2 incomes and still not making it

amother

Saddlebrown

Sun, Aug 02 2015, 11:55 am

Together we bring in only about 90k. We have tried finding more lucrative jobs and second jobs but nothing is coming up (we both work 40 hours a week). DC is in public school- can't afford yeshivas, other DC goes to daycare at a cost of 1k a month (standard where I live).

Moving is not an option right now. If you are in the same boat, how do you cut down costs but still have funding for a date night or similar? We work so hard and get so little time together that a date night is one thing we both need. Ftr, no cleaners, no fancy foods, no non-essential shopping etc.
also we both have good degrees so more schooling wouldn't help either.

LittleDucky

Sun, Aug 02 2015, 12:22 pm

Take a good look at your budgets. What do you spend money on? Little things add up. Shop around, shop sales. Coupon. Cut costs everywhere. See if everything is truly essential. If they were out of it at the store, would you make a 2nd, 3rd etc trip to farther stores to buy it?
Also, date night for us is simple. It doesn't need to be restaurants and events. DH might pick up something on his way home to share and we talk about our day. Play a board game. Just something different.

Amarante

Sun, Aug 02 2015, 12:40 pm

You have a good income - not a great income especially if you live in a high cost area.

However, I second LittleDucky's suggestion in terms of seeing exactly what you spend money on. For a month, track EVERYTHING you spend money on.

Many people concentrate on the large items like housing but there are lots of leaks on small things that add up to thousands each year. I remember when I realized that stopping for a Starbucks in the morning - and sometimes during the day was costing me $2000 PER YEAR. After that the tea and coffee at work tasted much better.

Just tracking your expenses will put you in control and let you determine where to save money because that's a personal decision. You have fixed expenses which are difficult to change but you do have some control over your discretionary spending and how you want to allocate it.

Dolly Welsh

Sun, Aug 02 2015, 12:56 pm

A thousand in cash is equal two thousand in earnings. Approximately.

That is because your tax rate is fifty percent. You pay about half your earnings in taxes.

So you have to be paid two thousand, to hold a thousand in your hand. To give it to another woman.

I am referring to the real price of your leaving the house. Call it an exit fee.

Usually, you have to pay to go IN somewhere, such as the movies. But there are fees to be paid for going OUT of a place, not just going into it. This is one.

There are other costs too, less formal but quite real: work clothes, lunches and coffees at the office, nicer hair, different shoes, transportation to the office. And dinner at home may cost more too, because a working woman is less likely to cook from scratch. Convenience foods, such as breakfast cereal, store bought bread, or the occasional pizza ordered in, because the poor thing is tired, add up. Every nickel she pays for anything at all required that two nickels be earned.

It's more efficient for one person, typically the man, to work his fingers to the bone, and collapse from utter exhaustion, while doing little to help his wife at home. It's cheaper for the family for the wife to do her (very hard and very real) work sheltered from the costs, both governmental and societal, that come with entering the more formal and visible labor force.

In short, her doing the laundry is cheaper than him doing the exact same laundry.

His effort that was used in doing the laundry should have been expended in a paid job, because once you are transporting and beautifying two people for the office, you are buying the same thing twice.

If you added up the true costs of your working, and figured in another income for you obtained by watching the child of another woman while SHE works (meaning, take your babysitter's monthly thousand back, for yourself, and another thousand on top of that) it might be something to consider. Your husband would still need to increase his own earnings, perhaps. But your taking all other support considerations off his shoulders, such as house maintenance, might enable him to do that.

He might tutor. He is learned.

If you can watch somebody's child AND teach them, as a Torah home schooler, that might bring you more money than just watching the child.

If the above is insane, I apologize.

Dolly Welsh

Sun, Aug 02 2015, 1:00 pm

Yes Amarante. You learned that we do not buy water. It's in the tap. We never buy a soda. We never buy a coffee. Or only sometimes, as a rare treat, if it seems like the thing to do, but never as a habit.

It is essential to scrutinize what we allow to become a fixed, normal cost we don't think about. Deadly.

There is no point putting the coffee man's children through college. Put your own children through school, not his, I used to say.

Dolly Welsh

Sun, Aug 02 2015, 1:23 pm

I was assuming she lived in a high tax city and state. She mentioned yeshivas. That sounded like New York. But I don't know where she lives.

But federal taxes include social security and medicare taxes on top of income tax. No matter what city and state you live in.

And, remember, this isn't someone who brings in $90.

This is two people whose incomes totaled together are $90.

They are paying a marriage penalty for having the money be two incomes, instead of the same money in one income.

amother

Saddlebrown

Sun, Aug 02 2015, 2:07 pm

miami85 wrote:

Something doesn't sound right with your financial picture. I know of many who DO send their children to yeshivos and aren't making 90k together

Op here: we earn, together, 85k. We are MO. MO yeshivas are close to 12k a year. We do not live in NY, we live in IL. Our rent is 2500 a month and bc of jobs, schools and other stuff we can't change right now, moving is impossible. We are not eligible for any kind of Medicaid so we pay from my work ($400/paycheck), we have only one car and insurance and daycare. As I said, very few luxuries- no cleaning lady, no starbux, barely any bought takeout food... The list of cutbacks is endless.
We also wouldn't qualify for much financial aid bc our income is good so a MO yeshiva is just out of reach. Add in utilities (bare basics), pre pay phone lines (we can't afford contract plans so we pay $35/month each), gas etc and we are just basically left w nothing. My only splurge is getting my eyebrows waxed actually- I think I last got a manicure about 5 years ago lol.

amother

Saddlebrown

Sun, Aug 02 2015, 2:10 pm

amother wrote:

Oh yes, and before plus after care for DC in PS which is $320 a month.

Amarante

Sun, Aug 02 2015, 3:00 pm

I just wanted to clarify that I don't think OP is profligate because the reality is that $90,000 or so in a high cost of living area is just "middle class" without a lot of money for extras. And people at that income level don't normally pay for private school as that is not affordable so it's not as if there is some way to magically have an extra $25,000 or so in tuition after taxes unless one wants to sabotage one's fiscal well being by going heavily into debt.

I also don't think the OP would be better off with one income because the amount saved would appear to be far less than the amount brought in by the second salary.

Without knowing what rent is, I have no idea whether OP can save significantly by moving when the rent comes up. In my experience, rents in expensive areas - especially where the public school system is good - tend to be costly.

TwinsMommy

Sun, Aug 02 2015, 4:30 pm

we have our kids in public school in Cleveland (VERY happy with their schools, 2 diff ones) -- they have special needs so the Jewish schools aren't a good fit for them--- and our rent is half that. we pay $1200 plus water and sewer so usually between $1300 and $1400 a month for rent. $2500 is a lot, in my opinion. We have a decent sized 3 bedroom house with attic and basement and detached garage and huge backyard. So I don't think you have to have a huge rent in an area with a decent public school.

There are lots of ways to make money at home without babysitting. I've been self employed at home since before I had kids. My husband only makes $20 K a year-- I'm not kidding-- but he likes his job and so I've got to hustle..... even so, we make less than you. But no babysitting cost or before/after care or huge amount of rent, etc. But we are in debt of over $100,000 (we used to make more money and had a whole different lifestyle) and debt payments are huge.

Amarante

Sun, Aug 02 2015, 5:29 pm

TwinsMommy wrote:

Housing costs are so dependent on location that comparing one's mortgage/rent to another person in an entirely different location is meaningless. I think Cleveland has lower housing costs than certain "expensive" areas of Chicago like Evanston or Skokie - or even good areas within Chicago.

$2500 would be cheap for rent in Los Angeles - and even areas at that rent might not have what are considered to be good public schools. Beverly Hills is expensive - in part - because the public schools are considered to be first rate and people feel similarly about Santa Monica and Culver City (which are also not within the Los Angeles school district).

Dolly Welsh

Sun, Aug 02 2015, 5:34 pm

OP, your child care costs are like tuition.

Do you realize child care costs come straight out of your salary? They are the cost of you working. Exactly what is your true hourly rate of pay? After all costs of working (taxes, transportation, clothes) are removed and the rest divided up by the hours you work? Ask your accountant how much your husband's taxes would go down if you did not work.

As you have a nice house, you might consider taking in a boarder or even two of them. In fact, I think you have to.

As you have only a two year lease you can strategize about what to do when that's up.

OP, cleaning ladies are wonderful, and I suppose Starbucks is nice (I have never drunk any) but cleaning your house and making your own coffee are not "cutbacks". Those things are normal living.

Nobody should ever borrow money to just live. Only to get education or start a business. And not always even then. Maybe.

Debt is slavery pure and simple. When the bank pays you that rate on a CD....

Don't be somebody else's CD.

mille

Sun, Aug 02 2015, 8:01 pm

You really need to make a full itemized list of where every single penny is going. There's something you're not seeing and not taking into account.

I agree with Dolly's post - no starbucks and no cleaning lady is not a cutback. Those are luxuries. It sounds like maybe you have other luxuries that you consider necessity. No one can make any suggestions without seeing all of your finances. I'm not saying you should share here, definitely not, it's personal - but you need to write it all down so you can get a better idea.