Opinions on paying 10K a month in rent

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WestCoastLiving1
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Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

I've never paid 10K a month in rent but I need to move and it is necessary at this point. I hope to pay less in the future, within 1 year. I get 8K a month in perpetuity that goes up with inflation. I also have about 4K a month in personal expenses. I have 2.5MM in investments and 60K in CC debt but it is at 0% interest. I think I will be fine as this will not be an expense for more than a year, probably even less. But it is emotionally a big deal taking this step to move forward with my life.
newyorker
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Re: Opinions on paying 10K a month in rent

Post by newyorker »

Thats a lot of money but it seems like you can afford it
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Re: Opinions on paying 10K a month in rent

Post by muffins14 »

You can buy a new, modern 2BR apartment in Manhattan or San Francisco for that amount, so if you’re going to do it, I’d try to do it short-term?
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ut2sua
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Re: Opinions on paying 10K a month in rent

Post by ut2sua »

WestCoastLiving1 wrote: Sun May 08, 2022 3:58 pm I've never paid 10K a month in rent but I need to move and it is necessary at this point.
OP, what are you asking for here? If it is necessary then you don't have a choice right?
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Re: Opinions on paying 10K a month in rent

Post by ut2sua »

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Silk McCue
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Re: Opinions on paying 10K a month in rent

Post by Silk McCue »

Are you compelled to spend $10k per month in rent? Do you have no say in this matter or are you able to look at other options? Can you explain the situation?

Just because you can technically afford it doesn’t mean you should have to.

Welcome to the forum.

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Re: Opinions on paying 10K a month in rent

Post by ut2sua »

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muffins14
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Re: Opinions on paying 10K a month in rent

Post by muffins14 »

You can buy a new, modern 2BR apartment in Manhattan or San Francisco for that amount, so if you’re going to do it, I’d try to do it short-term?

What kind of apartment are you renting? You should be able to find something super nice for much less, unless you’re talking about a new fancy 3BR condo in Manhattan or a house somewhere out west that I don’t know about
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WestCoastLiving1
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Re: Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

newyorker wrote: Sun May 08, 2022 4:25 pm Thats a lot of money but it seems like you can afford it
Ok, thank you. I don't think I have ever spent more than 8K a month. I hope to revert back to my normal expenditures as soon as possible.
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WestCoastLiving1
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Re: Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

muffins14 wrote: Sun May 08, 2022 4:31 pm You can buy a new, modern 2BR apartment in Manhattan or San Francisco for that amount, so if you’re going to do it, I’d try to do it short-term?
I'm not looking to buy right now because I may move. But eventually I do hope to buy a home.
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JoeRetire
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Re: Opinions on paying 10K a month in rent

Post by JoeRetire »

Get a roommate and split the cost.
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WestCoastLiving1
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Re: Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

Silk McCue wrote: Sun May 08, 2022 4:33 pm Are you compelled to spend $10k per month in rent? Do you have no say in this matter or are you able to look at other options? Can you explain the situation?

Just because you can technically afford it doesn’t mean you should have to.

Welcome to the forum.

Cheers
Thank you. My options are limited simply because of my personal situation right now, but things always change. Eventually, hopefully sooner rather than later, I hope to get back to spending my usual amount.

It's just that I've never spent so much before. This level of spending is new to me, but I think I will be OK mainly because this is more of a short-term thing.
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Re: Opinions on paying 10K a month in rent

Post by adamthesmythe »

Doesn't make sense, or at least details are missing. If OP is moving to a HCOL area because he will get a good job there that's one thing. If he's moving for luxury and can't afford it given assets that's another thing. If short term means a few weeks that's yet another thing.

I suspect this is odd enough that us normal people can't understand or properly comment.
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Re: Opinions on paying 10K a month in rent

Post by goingup »

We really know very little about your situation. However, your income doesn’t cover the rent. Your $60k in CC debt will likely come due soon. And moving itself can be quite costly.

I would certainly keep looking for a better arrangement.
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WestCoastLiving1
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Re: Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

goingup wrote: Sun May 08, 2022 5:17 pm We really know very little about your situation. However, your income doesn’t cover the rent. Your $60k in CC debt will likely come due soon. And moving itself can be quite costly.

I would certainly keep looking for a better arrangement.
What I'm thinking is 8K would leave me with 2K a month in rent. Plus I still have around 4K in personal expenses. So that's -6K. If I'm -6K a month for 12 months thats -72K. Of course, if I find somewhere cheaper sooner than things will change. The 60K CC debt isn't due for around a year I believe, before they start charging interest.
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Re: Opinions on paying 10K a month in rent

Post by muffins14 »

What exactly do you mean by “if you find somewhere cheaper”? 99.9% of apartments are cheaper than 10k per month.
What is the location and number of bedrooms or people that need to live in this apartment?
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mrspock
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Re: Opinions on paying 10K a month in rent

Post by mrspock »

OP, more info is likely required to give anything which resembles useful advice here:

1. How many people do you need to accommodate
2. What sort of area are you moving to? VHCOL? HCOL? (i.e. very high cost, high cost, medium cost?)
3. Any thing special which is driving you to *this* property or area? (e.g. want to be close to family member? root? job?)
4. Job situation? Stable? Not stable?
5. What's your AA and/or cash/cash/bond equivalent situation? Market is in a downturn, if you lack cash reserves or have a very aggressive portfolio, this could lead to behavior mistakes. Combined with a high cost of living, this can be pretty bad.

For reference, I live in SF and the $10k/month is *a lot* even for here (you can get some very nice 3+ BDRM townhomes/condos for this kind of money).
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Re: Opinions on paying 10K a month in rent

Post by randomguy »

goingup wrote: Sun May 08, 2022 5:17 pm We really know very little about your situation. However, your income doesn’t cover the rent. Your $60k in CC debt will likely come due soon. And moving itself can be quite costly.

I would certainly keep looking for a better arrangement.
He has 2.5m. He can write a check for 120k...

I can't imagine many cases where something like this is required (need to be right next to x in the most expensive cities.) but maybe the OP is in one of them. Or maybe they just really want to live in a 10k apartment....
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Re: Opinions on paying 10K a month in rent

Post by muffins14 »

WestCoastLiving1 wrote: Sun May 08, 2022 4:52 pm
muffins14 wrote: Sun May 08, 2022 4:31 pm You can buy a new, modern 2BR apartment in downtown Manhattan or a nice part of San Francisco for that amount, so if you’re going to do it, I’d try to do it short-term?
I'm not looking to buy right now because I may move. But eventually I do hope to buy a home.
I’m just trying to help reset your expectations. If you can buy a brand new 2 BR in Manhattan for less than 10k per month mortgage, taxes, HOA, facilities, you can rent almost anywhere for cheaper than 10k

10k is an exceptionally high amount of rent unless you are renting like a 3BR Penthouse in a major VHCOL city

You can probably rent something for 40-50% what you are thinking about
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Re: Opinions on paying 10K a month in rent

Post by freckles01 »

10k per month in rent is whole other level of living even among bogleheads!

With your housing stipend plus you can surely afford it but are here no other housing options where you are located? Even in pricey Santa Barbara and San Francisco, there are less costly options.
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Re: Opinions on paying 10K a month in rent

Post by huzen »

I'm thinking your TOTAL expenses (including taxes, credit card payments, rent, furnishings, transportation, insurance, utilities, medical, travel, gifts, personal expenses, financial advisor, investment fees, accountant, lawyer, etc) shouldn't be more than $14,000/month. That's your $8,000/month plus 6,000/month from your 2.5m at a 3% withdrawal rate. (How old are you? How long does this 2.5m need to last?)

I doubt your expenses for this next year would be under $14,000/month. You have the money to rent this 10,000 place now if you really have no cheaper options but you'll need to take a close look at how much money you actually spend and find a less expensive place to live going forward.
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Re: Opinions on paying 10K a month in rent

Post by 123 »

Is the $10K in rent for a standard residential house/condo/apartment or does it include some level of personal services being provided, such as an assisted living or nursing home placement?
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Re: Opinions on paying 10K a month in rent

Post by Caliscotsman »

Personally with 8K income, 60K CC debt, (I don't know when it becomes payable.) and 4K expenses I wouldn't do this.

Are you able to take funds from your investments easily? Or are they in retirement accounts etc..?
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Re: Opinions on paying 10K a month in rent

Post by sleepy06 »

This is a false dichotomy. There must be other options and no one HAS to pay that sum for rent. You can pay $329 per night for a hotel room and be paying the same amount until you figure it out without being locked in for a year. Put your stuff in storage. Being cramped will motivate you to find other options.
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Re: Opinions on paying 10K a month in rent

Post by mikejuss »

On a side note: how do you have credit card debt with no interest :?:
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Re: Opinions on paying 10K a month in rent

Post by Goal33 »

I hate threads like this. No real information.

Just to make things interesting, how about an opposing view? Pending more information, you can’t afford it rent that is higher than your income.
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Re: Opinions on paying 10K a month in rent

Post by AerialWombat »

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Re: Opinions on paying 10K a month in rent

Post by Silk McCue »

mikejuss wrote: Sun May 08, 2022 6:35 pm On a side note: how do you have credit card debt with no interest :?:
We received multiple unsolicited 0% high limit CC offers a few months back. 18 months before any interest charged. Balance transfers or cash advances carried something like a 3% upfront fee. Purchases had no such fee.

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Re: Opinions on paying 10K a month in rent

Post by randomguy »

AerialWombat wrote: Sun May 08, 2022 6:40 pm
sleepy06 wrote: Sun May 08, 2022 6:25 pm This is a false dichotomy. There must be other options and no one HAS to pay that sum for rent. You can pay $329 per night for a hotel room and be paying the same amount until you figure it out without being locked in for a year. Put your stuff in storage. Being cramped will motivate you to find other options.
+1. There is nobody, anywhere on Planet Earth, that has this and only this option.

Add this to the “Only on Bogleheads” list.

To OP, the answer is “no, you can’t afford this”. Now what are you going to do?
OP has shared zero details about why it is needed. I too am suspect about it being a need rather than a want. But assume it is. They can afford it. The point of having money is to spend it on things you need. They can afford this if they want it..
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Re: Opinions on paying 10K a month in rent

Post by fyre4ce »

You've provided very sparse details on why you think spending $10,000/mo rent is absolutely unavoidable. Frankly, I'm extremely skeptical that's actually the case. Even in very-HCOL areas there are ways to mitigate high rent costs, like targeting less nice places, getting a roommate, living outside town and taking a longer commute, or even taking another job elsewhere. You can take a BIG pay cut living in a L/MCOL area and still come out ahead when you're saving $8k+/mo in rent, plus loads more in taxes. My guess would be something like: OP got a job offer in NYC, found a high-end apartment he likes in a swanky part of town, and is trying to logically justify a decision already made for emotional reasons. I hope this doesn't sound unduly harsh, but the $60,000 in credit card debt already accrued (even if temporarily at 0%) is a sign of less than perfect financial decisions made in the recent past. I can't escape the feeling that renting a $10,000/mo apartment would be another one.

Let's say I'm wrong and it's unavoidable. OP would be running a budget deficit of $2,000/mo with renting this apartment, which means he can't afford it. Is the plan to sign a 1-year lease on the apartment? Why do you think you can move out before one year? It can be difficult/expensive to break a lease. Where do you move after this apartment? Rent drops from $10,000 to what? When does the 0% interest rate on the $60,000 credit cards expire? What form are the investments in that will be tapped to cover the deficit? If taxable, how much capital gains would be realized by liquidating the required amount? If a retirement account, pre-tax or Roth, and will there be penalties for early withdrawal? OP needs a much more detailed financial plan.
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Re: Opinions on paying 10K a month in rent

Post by StevieG72 »

That is crazy! 10k month?!?!?!

I would look for cheaper alternatives.
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Re: Opinions on paying 10K a month in rent

Post by chipperd »

WestCoastLiving1 wrote: Sun May 08, 2022 3:58 pm I've never paid 10K a month in rent but I need to move and it is necessary at this point. I hope to pay less in the future, within 1 year. I get 8K a month in perpetuity that goes up with inflation. I also have about 4K a month in personal expenses. I have 2.5MM in investments and 60K in CC debt but it is at 0% interest. I think I will be fine as this will not be an expense for more than a year, probably even less. But it is emotionally a big deal taking this step to move forward with my life.
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Re: Opinions on paying 10K a month in rent

Post by grabiner »

fyre4ce wrote: Sun May 08, 2022 7:23 pm Let's say I'm wrong and it's unavoidable. OP would be running a budget deficit of $2,000/mo with renting this apartment, which means he can't afford it.
OP has a $2.5M portfolio. The sustainable withdrawal rate from this portfolio is $100K annually, so that is enough for $16,000 in monthly expenses, and the OP reports $14,000 expenses including the rent.

So that is still not enough to sustain the expenses. There will be taxes on the portfolio withdrawals (and given the OP's username, likely CA state taxes), and there will be unexpected expenses.

That doesn't make the plan a failure for a short term, but it won't be stable through retirement. (And Social Security, which the OP doesn't mention but will probably be getting later, is too small to make much of a difference.)
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Watty
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Re: Opinions on paying 10K a month in rent

Post by Watty »

Opinions on paying 10K a month in rent
The big question is what you will do if you do not pay $10K a month in rent.

You can afford it and it could be that $10K in rent is the least bad option so it would make sense to just pay that for a year and take the next year to come up with a longer term plan.

It sounds like you have something big going on in your life now(which is none of our business) and spending the extra $2,000 a month(compared to the $8K rent it sounds like you have paid before) for the next year would help you get through the immediate difficulties.

In your situation spending an extra $24K over the next year is barely more than a rounding error in your overall finances so if it helps get you through a difficult situation that could be money that is well spent.

It would be good though to have a plan to decide what to do in a year when your lease ends. If you are not careful then you could find yourself in the same place 5 or 10 years from now when there would be better long term alternatives.

Just for brainstorming through an alternative to consider is that you might also look into spending a few months in an nice extended stay hotel if that would buy you some time fo figure out the situation without signing a year long lease. If you call the front desk(not their 800 number) they may be able to give you better weekly or monthly rates than you will see online.
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Re: Opinions on paying 10K a month in rent

Post by humblecoder »

WestCoastLiving1 wrote: Sun May 08, 2022 3:58 pm I've never paid 10K a month in rent but I need to move and it is necessary at this point. I hope to pay less in the future, within 1 year. I get 8K a month in perpetuity that goes up with inflation. I also have about 4K a month in personal expenses. I have 2.5MM in investments and 60K in CC debt but it is at 0% interest. I think I will be fine as this will not be an expense for more than a year, probably even less. But it is emotionally a big deal taking this step to move forward with my life.
Clearly you can afford it. If you get $8K/month "in perpetuity" and you have $4K/month in "personal expenses" (which I assume does not include rent, that means you have $4K/month that you can put towards rent. That leave you with $6K/month to cover from your investments or $72K/year. That wouldn't really move the needle in terms of your investments.

Of course, the above analysis is based upon the limited information that you provided regarding your circumstances.

All that said, you say that paying that much for rent is "necessary at this point". You don't expound upon why you can't afford to rent cheaper. Nor are you under any obligation to explain it to the group. However, if paying that much for rent per month is giving you emotional pause, then consider if there are other options.

One thought is to just stay at a hotel. Even at $300/night, that comes out to less money than what you are proposing to pay for rent. That would also not lock you into a $10K/month lease so that when your circumstances change, you can just "check out" as it were.
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Re: Opinions on paying 10K a month in rent

Post by fyre4ce »

grabiner wrote: Sun May 08, 2022 7:37 pm
fyre4ce wrote: Sun May 08, 2022 7:23 pm Let's say I'm wrong and it's unavoidable. OP would be running a budget deficit of $2,000/mo with renting this apartment, which means he can't afford it.
OP has a $2.5M portfolio. The sustainable withdrawal rate from this portfolio is $100K annually, so that is enough for $16,000 in monthly expenses, and the OP reports $14,000 expenses including the rent.

So that is still not enough to sustain the expenses. There will be taxes on the portfolio withdrawals (and given the OP's username, likely CA state taxes), and there will be unexpected expenses.

That doesn't make the plan a failure for a short term, but it won't be stable through retirement. (And Social Security, which the OP doesn't mention but will probably be getting later, is too small to make much of a difference.)
Don't forget that OP says he gets $8,000/mo "in perpetuity and indexed for inflation". He's given very little detail, but there aren't many sources of income that fit that description. It's too much for Social Security, most pensions and annuities don't offer inflation adjustment, and somehow I doubt the OP set up a TIPS ladder. Maybe trust income? In any case, I assumed the perpetuity was separate from the $2.5M portfolio. I realize that the perpetuity plus 4% of the portfolio exceeds the rent on this apartment plus personal expenses, but I wouldn't want to count on portfolio withdrawal without understanding the tax consequences. Also, with $60,000 in credit card debt and possibly other financial issues, I would suggest the OP slum it for a year in a $8,000/mo apartment until he cleans up the financial picture a bit.
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Re: Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

Wow thank you all for the replies. I am seeing many of the same questions. Let me reiterate I don't plan on spending 10K a month on rent forever. But this is the best available now for my needs. Nothing else has similar accommodations at this time, but I will keep looking and I am sure I will find something else in the future.

I have some cash in a savings account which would probably be enough for at least 6 months if not a few months more. So basically I have the 8K a month and then could withdraw from my savings account for the rest of my needs for now.
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Re: Opinions on paying 10K a month in rent

Post by muffins14 »

WestCoastLiving1 wrote: Sun May 08, 2022 10:56 pm But this is the best available now for my needs.
Can you clarify what your needs are?
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Re: Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

humblecoder wrote: Sun May 08, 2022 7:42 pm
WestCoastLiving1 wrote: Sun May 08, 2022 3:58 pm I've never paid 10K a month in rent but I need to move and it is necessary at this point. I hope to pay less in the future, within 1 year. I get 8K a month in perpetuity that goes up with inflation. I also have about 4K a month in personal expenses. I have 2.5MM in investments and 60K in CC debt but it is at 0% interest. I think I will be fine as this will not be an expense for more than a year, probably even less. But it is emotionally a big deal taking this step to move forward with my life.
Clearly you can afford it. If you get $8K/month "in perpetuity" and you have $4K/month in "personal expenses" (which I assume does not include rent, that means you have $4K/month that you can put towards rent. That leave you with $6K/month to cover from your investments or $72K/year. That wouldn't really move the needle in terms of your investments.

Of course, the above analysis is based upon the limited information that you provided regarding your circumstances.

All that said, you say that paying that much for rent is "necessary at this point". You don't expound upon why you can't afford to rent cheaper. Nor are you under any obligation to explain it to the group. However, if paying that much for rent per month is giving you emotional pause, then consider if there are other options.

One thought is to just stay at a hotel. Even at $300/night, that comes out to less money than what you are proposing to pay for rent. That would also not lock you into a $10K/month lease so that when your circumstances change, you can just "check out" as it were.
For the longest time my bills were less than 8K and I was able to save the rest. My intent is not to be financially reckless, but it would help me out greatly if I were to rent this place because of the accommodations. There is nothing else available like it at this time. I am sure more housing options will become available if I keep looking everyday that fit my needs. I don't imagine it would take longer than 3 months to find something cheaper.
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Re: Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

Silk McCue wrote: Sun May 08, 2022 6:44 pm
mikejuss wrote: Sun May 08, 2022 6:35 pm On a side note: how do you have credit card debt with no interest :?:
We received multiple unsolicited 0% high limit CC offers a few months back. 18 months before any interest charged. Balance transfers or cash advances carried something like a 3% upfront fee. Purchases had no such fee.

Cheers
They won't charge interest for a period of time, and then they will. I believe I have about a year or so left. In the past I have paid my CC and the end of each billing cycle before it was due to avoid interest payments.
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Re: Opinions on paying 10K a month in rent

Post by muffins14 »

To be blunt:

1) you carry 60k of credit card debt, so you are either living beyond your means, or aggressively spending and kicking the can down the road rather than paying it off with your 2.5M. That is a bad habit

2) you come here asking about a 10k monthly rent, but you can’t even articulate 1-2 sentences about what your needs are or what the accommodations are that you need this apartment to provide

Multiple people are spending time trying to help you, but you are refusing to answer direct questions that help people understand your situation and motivations for spending this amount on the apartment. (Or is it a house, or a full-service hotel, or facility with medical staff? No one knows, because you aren’t telling us)
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Re: Opinions on paying 10K a month in rent

Post by Northern Flicker »

fyre4ce wrote: Sun May 08, 2022 8:09 pm
grabiner wrote: Sun May 08, 2022 7:37 pm
fyre4ce wrote: Sun May 08, 2022 7:23 pm Let's say I'm wrong and it's unavoidable. OP would be running a budget deficit of $2,000/mo with renting this apartment, which means he can't afford it.
OP has a $2.5M portfolio. The sustainable withdrawal rate from this portfolio is $100K annually, so that is enough for $16,000 in monthly expenses, and the OP reports $14,000 expenses including the rent.

So that is still not enough to sustain the expenses. There will be taxes on the portfolio withdrawals (and given the OP's username, likely CA state taxes), and there will be unexpected expenses.

That doesn't make the plan a failure for a short term, but it won't be stable through retirement. (And Social Security, which the OP doesn't mention but will probably be getting later, is too small to make much of a difference.)
Don't forget that OP says he gets $8,000/mo "in perpetuity and indexed for inflation".
$8K/mo of sustainable portfolio withdrawal plus $8K/mo perpetuity = $16K/mo. of sustainable, inflation-adjusted income.
Taking a break from Bogleheads.
Topic Author
WestCoastLiving1
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Joined: Sun May 08, 2022 3:53 pm

Re: Opinions on paying 10K a month in rent

Post by WestCoastLiving1 »

mrspock wrote: Sun May 08, 2022 5:28 pm OP, more info is likely required to give anything which resembles useful advice here:

1. How many people do you need to accommodate
2. What sort of area are you moving to? VHCOL? HCOL? (i.e. very high cost, high cost, medium cost?)
3. Any thing special which is driving you to *this* property or area? (e.g. want to be close to family member? root? job?)
4. Job situation? Stable? Not stable?
5. What's your AA and/or cash/cash/bond equivalent situation? Market is in a downturn, if you lack cash reserves or have a very aggressive portfolio, this could lead to behavior mistakes. Combined with a high cost of living, this can be pretty bad.

For reference, I live in SF and the $10k/month is *a lot* even for here (you can get some very nice 3+ BDRM townhomes/condos for this kind of money).
It is me and family when they visit. It is high cost because of the area and accommodations. Everything is relatively stable.

What I am thinking is let's say costs are 14K.

8K comes in so that leaves me with -6K.

I withdraw 6K a month from my savings account for about 8 months.

That's about ~50K. I would still have a good amount invested. Of course, I guess it would fluctuate and I don't know whether it will be higher or lower.

But within 8 months, if I find a cheaper place, let's say 4K, that would leave me with an 8K income and 8K expense.

I wouldn't have 50K in my savings account anymore, but I suppose that would be all right.
Tellurius
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Re: Opinions on paying 10K a month in rent

Post by Tellurius »

WestCoastLiving1 wrote: Mon May 09, 2022 2:39 am
mrspock wrote: Sun May 08, 2022 5:28 pm OP, more info is likely required to give anything which resembles useful advice here:

1. How many people do you need to accommodate
2. What sort of area are you moving to? VHCOL? HCOL? (i.e. very high cost, high cost, medium cost?)
3. Any thing special which is driving you to *this* property or area? (e.g. want to be close to family member? root? job?)
4. Job situation? Stable? Not stable?
5. What's your AA and/or cash/cash/bond equivalent situation? Market is in a downturn, if you lack cash reserves or have a very aggressive portfolio, this could lead to behavior mistakes. Combined with a high cost of living, this can be pretty bad.

For reference, I live in SF and the $10k/month is *a lot* even for here (you can get some very nice 3+ BDRM townhomes/condos for this kind of money).
It is me and family when they visit. It is high cost because of the area and accommodations. Everything is relatively stable.

What I am thinking is let's say costs are 14K.

8K comes in so that leaves me with -6K.

I withdraw 6K a month from my savings account for about 8 months.

That's about ~50K. I would still have a good amount invested. Of course, I guess it would fluctuate and I don't know whether it will be higher or lower.

But within 8 months, if I find a cheaper place, let's say 4K, that would leave me with an 8K income and 8K expense.

I wouldn't have 50K in my savings account anymore, but I suppose that would be all right.
It’s still not explained why the rent has to be so high, what’s so specific about the place. Is it the bedrooms that are needed for a large family? Is it close to a location where you ABSOLUTELY have to be?

Have you been used to a different lifestyle in the past? There are lots of people who find it difficult to adjust down
“And how shall I think of you?' He considered a moment and then laughed. 'Think of me with my nose in a book!” | ― Susanna Clarke, Jonathan Strange & Mr Norrell
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galawdawg
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Re: Opinions on paying 10K a month in rent

Post by galawdawg »

Forgive me if my directness offends, but my opinion (since you asked) on paying $10k a month in rent? Ridiculous. Foolish. Unwise.

You are being very evasive about why it "is necessary at this point" to pay $10k per month in rent and why your "options are limited simply because of my personal situation right now." Saying that "it would help me out greatly if I were to rent this place because of the accommodations. There is nothing else available like it at this time" and "it is me and family when they visit. It is high cost because of the area and accommodations" doesn't make this a wise or prudent decision. I guarantee you that you could find a high quality rental for yourself, even in a VHCOL area, for under $5k per month. Zillow has many very nice "luxury" one bedroom apartments listed in San Francisco, for example, for under $5k per month.

If I were to look at it from your perspective, the 4,000 sq. ft. Chairman Suite at the Bellagio Hotel (the most luxurious suite in Las Vegas at about $7k per night) would help me out greatly "because of the accommodations as there is nothing else available like it and it is high cost because of the area and accommodations." I'd love to live there for even just a year, but I'd drain my very substantial portfolio before that year was up and then I'd be broke.

While we are glad you found us at Bogleheads, this is a forum about investing advice inspired by Jack Bogle. That means most of us are focused on making wise and thoughtful decisions about both investing and spending. But my impression is that this thread is about validating a decision that has already been made, not about seeking advice and wisdom from other Bogleheads.

Good luck! :beer
CoastLawyer2030
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Location: The Buckeye State

Re: Opinions on paying 10K a month in rent

Post by CoastLawyer2030 »

WestCoastLiving1 wrote: Sun May 08, 2022 3:58 pm I've never paid 10K a month in rent but I need to move and it is necessary at this point. I hope to pay less in the future, within 1 year. I get 8K a month in perpetuity that goes up with inflation. I also have about 4K a month in personal expenses. I have 2.5MM in investments and 60K in CC debt but it is at 0% interest. I think I will be fine as this will not be an expense for more than a year, probably even less. But it is emotionally a big deal taking this step to move forward with my life.
Some random thoughts:

1. You are being unbelievably evasive in answering posters' questions. If you are really seeking actual advice, you should state why this place is so necessary.

2. Your alleged $8,000 in perpetuity is causing you to do mental cartwheels to justify spending $10,000 a month on rent, which you already seem to know is a shaky decision.

3. For the same reason you should not buy a truck just because you might "need" it twice a year, you do not base your living situation on family visits that occur several times per year. Save your money and pay for their hotel rooms, dinners, and Uber rides.

4. If your "$8,000 in perpetuity" is from a stable job instead of a trust, I am going to lose it.
ZWorkLess
Posts: 382
Joined: Thu May 04, 2017 8:13 pm

Re: Opinions on paying 10K a month in rent

Post by ZWorkLess »

No, you can't afford it.

8k/mo in guaranteed income.

2.5M portfolio = 100k/yr (8333/mo) at 4% SWR 75k/yr ($6250/m0) at 3% SWR.

Leaving you a total of something around 14250/mo and 16333/mo in total that is reasonably safe to spend.

Spending 2/3+ of your income on RENT is ridiculously far outside any reasonable guidelines.

[Disrespectful comments removed by moderator oldcomputerguy]
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Watty
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Re: Opinions on paying 10K a month in rent

Post by Watty »

WestCoastLiving1 wrote: Mon May 09, 2022 2:39 am Let me reiterate I don't plan on spending 10K a month on rent forever. But this is the best available now for my needs.
........
I wouldn't have 50K in my savings account anymore, but I suppose that would be all right.
That is 2% of your $2.5 million in investments.

If that turns out to be a mistake or unnecessary expense then that is not a life changing amount for you.

I can understand that there might be situations that you do not want to post publicly about(death, unexpected divorce, etc.) and in an emergency money spent to get you through it could be money well spent even if there are cheaper alternatives. That is one of the advantages of having money.
WestCoastLiving1 wrote: Sun May 08, 2022 11:00 pm There is nothing else available like it at this time. I am sure more housing options will become available if I keep looking everyday that fit my needs. I don't imagine it would take longer than 3 months to find something cheaper.
In some situations where there is less urgency an extended stay hotel for a couple of would be an option. Some of them are basically more like a furnished condo than a typical hotel room.

One advantage of these is that you do not need to sign a year long lease so that when you find a less expensive long term rental you do not need to worry about getting out of your current lease or waiting for the end date.
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goingup
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Re: Opinions on paying 10K a month in rent

Post by goingup »

OP-
There is really no appropriate answer for you, given the limited information you've shared. Hope it works out for you. :beer
Maverick3320
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Joined: Tue May 12, 2015 2:59 pm

Re: Opinions on paying 10K a month in rent

Post by Maverick3320 »

OP,

Some very common questions are coming up here that aren't being answered.

1. What is the 8k/month in perpetuity?
2. You literally cannot find anywhere to live cheaper than 10k/month?
3. What's your family situation?
4. What's the story with the credit card debt?
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