but there are environmental and socio-economic factors that play into their existence. 

You can't just throw people away, no matter how much you want to or how much they deserve it. 
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The reason I like this post is automatically I understand your POV better and in no way is it a put down of what I was trying to explain. I agree with you on the numbers but I feel like the kids are getting the wrong message. Meaning the bottom 25% or 50%, they are not born any dumber than most but their environments shape them and those inner cities have been slaughtered by politicians and the like. 

 
Pipes said:
It's deductible.  Any decent employer should have a 125 cafeteria plan so all insurance premiums (health, dental and vision) are pretax.  No Medicare and social security taxes either on those premiums.
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$2500 year limit

 
You know, we really don't have enough political threads going.  Luckily we have MOP to get us back on track.

Thank you MOP for your service to FBG's and our children.  :thumbup:

 
proninja said:
That's because a $100k income puts you in the 96th percentile of earners in the USA. And if you go by household, it's around the 75th

The real answer isn't so simple. If you live in hedgefundville CT 100k is nothing. 
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Add North/Central NJ, A good portion of Long Island, & Westchester to that too.

 
Doctor Detroit said:
Yeah the thing about 401k type plans and IRAs is that everyone, regardless of income, can contribute only X amount of dollars per year.  In theory this is supposed to level the playing field for the average guy and the super saver, because they can only put $18k in a year just like rich guy can.  Now if Americans aren't offered any plan at all, and I think that number is around 35% of all employees, then they actually need to make an effort to use IRAs, myRA, tax-deferred investments, etc.  But what is happening is that people with plans available to them, don't contribute.  Almost half the people who have a company match don't contribute enough to get the match, thus giving away free money. 

People are so terrible at saving that companies and even government is making a 3% contribution automatic now, so you have to sign paperwork to opt out of not giving at least X amount to your retirement.  I like Dave Ramsey and he often deals with the dumbest of people who are trying to get out of a mountain of debt, but I disagree with his premise that you stop contributing to a 401k/403b/etc if you are trying to pay off a lot of debt.  You still have to contribute enough to get the match if one is offered, not doing so will impact you for the rest of your life. 
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Something I will never understand and just amplifies my feelings on how dumb people are, especially when it comes to money. 

You're being offered free money, which will compound/grow tax free until withdrawal, and you don't take advantage. 

 
Doctor Detroit said:
I like Dave Ramsey and he often deals with the dumbest of people who are trying to get out of a mountain of debt, but I disagree with his premise that you stop contributing to a 401k/403b/etc if you are trying to pay off a lot of debt.  You still have to contribute enough to get the match if one is offered, not doing so will impact you for the rest of your life. 
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"Here, let me give you an automatic 100% return on your investment."

"No thanks.  I need to pay down my 4.5% mortgage."

 
DA RAIDERS said:
credit cards until they're maxed.

govt subsidies to the max.

my wife's childhood friend made the decision to have a 4th child because they could bilk more money out of the govt.  dad is an ac repair man.  mom doesn't work.  i'd be shocked if he makes more then 50- 60k.  they have new phones, drive nice/newer cars than we do, etc.  it makes me sick, working the system is a ####### scam.
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You should see what doctors do.  Talk about working the system.  

 
Wow, the tone on the majority of these posts.... good lord.  So many assuming that since they're making $57K, they must be a POS.  Good work, guys.

Since you're using the average income, you gotta use average numbers everywhere else to make any sense of it - which I think a lot of the numbers used aren't the average.  The 8% retirement figure just can't be close to the average - that's pretty high for almost anyone I know at work (major investment firm).  I can't really speak to the taxes side of things, but the insurance numbers seem high also - especially dental and vision.  I'd be shocked if the average american bothers with vision coverage at all.  $100 for dental seems insane. :shrug:  

 
fantasycurse42 said:
Something I will never understand and just amplifies my feelings on how dumb people are, especially when it comes to money. 

You're being offered free money, which will compound/grow tax free until withdrawal, and you don't take advantage. 
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Sometimes people just can't afford to do it.  On the show Atlanta, the main character is in need for cash for his daughter. His buddy says he knows a way to double the money he was getting from pawning his phone. After the story unfolds, getting double that money won't occur for a month or two, but it's needed now. 

Point being, poor people don't have time for investments and need the money to live sometimes.  I'm fortunate enough to not be in that situation, but I can see how some people are (sometimes because they're bad at life, but sometimes because like is hard). 

 
1200/month housing for someone that makes low money is way too high.

when you get into rural areas, people are paying 500-900 in housing costs.

 
shader said:
1200/month housing for someone that makes low money is way too high.

when you get into rural areas, people are paying 500-900 in housing costs.
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Can confirm.  My wife and I live in ####hole USA.   I am a landlord and $900 would get you quite a nice place.  

 
Doctor Detroit said:
Yeah the thing about 401k type plans and IRAs is that everyone, regardless of income, can contribute only X amount of dollars per year.  In theory this is supposed to level the playing field for the average guy and the super saver, because they can only put $18k in a year just like rich guy can.  Now if Americans aren't offered any plan at all, and I think that number is around 35% of all employees, then they actually need to make an effort to use IRAs, myRA, tax-deferred investments, etc.  But what is happening is that people with plans available to them, don't contribute.  Almost half the people who have a company match don't contribute enough to get the match, thus giving away free money. 

People are so terrible at saving that companies and even government is making a 3% contribution automatic now, so you have to sign paperwork to opt out of not giving at least X amount to your retirement.  I like Dave Ramsey and he often deals with the dumbest of people who are trying to get out of a mountain of debt, but I disagree with his premise that you stop contributing to a 401k/403b/etc if you are trying to pay off a lot of debt.  You still have to contribute enough to get the match if one is offered, not doing so will impact you for the rest of your life. 
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My uncle had his own business and annually would stand in the conference room in front of the white board and draw up how he was going to match 5% and how your money coming out was pre-tax so you COULDN'T afford not to do it. He told me he only got maybe 1/10 people to sign up and after a few years he just figured #### it why am I wasting my time and stopped having the meetings. 

 
Sabertooth said:
Can confirm.  My wife and I live in ####hole USA.   I am a landlord and $900 would get you quite a nice place.  
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You also can get quite a nice #### hole of an apartment in most cities for 900 bucks too

 
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Additionally, in Wisconsin (at least the area of Wisconsin we live) making $57k per year, you can send you kids to catholic private school for free through the voucher system.  A high school we looked at for my daughter would cost us $11,000 tuition per year just to get in then add book fees, computer fees, sports fees, etc. and this raises the cost higher, but through the voucher system all of this is free for a family making this level.  After 4 years of high school we would be looking at $44,000 to $50,000, while a child eligible through the voucher system costs the family $0.

 
$57k family income is rough - no doubt about it.  That's two parents, each making <$30k, which is basically entry-level teaching, retail, food services, receptionist, etc.  I have a lot of friends in this situation (or worse off).

You make sacrifices to get by, thinking it's only an 18 year problem.  Kids will grow up and leave the house, so if you have to live paycheck to paycheck for a while, so be it.  There will be time to save for retirement (if that's even on the radar) once the kids are out of the house.

You don't pay $350/month for a car.  You buy used, and you scrimp and save to pay for repairs.

Your house - you aren't paying $1200.  You are living either in a ####ty neighborhood or out in the sticks and commute...or, just live/work in Podunk.

You don't go on fancy vacations.  Instead of Disney, you go camping at the local state park.  Maybe every couple of years you can save up some money and fly somewhere.

Maybe there is no cable or direcTV.  Maybe even no internet.   No craft beer, Starbucks, filet mignon, etc.

You live under the assumption that things will get easier.  You hope to get a promotion one day, or maybe you keep an eye open for a new job.  You look forward to the day your kids are out of the house and stop eating your food.  You count down until your car/mortgage/student loans are paid off, because you will have that much more income.  You hustle, you scrimp, you save, and you get by...it's just 18 years, after all.

 If you are lucky, you make it out without dabbling with meth/heroin/etc, or running up a ton of debt.

Life ain't easy.

 
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So I hit the submit button on the OP as I was leaving work yesterday.  Was a bit of a experiment to see how many posts it would generate by this morning, and also to see what direction the thread would head in.  Didn't get quite as political as I was expecting, which is a good thing.

I've seen two primary things as themes in many of the replies - your numbers are off, and generally people are stupid when it comes to financial decision making.  I can't really argue with the latter.  On the former, I understand that everyone' situation is different, buy by in large I was attempting to use "average" numbers.  Someone above said that my initial $57k number is off.  I guess it is, I used it as I heard it was the "median income in 2016", but as he points out that's for all households not just for families where the number should be $68k, which does make feel a bit better.  What that does, though, would be to increase taxes as well as the amount they are putting away to retirement assuming they are doing so on a percentage basis.  The retirement thing is important to me with this question - if you aren't putting away any money into your retirement plans (especially if you're being matched by your employer - aka "free money") because you can't afford to due to having a family, then you aren't in my eyes "making it" - or at least you won't be when you do eventually get to your retirement.  I used the 8% figure for that as it's what's suggested to put away by many financial planners.  On federal taxes I used an effective rate of 8.77%, which I thought was fair.  Should be a higher effective rate if family income was $68k, too.

On medical insurance, my $5,277 number comes straight from KFF.  On the dental and vision, that was a ballpark and depends on your employer.  I have one employer group that simply pays $25/m towards your dental no matter if your an "employee only" or a "family", making the balance for a family $145 - and I have another group that pays 80% of the dental premium no matter how you're enrolled, making a family premium closer to $35.  You can trim that number down a bit if you want. 

The average used car payment of $350 came from here, though that number is now 4 years old.  I also used average figures for amount of driving done per year, average cost of gas, 30 MPG (might be high for a family SUV type vehicle anyway), and auto insurance.  I didn't even put in the first maintenance type thing needed.  Oil changes, tires, tuneups, timing belts, water pumps and all the like aren't free.

Housing costs were tough, as they are dependent on where you live.  I threw out $1,200 as an average assuming $250k loan, 4% interest on a 30 year note.  Finagle as you please on that.  Owning a residence rather than renting as many have brought up, to me is like the retirement savings above.  Are you just going to rent until your kids are out of the house or out of college - and go home shopping when you're 50?  A few hundred more a month on taxes, insurance, power, water/sewer, internet/phone/TV, gas, so forth.  I think all in on my initial post for all that was like $300-400.  Again, finagle as needed.

The thing I specifically left out, which was actually brought up in the 5th post of this thread was child care costs.  That was actually the primary reason I started this thread as yesterday I made my last payment for this year for child care costs for my kid.  We use a wonderful lady in town who's been doing this for years and takes care of maybe 4-6 kids per day (some just after school).  She's $55 a day, but flexible with her scheduling.  Assuming 200 work days a year give or take, that's exactly $11k per child.  I'm sure that's more expensive than a lot of places (it's what my wife wanted), but even chopping the per child cost in half....but then having two kids gets you right back to that number.  To me, getting to a place in life where you have multiple children you should (though many aren't) be in a place where you're putting something away towards your own retirement, and should hopefully also be a homeowner and not a renter (though again I know that isn't always, or even typically the case).  When you start taking the money out for some savings vehicle, taxes, insurances, housing, transportation, and other "necessities" with the average "family income" today, it simply doesn't leave much left at the end of the month for any education type savings or education debt reduction, food, clothing, child care, or for any "unforeseen" expenses that come up - car broke down, medical bills, family pet got hurt, house AC unit broke, fridge died....whatever. 

 
You really need to rule out saving for retirement and education.   It just ain't happening.  They work until they're 65 and then they live off of SS.

Childcare might not be as much of a necessity at you think.  People could have staggered schedules.  The man may have the 9-5 job and the woman works nights and weekends at walmart for instance.   There may be grandparents in the equation.   Once the kids hit like 8ish, they'll become latchkey kids.  There's  a lot of factors there.  

 
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I know of several couples that have never changed their girlfriends address from her parents, theyve lived together for years, and receive government assistance for a single mother with kids.

edit: they both make much more than 60K too 

 
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