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How much do you/should you spend on food (US)?
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250 a week on the average here on the central coast of California for a family of 5. We eat as clean as we can with no boxed or canned junk mostly from Trader Joe’s but meats com from a different store2
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How much do you spend on food? Do feel like what you spend is reasonable? Do you feel like you are stuck spending more money than other people, or do you feel thrifty and like you get good food for the cost? I spend 17% of my take-home pay on food (groceries, eating out, everything). This seems like way too much, but my partner disagrees. I searched the internet to get an idea of what "normal" spending is, but I couldn't find anything very current from a reliable source.
This is the best I could come up with, but it's from 2014 and doesn't account for the variety of cost of living in different places. I do live in an expensive city compared to other places in the US.
https://www.cnpp.usda.gov/sites/default/files/usda_food_plans_cost_of_food/CostofFoodJul2014.pdf
Family of 5 and we spend $600ish a month on grocery food and then another $200ish on eating out/alcohol etc. So a little less than 17%, if I'm doing my math right. We used to have a very frugal grocery budget when times were tight, but we're in a better place financially now, so I don't have a problem spending more on groceries/food. It gives us the room to buy more produce, real butter, ingredients for homemade breads, nuts and seeds, beer lol, etc.1 -
Single, and I spend $35/week or $140/month on groceries. Add in about $25 in eating out/alcohol per month for a total of $165 per month. I live in the southeast. Produce is generally cheap year-round, and I buy a lot of it. Most of my food budget goes towards meat (mainly poultry, fresh salmon, shrimp, some pork) and fruit (usually seasonal), with vegetables and starches (usually rice, beans, or pasta) being the cheapest components. I have access to a few Asian grocery stores which are my go-to for certain produce on the cheap (ginger, garlic, shallots, cruciferous veggies, radishes, mushrooms). I cook 90% of what I eat and always shop the grocery store sales flyer, which makes things pretty darn affordable. We also have grocery stores with good rewards programs in my area which helps. I'm starting to experiment with a higher protein, higher fat diet so my weekly grocery bill is going to get a little more expensive, but I still don't anticipate spending more than $40/week or $160/month.
I've lived on as little as $20-$25/week, which which was mainly dark meat chicken or eggs, beans, rice, and whatever veggies were cheap and bulky (cabbage and turnip greens are always super cheap around here) plus fruit and oatmeal.
For non-grocery household needs, I've saved money by buying reusable dish washing cloths ($4 for 2 vs $2-4 for a 2-pack of disposable sponges), switching over to vinegar for cleansing (vs buying clorox wipes and the like), and cleaning my bakeware instead of using aluminum foil.0 -
I spend about 25% of my take-home income on groceries, but that includes non-food items (toilet paper, cat supplies, cleaning stuff, etc.). I live in a low COL area, but my percentage is high because my income is low -- the actual dollar amount is around $550/month, though it fluctuates some. I just feed my son and me, so we eat very well on this amount. I could definitely cut it, probably almost by half, but good, varied, plentiful food is foundational to my sense of security and well-being. I grew up poor and quite literally starved; on top of this, food was used as a tool of abuse in my home, and I developed a life-threatening eating disorder as a teen. Part of my work on food behaviors and total health is keeping the house well-stocked and not artificially constraining my choices.
... Which, I know, is mostly a load of hippie nonsense. But it does help me to know I can (within what I can afford) buy what I want, cook what I want, focus on health and pleasure over cost alone, and feed my son abundantly and without fear or resentment. I spend more on food than anyone I know locally, but it's really worth it to me.4 -
250 a week on the average here on the central coast of California for a family of 5. We eat as clean as we can with no boxed or canned junk mostly from Trader Joe’s but meats com from a different store
Good. This sounds a bit more realistic than some of the other statements I see here, but evidently there's a lot of from location to the next.0 -
More than I care to admit for a single person. I eat an autoimmune paleo diet, and struggle keeping weight on due to Crohn's, so I have to eat more than the average 'healthy' female with my stats. I spend an average of $100 a week. It's a lot less than when I was trying to gain though!
I downloaded a budget app this month because I want to afford my own apartment. I have already started making changes - seasonal and local produce, discounted meat section, shopping st different stores for sales, more organ meat. I will come back to update on my progress.
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We spend 20% of our take-home on food. It seems strange to me that we calculate in percentages though. The food needs of a person don't change with income. We're at around $350/ week for 2 adults plus a toddler which includes organic groceries plus eating out 2-5 times weekly.0
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In my household of 2 we make it our goal to be less than $200/month for groceries. Most of our budget goes toward meat but we are now jumping on the Meatless Mondays band wagon and I'm trying to cut out meat from all of my lunches and focus on other sources of proteins. We also eat out but have limited ourselves to once per week and I'd say average is about $30/week for about $120/month.1
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We spend 20% of our take-home on food. It seems strange to me that we calculate in percentages though. The food needs of a person don't change with income. We're at around $350/ week for 2 adults plus a toddler which includes organic groceries plus eating out 2-5 times weekly.
I just read this:
The 50-20-30 Rule helps you build a budget by using three spending categories:- 50% of your income should go to living expenses and essentials. This includes your rent, utilities, and things like groceries and transportation for work.
- 20% of your income should go to financial goals, meaning your savings, investments, and debt-reduction payments (if you have debt, such as credit card payments).
- 30% of your income should be used for flexible spending. This is everything you buy that you want but don’t necessarily need (like money spent on movies and travel).
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How much we spend? Family of two adults, waaayyy to much money!!. I could say a percentage, but that doesn't display the magnitude of the damage as we live in California where food is relatively inexpensive out side of eating out, and incomes are higher. I also admit I eat out entirely too often, contributing to my excess weight. We like wine as a couple and my husband drinks craft beer. The only time I don't drink wine is when I'm watching my calorie intake, like the last 20ish days lol. Another consideration, my husband likes to smoke food for friends and co-workers because he's very good at it; it's a hobby. We entertain about twice a month, usually between 4 and 8 people.
All things considered, I just added up my last month bank statement on groceries and dining out, this is a shock to me...$1764.32. That's intense! Do I believe we pay more than the average family of two? I'm positive we do, and it's excessive. We could live on 25% of that and still eat well, but the ingredients my husband cooks with are expensive.
Many people spend money on hobbies, habits and luxuries, I guess one of our hobbies is cooking and eating out, so that's where extra money goes. Funny thing is, I'm vegetarian, so only one of us is eating the most expensive food, meat. I only buy about 2 to 3 bottle of wine per month and he and his friends drink about four 6pks of beer a month.
I suppose only eating out 2 to 3 times a week could save us approximately $500 per month, and that is likely where we would need to begin cutting back. It will help the waistline and wallet. Since starting back with MPG, I have encouraged we eat at home at least 4 times when we could have easily gone out, I call that a win.3 -
We spend around $600/month on groceries (including toiletries) for two adults and three elementary aged children (we live in the Midwest part of the US). I use coupons and shop sales most of the time. Then we also eat out once per week for dinner (usually fast food or pizza) and I usually eat out once or twice for lunch during the week. So, that equals another $150ish per month on food. We currently have a one income household (but I'll be going back to work once our youngest starts kindergarten in August so that will bring our percentage down to something more reasonable, but definitely not close to that 6% number that was stated on the first page).
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Food? Probably <10% of gross.
Also refuse to buy a home more than 2x household income(I realize that is nearly impossible in places like NY, MA, and CA) . So mortgage+escrow is right around 10% of gross.0 -
$50/wk on average just for myself, I can go less during the school year and I'm being fed 2x a day at work. Great deal if you can eat cheeseburgers and pizza all the time.0
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Also refuse to buy a home more than 2x household income(I realize that is nearly impossible in places like NY, MA, and CA)
...and WA, and a lot of urban areas in general. My house is 5x my household income and I have a dual professional income household and we were being frugal relative to most in our area. 2x is impossible unless you are making a huge income. 3x pretty much impossible as well, 4x would be a stretch. Not sure where you are from where houses go for only 2x of household income as an upper bound but if that rule was followed then almost no one would have a house in urban areas on the coasts at least unless their household income is $300k+
I think more general advise would be don't purchase a house if you could rent an equivalent for less than the mortgage interest/home insurance/maintenance costs and don't purchase a house unless you have at least 2 years worth of mortgage payments in savings to provide a buffer for job loss or transitions.2 -
Thanks a lot for your detailed info. I'm in Southern Ontario and love that we can get local produce in the summer. In the winter we have no choice but buy imported food. I'm trying to get our grocery bill down and will definitely use your strategies. We are 2 adults and 2 young college/university students and I spend at least $200-300 per week. One thing my parents allways did was avoid going to the store between the weekly trip. This is a real pitfall for me as I go in for 1 item that I had forgotten or need for a recipe and end up $30-40 later. Meat is expensive, especially beef so we only buy beef if there's a good sale. I need to plan better and not let my husband do the grocery shopping as he doesn't look for sales and buys too much processed food. I'm inspired now to get this under $150 a week.2
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Just my husband and I, plus the cat. I live in Spain, supposedly a lower cost of living country atm. So we spend 500 euro a month which exchanges to $585 U.S. dollars a month. We just buy fish, yogurt, fresh vegetables mostly, a few frozen, fruit, cheese, some nuts, rarely snack foods, pasta, rice, two to three fresh bread a week. I think we are frugal, we don't go to restaurants. There is the water too included in that, can't drink from the tap here, but spring water is cheap, .50 a bottle.
We arn't working atm, with no income, so I can't say what that would be, but when work does happen $585 is 4% of our income.1 -
stanmann571 wrote: »Aaron_K123 wrote: »Aaron_K123 wrote: »Aaron_K123 wrote: »Packerjohn wrote: »We live downstate IL mid-size community....same house in S. Cali or Seattle would be 4-5X as much.
Yeah not even an exaggeration....pretty spot on. Median price per square foot for houses:
Seattle: $506
Los Angeles: $635
Illinois: $141
Illinois x 4 = Seattle
Illinois x 5 = So Cal.
Your house would probably be ~1.2 million in Seattle. Food prices probably a little higher in Seattle as well but not nearly to that degree.
Acutely aware after family moved from St. Louis to Mission Viejo in the mid 1970s and living as a single sailor in San Diego in 1996. Food, gas, basics in general were about double the price largely due to taxes associated with the product. Economics in motion - supply and demand.
I don't want to divert too much from the thread's topic, but housing (in Seattle at least) is NOT economics in motion. It's investors having their fun. The demand for low-income housing is through the roof. Nine percent of children attending public schools do not have a roof over their heads at night. An overwhelming number of adults living without shelter are employed full time. But there are plenty of housing options for the top 20% and plenty of vacant properties too (although a lot of that is zoned for business). I'm sure we'll be like Vancouver, BC soon, with vacant overpriced properties everywhere you look.
High demand, low supply. How is this not economics? Seattle's primary issue is dealing with reality.
You can either rail against a system which you have no control over, or you can change that which you have control over. Get a group of investors together and purchase property offering low-income housing.
Eh I think you can understand that when a city (which obviously has to employ a labor force and base-level professional workers) has housing costs that vastly exceed the income of those people it creates a very awkward situation where you need people to work in the city but they can't afford to live in the city. You can't really get a house within the Seattle city limits for less than 500k now and if you get one that is 500k you are talking like a 900 sqft townhome on the outskirts.
This is precisely my point. We can sit and discuss it, but market forces being what they are those with wealth can either decide to provide necessities to maintain status quo or suffer. Until workers utilize their power there will be no change. Seattle like so many other cities needs to quickly come to terms with reality. Chicago is in the same situation, only the disparity is not as obvious. Government blames industry. Industry blames government. Both have the power to implement a solution.
No offense but I think that Vancouver and Seattle are in rather unique situations that you aren't fully grasping. The real estate economy is so "booming" or "bubbling" that it has attracted a lot of foreign investment of people buying up property not to occupy it or even to use it really but like they are valuable trading cards or something. Sure, free market capatalism balances the whole system, but if you look locally to the actual people who live in the actual city they are getting kind of screwed by investor wars driving up prices and making housing overpriced and non-functional for the general population. When a run down 900 sq ft townhouse costs more than a typically 2 person household can afford that is sort of a problem and if the market "equalizes" by crashing that isn't good either.
I don't think anything like that is happening in Chicago.
It's Ok, The tulips will rot. and yes, a crash will suck, so keep your powder dry.
I'm terribly off topic here but along these lines I was shocked to find out that over half the homes in spain are vacant! Most families own three plus homes or apartments and don't rent them or sell them. I thought they already had a crash, how much worse could it get, yet the euro keeps floating along. On the ground it doesn't look good. I don't see how it keeps afloat myself. There a a lot of people who are barely making it here, a lot of young people live with family and never move out of home.
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I just read this:
The 50-20-30 Rule helps you build a budget by using three spending categories:- 50% of your income should go to living expenses and essentials. This includes your rent, utilities, and things like groceries and transportation for work.
- 20% of your income should go to financial goals, meaning your savings, investments, and debt-reduction payments (if you have debt, such as credit card payments).
- 30% of your income should be used for flexible spending. This is everything you buy that you want but don’t necessarily need (like money spent on movies and travel).
I’ve see this rule before, and I’ll admit, it puts my hackles up a little. Not saying anything bad about the person who put it up, mind- I know Elizabeth Warren made this popular in her book. But the concept always has that assumption that people ‘of course’ have enough money, they just need to learn how to spend it right and budget better.
And there are millions of people right now where this is not in any way the case.
Heck, my living expenses and essential expenses are 90% of my income this month. That’s with groceries down to the bone, the most ‘processed’ food being a little plain cheese, excepting the special nutrient shakes for my kid on a medical diet that cost the earth.
This is not that uncommon, either. The 50-20-30 thing was invented by folks who, I think, are an example of how out of touch the wealthy and upper middle class are with those in lower income brackets. :-(
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I just read this:
The 50-20-30 Rule helps you build a budget by using three spending categories:- 50% of your income should go to living expenses and essentials. This includes your rent, utilities, and things like groceries and transportation for work.
- 20% of your income should go to financial goals, meaning your savings, investments, and debt-reduction payments (if you have debt, such as credit card payments).
- 30% of your income should be used for flexible spending. This is everything you buy that you want but don’t necessarily need (like money spent on movies and travel).
I’ve see this rule before, and I’ll admit, it puts my hackles up a little. Not saying anything bad about the person who put it up, mind- I know Elizabeth Warren made this popular in her book. But the concept always has that assumption that people ‘of course’ have enough money, they just need to learn how to spend it right and budget better.
And there are millions of people right now where this is not in any way the case.
Heck, my living expenses and essential expenses are 90% of my income this month. That’s with groceries down to the bone, the most ‘processed’ food being a little plain cheese, excepting the special nutrient shakes for my kid on a medical diet that cost the earth.
This is not that uncommon, either. The 50-20-30 thing was invented by folks who, I think, are an example of how out of touch the wealthy and upper middle class are with those in lower income brackets. :-(
I read it and shared it here, but it certainly isn't my own reality. The 20% for financial goals disappears straight into the other living expenses department for those if us merely existing from paycheck to paycheck each month.0 -
Aaron_K123 wrote: »Also refuse to buy a home more than 2x household income(I realize that is nearly impossible in places like NY, MA, and CA)
...and WA, and a lot of urban areas in general. My house is 5x my household income and I have a dual professional income household and we were being frugal relative to most in our area. 2x is impossible unless you are making a huge income. 3x pretty much impossible as well, 4x would be a stretch. Not sure where you are from where houses go for only 2x of household income as an upper bound but if that rule was followed then almost no one would have a house in urban areas on the coasts at least unless their household income is $300k+
I think more general advise would be don't purchase a house if you could rent an equivalent for less than the mortgage interest/home insurance/maintenance costs and don't purchase a house unless you have at least 2 years worth of mortgage payments in savings to provide a buffer for job loss or transitions.
I had to giggle at this, as living in California having 2 years of mortgage in the bank doesn't really make sense to me. If I did have 2 years, that would be over 100k and better spent as a down payment on the actual morgage to avoid the costly PMI. If I did have to save 100k I'd never own a home.
Here in Cali it's advised you have 3 to 4 months morgage on the bank, which is still a lot, as most mortgages are between 4k and 5k.1 -
Leslierussell4134 wrote: »Aaron_K123 wrote: »Also refuse to buy a home more than 2x household income(I realize that is nearly impossible in places like NY, MA, and CA)
...and WA, and a lot of urban areas in general. My house is 5x my household income and I have a dual professional income household and we were being frugal relative to most in our area. 2x is impossible unless you are making a huge income. 3x pretty much impossible as well, 4x would be a stretch. Not sure where you are from where houses go for only 2x of household income as an upper bound but if that rule was followed then almost no one would have a house in urban areas on the coasts at least unless their household income is $300k+
I think more general advise would be don't purchase a house if you could rent an equivalent for less than the mortgage interest/home insurance/maintenance costs and don't purchase a house unless you have at least 2 years worth of mortgage payments in savings to provide a buffer for job loss or transitions.
I had to giggle at this, as living in California having 2 years of mortgage in the bank doesn't really make sense to me. If I did have 2 years, that would be over 100k and better spent as a down payment on the actual morgage to avoid the costly PMI. If I did have to save 100k I'd never own a home.
Here in Cali it's advised you have 3 to 4 months morgage on the bank, which is still a lot, as most mortgages are between 4k and 5k.
Seattle is as expensive as Cali so I dont think that matters. If you are super confident there is no way you can lose your income for more than 3 months then okay but to me that is extremely risky. Having 1 year in mortgage saved might be enough but it isn't all that hard to have a major hit to income during tough economic times and 6-8 months without a job will wipe that out and that's assuming your mortgage is more than your other living expenses. If you default on a mortgage then say goodbye to your credit rating....is that worth getting out of rentals into a home a little earlier?
I did have 100k in savings on top of my downpayment which was 20% to avoid PMI entirely which is why I felt it was okay to purchase at that point since 2 years mortgage for me was about 70k. Plus that level of solvency let me get an interest rate low enough that I was saving compared to rent on day one. Not sure why that is funny. If you dont have much liquidity then home ownership is a risky proposition...I'd rather rent for another couple years than risk my financial record and solvency.3 -
Aaron_K123 wrote: »Leslierussell4134 wrote: »Aaron_K123 wrote: »Also refuse to buy a home more than 2x household income(I realize that is nearly impossible in places like NY, MA, and CA)
...and WA, and a lot of urban areas in general. My house is 5x my household income and I have a dual professional income household and we were being frugal relative to most in our area. 2x is impossible unless you are making a huge income. 3x pretty much impossible as well, 4x would be a stretch. Not sure where you are from where houses go for only 2x of household income as an upper bound but if that rule was followed then almost no one would have a house in urban areas on the coasts at least unless their household income is $300k+
I think more general advise would be don't purchase a house if you could rent an equivalent for less than the mortgage interest/home insurance/maintenance costs and don't purchase a house unless you have at least 2 years worth of mortgage payments in savings to provide a buffer for job loss or transitions.
I had to giggle at this, as living in California having 2 years of mortgage in the bank doesn't really make sense to me. If I did have 2 years, that would be over 100k and better spent as a down payment on the actual morgage to avoid the costly PMI. If I did have to save 100k I'd never own a home.
Here in Cali it's advised you have 3 to 4 months morgage on the bank, which is still a lot, as most mortgages are between 4k and 5k.
Seattle is as expensive as Cali so I dont think that matters. If you are super confident there is no way you can lose your income for more than 3 months then okay but to me that is extremely risky. Having 1 year in mortgage saved might be enough but it isn't all that hard to have a major hit to income during tough economic times and 6-8 months without a job will wipe that out and that's assuming your mortgage is more than your other living expenses. If you default on a mortgage then say goodbye to your credit rating....is that worth getting out of rentals into a home a little earlier?
I did have 100k in savings on top of my downpayment which was 20% to avoid PMI entirely which is why I felt it was okay to purchase at that point since 2 years mortgage for me was about 70k. Plus that level of solvency let me get an interest rate low enough that I was saving compared to rent on day one. Not sure why that is funny. If you dont have much liquidity then home ownership is a risky proposition...I'd rather rent for another couple years than risk my financial record and solvency.
The trouble with renting is that you're paying out money every month that isn't ever going towards ownership!!2 -
There was no way for me to save a year's mortgage plus down payment in California. They were taking too much tax when I had no write off and rent was sky high. I am grateful to be in a house now.1
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Aaron_K123 wrote: »Leslierussell4134 wrote: »Aaron_K123 wrote: »Also refuse to buy a home more than 2x household income(I realize that is nearly impossible in places like NY, MA, and CA)
...and WA, and a lot of urban areas in general. My house is 5x my household income and I have a dual professional income household and we were being frugal relative to most in our area. 2x is impossible unless you are making a huge income. 3x pretty much impossible as well, 4x would be a stretch. Not sure where you are from where houses go for only 2x of household income as an upper bound but if that rule was followed then almost no one would have a house in urban areas on the coasts at least unless their household income is $300k+
I think more general advise would be don't purchase a house if you could rent an equivalent for less than the mortgage interest/home insurance/maintenance costs and don't purchase a house unless you have at least 2 years worth of mortgage payments in savings to provide a buffer for job loss or transitions.
I had to giggle at this, as living in California having 2 years of mortgage in the bank doesn't really make sense to me. If I did have 2 years, that would be over 100k and better spent as a down payment on the actual morgage to avoid the costly PMI. If I did have to save 100k I'd never own a home.
Here in Cali it's advised you have 3 to 4 months morgage on the bank, which is still a lot, as most mortgages are between 4k and 5k.
Seattle is as expensive as Cali so I dont think that matters. If you are super confident there is no way you can lose your income for more than 3 months then okay but to me that is extremely risky. Having 1 year in mortgage saved might be enough but it isn't all that hard to have a major hit to income during tough economic times and 6-8 months without a job will wipe that out and that's assuming your mortgage is more than your other living expenses. If you default on a mortgage then say goodbye to your credit rating....is that worth getting out of rentals into a home a little earlier?
I did have 100k in savings on top of my downpayment which was 20% to avoid PMI entirely which is why I felt it was okay to purchase at that point since 2 years mortgage for me was about 70k. Plus that level of solvency let me get an interest rate low enough that I was saving compared to rent on day one. Not sure why that is funny. If you dont have much liquidity then home ownership is a risky proposition...I'd rather rent for another couple years than risk my financial record and solvency.
The trouble with renting is that you're paying out money every month that isn't ever going towards ownership!!
I understand that, but if you pay less in rent than you do in interest, home insurance, property tax and home maintenance in a house then renting is still the better deal. Home ownership is not guaranteed to save you money over renting.
For example. Assuming you are in a place like Los Angeles or Seattle lets say you are buying a $700k house which these days is a "cheap" house. Lets say you do the standard 20% downpayment to avoid PMI...so $140k. That is $140k you have now put into the equity of your home and is now frozen. If you were renting that is $140k you could have put in a zero risk bond dividend fund and yielded a good 3-4% annual for an extra ~$400 a month in income. You now have a $560k mortgage which we will assume is at 4.5% annual which is $2100 a month in interest payments. You also have property tax which is likely going to be something like 2% on the assessed value of your home so lets assume an extra $800 a month. You also have home insurance which lets assume $60 a month. So 2100+800+400+60 is $3360 a month in money you aren't getting back.
One thing you do get from home ownership is a tax credit for your mortgage which might net you something like $6k a year back in taxes which is a net gain of about $500 a month which offsets that dividend investment you could get if you just kept your downpayment and continued renting or offset some of the property tax that you wouldn't even have if you were renting. So if your rent is less than around $2800 a month you might be better off continuing to rent for now and continuing to save until you have more of a safety net or downpayment or until rent gets more expensive. That doesn't even take into account the likely hundreds a month you will be spending in home maintenance and extra utilities that you wouldn't have been in a rental.
Now you might point out that real estate itself is an investment that can often have high returns and that is true but unless you are planning on flipping your house immediately those aren't returns you are going to actually have available to you unlike something like a treasury bond dividend fund. Also unlike treasury bonds the real estate market is volatile there is no guarantee that the real estate market will payout for you so you are essentially gambling that money if your goal is just investment in real estate. Also even if your home value does go up that is great when you sell, but until you sell all that really means is that your expenses go up as your property tax increases. On top of that if it is the house you are living in and it has gone up in value and you sell it then all that means is that you will be buying another house which has also gone up in value and therefore it is sort of a wash unless you happen to move from a city where house prices went up to a city where they did not.
It is actually not all that easy to hit the market at a time and with enough credit to get the money you lose in home ownership to actually be lower than the amount you lose in rent, at least until you have paid down a substantial portion of your mortgage. Personally I purchased a home at the point in which I had sufficient solvency and credit to put in a downpayment and acquire a mortgage interest rate where my (mortgage interest + property tax + home insurance) was equal to my rent and I had enough liquidity beyond that to cover two years of mortgage payments plus an austere cost of living if i were to lose my job. Until that moment happened I just continued to rent as it made more sense financially to me.2 -
There was no way for me to save a year's mortgage plus down payment in California. They were taking too much tax when I had no write off and rent was sky high. I am grateful to be in a house now.
If you were able to save up enough for a downpayment then wouldn't continuing to wait longer and continuing to save allow you to save up enough to have both a downpayment and a financial cushion in case of job loss? I'm not saying you can't buy a house as soon as you have enough for a downpayment, obviously you can. I'm also not saying that you couldn't save money with a home over rental, obviously you can although unlikely at least until the mortgage is paid down. I'm just saying it isn't that financially prudent to purchase a house if the result is to completely empty out your bank account because that is extremely risky. It is hard to recover from defaulting on a mortgage and job loss or economic crashes can come with little warning (2008 anyone?). Buying a house without a safety net is gambling, it is a gamble that very well might pay off...but it is gambling. I'm just an advocate for prudence over basically betting that you won't lose your job in order to save a few extra thousand a year in the short-term.
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@Aaron_K123 Thanks for the wonderful financial insights here. I'm glad to have reached this stage in life where my mortgage is all paid off.1
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@Aaron_K123 Thanks for the wonderful financial insights here. I'm glad to have reached this stage in life where my mortgage is all paid off.
@TonyB0588 Yeah I'm looking forward to that myself, still a ways off. Apologies if my post came off as patronizing, wasn't my intent. For sure as one pays down their mortgage eventually home ownership becomes better than rent as more of ones payment goes to equity rather than interest.1 -
<10% of take home pay for a 2-person house with a dog. It's $600 max a month for everything, with a very occasional overage.0
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Aaron_K123 wrote: »There was no way for me to save a year's mortgage plus down payment in California. They were taking too much tax when I had no write off and rent was sky high. I am grateful to be in a house now.
If you were able to save up enough for a downpayment then wouldn't continuing to wait longer and continuing to save allow you to save up enough to have both a downpayment and a financial cushion in case of job loss? I'm not saying you can't buy a house as soon as you have enough for a downpayment, obviously you can. I'm also not saying that you couldn't save money with a home over rental, obviously you can although unlikely at least until the mortgage is paid down. I'm just saying it isn't that financially prudent to purchase a house if the result is to completely empty out your bank account because that is extremely risky. It is hard to recover from defaulting on a mortgage and job loss or economic crashes can come with little warning (2008 anyone?). Buying a house without a safety net is gambling, it is a gamble that very well might pay off...but it is gambling. I'm just an advocate for prudence over basically betting that you won't lose your job in order to save a few extra thousand a year in the short-term.
I ended up taking out a loan on my 401K to get the money for the down payment. That was the only way I could do it. I was renting a modest 1 bedroom apartment and driving a paid off used car. Even now, with my write off I only see about 60% of my income in take home pay. That is how bad the tax situation is here. There was no way I could save up the money before.0 -
Central CA here, I budget $120 a week for food for a family of four with school aged kids. Dining out is extra- we try to keep that to once a week, and pet food runs around $100 a month. I buy budget to stay on track, so organic isn't really an option aside from a few staples but luckily we have some great affordable stores around (yay Winco!). I swear the farmers markets are more than the grocery stores here! But that's our sacrifice to keep our savings on track and keep to our 50-20-30, and the trade off works for my peace of mind. It's a lot easier to stay within costs when I'm not buying junk though.0
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