What is "good" money.

[Green Tea]

It's not what you make, it's what you keep that counts!

I like that answer. I was thinking along the lines of it isn't what you make, it is what you live on vs what you make.

 

[angierae]

I did some quick googling and looked up the median household income for my city.

We make 30% more than that, and we have a household income that many here are saying you couldn't live on. We contribute to my 401(k), we have one car payment, we own a house, we have money set aside for our daughter's education (not four years of university, but I don't believe in paying for your kid's college 100%, anyway), we're planning a Disney vacation for 2012 plus two long weekend trips this year.

We don't live in a brand new house with granite countertops - our house was built in the 40's. But I'd say we're doing just fine.

 

[Swimalie]

Even around DC, the biggest bite out of most people's incomes is their mortage, but my situation in that regard (purchased @ the peak in 2006) is quite different than some of my neighbors who purchased their homes way before the boom. So some of my neighbors could make considerably less money than we do, and still have a "good" income for what they need.

I can so relate to you. We bought at the peak as well. Right now we are the most expensive house on the street (the few that were more expensive have all sold under foreclosure/short sale) and yet we have the smallest model. Strangely enough, we have, from the few we know, the smallest mortgage payment. Why? Because we owned our first house, lived in a very low cost of living area and lived easily on my husband's $30k a year. We saved a lot then. We then moved to a more expensive area of the country, spent 3 times as much on a house but in 4 years it made $100k which we then put in to this house when we had to move here. And my husband worked hard and made 3 times as much before we moved. Now we're in a very high cost of living area and I'm glad that I still can stay home with our son and we're doing okay. But if it hadn't been for that first house and the low cost of living area, we wouldn't be able to afford to live here as well as we do. The Plan put in place for us was a good one

 

[FINFAN]

Have you looked farther west?? I know people that live in the Yorkville/Plano/Sandwich area and they are quite happy.. Or if he works downtown, the Peotone/Manhattan/Manteno area won't add much time at all to a commute into the city.. None of those places are Naperville, but the cost is MUCH lower..

we did look west a few years ago, but our youngest is now a Jr in HS, so sticking out and hoping to move South , WAY south. DH turns 50 at the end of the month, a lot of life changing discussions going on in our house these days. We have looked into the cost of a local move ( within 30 miles) and it is not going to save us that much in the long run. he is not in the city, Lisle so he drives and does so in a 96 minivan. heading out further would more than likely end up adding a newer car, and basically, by the time we pay a realtor, do the upgrades we have to do to sell( but have been putting off since they are not a priority like gas in the car) we figure we are staring at a minimum of 40-50 grand...nothing is moving in our neighborhood, I think 1 foreclosure finally sold after 4 years... so the plan is to tough it out and tighten the already too tight belt for the major move south hopefully in 3-5 years. Hopefully our earning power south will be as lucrative as your wife..if we could command 100,000 in FL or similar, we would be fine and actually maybe even be able to eat out!

 

[pearlieq]

we did look west a few years ago, but our youngest is now a Jr in HS, so sticking out and hoping to move South , WAY south.

Yeah, probably not worth a move at this point in your lives, with the real estate market and your long term plans being what they are.

That being said, plenty of young families out in the far West burbs commute to Naperville/Lisle/Downers Grove/Oakbrook. It's about 30-45 minutes depending on traffic, which, as you well know, for Chicagoland is par for the course.

Aside from real estate, I don't think Naperville really has a higher COL than anywhere else in Chicagoland. Food costs the same at Dominicks out here. Target doesn't charge more for paper towels. Clothes are the same at Penneys. DuPage county taxes are actually lower than a lot of surrounding counties since there is a much larger business tax base and you get a heck of a lot more for your money!

I guess my point is that I'm worried that you're going to have the same COL issues wherever you wind up, because aside from housing, I don't think there's anything exceptionally high about where you are now. We have one of the lowest COLs for a major metropolitan area.

 

[punkin]

I agree with this, but I also live in the DC area, but on the other side in Maryland. It's just not something that can be given a pat answer without factoring in so many variables.

Even around DC, the biggest bite out of most people's incomes is their mortage, but my situation in that regard (purchased @ the peak in 2006) is quite different than some of my neighbors who purchased their homes way before the boom. So some of my neighbors could make considerably less money than we do, and still have a "good" income for what they need.

Yes, housing is the BIG ticket item around DC. You want a good school district--you pay through the nose. So we pay through the nose.

 

[FINFAN]

Yeah, probably not worth a move at this point in your lives, with the real estate market and your long term plans being what they are.

That being said, plenty of young families out in the far West burbs commute to Naperville/Lisle/Downers Grove/Oakbrook. It's about 30-45 minutes depending on traffic, which, as you well know, for Chicagoland is par for the course.

Aside from real estate, I don't think Naperville really has a higher COL than anywhere else in Chicagoland. Food costs the same at Dominicks out here. Target doesn't charge more for paper towels. Clothes are the same at Penneys. DuPage county taxes are actually lower than a lot of surrounding counties since there is a much larger business tax base and you get a heck of a lot more for your money!

I guess my point is that I'm worried that you're going to have the same COL issues wherever you wind up, because aside from housing, I don't think there's anything exceptionally high about where you are now. We have one of the lowest COLs for a major metropolitan area.

yep, which is why heading where there is no state tax and housing is 1/2 is a plan. I know insurance is nuts in Fl, but from what we have researched and from what my family pays, once our real estate tax is factored in it will be a wash if not a savings. Downsizing while staying within a certain salary range is the key...and I know electric costs wil be big and lawn care etc, however I have been frequenting FL for my whole life, spent my summers there as a teen so know how brutal the heat gets and the hidden costs of the season. Groceries are high to me there and basically, service jobs are it but sometimes you just have to follow your heart. It is a crap shoot, you know? Life is an enigma, constantly changing , just hoping to start enjoying it more rather than merely existing and surviving it.

 

[snowywhite89]

I did some quick googling and looked up the median household income for my city.

We make 30% more than that, and we have a household income that many here are saying you couldn't live on. We contribute to my 401(k), we have one car payment, we own a house, we have money set aside for our daughter's education (not four years of university, but I don't believe in paying for your kid's college 100%, anyway), we're planning a Disney vacation for 2012 plus two long weekend trips this year.

We don't live in a brand new house with granite countertops - our house was built in the 40's. But I'd say we're doing just fine.

Don't worry about that. I was watching the one of the house networks and they made a comment that 2/3 of all counter tops sold each year in the US is laminate. Granite it not the norm in most places.

 

[angierae]

Don't worry about that. I was watching the one of the house networks and they made a comment that 2/3 of all counter tops sold each year in the US is laminate. Granite it not the norm in most places.

I was just using it as an example - our house is not "new construction" with a master suite, multiple walk in closets, whatever. It's a 70 year old bungalow with a finished attic.

 

[NotUrsula]

In my mind it isn't tied to any kind of number, really. I grew up blue-collar working-class, and "he makes good money" is an expression with decidedly blue-collar origins. Working-class people are a lot more willing to talk about what they make than white-collar people are, and IME, "good money" is always relative -- to one's relatives, specifically.

In my world, one defined "making good money" as doing financially better than, or at least as well as, your parents. "Making good money" means keeping your mobility on an upward track. If you don't do as well as your parents you find yourself on a down slope relative to the rest of your family; thus your income is no longer good in their eyes.

 

[snowywhite89]

I was just using it as an example - our house is not "new construction" with a master suite, multiple walk in closets, whatever. It's a 70 year old bungalow with a finished attic.

I miss having a walk up attic. I loved to play in my grandparent's attic when I was young.

 

[ajh88]

This got me curious - I checked out the county where I live in the Midwest to see what "good" money might be here. FWIW, I agree with others in that there isn't a right amount. When I watch Til Debt Do Us Part and I see a couple making over $100K with no kids (or maybe 1 child) and they still spend $2000 a month more than they earn - I always think, man, they are making good money, why can't they live on that!?! Then again, if they could live on it, they wouldn't need Gail's help!

Anyway, the cost of living (COL) index for my county is 77.6, considered low because the U.S. average is 100. The mean household income in 2009 was about $36K (HOUSEHOLD, not per capita) while the average home value is about $76K. If I get more specific and look only at the town where I live (population 456), the average household income was $45K and average home value about $54K. Somehow the COL for my town is 79.6, but still low.

So, I guess once I graduate and get my high 5-low 6 figure job, I'll be making super great money for my county and town. I just hope I remember everything I've learned here on the budget board and from the past 4 years of living on barely 5 figures so that I don't need Gail to come to my house!

 

[punkin]

I just looked up my town's COL index on bestplaces.net and it is 218, which means that it is twice as expensive to live here than the "average" town in the USA. I guess that's why I don't think we make "good money" despite a rather large salary.

 

[vicki_c]

ajh88 - that is interesting - I hadn't looked up that type of info since before we moved here.

Where I live the COL index is 108 and the median income is $115K. Of course, the median house price is $515K.

So that's just a good example of why a "good" income is not a number - or at least not one that people from different areas of the country could settle on.

 

[Colleen27]

I just looked up my town's COL index on bestplaces.net and it is 218, which means that it is twice as expensive to live here than the "average" town in the USA. I guess that's why I don't think we make "good money" despite a rather large salary.

Ours is 76, which is probably why I consider 52K to be good money. The median housing price in our town is $64,000, and a single income family making $50K can easily afford acreage or waterfront based on the old "three times annual salary" rule of thumb.

We have a slightly above median income for our community and on that we were able to save to pay cash for a home - a 130yo historic home, nothing fancy but nice sized and comfortable - and now vacation pretty frequently. So where we're at feels like pretty good money even if we couldn't live on it in NYC or DC. Six figures in our circumstances would feel downright wealthy.

 

[Green Tea]

Interesting website! My COL is 102, so right about average.

 

[vicki_c]

Geez punkin -you need to move! LOL. 218 - that is screaming high.

Edited to add - oh! We might not all be comparing apples to apples - punkin used bestplaces.net - I used citydata the first time. When I check mine on bestplaces, it jumps from 108 to 144.

 

[punkin]

Ours is 76, which is probably why I consider 52K to be good money. The median housing price in our town is $64,000, and a single income family making $50K can easily afford acreage or waterfront based on the old "three times annual salary" rule of thumb.

We have a slightly above median income for our community and on that we were able to save to pay cash for a home - a 130yo historic home, nothing fancy but nice sized and comfortable - and now vacation pretty frequently. So where we're at feels like pretty good money even if we couldn't live on it in NYC or DC. Six figures in our circumstances would feel downright wealthy.

Just for fun, I looked up Buffalo (COL at 78, very close to yours) and compared it to where I live and a $100K salary in Buffalo comes to $272,959 where I am. We make significantly less. $50K would be around $136,480. It's interesting, right?

 

[punkin]

Geez punkin -you need to move! LOL. 218 - that is screaming high.

I agree. As soon as DD12 graduates, I am moving into a condo in a crappy school district.

 

[vicki_c]

Just for fun, I looked up Buffalo (COL at 78, very close to yours) and compared it to where I live and a $100K salary in Buffalo comes to $272,959 where I am. We make significantly less. $50K would be around $136,480. It's interesting, right?

Believe me, it all needs to be taken with a grain of salt. We moved from WNY to central coastal Florida and the COL calculators had them about equal at that time. However, the housing prices were SO high when we moved, it actually was a huge difference in that one area. Everything else was about the same but that factor alone (just like here in the DC area) can really skew how it "feels".