Anybody else unable to afford a home/have six figure income?

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ChristopherRobin
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Anybody else unable to afford a home/have six figure income?

Post by ChristopherRobin » Wed Jun 26, 2019 3:20 pm

I read a lot of similar stories on these forums of people who owns homes and make over $100,000.

Am I alone on this board in not being able to afford a home or make anywhere near six figures?

DesertDiva
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Re: Anybody else unable to afford a home/have six figure income?

Post by DesertDiva » Wed Jun 26, 2019 3:23 pm

Do you live in HCOL area, like NYC, Cali, Hawaii?
Edit: I apologize... I misread your post.
There are many types of people on this forum, all with differing backgrounds, education levels, ages, income, and net worth. Many want to get a plan together and see what they can do to improve their situation. Take some time to read through the Wiki pages, as well as the recommended reading list. This is a process and seeing results can take some time.
Last edited by DesertDiva on Wed Jun 26, 2019 3:33 pm, edited 1 time in total.

alfaspider
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Re: Anybody else unable to afford a home/have six figure income?

Post by alfaspider » Wed Jun 26, 2019 3:26 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.

Am I alone on this board in not being able to afford a home or make anywhere near six figures?
No. There are plenty of BH who don't have high incomes. There is a decent amount of selection bias among people who report their incomes/net worth here. You also have to keep in mind that the type of person who seeks out an investing forum likely has money to invest, which means the average forum user is likely well above average means.

Burgoo
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Re: Anybody else unable to afford a home/have six figure income?

Post by Burgoo » Wed Jun 26, 2019 3:28 pm

As a former resident of Vancouver Canada I had a six figure income and couldn't afford a home. My solution was to move to a lower cost of living city in the USA and get a pay raise at the same time.

Edit - I apparently lack reading comprehension. If you are in a HCOL city and have a sub six figure income I would seriously considering leaving if your goal is to own a home.

Topic Author
ChristopherRobin
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Re: Anybody else unable to afford a home/have six figure income?

Post by ChristopherRobin » Wed Jun 26, 2019 3:36 pm

Burgoo wrote:
Wed Jun 26, 2019 3:28 pm
As a former resident of Vancouver Canada I had a six figure income and couldn't afford a home. My solution was to move to a lower cost of living city in the USA and get a pay raise at the same time.

Edit - I apparently lack reading comprehension. If you are in a HCOL city and have a sub six figure income I would seriously considering leaving if your goal is to own a home.
I live in California, so home ownership is out of reach. I will most likely leave in a couple years (for many reasons).

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Quirkz
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Re: Anybody else unable to afford a home/have six figure income?

Post by Quirkz » Wed Jun 26, 2019 3:42 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 3:36 pm

I live in California, so home ownership is out of reach. I will most likely leave in a couple years (for many reasons).
In a situation like that, I think the answer is to sit tight, take care of other financial aspects as well as possible, and revisit the idea when you move. It's totally fine to rent for a while (or longer) if it fits in your big-picture plans.

livesoft
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Re: Anybody else unable to afford a home/have six figure income?

Post by livesoft » Wed Jun 26, 2019 3:45 pm

Decades ago, we could not afford a home in NY. It never bothered us at all. Lot of folks in NY are renters for life.

We moved away and bought a home when we were in our late 30s which could be considered way older than the OP.

I must admit that I never understood why anybody would be anxious to buy a home, but I'm weird in more ways than that.
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dm200
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Re: Anybody else unable to afford a home/have six figure income?

Post by dm200 » Wed Jun 26, 2019 3:47 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.
Am I alone on this board in not being able to afford a home or make anywhere near six figures?
Big difference in buying "a home" and getting that home in the area you want and/or need.

Our locality, where we bought our single family home 41 years ago is now completely unaffordable for similar small home purchases today for folks like we were when we bought the house.

alfaspider
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Re: Anybody else unable to afford a home/have six figure income?

Post by alfaspider » Wed Jun 26, 2019 3:53 pm

dm200 wrote:
Wed Jun 26, 2019 3:47 pm
ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.
Am I alone on this board in not being able to afford a home or make anywhere near six figures?
Big difference in buying "a home" and getting that home in the area you want and/or need.

Our locality, where we bought our single family home 41 years ago is now completely unaffordable for similar small home purchases today for folks like we were when we bought the house.
That's an interesting point. Especially in places like California and NYC, you often have to be richer than the median existing homeowner by a decent bit in order to buy-in. Where I lived in Brooklyn, it wasn't uncommon for regular folks making under $100k a year to be sitting on brownstones worth millions that they or their parents bought cheap 30+ years ago.

Burgoo
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Re: Anybody else unable to afford a home/have six figure income?

Post by Burgoo » Wed Jun 26, 2019 3:59 pm

alfaspider wrote:
Wed Jun 26, 2019 3:53 pm
dm200 wrote:
Wed Jun 26, 2019 3:47 pm
ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.
Am I alone on this board in not being able to afford a home or make anywhere near six figures?
Big difference in buying "a home" and getting that home in the area you want and/or need.

Our locality, where we bought our single family home 41 years ago is now completely unaffordable for similar small home purchases today for folks like we were when we bought the house.
That's an interesting point. Especially in places like California and NYC, you often have to be richer than the median existing homeowner by a decent bit in order to buy-in. Where I lived in Brooklyn, it wasn't uncommon for regular folks making under $100k a year to be sitting on brownstones worth millions that they or their parents bought cheap 30+ years ago.
Yeah this is Vancouver in a nut shell as well. My parents house cost them 150K back in the 80's and is now worth ~3 million.

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Re: Anybody else unable to afford a home/have six figure income?

Post by bloom2708 » Wed Jun 26, 2019 4:02 pm

There are many threads where Bogleheads fully recommends renting. I assume you are living somewhere, apartment, tiny house, RV, with family, splitting costs with a roommate or 2 or 3, etc.

Home ownership is not the dream you think it is if it derails your financial goals. You live in a state with beautiful weather much of the year. Find a rental scenario that allows you to meet your financial goals. Save and save. See what happens going forward. Store your stuff in the rental, eat, sleep, watch TV. Turn off HGTV and know that a "Dream home" or "Forever home" really have nothing to do with your financial and personal goals. Some places it is easier to own than others. Get off the couch and go outside. :o

I guess this is another thread where I say "renting is just fine and it is not throwing money away. If it was, all your stuff would be outside and get wet when it rains. Although it never rains in Southern California. :wink:

My favorite video about buying stuff:

https://vimeo.com/41152287
Last edited by bloom2708 on Wed Jun 26, 2019 4:38 pm, edited 1 time in total.
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ohai
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Re: Anybody else unable to afford a home/have six figure income?

Post by ohai » Wed Jun 26, 2019 4:05 pm

OP, my (household) income last year was in seven figures and I cannot afford a decent home in NYC.

Jags4186
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Re: Anybody else unable to afford a home/have six figure income?

Post by Jags4186 » Wed Jun 26, 2019 4:06 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.

Am I alone on this board in not being able to afford a home or make anywhere near six figures?
You’re in a self selecting forum. People who have money to invest and have an interest in investing come here. I have a little money to invest every month and enjoy talking about investing, hence I am here.

I can assure you there are lower income folks on this website who don’t own homes. But they would be in the minority likely.

What I can tell you is that if you are interested in getting your income up and getting your financial life in order, there is no better place on the web to solicit actionable advice from than Bogleheads!

123
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Re: Anybody else unable to afford a home/have six figure income?

Post by 123 » Wed Jun 26, 2019 4:17 pm

As a current example about 56% of the people in San Francisco live in rentals. The percentage is slightly higher in Oakland.
The closest helping hand is at the end of your own arm.

Point
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Re: Anybody else unable to afford a home/have six figure income?

Post by Point » Wed Jun 26, 2019 4:19 pm

Owning a home for us was like anything else- figuring out the process. We were married in the early 80’s and we still live in California. We were at that time in a high cost area and still are.

We did a lot of very serious lifestyle changes, eliminated all personal debt, and spent only on needs, not wants, until we had money saved up for a down payment. Then we bought the house, for the last 4 decades we both worked. And we kept old cars, didn’t take airline vacations or eat out a lot.we actually didn’t take a lot of vacations. The weather is great and we enjoyed living local. We stayed away from keeping up with the Jones’s and we did well for ourselves. It was all a slow process that built on itself over the decades. We now have a house, a rentals, two kids, both married, with masters degrees, they have no college debt. We are both retired, and in our mid sixties.

No one loaned us money. We received no inheritance. We did this ourselves.

Slow and steady
Stay away from the shiny stuff
Avoid debt purchasing
Repaired our own house and cars as much as possible
Enjoy local
Needs vs wants

It worked for us.

Burgoo
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Re: Anybody else unable to afford a home/have six figure income?

Post by Burgoo » Wed Jun 26, 2019 4:21 pm

bloom2708 wrote:
Wed Jun 26, 2019 4:02 pm
There are many threads where Bogleheads fully recommends renting. I assume you are living somewhere, apartment, tiny house, RV, with family, splitting costs with a roommate or 2 or 3, etc.

Home ownership is not the dream you think it is if it derails your financial goals. You live in a state with beautiful weather much of the year. Find a rental scenario that allows you to meet your financial goals. Save and save. See what happens going forward. Store your stuff in the rental, eat, sleep, watch TV. Turn off HGTV and know that a "Dream home" or "Forever home" really have nothing to do with your financial and personal goals. Some places it is easier to own than others. Get off the couch and go outside. :o

I guess this is another thread where I say "renting is just fine and it is not throwing money away. If it was, all your stuff would be outside and get wet when it rains. Although it never rains in Southern California. :wink:
Renting isn't throwing away money if the person is investing the savings from renting instead of buying, which someone here is likely to do. The problem is the general public is terrible at saving and buying a house acts as a form of forced savings.

Luckywon
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Re: Anybody else unable to afford a home/have six figure income?

Post by Luckywon » Wed Jun 26, 2019 4:22 pm

ohai wrote:
Wed Jun 26, 2019 4:05 pm
OP, my (household) income last year was in seven figures and I cannot afford a decent home in NYC.
Very encouraging words for OP. :) Only on Bogleheads!! :sharebeer

Topic Author
ChristopherRobin
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Re: Anybody else unable to afford a home/have six figure income?

Post by ChristopherRobin » Wed Jun 26, 2019 4:41 pm

I'm 32 and not close to having $100,000 saved. Maybe by 35 I will, but that's assuming my expenses stay extremely low.

I don't have debt, not married, I invest in 401k and Roth IRA, and have (depending on the month) close to $1000 leftover at the end of the month to play around with.

Perhaps a lot of you have great paying jobs in low cost areas.

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Watty
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Re: Anybody else unable to afford a home/have six figure income?

Post by Watty » Wed Jun 26, 2019 5:03 pm

livesoft wrote:
Wed Jun 26, 2019 3:45 pm
I must admit that I never understood why anybody would be anxious to buy a home, but I'm weird in more ways than that.
At least for me having a paid off house makes my retirement numbers work a lot better even though there will be things like maintenance costs.

It helps that I live in a medium to low cost of living area but with a paid off house I could live a frugal but comfortable lifestyle with just my Social Security if I really needed to.

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Re: Anybody else unable to afford a home/have six figure income?

Post by DesertDiva » Wed Jun 26, 2019 5:07 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 4:41 pm
I'm 32 and not close to having $100,000 saved. Maybe by 35 I will, but that's assuming my expenses stay extremely low.

I don't have debt, not married, I invest in 401k and Roth IRA, and have (depending on the month) close to $1000 leftover at the end of the month to play around with.

Perhaps a lot of you have great paying jobs in low cost areas.
Don't compare yourself with others. Life isn't a competition, although we tend to make it that way. Many people on this forum (myself included) have overcome challenges (job loss, health issues, etc.) that have taken a financial toll and over time have rebounded. You have time on your side. Set reasonable goals, make a plan, stick to it and be patient.

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ChristopherRobin
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Re: Anybody else unable to afford a home/have six figure income?

Post by ChristopherRobin » Wed Jun 26, 2019 5:27 pm

DesertDiva wrote:
Wed Jun 26, 2019 5:07 pm
ChristopherRobin wrote:
Wed Jun 26, 2019 4:41 pm
I'm 32 and not close to having $100,000 saved. Maybe by 35 I will, but that's assuming my expenses stay extremely low.

I don't have debt, not married, I invest in 401k and Roth IRA, and have (depending on the month) close to $1000 leftover at the end of the month to play around with.

Perhaps a lot of you have great paying jobs in low cost areas.
Don't compare yourself with others. Life isn't a competition, although we tend to make it that way. Many people on this forum (myself included) have overcome challenges (job loss, health issues, etc.) that have taken a financial toll and over time have rebounded. You have time on your side. Set reasonable goals, make a plan, stick to it and be patient.
I hear ya. Thank you for giving your two cents.

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Sandtrap
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Re: Anybody else unable to afford a home/have six figure income?

Post by Sandtrap » Wed Jun 26, 2019 5:32 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.

Am I alone on this board in not being able to afford a home or make anywhere near six figures?
DW and I were not able to do that easily in Hawaii. I had done so in the long past and it was very very difficult.
As it is an UHCOL area, everyone struggles.

Post retirement move to LCOL was a breath of fresh air!
We have a ranch estate mini-mac. that we could never have been able to afford in Hawaii, not even in our dreams. :shock:

DW is happy . . . . horses are happy . . . . life is good.
j :happy
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livesoft
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Re: Anybody else unable to afford a home/have six figure income?

Post by livesoft » Wed Jun 26, 2019 5:40 pm

Watty wrote:
Wed Jun 26, 2019 5:03 pm
livesoft wrote:
Wed Jun 26, 2019 3:45 pm
I must admit that I never understood why anybody would be anxious to buy a home, but I'm weird in more ways than that.
At least for me having a paid off house makes my retirement numbers work a lot better even though there will be things like maintenance costs.
I get that, but I don't think you retired at age 33. We have home and it is paid off as well, but we are not young anymore.

And for the OP, I never ever was able to live alone and pay all the rent for any place that I lived. I always had 1 to 4 others living under the same roof helping me to pay rent.
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pretzelfisch
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Re: Anybody else unable to afford a home/have six figure income?

Post by pretzelfisch » Wed Jun 26, 2019 5:48 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 3:36 pm
Burgoo wrote:
Wed Jun 26, 2019 3:28 pm
As a former resident of Vancouver Canada I had a six figure income and couldn't afford a home. My solution was to move to a lower cost of living city in the USA and get a pay raise at the same time.

Edit - I apparently lack reading comprehension. If you are in a HCOL city and have a sub six figure income I would seriously considering leaving if your goal is to own a home.
I live in California, so home ownership is out of reach. I will most likely leave in a couple years (for many reasons).
there are many affordable places to live in California. None of them are in the Bay Area, LA county or San Diego.

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Watty
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Re: Anybody else unable to afford a home/have six figure income?

Post by Watty » Wed Jun 26, 2019 5:53 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 4:41 pm
Perhaps a lot of you have great paying jobs in low cost areas.
In most of the US you don't need a high income to be able to afford to buy a house.

The median US existing home prices last quarter was only $254,800. With a 20% down payment a 30 year fixed rate mortage payment would be less than $1,000 a month. You would have maintenance, property taxes, insurance, etc. If you were looking at a condo or townhouse it might be even less.
Inventory increased and metro market prices rose in the first quarter of 2019, but at a slower pace than the previous quarter. The national median existing single-family home price in the first quarter was $254,800, up 3.9% from the first quarter of 2018 ($245,300).
https://www.nar.realtor/research-and-st ... ordability

https://www.nar.realtor/sites/default/f ... -05-14.pdf

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ChristopherRobin
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Re: Anybody else unable to afford a home/have six figure income?

Post by ChristopherRobin » Wed Jun 26, 2019 6:02 pm

pretzelfisch wrote:
Wed Jun 26, 2019 5:48 pm
ChristopherRobin wrote:
Wed Jun 26, 2019 3:36 pm
Burgoo wrote:
Wed Jun 26, 2019 3:28 pm
As a former resident of Vancouver Canada I had a six figure income and couldn't afford a home. My solution was to move to a lower cost of living city in the USA and get a pay raise at the same time.

Edit - I apparently lack reading comprehension. If you are in a HCOL city and have a sub six figure income I would seriously considering leaving if your goal is to own a home.
I live in California, so home ownership is out of reach. I will most likely leave in a couple years (for many reasons).
there are many affordable places to live in California. None of them are in the Bay Area, LA county or San Diego.
True, but my job is in LA :(

Thegame14
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Re: Anybody else unable to afford a home/have six figure income?

Post by Thegame14 » Wed Jun 26, 2019 6:09 pm

I make 101K, but was able to buy a house, because I stayed home with parents until I was almost 30 and saved over $100K to put down for a house. Was it the easiest most comfortable thing to do, no, but that was what I did. DW stayed home and put all her extra money to savings and paying off student loans, so they would be paid off before buying a house.

There has to be sacrifices, and a long term approach.

RollTide31457
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Re: Anybody else unable to afford a home/have six figure income?

Post by RollTide31457 » Wed Jun 26, 2019 6:13 pm

Leave California. Your quality of life will greatly improve in the Midwest or South.

quantAndHold
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Re: Anybody else unable to afford a home/have six figure income?

Post by quantAndHold » Wed Jun 26, 2019 11:33 pm

RollTide31457 wrote:
Wed Jun 26, 2019 6:13 pm
Leave California. Your quality of life will greatly improve in the Midwest or South.
Unless you can’t find a job that pays what you make in California, of course.
Yes, I’m really that pedantic.

quantAndHold
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Re: Anybody else unable to afford a home/have six figure income?

Post by quantAndHold » Wed Jun 26, 2019 11:47 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 4:41 pm
I'm 32 and not close to having $100,000 saved. Maybe by 35 I will, but that's assuming my expenses stay extremely low.

I don't have debt, not married, I invest in 401k and Roth IRA, and have (depending on the month) close to $1000 leftover at the end of the month to play around with.

Perhaps a lot of you have great paying jobs in low cost areas.
I’m having trouble remembering exactly, but at 32, I’m pretty sure my net worth was negative. I was underwater on a mistake of a condo that I could barely afford. I’m certain that I didn’t have $100k for several more years after that. 20 years later, I retired at 52. I made a steady income, but I didn’t make a lot of money until my late 40’s. My wife never made a lot either, but we lived sensibly, and kept saving. It takes time to build wealth. When you’re young, it goes really slowly, and it’s easy to get impatient with how slowly it’s going. You kind of have to just stick with it and trust that the magic of compounding will do its work eventually.
Last edited by quantAndHold on Thu Jun 27, 2019 1:38 am, edited 1 time in total.
Yes, I’m really that pedantic.

crossbow
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Re: Anybody else unable to afford a home/have six figure income?

Post by crossbow » Thu Jun 27, 2019 1:28 am

quantAndHold wrote:
Wed Jun 26, 2019 11:47 pm
ChristopherRobin wrote:
Wed Jun 26, 2019 4:41 pm
I'm 32 and not close to having $100,000 saved. Maybe by 35 I will, but that's assuming my expenses stay extremely low.

I don't have debt, not married, I invest in 401k and Roth IRA, and have (depending on the month) close to $1000 leftover at the end of the month to play around with.

Perhaps a lot of you have great paying jobs in low cost areas.
I’m having trouble remembering exactly, but at 32, I’m pretty sure my net worth was negative. I was underwater on a mistake of a condo that I could barely afford. I’m certain that I didn’t have $100k for several more years after that. 30 years later, I retired at 52. I made a steady income, but I didn’t make a lot of money until my late 40’s. My wife never made a lot either, but we lived sensibly, and kept saving. It takes time to build wealth. When you’re young, it goes really slowly, and it’s easy to get impatient with how slowly it’s going. You kind of have to just stick with it and trust that the magic of compounding will do its work eventually.
32+30=62, not 52 :sharebeer

You're older than you think! :D

quantAndHold
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Re: Anybody else unable to afford a home/have six figure income?

Post by quantAndHold » Thu Jun 27, 2019 1:38 am

crossbow wrote:
Thu Jun 27, 2019 1:28 am
quantAndHold wrote:
Wed Jun 26, 2019 11:47 pm
ChristopherRobin wrote:
Wed Jun 26, 2019 4:41 pm
I'm 32 and not close to having $100,000 saved. Maybe by 35 I will, but that's assuming my expenses stay extremely low.

I don't have debt, not married, I invest in 401k and Roth IRA, and have (depending on the month) close to $1000 leftover at the end of the month to play around with.

Perhaps a lot of you have great paying jobs in low cost areas.
I’m having trouble remembering exactly, but at 32, I’m pretty sure my net worth was negative. I was underwater on a mistake of a condo that I could barely afford. I’m certain that I didn’t have $100k for several more years after that. 30 years later, I retired at 52. I made a steady income, but I didn’t make a lot of money until my late 40’s. My wife never made a lot either, but we lived sensibly, and kept saving. It takes time to build wealth. When you’re young, it goes really slowly, and it’s easy to get impatient with how slowly it’s going. You kind of have to just stick with it and trust that the magic of compounding will do its work eventually.
32+30=62, not 52 :sharebeer

You're older than you think! :D
Lol. Doh. I guess I didn’t get rich as slowly as I thought.
Yes, I’m really that pedantic.

SDLinguist
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Re: Anybody else unable to afford a home/have six figure income?

Post by SDLinguist » Thu Jun 27, 2019 1:39 am

alfaspider wrote:
Wed Jun 26, 2019 3:53 pm
dm200 wrote:
Wed Jun 26, 2019 3:47 pm
ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.
Am I alone on this board in not being able to afford a home or make anywhere near six figures?
Big difference in buying "a home" and getting that home in the area you want and/or need.

Our locality, where we bought our single family home 41 years ago is now completely unaffordable for similar small home purchases today for folks like we were when we bought the house.
That's an interesting point. Especially in places like California and NYC, you often have to be richer than the median existing homeowner by a decent bit in order to buy-in. Where I lived in Brooklyn, it wasn't uncommon for regular folks making under $100k a year to be sitting on brownstones worth millions that they or their parents bought cheap 30+ years ago.
When my parents bought their first home in San Diego 21 years ago they had a HHI inflation adjusted to ~$145k in today's dollars. My wife and I have a HHI almost 30% greater than that. Except that to buy anything in this area nowadays you realistically need close to if not more than double our HHI.

What this shows is that 20 years ago you could afford to buy while being outside the top 10% of earners, nowadays you need to be within the top 5%.

chicagoan23
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Re: Anybody else unable to afford a home/have six figure income?

Post by chicagoan23 » Thu Jun 27, 2019 6:34 am

ChristopherRobin wrote:
Wed Jun 26, 2019 4:41 pm
I'm 32 and not close to having $100,000 saved. Maybe by 35 I will, but that's assuming my expenses stay extremely low.

I don't have debt, not married, I invest in 401k and Roth IRA, and have (depending on the month) close to $1000 leftover at the end of the month to play around with.

Perhaps a lot of you have great paying jobs in low cost areas.
The average net worth for Americans under age 35 has been reported as $6,600. It sounds like you are doing much better than that?

Someone who has HOUSEHOLD income of $110,000 is in the top 25% of earners in the US, so yes, it is very unusual for one individual to make $100,000 in this country. And that is for all households, not just those which consist of people in their early 30s.

There are opportunities to buy LA real estate on an average salary. I know my brother-in-law had a small townhouse in Downey when he was just starting out and it was affordable. Those opportunities are out there even if not in your ideal neighborhood.

You have a long way to go to be rich, but you have a long time to get there, and you have the ability to make good decisions. Find a responsible person as a spouse/partner, both work hard, live below your means, make smart financial choices and protect yourself from disaster through adequate insurance.

The fact that you are debt free and have significant retirement savings, plus something extra, puts you well ahead of most of your peers. Focus on that fact, and the long run. You will do great.
"The Basic Choices for Investors and the One We Strongly Prefer" | | https://www.berkshirehathaway.com/letters/2011ltr.pdf

bayview
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Re: Anybody else unable to afford a home/have six figure income?

Post by bayview » Thu Jun 27, 2019 7:10 am

ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.

Am I alone on this board in not being able to afford a home or make anywhere near six figures?
Your title misled me. You're asking if there are people here who don't own their own homes, as well as if there are people here who don't make a 6 figure income, correct? Not people earning over $100k who can't afford to buy a house.

The closest I ever got to a six-figure income was when I earned in the mid-$80's due to locality pay (federal employee in San Francisco.) DH was briefly earning >$100k ten or so years ago, but he received a surprise retirement (corporation getting rid of pesky older employers who made too much and who knew how the company actually worked.) For a short period of time, our joint income was a bit over $100k, but it didn't last. And this is a second marriage for both of us, so neither of us started out with much in the way of savings, all of which was in IRA/401k-type accounts.

We do own our own home in a MCOL area, and it's probably more home than we should have per some people here, but it works for us in our situation, and we can afford it. (We rented it out for 6 years before moving in ourselves.)

There are times that the OMG-what-do-I-do-with-all-this-money posts get annoying. I've just learned to ignore them for the most part.

The underlying advice and guidelines here apply to EVERYONE. And the younger you are, and the sooner you start applying them to your own finances, the more rewarding they will be.
The continuous execution of a sound strategy gives you the benefit of the strategy. That's what it's all about. --Rick Ferri

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Sandtrap
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Re: Anybody else unable to afford a home/have six figure income?

Post by Sandtrap » Thu Jun 27, 2019 7:22 am

livesoft wrote:
Wed Jun 26, 2019 5:40 pm
Watty wrote:
Wed Jun 26, 2019 5:03 pm
livesoft wrote:
Wed Jun 26, 2019 3:45 pm
I must admit that I never understood why anybody would be anxious to buy a home, but I'm weird in more ways than that.
At least for me having a paid off house makes my retirement numbers work a lot better even though there will be things like maintenance costs.
I get that, but I don't think you retired at age 33. We have home and it is paid off as well, but we are not young anymore.

And for the OP, I never ever was able to live alone and pay all the rent for any place that I lived. I always had 1 to 4 others living under the same roof helping me to pay rent.
In Hawaii's UHCOL, only the oldest generations have paid off homes, or those that have inherited those homes. Because of the need (or temptation) to tap into HELOC's with rising home equity values, many stay in mortgage debt forever.
Younger folks that have enough resources or "help" to purchase a home, condo, or townhouse, work 2+ jobs, and/or multiple sources of income, and so forth. It is tough and not visible.

DW and I had purchased a home but the financial burden was just not worth it. The banks were getting rich on us. But, that was our point of view. Others struggled along and ended up fine. For us, we lived in our own multi unit properties and saved a bundle such that we were able to buy our "dream home" (ranch estate) when we retired to a LCOL area. We also had planned to initially retire to the outer islands and it would have taken about 2 million to have a decent "set up".

These situations are so different in UHCOL areas vs LCOL or other areas. Not to mention difference between financial means and just plain luck in paths taken.

j
Wiki Bogleheads Wiki: Everything You Need to Know

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CyclingDuo
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Re: Anybody else unable to afford a home/have six figure income?

Post by CyclingDuo » Thu Jun 27, 2019 8:17 am

RollTide31457 wrote:
Wed Jun 26, 2019 6:13 pm
Leave California. Your quality of life will greatly improve in the Midwest or South.
At which point the OP would post up a new thread entitled "Anybody else unable to afford a home/have 5 figure ($50-$60K) income?" :beer
"Everywhere is within walking distance if you have the time." ~ Steven Wright

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Re: Anybody else unable to afford a home/have six figure income?

Post by EddyB » Thu Jun 27, 2019 8:50 am

RollTide31457 wrote:
Wed Jun 26, 2019 6:13 pm
Leave California. Your quality of life will greatly improve in the Midwest or South.
While I think market behavior indicates that this isn’t generally true, there’s certainly no way to say it’s true for a specific person about whom you know so little.

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Re: Anybody else unable to afford a home/have six figure income?

Post by mbasherp » Thu Jun 27, 2019 8:52 am

It's all relative. The home we bought a few years ago for around 250k in a MCOL area would be 10x that in San Francisco, judging by Zillow listings. We make just over 100k combined. I doubt either of us will break 100k individually aside from inflation, although that is a goal.

Theoretically, you only need to save up a down payment once. When we did it, it was a maniacal mission - EVERY spare dollar went into savings! For two years! When we found the right house, we didn't yet have 20% to put down. We bought anyway because the market was rising fast, paid PMI for a couple years, then re-appraised out of it. A few years later we already have six figures in home equity. So far, it's actually been my best return on investment of my lifetime.

You don't have to buy a house to achieve financial independence. Do it if it's cheaper than renting and if you'll stay long enough to not get bitten too hard by the high transaction costs.

As for feeling behind? I got to a positive net worth at 29 and I don't have anything beyond a Bachelor's degree to show for my 20's. But doing the right things has us into mid six figures less than 10 years later. Never underestimate the power of good habits over enough time.

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Sandtrap
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Re: Anybody else unable to afford a home/have six figure income?

Post by Sandtrap » Thu Jun 27, 2019 9:16 am

CyclingDuo wrote:
Thu Jun 27, 2019 8:17 am
RollTide31457 wrote:
Wed Jun 26, 2019 6:13 pm
Leave California. Your quality of life will greatly improve in the Midwest or South.
At which point the OP would post up a new thread entitled "Anybody else unable to afford a home/have 5 figure ($50-$60K) income?" :beer
Good one!
. . . .
Took me a couple reads to "get it". . . . . :shock:

Yes. It's all relative and contextual.
j
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cshell2
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Re: Anybody else unable to afford a home/have six figure income?

Post by cshell2 » Thu Jun 27, 2019 9:18 am

I make nowhere near 6 figures, so you're not alone there. I do own a home, but I'm 50 years old and it's my second house in a LCOL area (first cost me 42K and I sold for 74K for the down payment on the one I'm in now).

There are all kinds of people on this forum and you can learn something from people in every financial situation. Comparing yourself to others isn't all that productive, but if you want to feel better, I've never made much, usually in the 30-40K/year range (although this year I MIGHT hit 50K if I work a lot of OT). Not so awesome for someone my age with two kids to support! I can budget and save like nobody's business though. :moneybag 8-)

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Re: Anybody else unable to afford a home/have six figure income?

Post by Sandtrap » Thu Jun 27, 2019 9:21 am

livesoft wrote:
Wed Jun 26, 2019 3:45 pm
Decades ago, we could not afford a home in NY. It never bothered us at all. Lot of folks in NY are renters for life.

We moved away and bought a home when we were in our late 30s which could be considered way older than the OP.

I must admit that I never understood why anybody would be anxious to buy a home, but I'm weird in more ways than that.
DW and I have always felt this way as we watched others drown in debt and struggle as they rushed into their first homes with minimal down payments and marginal finances.
My very first home, (big lesson) had newspaper and cardboard on the windows for a very long time because I could not afford drapes.
Of course, there were those that waited until they were financially solid to do so. Everyone's different.
j
Wiki Bogleheads Wiki: Everything You Need to Know

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Re: Anybody else unable to afford a home/have six figure income?

Post by investingdad » Thu Jun 27, 2019 9:37 am

ChristopherRobin wrote:
Wed Jun 26, 2019 3:20 pm
I read a lot of similar stories on these forums of people who owns homes and make over $100,000.

Am I alone on this board in not being able to afford a home or make anywhere near six figures?
I make 6 figures. So does my wife. But we're also 45 and 46 respectively and it took two decades plus of working to get here.

You can't compare mid career and early career and expect parity of earnings.

Also, how did you go from age 30 on Sept 4, 2018 to 32 in June of 2019?

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Re: Anybody else unable to afford a home/have six figure income?

Post by mikemikemike » Thu Jun 27, 2019 9:42 am

Wife and I both make 6 figures and are early 30s. We work in relatively well-paying sectors.

We sold our house recently and moved to a new city.

Housing costs are very high here (median single family detached home well above $1MM). We rent a house: it would take about 400 months' rent payments to buy the house we rent. So we feel like we're getting a much better deal by renting, and have fewer maintenance hassles / friction points if we move again. Took the money from selling our old house and invested it.

Before we bought our first house, owning a home felt like an important milestone. Now I'm glad to not own one anymore. If I could wind back the clock, I'd advise my past self against buying that first home even though it worked out well financially.

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Re: Anybody else unable to afford a home/have six figure income?

Post by mcraepat9 » Thu Jun 27, 2019 10:53 am

livesoft wrote:
Wed Jun 26, 2019 3:45 pm
I must admit that I never understood why anybody would be anxious to buy a home, but I'm weird in more ways than that.
I never understood this either.
Amateur investors are not cool-headed logicians.

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Re: Anybody else unable to afford a home/have six figure income?

Post by Toons » Thu Jun 27, 2019 11:46 am

Point wrote:
Wed Jun 26, 2019 4:19 pm
Owning a home for us was like anything else- figuring out the process. We were married in the early 80’s and we still live in California. We were at that time in a high cost area and still are.

We did a lot of very serious lifestyle changes, eliminated all personal debt, and spent only on needs, not wants, until we had money saved up for a down payment. Then we bought the house, for the last 4 decades we both worked. And we kept old cars, didn’t take airline vacations or eat out a lot.we actually didn’t take a lot of vacations. The weather is great and we enjoyed living local. We stayed away from keeping up with the Jones’s and we did well for ourselves. It was all a slow process that built on itself over the decades. We now have a house, a rentals, two kids, both married, with masters degrees, they have no college debt. We are both retired, and in our mid sixties.

No one loaned us money. We received no inheritance. We did this ourselves.

Slow and steady
Stay away from the shiny stuff
Avoid debt purchasing
Repaired our own house and cars as much as possible
Enjoy local
Needs vs wants

It worked for us.

Kudos!
Fantastic!
Slow and Steady!
:sharebeer
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

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Re: Anybody else unable to afford a home/have six figure income?

Post by Buckeye Chuck » Thu Jun 27, 2019 11:51 am

I live in Ohio. It seems like a lot of people move here from other areas. Of course it's nothing like SoCal. I'm in the northwest corner near southeast Michigan an hour away from Detroit. Lower cost of living. I know 4 people who recently moved here. 2 families from San Diego, 1 from Hawaii, 1 from Tampa. They all moved for job offers and low cost of living. They like it except winter is rough. Most would go back if they could make higher wages but for now they get more for their money here. I have a good job and sacrifice to do better. Longer hours at work ...stress etc.. it is a lifestyle change to move to the midwest but I believe your dollar will go further.

The guy from Tampa didn't like the heat or traffic so he is happy lol.

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Re: Anybody else unable to afford a home/have six figure income?

Post by NerdicSkier » Thu Jun 27, 2019 12:03 pm

Mrs. NerdicSkier and I made a little less than 6 figures combined last year. She was a stay at home mom for many years and our (my) income was 50 to 75 k. We are on our third home in flyover country, bought for $165,000 in 2014. We lost money on the houses that we had bought in 2004 and 2007.

I often feel in the shadow of other posters here in terms of net worth and income. Yet we started with an unwed teen pregnancy so I am very proud of what we have been able to achieve. For me, I prefer to compare our progress to our own goals, not relative to others here. Do what you can with what you have.

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Re: Anybody else unable to afford a home/have six figure income?

Post by Polymorphic » Thu Jun 27, 2019 12:06 pm

mcraepat9 wrote:
Thu Jun 27, 2019 10:53 am
livesoft wrote:
Wed Jun 26, 2019 3:45 pm
I must admit that I never understood why anybody would be anxious to buy a home, but I'm weird in more ways than that.
I never understood this either.
I look back fondly on my years of being a renter. But my wife wanted to own a home, so we compromised and bought a house. :D

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Re: Anybody else unable to afford a home/have six figure income?

Post by cshell2 » Thu Jun 27, 2019 12:18 pm

ChristopherRobin wrote:
Wed Jun 26, 2019 4:41 pm
I'm 32 and not close to having $100,000 saved. Maybe by 35 I will, but that's assuming my expenses stay extremely low.

I don't have debt, not married, I invest in 401k and Roth IRA, and have (depending on the month) close to $1000 leftover at the end of the month to play around with.

Perhaps a lot of you have great paying jobs in low cost areas.
When I was 35 I had 80K. I remember that number quite well since it was the year I got divorced and we were dividing assets. He had about the same in his 401K, so we just walked away with leaving our accounts alone.

Fifteen years later about 550K between retirement and college savings. I don't make much, so most of those years I wasn't putting much more aside than 10-12K/year. A LOT is just growth on it's own.

And $1000 left over every month to play with is awesome! Wish I had that.

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