What’s the Perfect Budget?

[mydogsarelazy]

Right now, what makes it possible to do what we are doing — raising three daughters in Southern California — is capital.

We are older, and have paid off both cars, have less than $1k in credit card debt and just ten years to go to pay off our fixed rate mortgage. With an income of $115k we are fine, and are putting money in the girl’s college accounts every month. Of our $7k monthly after tax paycheck, we put about $1900 into property taxes and mortgage, and the rest can go elsewhere.

This economy is brutal for younger people, as they have a very tough time accumulating capital. Income is an important measure, but net worth is a crucial factor. Imagine being in your early twenties, wanting to start a family and living in Southern California. I would look around, scream and run to another state. Of course, I have no idea what state that would be.

JS

[enron_by_the_sea]

I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.

[enron_by_the_sea]

I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.

[enron_by_the_sea]

I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.

[enron_by_the_sea]

I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.

[enron_by_the_sea]

I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.

[nla]

– $1,500 1.5% School Fund (pretax)

I’m curious about this too. 529 and Educational IRA are after tax AFAIK.

[nla]

– $1,500 1.5% School Fund (pretax)

I’m curious about this too. 529 and Educational IRA are after tax AFAIK.

[nla]

– $1,500 1.5% School Fund (pretax)

I’m curious about this too. 529 and Educational IRA are after tax AFAIK.

[nla]

– $1,500 1.5% School Fund (pretax)

I’m curious about this too. 529 and Educational IRA are after tax AFAIK.

[nla]

– $1,500 1.5% School Fund (pretax)

I’m curious about this too. 529 and Educational IRA are after tax AFAIK.

[atr]

I think that the most
Submitted by enron_by_the_sea on April 22, 2008 – 7:47am.

“I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.”

I don’t believe that the taxes are being overestimated. We are a renting family of three with a household income around 135K (single income). We were SHOCKED at how much we are paying in taxes now that we are CA residents. Everything included is around 40% out each month. Add in union dues, medical, 401k contribution, and our take home pay gets smaller and smaller! We’ll maybe get $2000 back at tax time as renters. When you don’t own your own business and don’t own a house, taxes are enormous.

We invest 10% of our gross to our IRAs and 401k, plus a fairly substantial percentage to increase our future down payment on a house. We also have funds for vacation and Christmas, and child’s college. Both of our cars are paid off and we have no debt. We are able to live modestly and still have some fun, but I would not feel comfortable buying a house that cost any more than 300K or so. Doing so would make us much tighter than I would wish to be, especially considering that child will be entering college sooner rather than later! Granted, I will return to work in a more full time capacity when kiddo goes off to school.

[atr]

I think that the most
Submitted by enron_by_the_sea on April 22, 2008 – 7:47am.

“I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.”

I don’t believe that the taxes are being overestimated. We are a renting family of three with a household income around 135K (single income). We were SHOCKED at how much we are paying in taxes now that we are CA residents. Everything included is around 40% out each month. Add in union dues, medical, 401k contribution, and our take home pay gets smaller and smaller! We’ll maybe get $2000 back at tax time as renters. When you don’t own your own business and don’t own a house, taxes are enormous.

We invest 10% of our gross to our IRAs and 401k, plus a fairly substantial percentage to increase our future down payment on a house. We also have funds for vacation and Christmas, and child’s college. Both of our cars are paid off and we have no debt. We are able to live modestly and still have some fun, but I would not feel comfortable buying a house that cost any more than 300K or so. Doing so would make us much tighter than I would wish to be, especially considering that child will be entering college sooner rather than later! Granted, I will return to work in a more full time capacity when kiddo goes off to school.

[atr]

I think that the most
Submitted by enron_by_the_sea on April 22, 2008 – 7:47am.

“I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.”

I don’t believe that the taxes are being overestimated. We are a renting family of three with a household income around 135K (single income). We were SHOCKED at how much we are paying in taxes now that we are CA residents. Everything included is around 40% out each month. Add in union dues, medical, 401k contribution, and our take home pay gets smaller and smaller! We’ll maybe get $2000 back at tax time as renters. When you don’t own your own business and don’t own a house, taxes are enormous.

We invest 10% of our gross to our IRAs and 401k, plus a fairly substantial percentage to increase our future down payment on a house. We also have funds for vacation and Christmas, and child’s college. Both of our cars are paid off and we have no debt. We are able to live modestly and still have some fun, but I would not feel comfortable buying a house that cost any more than 300K or so. Doing so would make us much tighter than I would wish to be, especially considering that child will be entering college sooner rather than later! Granted, I will return to work in a more full time capacity when kiddo goes off to school.

[atr]

I think that the most
Submitted by enron_by_the_sea on April 22, 2008 – 7:47am.

“I think that the most obviously overestimated thing in this calculation is taxes!!!

By my calculations, a renter family of 3 making 100K, contributing to 401K etc. will pay about 18500 USD in total taxes (Fed+CA+FICA+Med). (Not $25400 as suggested in the post.) That is about 7000 USD difference in take home pay which could influence rent/buy decisions.

Why? Because there is standard deduction, exemptions, child tax credit etc. in the tax code; so you almost need to fill out your tax form to find out how much the tax owed is. I have one excel spreadsheet that I optimized for my situation for this purpose.

Does anyone that fits the above situation, share with us if their taxes are closer to 18K or 25K? I wanted to see if there is any error in my spreadsheet.”

I don’t believe that the taxes are being overestimated. We are a renting family of three with a household income around 135K (single income). We were SHOCKED at how much we are paying in taxes now that we are CA residents. Everything included is around 40% out each month. Add in union dues, medical, 401k contribution, and our take home pay gets smaller and smaller! We’ll maybe get $2000 back at tax time as renters. When you don’t own your own business and don’t own a house, taxes are enormous.

We invest 10% of our gross to our IRAs and 401k, plus a fairly substantial percentage to increase our future down payment on a house. We also have funds for vacation and Christmas, and child’s college. Both of our cars are paid off and we have no debt. We are able to live modestly and still have some fun, but I would not feel comfortable buying a house that cost any more than 300K or so. Doing so would make us much tighter than I would wish to be, especially considering that child will be entering college sooner rather than later! Granted, I will return to work in a more full time capacity when kiddo goes off to school.

[Author]

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