As someone who makes $60,000 a year wage income, I have to comment on several things.
1) My taxes on my take-home pay are a bit over 30%. Back in the day I bought a few shares of stock, sold it recently, and realized some small amounts of capital gains on it. Doing the little math-rigamarole in the tax booklet made it clear that the tax on that stock gain was much, much less than that on my wages.
The downside of “make more money on capital gains” is that you have to have the money to invest in the first place– pretty tough when you are living close to the edge.
2) I do the best I can to save, put money away in my 401K, etc. I save some 8% towards retirement total, which I “hope” will be enough when I get there.
3) I am trying to save up some sort of a down payment, but the choices I am confronted with at $39,000/year max net are, (a) rent a decent-enough place and not save up more than a couple hundred dollars a month, petty change in this housing market, or (b) rent two rooms in a house and save more like $1,000/month, which might bring me a decent down-payment for a condo by the time the bottom rolls around. (I am doing the latter.) I think a house in any kind of decent neighborhood will forever be out of my reach even at the bottom. Meantime I endure cramped uncomfortable quarters just in the hope that I can lock down something and start paying it off so I am not renting when I retire in 24 years.
4)’waiting for bottom’, what the heck are you renting??? What the heck are you eating??? I see a lot of slack in your budget, based on the way I spend my own money. For one, nice 4 BR houses in RB rent for 2400/month. For another, I spend something like $200/month on groceries for myself… if you had kids I could see up to $800/month. Eating out and buying prepackaged foods will boost the monthly grocery bill pretty quickly.
Based on your description, I am guessing that you live in the big 5 bedroom house with the lawn, two SUV/minivans, lots of microwave dinners and the odd visit to Chuck E. Cheese, lots of shuttling back and forth to soccer games and the like. This is the way I grew up, and it is “middle class” in most of Middle America, but yup, you guessed it– in San Diego terms, you are Livin Large. Welcome to the top 5% of San Diegans, the rest of us don’t live that way.
