Berkeley Parents Network: Salary Reality Check

Berkeley Parents Network

Salary Reality Check

Berkeley Parents Network > Advice > Household Management > Household Finances > Salary Reality Check

What is "middle income" in the Bay area?

Feb 2005

Does anyone know how to get an idea of what constitutes different income levels for the Bay Area (Berkeley, in particular)? We're trying to set up a budget, but it seems that our combined incomes don't cover the basics that they should. If I knew what was considered standard, or ''middle,'' or even ''middle-upper,'' etc., I'd have some context for what we're trying to do. We'll eventually look for a financial planner, but I need to do do some initial research first.

Here's a link for Berkeley income distributions as of 2000: http://www.ersys.com/usa/06/0606000/income.htm The median household income is $44,485, which means half are higher and half are lower. More than one-quarter of Berkeley households have income under $20,000.
Berkeley resident

Is everyone making a ton more money than us?

March 2004

Am I being totally ridiculous? I used to think my husband made a decent amount of money (about $80K, which I don't normally blab, but feel this is pretty anonymous). We (husband, baby, me) are well fed, clothed, and sheltered (tiny place, but cozy). Recently, I've been questioning whether or not he actually is doing well, in terms of salary. Friends and relatives (our age, late 20s) are buying $500K houses, nice cars, vacations. Houses in our not so nice neighbor are now selling for over $400K (we bought our house for half that a couple of years ago). How are people doing it? Is everyone just making a ton more money than us?? Please advise- am I being silly? Or do we need a reality check?? Perplexed- Where are you getting all this money??

You're not alone... we make a combined income of about $55K, and are BARELY making it - and thinking about giving up the few amenities we have (2nd car, the Chronicle, etc.). Enough to make me think about moving somewhere else! I have no idea how people do it. Any good money-saving tips???? strapped also

My husband used to make about what your husband makes, and on that salary he could not support our family and a mortgage in the bay area. I have continued to work outside the home. My own salary is higher than $80K (husband's is far less now due to the dot-bomb) & we still feel pressed. I used to think when we crossed the six-figure mark, we'd be on easy street. HA! The problem with static ideals like ''six figures'' is that they do not adjust for inflation, and particularly when you are talking about Bay Area real estate, inflation is just insane. To answer your question directly, I do think $80K is low, but not atypical. You really have to hope there are career advancements or raises other than cost-of-living increases available to your husband.

I empathize with your comment about ''how do they do it?'' We are constantly running into fellow Berkeleyans who seem far more committed to their principles than we are - they would never work for a soulless corporation as I do, they would never send their kids to daycare, they would never send their kids to public school when private schools are so much better, etc! We, too, wonder how they do it. But most often, when we get to know these people a little better, we realize that they have lots of money from other sources, primarily well-off parents, which neither of us have. So we take it all with a grain of salt.

It IS financially difficult for a middle-class couple to make it in the bay area, and especially to achieve the dream of homeownership. You could do it, probably, but you'd have to make those sacrifices - a long commute, living in a neighborhood you find less than ideal, & possibly working outside the home - that some of our silver spoon friends would never understand. As with the rest of life, it's ''this or that, but not both.'' squeezed

Hi. You sound like you are doing very well. We are early-mid thirties. I make less than $40,000 (as a specialist in a private school), with a CA teaching credential and lots of grad school under my belt. My husband, b.a. from Cal and MA from UOP, although self-employed with inconsistent income right now, was working as a tech instructor making around $40,000. We have two kids, and hence two tuitions to pay (pre-school and private school), and debt accrued from my three years as a stay-at-home- mom, medical costs, and time unemployed (dot-com crash). Luckily, we bought our house 5 years ago, and get some tuition help from my inlaws. It's a bummer, but it seems like well- paying jobs are hard to come by nowadays. I keep telling myself that things will get better, and that lots of people are operating ''in the red''. If I were you, I'd be rather satisfied. anon

hello. who CARES what other families earn and how they are doing? it sounds like you have all of the riches in the world anyone could ever want. a baby, a cozy home, the ability to stay home with your baby and a loving husband. enjoy! anon

We also had the same questions at one point and we were told about this website. check it out http://www.salary.com/salary/layoutscripts/sall_display.asp you answer a few questions and they give you a range of saleries in you area for your job/experiance. It was a real eye opener for us. Good luck. anon

You are doing well - don't worry.

As to how they are doing it, well, it's impossible to know about other people's individual circumstances but consider that given today low's interest rates and the fact that mortagage interest is deductible, today it costs about the same to buy a house than to rent (for example, that $450K house may mean a $1700 monthly payment after taxes). The same can be said about nice cars - given today's low interest rates and extended payment periods, the monthly payments can be affordable to many. Also remember that people often overspend and go in debt for things like vacations. anon

honey, I feel you! first of all, I think lots of folks use credit cards for those vacations, cars, fancy clothes, etc. and putting off savings. as far as homes, banks will lend you so much more than you can afford & I know many people whose parents help them with a down payment (the standard 20% down on a $500K house is $100K!). I stay at home with our bambina & my husband makes a little over $100K. We bought our house 4 years ago in an OK El Cerrito neighborhood, when they were still on the $300K's- we would DEFINITELY be priced out of our own neighborhood if we wanted to buy today.

I think folks are constantly trying to 'keep up with the Joneses' & perhaps are feeling the crunch, too but don't want to show it.

PS- $80K is a very respectable salary! six figure salary & still struggling!

Your husband makes a more than decent salary. I suspect that most of the people you're talking about who are buying $500K homes and new cars and going on vacations differ from you in the following ways: (1) Most importantly, their households have *two* adult members earning salaries. It sounds like you're not working in a paying job, so your family is being supported (and pretty well!) by only one ''breadwinner''. And are you comparing yourselves to friends who don't have children? (Maybe it's obvious, or maybe it's not, but of course someone who isn't housing, feeding and clothing a child has a little more ''play'' money than someone who is.) (2) Their debt load is higher, and/or their savings accounts smaller. My husband and I, combined, earn more than your husband does, but we have little left for long-term savings after paying our mortgage and childcare bills. Unlike many couples in roughly the same socioeconomic bracket, we do NOT have car loans or credit card debt. (And we drive older cars and take cheap vacations.) (3) Their mortgages may have a lower interest rate than yours, if you haven't refinanced since you bought. So although they bought their homes for a higher price, their monthly housing payments may be about the same. Wish *mine* made that much (or that I did)

Our similar income is not high enough to support the lifestyle we'd like (private school, nanny, twice weekly piano lessons, vacations away), but we did remodel the kitchen and have 2 new cars. How? Home equity loan. living beyond our means

Hi. Here's what I think - I think there are alot of people who are way in over their head with regards to debt. Be it their mortgage, car, credit cards, etc...it all looks good, but in the end there is a lot of stress in their lives you don't see. And in an instance it actually could all be gone. I think your husband is doing very well especially if you already have purchased a home and are happy and content. I also think that living in the bay area where you do have highly skilled and educated folks the 'intensity' of 'having the most and the best' is magnified. I'm not sure how you approach your finances, but I've always prescibed to living below your means. And personally, you come out better because of it in the long run. Don't worry about what others are doing. You probably are destined to be the 'millionaire next door' if you aren't already and nobody knows it because you lead a simple and uncomplicated life. So when it does come time to change careers or drop everything to live abroad for a bit, or something so life altering you can't pass it up, you will not have any heavy burdens to stop you!! Anon

I know, I wonder about this too. Our household makes about $75K, and we never go on vacations (other than family-related ones), have old used cars, etc., and it feels like we never have enough money. Here's one possible answer: family help. I have two friends whose parents give them a significant amount of money each year ($10-40K), which can go a long way to stretch an income, esp. since it's tax free! Anon

First of I think you should feel lucky that you own a house and feel comfortable with your financial situation. Second of all, I think, especially in this area that it is important to realize that everyone has such different means and if you play the comparison game you will always lose to many many people (I know because sometimes I do this too!)

And lastly, I have a friend whose husband has family money and that is how they do all the vacations/home/etc. that you probably see around you. I would guess that at least some people that you are seeing have savings or money that is not related to their jobs and is contributing to an enviable lifestyle. It's hard to compare to that. I know the temptation is very real though. I know how you feel sometimes.

Good question! Let me just say that I *wish* my husband was making that much. Consider yourself lucky that he's making that much and that you didn't have to pay over $400k like those starting out now to buy a home). The people who are affording these $400k+ homes are either those with two income households (like us, but just barely getting by even still), those getting financial help (from family or somewhere), or those who don't mind having a *huge* amount of debt. Maybe I'm way off, but that's the impression I'm getting. I'm looking forward to hearing others' opinions about this because I think an $80k salary is quite decent. Wishing I could stay at home with baby, but have to work to help pay the mortgage.

Debt (house), debt (car), debt (vacation).... Please read the book ''The Millionaire Next Door: The Surprising Secrets of America's Wealthy'' by Thomas J. Stanley, PhD and William D. Danko, PhD. This is the first paragraph of the introduction to the book: ''Twenty years ago we began studying how people become wealthy. Intially, we did it just as you might imagine, by surveying people in so-called upscale neighborhoods across the country. In time, we discovered something odd. Many people who live in expensive homes and drive luxury cars do not actually have much wealth. Then, we discovered something even odder: Many people who have a great deal of wealth do not even live in upscale neighborhoods.'' Keep reading. It will impact how you and your husband view your financial choices and his income. ''Wealth is what you accumulate, no what you spend.'' Kathleen

Pleaaaze....Don't be in the rat race. Your husband makes good money. abd you look like you live a comfortable life. Dont worry about what others are doing. They are probably deep in debt, or they won a lottery. There are fammilies with big problems, single parents, no house.....trying to meet ends meet and stil doesnt happen.

You are so young and doing so good....Look at other ppl, ppl who are intelligent hardworking, with good education, but things just didnt go right for them.....and are struggling...they are happy if they are able to put food on the table for thier kids. Forget about houses and cars............ I think instead of wondering why and how ppl are getting cars and vacations....Reach out to the communty, try to have compasion for ppl who are making effort and need a little boost from the fortunate ones. Be a friend to someone, Thier are a lo more things you can do rather than wonder how come...they have this and that ...and i dont.........This is greed.keep away from it.....Take care and enjoy your blessings sherry

I read in the paper recently that the minimum a family of four needs in the bay area for rent, food, daycare and healthcare is 60K a year. And that's no savings, no extra anything.

You own a house (and therefore have to pay taxes, insurance, etc.) so things probably feel a little tight.

I just read ''The Two-Income Trap: Why Middle Class Mothers and Fathers are Going Broke'' and it really paints a stark picture of how the government considers us to be ''affluent'' but really, every penny goes to keeping the family afloat.

As to why people can afford to spend $500,000 on a house, lenders have lowered their standards. There are more no money down loans, more 80/10 loans. It used to be the rule was you should spend no more than 2-3 times your annual salary on a house. Now people spend 3 to 5 times their annual salary.

I wonder where people are getting their money, too. I think a lot of people are up to their eyeballs in debt, car loans, home equity loans, credit card debt. Some people are probably good with money, and some people just earn a lot.

I try not to compare our family with others, but its hard. We really would like a newer, bigger car (I drive a '89 Jeep and my husband drives a '98 Honda Accord) and a three bedroom house. (We have a boy and a girl and a two-bedroom house). But for us, its more important not to be in debt, have a low mortgage and to have a cash cushion.

BTW, if you want to borrow my copy of the book, email me and I will leave it out for you. pgm

Interesting question, and one I have had myself many, many times. The way EVERYONE I know is ''doing it'' (nice cars, expensive houses, vacations, ''best'' schools, etc.) is with money from their parents or grandparents. Seriously. Those down payments come from grandma and grandpa, and so does private school for the kids. Once I realized that (because friends let it ''slip'') it all started to make more sense to me.

I'm sure there are people out there who are earning every cent they spend, but a lot of people living the good life in the Bay Area are doing it with a little (or a lot) of help! Tax the rich!

You posted a great topic for discussion. I have no answers but as a family of four that owns a home and has two kids under five and lives on 70K, it hit a nerve. I think it is a huge Bay Area issue now with housing the way it is. A house next door sold for $600,000 and we wonder how we will be able to be friends with the couple :). All of us on the street want to know how they did it (in this area) and how will they pay the over $6,000 a year in property taxes? It is creating a class difference for many of us who are middle class, educated etc.. but cannot afford the home improvements, the vacations, and the local swim club. We are struggling just to keep what we have and worry if we should stay here. I just think it is more common than you might think that many here in the Bay Area live on the lighter side (after all the bills). My East coast relatives would actually be shocked about our annual income if I ever told them because to them it would seem high. I guess we just need to weigh out the benefits or take our money and run. would love a new roof

I didn't see the original posting, but here's my advice for frugal living.

We are a family of six (2 adults, 9yoB, 7yoB, 4yoG, 2yoG) and if I remember correctly, we made $28K last year. I know it was under $30K.

I buy all the kids clothes at Thriftown, wait, I buy EVERYTHING at Thriftown! :) Books, kitchen stuff, clothes, bedding (not blankets - we usually use sleeping bags instead of blankets), shoes, organizing stuff, dressers, bookcases, art (well, one piece i fell in love with) and do most of my clothes buying when they have their 1/2 off all clothing days. I have memorized (pretty much) the prices of all the food staples I buy and shop at Williams Natural Grocery, Trader Joes, Berkeley Bowl, Raleys, Safeway (mostly just for WIC stuff) and Costco to get the best buys. If your memory isn't that reliable (mine ONLY works for food prices :)), get a book and track the prices of all the staples you get until you *know* where they are the cheapest.

I never (well, hardly ever :)) buy processed food. I try to make my own bread, we buy little paper goods (only toliet paper which is used to supplement the cloth wipes we normally use). I make our own soap (this is REALLY simple - just melt and pour, but cheaper and cleaner than anything I've found). I water down all our liquid soaps (detergent also) and find great results watering down 1/3 soap to 2/3 water. I recycle all plastic bags and don't need to buy any as I simply use the ones I get at BB or in packaging. We have free dialup and just got cable TV (but get the $25/month one and I'm not sure if we'll keep it. Basic cable is only about $14/mo). We have 2 cars and do the maintenance ourselves - but they are easy - 1985 VW Vans.

We were incredibly lucky to buy our house before the boom (we actually bought in a buyer's market - can you believe such a thing? :)) and have recently refinanced to take $200/mo off our payments.

We have high deductibles on our cars and the house. We rarely use the heat in the winter and have no A/C. We hang our clothes to dry. We do not make toll or long distance calls - our phone bill is about $8 a month.

We do not go out for movies (I think we went to a theatre in 1996, but that would be the last time :)) and very rarely go out for dinner.

I buy all dairy, high fat, meat, selected fruits and veggies organic. We have oatmeal a lot for breakfast.

IMO, and being able to own our home makes a HUGE difference, you can live really cheaply here in the bay area - as long as you're already in a home. The biggest thing that has helped me is to ask myself before I purchase something if it is a need or a want. If it is a need, we save up for it.

Oh, and the biggest saver is probably homeschooling. Nah, the biggest saver is having bought our home in 1995. We were so incredibly lucky. I hope some of this might have helped.

Oh, I make my own tinctures (herbal remedies) and never go to the doctor, but then again, we have MediCal, so that's not too much of a help... Kathy

THANK GOD this discussion is going on. I'm in an even worse (or better?) situation. My husband makes $80K and so do I. He has child support payments, so it's not really $160K combined, but it's still a lot more money than I ever expected to have. I bought a tiny, little, house years ago when the market was low, and feel damned lucky to have it. We drive old cars (that get good mileage), and he keeps them tuned up. We cook and clean for ourselves. I would not say that we are living on the edge, but I don't feel comfortable considering private school, and I find summer day camp to be very pricey (and who are these families who can send their school aged children to day camp between 10 and 3 every day, when I am at work and commuting?). I feel like I am always scrimping and saving. On the other hand, I am surrounded by friends who buy new expensive cars and have huge beautiful houses. They manage private school, and have the nice vacations. I have suspected that some of them have family money, but have never considered their debt load (aside from my mortgage, I have none). This discussion makes me feel far more normal. Doesn't have rich relatives, either

To the responder wanting to cancel her Chronicle to save money: try switching to a Wed-Sun subscription for $24.99 per year or Fri-Sun for $19.99 for six months. --Doing OK on under 40K

You are not alone. My husband and I both work, and if you just look at the numbers, it appears we have a very good joint income. However, we have to live very frugally to make ends meet. I'd say we have a ''lower middle class'' lifestyle. However, we feel very lucky to live here. None of our neighbors could afford to buy their houses today either, so we feel right at home. :-)

I think the best way to look at it is to imagine that ''Bay Area dollars'' are a foreign currency. Say the exchange rate is about 2 Bay Area dollars to one ''Other U.S. dollar''. So, if you're earning $80K here, your standard of living will probably be about the same as someone earning $40K in, say, the Midwest.

There are advantages and disadvantages to being paid in ''Bay Area dollars''. For one thing, salaries are higher here, so if you do happen to have any money left over after paying the bills ;-) , you can probably afford more luxury items like vacations or other items which are sold on a nationwide basis. Of course, there are also disadvantages, like being taxed as though you were ''upper middle class'' when you're really ''lower middle class.'' ;-/

Every now and then I think of moving... but then I ask myself, where in the world could I find another place that has such good weather, great neighbors and friends, great politics and an atmosphere of tolerance? Where could I find a better place to raise my children? So we don't have a big house with a big yard or an SUV... who cares? My children are learning to be good people. They're learning tolerance and appreciating diversity. And, they're learning the value of a dollar (Bay Area or other) and the importance of hard work. loves this ''country''

We recently had a salary reality check. 2 years ago, my husband had a cushy job with a huge corporation, which allowed us to buy a house in Berkeley. Still, we had to do 100% financing (gulp). Three weeks after we moved in, he was laid off. Since then, it has been pretty scary --- three jobs, one after another... enough to pay the mortgage but we're putting groceries on the credit cards. We recently cashed in his last 401(k) to pay the property taxes. Things are looking up because he got a (yet another) new job, but this one pays our bills (hurray!!!) and we're hoping to get out of credit card debt by next year. We really dug ourselves into a hole and made some bad financial choices. The worst thing was not saving enough money when we could have. As my husband put it, ''We didn't realize we were rich, when we were.'' It has definitely been a learning experience for us.

I think people who live in this area, own a house, go on nice vacations, etc. must have some sort of savings or family money they can fall back on. Or, they didn't start their adult lives with debt (school loans, car, credit card) that they're trying to pay off at the same time. Learning all the time

Remember: The grass is always greener. While there may be some with more money, bigger houses, grander vacations, etc... than you, be grateful for what you have as there are many others who would LOVE to be in your position (you ARE a home owner and you get to stay home with your child). In terms of the housing thing, remember that those who were lucky enough to buy 5 - 10 years ago, have now made enough equity when they sell to put a huge ($250,000+) downpayment on those $500K - $800K+ houses in Berkeley, Albany, Kensington, El Cerrito,etc. We don't, by any stretch of the imagination, consider ourselves wealthy (combined my husband and I make around $120K) and if we hadn't purchased a home 6 years ago, it would be a stretch for us to afford to live in our neighborhood now. A recent article in the SF Chronicle said that to afford a median priced house in the Bay Area, a household income of around $138,000 was required. It's sad, really, that neighborhood dynamics are changing because of this ridiculous housing market and many people are now looking at their new neighbors moving in and wondering ''How did they afford that house?!'' instead of ''I want to get to know my new neighbors.'' Also lets not forget relatives. Mom/ Dad/ Grandparents who are well off provide their kids/grandkids with a downpayment for a house and/or ''gifted'' money every year. I know a couple who, in addition to both working, get $100K annually from a trust her wealthy grandmother set up for her before she was born. This pays for their pricey cars, tennis club memberships, annual cruise and private schools. I don't begrudge them this though - she was really lucky. Am I jealous at times, hell yes. Couldn't we all live a little easier with that kind of additional income? But I also try to put it into perspective. Your life is what you make of it regardless of what you earn, what kind of car you drive or where you rest your head at night. Anna

Our family lives on $3,200 per month and that includes everything. We have one child, one house in Berkeley we bought 8 years ago and 2 vehicles we own. I have never dipped into our savings - I make about $40,000 and my husband has been unemployed for a year. I was raised in a country where credit cards are not used for personal items and where you only spend what you've got. That's the main principle. It also helps to not be competitive and not compare yourself to others (major cause of unnecessary unhappiness). In addition, it helps if you have several friends who are in the same economic situation - you will emotionally suport each other. The expenses for private school do not end with the tuition, they extend into clothing, type of toys, birthday party entertainment and other lifestyle issues. There are some good public schools and we got into one. We refinanced until we got down to a $800 mortgage. I totaled up regular monthly bills and call them fixed costs. I totaled up infrequent bills (Homeowner's, Earthquake insurance, property taxes, car insurance, DMV...) and divided the amount by 12 month. This amount ($550) I have transfered monthly from my checking account into a savings account, which simply serves as a holding station whenever one of these bills are due. It works well, none of these bills ever surprise me - it was not my money to spend anyway - these are also fixed expenses. Then you subtract fixed expenses from your salary and see what you got left. That money is for variable expenses such as groceries, clothing, entertainment, vacation, Christmas, and gifts. Make your money stretch - know your stores! You can get basic cleaning supplies at the Dollar Store. I get most of groceries at Trader Joe's. If I have the urge to buy almost new designer clothes, I get them at the Goodwill, the Salvation Army or at yard sales. There is no need to spend more than $7 per piece. New women's clothing will skyrocket your budget. Target is good for kid's clothes. I use only one credit card for everything, which I pay off every month. (No balance, and never a finance charge). I earn Sears rewards dollars for using their card and end up with an average of $180 per year that I get to spend for free at Sears. I use a part of that for buying my child new clothes in the fall and spring. I have tea and granola bars at my desk. There is no going out for coffee and a muffin - a savings of $80 per month. These are just examples of why these expenses are variable. One reliable car is 10 years old with only $65,000 miles. Helps to have your job location close by. (Regular car maintenance & repairs are part of the fixed expenses). The other (end of the year) vehicle was purchased new as part of a refinance. I know we have quite some equity available to us, but I feel this is all on paper. One major earthquake.... and the dream is gone. Then what? We invested in good camping supplies and have short vacations several times per year. If I don't have the cash to go to Hawaii for a week, I will not go there. It's very simple and I don't feel deprived at all. I just turn around and contact the remaining families during Berkeley spring break to arrange playdates, so we don't have to enroll our child in a full-time spring program. I take advantage of library rentals and free entertainment at festivals. We never paid a babysitter, we trade playdates with friends. We are not interested in cable TV and we often wait until movies come out as rentals. Our savings cover over a year of living expenses at this level. I feel sheltered and good about our quality of life. In summary, I think it is probably not so much about the amount of money you make, it is how you successfully manage what you've got. Anonymous

The cost of living in the Bay Area is unreal - especially housing prices, so ''average'' salaries here would be upper middle class in most of the U.S. So, the trick is to live below your means here - and yes, for those of us that were lucky enough to buy houses before surreal estate happened its alot easier (we bought a house 10 years ago that was affordable for us on one income if necessary - of course that's probably impossible now).

I buy clothes at thrift stores, consignment shops, outlets, and during the July/January sales ONLY (and that way I can indulge my shopaholic tendencies). Our cars are 13 and 7 years old (and are moderately priced). We are staunch supporters of Berkeley public schools. We only use credit cards for some vacation expenses(and agree how much to spend and by when the credit card will be paid off). We buy large appliances, etc. when stores are offering ''free interest'' and pay them off within the ''free'' time frame. We have a monthly budget and include savings as a ''bill'' to be paid up front - we also put aside every month for irregular expenses such as summer day camp, property tax, etc. Only THEN, do we have expendable cash for eating out, etc.

Some of our friends drive expensive SUV's, only buy at Nordstrom's and laugh at our ''cheapness''. But, we believe living ''below our means'' will prepare us to weather layoffs, illnesses, college tuition, and hopefully retirement. It has also been the ONLY way we have been able to deal with aging parent issues.

Being ''average'' in the Bay Area means making trade offs about what is important to you - if you are a SAHM, that is a choice that you and your husband made. To blame your husband for not making more, isn't fair in my opinion. I'm sure that he's stressed out being the sole bread winner as it is. After all, $80,000 in a GOOD salary that most would envy, its certainly a professional salary (more than TWO starting teacher salaries!) - unfortunately in the Bay Area $80,00 for a family of 4 is lower middle class. If that's not the level you are prepared to live within - you and your husband may have to consider relocating OR rethinking how important being a SAHM is to your family. Karen H.

I wanted to offer the opposite point of view to this question --- it seems most people have been talking about how they have to scrimp and save to live here but I actually feel the opposite. I don't feel like we have an exceedingly high income and yet I feel we live pretty well. My husband makes around $125k per year (though we used to make twice that when I worked and the economy was better) and I stay home with our three very young children. The things we are able to afford on this income include:
- a nice house in the hills (bought 5 years ago for $500k, now worth around $900k)
- housekeeper every two weeks
- gardener once a month
- babysitting about once a week
- country club membership
- I splurge on shopping about once a month at high end stores
- I buy the kid's clothes at Target, Old Navy and Gap
- We eat out at least 3-4 times a week (not fancy but things like burritos, salads, pasta etc.)
- We pay for preschool & classes
- About once every six months we buy an expensive item like a camcorder, jewelery, or something for the house.
- Probably once every few months my husband and I have an expensive date night.
- In general I don't feel I need to scrimp and save, I pretty much buy whatever we want or need for the house, food, clothes, etc.

Things we DON'T have or buy:
- fancy cars
- expensive vacations
- we have no debt other than our mortgage
- we've also decided we can't do private school
- we also get no outside help and when we got married we had absolutely no debt and about $60K combined in savings. I don't know how we do it -- like I said, I don't think our income is that high for this area, but I feel we live really well. Though when I look at what kind of house we could buy in another part of the country I do dream of moving... Anon

I've been reading all the postings with interest, and just wanted to add another take on the situation. I'm currently in grad school, and my huband works full time and goes to grad school at night, while my baby is in nearly full time day care. We are lucky in that we don't have any student loans and our parents help us out with trips and baby clothes, etc., but given that we're living in the bay area, things are pretty tight. Obviously, given the response to your posting, this is not an unusual situation, but I think we're much more okay with it than we might be otherwise because we rationalize it as a stage. That is to say, we're not in our ''real'' jobs yet, i.e. the ones we will have after we finish grad school, and so it's okay that we're not living a ''real'' life, i.e. owning a home, etc. To some extent this is not constructive behavior, since it means we're constantly sitting around waiting around for our lives to begin when by most standards they began a while ago. But it also helps handle the issues that come up when we don't have the things that others in our age group have. I just bring this up to say that so much of the anxieties we're talking about have to do with matching our expectations of what we've been told we need to have to live well, (and I am completely involved in those fantasies) rather than taking our lives for what they are at each moment. If where we are in our career can be designated ''temporary,'' not ''for real,'' then disappointments don't have to be for real either.

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