$100,000 income: No big deal anymore

[steve2470]

(yes, that is the title of the article. I am NOT agreeing with it, only posting it for discussion)

http://www.bankrate.com/finance/personal-finance/100-000-income-no-big-deal-anymore-1.aspx?ec_id=m1078093

One hundred thousand dollars. Since the 1980s, the magical "six-figure" salary has been a benchmark for financial success. Not too long ago, that income often meant two nice cars in the garage of a large house, fun family vacations and plenty of money left over to save for retirement and college tuition.

But times have changed. Not only has standard inflation steadily eroded the real value of a $100,000 income, but the costs of housing, health insurance and college tuition have risen dramatically in recent years. Consider the rising costs of food, energy and the necessities of a middle class life, and that six-figure luxury quickly turns to six-figure mediocrity.

Less than 20 percent of American households even break the six figures. But many who earn incomes near the mark find that their prized incomes don't take them as far as the hype. Many say that while breaking the $100,000 annual income mark may still be an impressive milestone, it doesn't exactly roll out the red carpet.

According to the U.S. Census Bureau, only 6.03 percent of individuals over 18 and only 19.9 percent of households had incomes of $100,000 or more in 2010. In fact, the median annual household income for 2010 was $50,046, just more than half of the six-figure benchmark. The overwhelming majority of Americans still look up to a $100,000 income, but the expectations of what comes with that income are rapidly slumping.

*more at link*

[ananda]

1. It would be a big deal to me.

I never made anything close to 100k in any one year.

[Shivering Jemmy]

2. I just landed a 6 figure salary

and I am noticeably better off. I don't feel rich, but it does feel a lot better than make <60,000 a year. A lot less worry about things.

[Ikonoklast]

5. Live like you only make 50K.

Employment, no matter the circumstances, should be treated as a temporary condition as it can change under you for no reason at any time.

[FBaggins]

3. In many areas of the country that's actually true.

But let's not pretend that it's just a step away from food stamps and emergency room health care either.

[dems_rightnow]

4. Depends on where you live

http://en.wikipedia.org/wiki/List_of_U.S._states_by_income

It's an above average income anywhere, but worth considerably more in some states than others.

[PSPS]

6. $100K/year puts you in the top 20%

[Heather MC]

7. The real problem is

people don't spend within their means. You can live just fine on way less than 100k if you learn how to properly manage your money. I do.

I read a book years ago called "Gods plans over your finances" One of the major things the author talked about was living by a 70/30 rule. spend no more than 70% of yourself income. Save 30%. then he broke down the 30% even further 10% to long-term saving 10% to short term, And 10% for charity or tithing.

You don't have to subscribe to a belief in God to follow that simple rule.

The challenge for most people today is that we are not taught to save. we are constantly being encouraged to spend spend spend. And that's a great plan for. Walmart Target car companies and the housing market, but it is a lousy plan for individuals and Families.

after I read that book I begin to streamline my family's personal finances.
we cut out cable, got rid of our home phone, got cheaper a cell phone service through boost mobile. and we got rid of our credit cards. I rarely buy new things I will go to ebay or craigslist or a thriftshop first.

when it comes to home repair my husband and I will do them first. I saved over 10,000 dollars remodeling my own kitchen. and I completely gutted the kitchen and rebuilt it back up. when we buy a new car we buy used. and we pay cash. we also plan when we are going to make a big purchase so we save the money first. therefore no need to live life on credit .

believe it or not we have a wonderful life. in fact the whole family is about to go on a cruise at the end of October. that is something we would not have been able to afford to do 5 years ago. and my husband is military and I am a stay at home mom, I teach zumba part-time 10 classes per week. we are nowhere near 100 K. and we live in Northern Virginia which is very very expensive.

I only buy organic food. but I use coupons like crazy which makes it affordable.

we need to relearn how our parents did it our parents use to save. they didn't have credit or credit cards out the wazoo. instant gratification is great for companies. but if you really want something save your money and then purchase it.

100k can go far if you don't try live like you are making 1million

[Livluvgrow]

8. 100 grand

100 grand a year living in big cities would just be absorbed by the big cities themselves. 100 Grand by me on the other hand would allow for savings and vast improvements to my home as well as probably being mortgage free within 2-3 years.

[DiverDave]

9. 100K, christ, I wish I was burdened with it

and people WHINE that thats all they make???
Walk a mile in my tennis shoes and then complain, I dare ya...

[SoCalDem]

10. As a society, we now "want" more and expect more

"Rich" families used to just live in a bigger house, but were not totally removed from the rest of us.

They had nicer, newer cars & nicer clothes, but their kids sat next to me at school, and included me in their parties & excursions..I was invited to their slumber parties & barbeques.

The rich kids had their own phones (meaning the family may have had 3 phones in their house...kitchen. bedroom & rec-room for the kids)

They probably had TWO tvs..

They flew to Florida on vacation...the rest of us drove to Yellowstone or Grandparents' house

They shopped at the same grocery stores, but they probably bought steaks when we bought hamburger

They had credit..most of the rest of us did not.

These days, with "EZ-CREDIT-FOR ALL" cards, even "paupers" have access to credit, and too many are wallowing in debt, trying to keep up with what is now "necessary".

I have a friend who always worries if she will have enough to put gas in her car or to pay her electric bill, but she finds money to go to the Indian Casino and to pay for her jazzy iphone bill..

Our priorities have changed..and what was once considered "luxuries" are now "necessities".

It can be something as simple as grocery shopping...example..

cakes, cookies, ice cream soda pop, chips used to be TREATS..bought occasionally ...maybe for a party or a camp out.. They were NOT staples to be consumed every day..

Clothes-shopping was not a "hobby" or something to do on a lazy boring afternoon. People shopped for clothes when kids outgrew what they had..for back-to-school or for a special occasion

Eating meals outside the home was a TREAT for a special occasion.....

[nadinbrzezinski]

12. You hit on something important which is style and status

For the record we do have a fancy, snazzy (not IPHONE didn't want to pay that much, but not the base model either, needed some speed) Android. For us it is now part of work... sadly it is not cheap.

But style and status has become critical for a lot of people, even if there is no money for the style or the status.

[nadinbrzezinski]

11. well it truly depends where you live

In OH that income is incredibly good, Mean Pay and cost of living is much lower, than let's say my home town of San Diego Ca.

Don't get me wrong. I WISH we made that much... but if the writer is talking about large metro areas in coastal states, he has a point.

If he is talking of small towns in not so large metro areas in the middle of the country, it is still way above average

This is part of the problem when we talk salary and how to calculate it. We tend to think of these things in ... national numbers, but they do not apply equally to the whole country. This is why the Feds actually have Cost of Living adjustments for Federal Employees living in expensive areas.

So is this six figure in oh Cleveland OH, or San Diego CA... yes, there is a difference on how far it will go and all that.

Regardless, that is a good salary and will hardly (even though it goes not as far), a starving pay.

[Douglas Carpenter]

13. in major metropolitan areas such as Boston, or San Francisco - $100,000/year would not be enough to

comfortably support a family of four at the traditional middle class lifestyle. If housing costs for a family housing unit averages over $800,000 as it does it places like the NYC areas, the Bay area and the Boston area - they would find it very difficult to purchase a comfortable home suitable for a family. They would no doubt be doing a lot better than a lot of people - but it certainly would not be upper middle class in large parts of America anymore. It would be a struggle to purchase a nice home and put the kids through college without going deep into burdensome debt. By that criteria - it is certainly not what it used to be. Where I am currently living I would say $100,000 per year would afford a middle class lifestyle for a family of four. But it would not by any means wealthy and probably not even upper middle class anymore. A single person earning $100,000/per year would be comfortably middle class almost anywhere in America - but in major metropolitan areas they would still barely qualify for a mortgage on even a one bedroom condo.

[HipChick]

15. One Bedroom Condo's go for the price of a single family home here..so $100K wouldn't go far..

[HopeHoops]

14. A lot of it depends on where you live. Personally, I think minimum wage should be tied...

... to the average cost of living (on an indexed level, of course) for the location. Making $10/hr. in NYC is a shitload different from making $10/hr in Owensboro, KY. And the GOP wants to eliminate minimum wage entirely. They keep bitching about the "47%", but their proposed solution would just increase that percentage.

[ctaylors6]

16. I think it's a lot but medical expenses

and student loans CAN wipe away a big chunk of that pretty quickly. We had over $30,000 in medical expenses this past year, and we thankfully didn't even have anything that serious. Mostly just really high premiums, deductibles, and out of pocket expenses.

While I don't think anyone making $100,00 should be complaining, I can understand the sentiment that making $100,000 with a family is not rolling in the dough like it was when I was growing up. Shoot, my dad and one of his friends laugh about how when they were growing up they never thought they could ever make $10,000 in one year.