What’s the Perfect Budget?

[SDEngineer]

“Oh, it’s a stick. I can’t imagine ever driving an automatic, and certainly not the TT. Do they make a TT that’s automatic? That should be criminal.”

You’d be surprised – the new manumatic types of transmissions that are appearing on the sporty cars are a lot better than they used to be. I was a manual snob until recently (I had had automatics before, and couldn’t stand them), but my wife refuses to learn to drive a stick, and I had resigned myself to getting an automatic so that she could take the “fun car” from time to time.

Got a Infiniti G37 with their automatic, and it really changed my opinion. I can drive it just like a manual using the paddle shifters – the tranny never overrules me (I can even hit the rev limiter if I’m not paying attention), and the tranny even *blips* the throttle to maintain engine revs in the sweet spot (and get rid of shift-shock) when shifting as if it were heel and toeing. And the wife can stick it in “D” and still have fun (the shift points and responsiveness are very good even when not driving it in manumatic mode).

[SDEngineer]

“Given that the median income in this county is less than $100K, what is the median house price again?”

This is true, but misleading – the numbers are a bit off, and median household income never buys a median house. The lower income tiers, whether by being unskilled, or young and at the bottom rung of their careers, don’t buy houses, they rent – even now, after the age of easy money, in Southern California as many households rent as own (it’s very close to a perfect 50/50 split). This is less true in other areas that have significantly higher homeownership like the midwest, but out here costs have always been high enough that there have been a great many renters. There was a post on here not too long ago that linked to a site that had the breakout of median household renters income in San Diego (don’t remember the site, but it was in one of the posts or articles on this site. IIRC, it was about 43K), and after backing that out of the figure they used for overall median household income (of all types, 72K), the number for median homeowners household income worked out to about 95K.

The take home figure for 100K is also a bit light – it should be a bit higher than 6k/mo take home. At those numbers, and assuming a median household income of 100K buying that median home, it still works out to better than 40% of their net (though it’s down to an approvable 28% of their gross). *EDIT* oops, just noticed that the OP had reduced the gross by using a full 15% to 401K. Certainly a smart thing to do, but I doubt most households do that, nor do I think it’s really necessary unless they started late on their retirement savings. Others will have decent matching also reducing the %(in my case, I get 6% matching, and am putting only 6% of my own dollars towards the 401K).

It’s not nearly as overpriced or unaffordable as it used to be (though it’s still well above historical norms for this area). Of course, prices are still going to fall, but I think it’s more now driven by factors other than that people simply can’t afford a home (ie. it’s still significantly cheaper to rent an equivalent home, and a great many can’t get financed in the current credit crunch, and of course, there’s still tons of foreclosures going to hit the market from people who did buy well above their means during the bubble using “creative” financing products).

[SDEngineer]

“Given that the median income in this county is less than $100K, what is the median house price again?”

This is true, but misleading – the numbers are a bit off, and median household income never buys a median house. The lower income tiers, whether by being unskilled, or young and at the bottom rung of their careers, don’t buy houses, they rent – even now, after the age of easy money, in Southern California as many households rent as own (it’s very close to a perfect 50/50 split). This is less true in other areas that have significantly higher homeownership like the midwest, but out here costs have always been high enough that there have been a great many renters. There was a post on here not too long ago that linked to a site that had the breakout of median household renters income in San Diego (don’t remember the site, but it was in one of the posts or articles on this site. IIRC, it was about 43K), and after backing that out of the figure they used for overall median household income (of all types, 72K), the number for median homeowners household income worked out to about 95K.

The take home figure for 100K is also a bit light – it should be a bit higher than 6k/mo take home. At those numbers, and assuming a median household income of 100K buying that median home, it still works out to better than 40% of their net (though it’s down to an approvable 28% of their gross). *EDIT* oops, just noticed that the OP had reduced the gross by using a full 15% to 401K. Certainly a smart thing to do, but I doubt most households do that, nor do I think it’s really necessary unless they started late on their retirement savings. Others will have decent matching also reducing the %(in my case, I get 6% matching, and am putting only 6% of my own dollars towards the 401K).

It’s not nearly as overpriced or unaffordable as it used to be (though it’s still well above historical norms for this area). Of course, prices are still going to fall, but I think it’s more now driven by factors other than that people simply can’t afford a home (ie. it’s still significantly cheaper to rent an equivalent home, and a great many can’t get financed in the current credit crunch, and of course, there’s still tons of foreclosures going to hit the market from people who did buy well above their means during the bubble using “creative” financing products).

[SDEngineer]

“Given that the median income in this county is less than $100K, what is the median house price again?”

This is true, but misleading – the numbers are a bit off, and median household income never buys a median house. The lower income tiers, whether by being unskilled, or young and at the bottom rung of their careers, don’t buy houses, they rent – even now, after the age of easy money, in Southern California as many households rent as own (it’s very close to a perfect 50/50 split). This is less true in other areas that have significantly higher homeownership like the midwest, but out here costs have always been high enough that there have been a great many renters. There was a post on here not too long ago that linked to a site that had the breakout of median household renters income in San Diego (don’t remember the site, but it was in one of the posts or articles on this site. IIRC, it was about 43K), and after backing that out of the figure they used for overall median household income (of all types, 72K), the number for median homeowners household income worked out to about 95K.

The take home figure for 100K is also a bit light – it should be a bit higher than 6k/mo take home. At those numbers, and assuming a median household income of 100K buying that median home, it still works out to better than 40% of their net (though it’s down to an approvable 28% of their gross). *EDIT* oops, just noticed that the OP had reduced the gross by using a full 15% to 401K. Certainly a smart thing to do, but I doubt most households do that, nor do I think it’s really necessary unless they started late on their retirement savings. Others will have decent matching also reducing the %(in my case, I get 6% matching, and am putting only 6% of my own dollars towards the 401K).

It’s not nearly as overpriced or unaffordable as it used to be (though it’s still well above historical norms for this area). Of course, prices are still going to fall, but I think it’s more now driven by factors other than that people simply can’t afford a home (ie. it’s still significantly cheaper to rent an equivalent home, and a great many can’t get financed in the current credit crunch, and of course, there’s still tons of foreclosures going to hit the market from people who did buy well above their means during the bubble using “creative” financing products).

[SDEngineer]

“Given that the median income in this county is less than $100K, what is the median house price again?”

This is true, but misleading – the numbers are a bit off, and median household income never buys a median house. The lower income tiers, whether by being unskilled, or young and at the bottom rung of their careers, don’t buy houses, they rent – even now, after the age of easy money, in Southern California as many households rent as own (it’s very close to a perfect 50/50 split). This is less true in other areas that have significantly higher homeownership like the midwest, but out here costs have always been high enough that there have been a great many renters. There was a post on here not too long ago that linked to a site that had the breakout of median household renters income in San Diego (don’t remember the site, but it was in one of the posts or articles on this site. IIRC, it was about 43K), and after backing that out of the figure they used for overall median household income (of all types, 72K), the number for median homeowners household income worked out to about 95K.

The take home figure for 100K is also a bit light – it should be a bit higher than 6k/mo take home. At those numbers, and assuming a median household income of 100K buying that median home, it still works out to better than 40% of their net (though it’s down to an approvable 28% of their gross). *EDIT* oops, just noticed that the OP had reduced the gross by using a full 15% to 401K. Certainly a smart thing to do, but I doubt most households do that, nor do I think it’s really necessary unless they started late on their retirement savings. Others will have decent matching also reducing the %(in my case, I get 6% matching, and am putting only 6% of my own dollars towards the 401K).

It’s not nearly as overpriced or unaffordable as it used to be (though it’s still well above historical norms for this area). Of course, prices are still going to fall, but I think it’s more now driven by factors other than that people simply can’t afford a home (ie. it’s still significantly cheaper to rent an equivalent home, and a great many can’t get financed in the current credit crunch, and of course, there’s still tons of foreclosures going to hit the market from people who did buy well above their means during the bubble using “creative” financing products).

[SDEngineer]

“Given that the median income in this county is less than $100K, what is the median house price again?”

This is true, but misleading – the numbers are a bit off, and median household income never buys a median house. The lower income tiers, whether by being unskilled, or young and at the bottom rung of their careers, don’t buy houses, they rent – even now, after the age of easy money, in Southern California as many households rent as own (it’s very close to a perfect 50/50 split). This is less true in other areas that have significantly higher homeownership like the midwest, but out here costs have always been high enough that there have been a great many renters. There was a post on here not too long ago that linked to a site that had the breakout of median household renters income in San Diego (don’t remember the site, but it was in one of the posts or articles on this site. IIRC, it was about 43K), and after backing that out of the figure they used for overall median household income (of all types, 72K), the number for median homeowners household income worked out to about 95K.

The take home figure for 100K is also a bit light – it should be a bit higher than 6k/mo take home. At those numbers, and assuming a median household income of 100K buying that median home, it still works out to better than 40% of their net (though it’s down to an approvable 28% of their gross). *EDIT* oops, just noticed that the OP had reduced the gross by using a full 15% to 401K. Certainly a smart thing to do, but I doubt most households do that, nor do I think it’s really necessary unless they started late on their retirement savings. Others will have decent matching also reducing the %(in my case, I get 6% matching, and am putting only 6% of my own dollars towards the 401K).

It’s not nearly as overpriced or unaffordable as it used to be (though it’s still well above historical norms for this area). Of course, prices are still going to fall, but I think it’s more now driven by factors other than that people simply can’t afford a home (ie. it’s still significantly cheaper to rent an equivalent home, and a great many can’t get financed in the current credit crunch, and of course, there’s still tons of foreclosures going to hit the market from people who did buy well above their means during the bubble using “creative” financing products).

[temeculaguy]

Back to the original post, 40% after tax income on mortgage expense is still on the high side but roughly 2k. The perfect budget is that all of the expenses of the house, PITI,hoa, utilities, gardner and maid equal 50%, the complete house tab equal 50% of your take home, determined after health insurance, dental insurance and 401k deducted. Clothes, food, cars, alcohol, porn and just having fun is the other half, income tax refund can be used for furniture, vacations, braces or other big ticket one time expenses. That’s the perfect budget, unfortunately 100k isn’t going to make it in S.D., 150k for a family of three is the launching point.

That way you don’t have to forgo the Nails. BTW, I am all dude, hopelessly heterosexual and I get my nails done, buffed not polished. Sex with men makes a man gay, not having a mani/pedi to match the suit and tie, c’mon guys, a little grooming goes a long way.

[temeculaguy]

Back to the original post, 40% after tax income on mortgage expense is still on the high side but roughly 2k. The perfect budget is that all of the expenses of the house, PITI,hoa, utilities, gardner and maid equal 50%, the complete house tab equal 50% of your take home, determined after health insurance, dental insurance and 401k deducted. Clothes, food, cars, alcohol, porn and just having fun is the other half, income tax refund can be used for furniture, vacations, braces or other big ticket one time expenses. That’s the perfect budget, unfortunately 100k isn’t going to make it in S.D., 150k for a family of three is the launching point.

That way you don’t have to forgo the Nails. BTW, I am all dude, hopelessly heterosexual and I get my nails done, buffed not polished. Sex with men makes a man gay, not having a mani/pedi to match the suit and tie, c’mon guys, a little grooming goes a long way.

[temeculaguy]

Back to the original post, 40% after tax income on mortgage expense is still on the high side but roughly 2k. The perfect budget is that all of the expenses of the house, PITI,hoa, utilities, gardner and maid equal 50%, the complete house tab equal 50% of your take home, determined after health insurance, dental insurance and 401k deducted. Clothes, food, cars, alcohol, porn and just having fun is the other half, income tax refund can be used for furniture, vacations, braces or other big ticket one time expenses. That’s the perfect budget, unfortunately 100k isn’t going to make it in S.D., 150k for a family of three is the launching point.

That way you don’t have to forgo the Nails. BTW, I am all dude, hopelessly heterosexual and I get my nails done, buffed not polished. Sex with men makes a man gay, not having a mani/pedi to match the suit and tie, c’mon guys, a little grooming goes a long way.

[temeculaguy]

Back to the original post, 40% after tax income on mortgage expense is still on the high side but roughly 2k. The perfect budget is that all of the expenses of the house, PITI,hoa, utilities, gardner and maid equal 50%, the complete house tab equal 50% of your take home, determined after health insurance, dental insurance and 401k deducted. Clothes, food, cars, alcohol, porn and just having fun is the other half, income tax refund can be used for furniture, vacations, braces or other big ticket one time expenses. That’s the perfect budget, unfortunately 100k isn’t going to make it in S.D., 150k for a family of three is the launching point.

That way you don’t have to forgo the Nails. BTW, I am all dude, hopelessly heterosexual and I get my nails done, buffed not polished. Sex with men makes a man gay, not having a mani/pedi to match the suit and tie, c’mon guys, a little grooming goes a long way.

[temeculaguy]

Back to the original post, 40% after tax income on mortgage expense is still on the high side but roughly 2k. The perfect budget is that all of the expenses of the house, PITI,hoa, utilities, gardner and maid equal 50%, the complete house tab equal 50% of your take home, determined after health insurance, dental insurance and 401k deducted. Clothes, food, cars, alcohol, porn and just having fun is the other half, income tax refund can be used for furniture, vacations, braces or other big ticket one time expenses. That’s the perfect budget, unfortunately 100k isn’t going to make it in S.D., 150k for a family of three is the launching point.

That way you don’t have to forgo the Nails. BTW, I am all dude, hopelessly heterosexual and I get my nails done, buffed not polished. Sex with men makes a man gay, not having a mani/pedi to match the suit and tie, c’mon guys, a little grooming goes a long way.

[TemekuT]

Wow, tough topic, those nails. I just cut my to the quick within the hour and then meandered over to the computer and found this thread. I resumed studying piano seriously when we moved to Temecula 3 years ago and had to decide – sacrifice my acrylic nails so I could play Chopin and Debussy, or have great looking hands. Beethoven et al won but I do still look forward to pedicures and sandals.

The thing I noticed in all the budget postings was nothing for music, dance, and art lessons for the kids.

[TemekuT]

Wow, tough topic, those nails. I just cut my to the quick within the hour and then meandered over to the computer and found this thread. I resumed studying piano seriously when we moved to Temecula 3 years ago and had to decide – sacrifice my acrylic nails so I could play Chopin and Debussy, or have great looking hands. Beethoven et al won but I do still look forward to pedicures and sandals.

The thing I noticed in all the budget postings was nothing for music, dance, and art lessons for the kids.

[TemekuT]

Wow, tough topic, those nails. I just cut my to the quick within the hour and then meandered over to the computer and found this thread. I resumed studying piano seriously when we moved to Temecula 3 years ago and had to decide – sacrifice my acrylic nails so I could play Chopin and Debussy, or have great looking hands. Beethoven et al won but I do still look forward to pedicures and sandals.

The thing I noticed in all the budget postings was nothing for music, dance, and art lessons for the kids.

[TemekuT]

Wow, tough topic, those nails. I just cut my to the quick within the hour and then meandered over to the computer and found this thread. I resumed studying piano seriously when we moved to Temecula 3 years ago and had to decide – sacrifice my acrylic nails so I could play Chopin and Debussy, or have great looking hands. Beethoven et al won but I do still look forward to pedicures and sandals.

The thing I noticed in all the budget postings was nothing for music, dance, and art lessons for the kids.

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