General Discussion
In reply to the discussion: $20,833.00 per month???? [View all]taught_me_patience
(5,477 posts)Gross income 20k/mo
pre tax savings - 1,500
pre tax health insurance - 200
Net income - $18,300
Federal Income tax (23% effective rate) - 4,200
State Income tax (7% effective rate) - 1300
Net income after tax: $12,800
Expenses:
mortgage (950k @4%) $4,535
prop taxes $1,000
student loan $1,000
car $800
daycare $1,950
food $1,000
gas $300
cable/water $200
insurance $400
misc $500
total $11,685
So you're looking at approx. 1,000 left over after expenses, which may seem like a lot, but is only 5% of gross income. Now, you may also argue that you're socking away 1,500 to a 401k every month, but, I'd argue that this long term asset acts like and "expense", at the moment that it occurs (it is also less than 10% of gross income). The $800 loan is two Honda type cars ($16k financed at 4% over 5 year term).