Speaking of Money

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Registered: 02-24-2009
Speaking of Money
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Sat, 03-02-2013 - 3:33pm

Here is a SAHM who takes careful budgeting to new heights. It must, of course, be noted that since her DH is military, the family is probably covered in terms of health insurance. 

http://finance.yahoo.com/news/how-a-family-of-four-manages-to-live-well-on-just--14-000-per-year-174803218.html

"Wagasky, 28, lives with her her husband, Jason, 31, and their two young children in a three-bedroom family home in Las Vegas, Nevada. While Jason, a member of the U.S. Army, completes his undergraduate studies, the family's only source of income is the $14,000 annual cost of living allowance he receives under the G.I. Bill. Despite all odds, the family has barely any credit card debt, no car payment, and no mortgage to speak of."

[...]

"By the time Wagasky's husband came home from Iraq, they had managed to scrape together the $30,000 they needed for a downpayment on a home. 


"But we decided the best option would be not to have a mortgage payment at all," she said. "We found a fixer-upper that didn't have a kitchen ... and we paid cash." "

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iVillage Member
Registered: 12-07-2003
Tue, 03-05-2013 - 11:47am
Well, you can make a white sauce to sub in, and that can be less than $1.25.
iVillage Member
Registered: 10-01-2010
Tue, 03-05-2013 - 11:50am
Forgive me if someone has already posted this, but if you run a calculation here http://www.bestplaces.net/col/, making $14,000 in Las Vegas would be the equivalent of making $21,446 in your town.-------- Who is this to geschichtsgal?
iVillage Member
Registered: 12-07-2003
Tue, 03-05-2013 - 11:56am
We have basic, basic cable because it makes our internet cheaper. I still watch quite a lot of TV-- lots of shows are available online at the network stations, we do have netflix and amazon prime instant video. And we occasionally buy series on dvd. Right now, DH and I are watching Game of Thrones season 2 on bluray.
iVillage Member
Registered: 12-07-2003
Tue, 03-05-2013 - 12:13pm

mycherubs wrote:
Forgive me if someone has already posted this, but if you run a calculation here http://www.bestplaces.net/col/, making $14,000 in Las Vegas would be the equivalent of making $21,446 in your town.-------- Who is this to geschichtsgal?

You.

iVillage Member
Registered: 10-01-2010
Tue, 03-05-2013 - 1:15pm
Ok, so not sure why you are telling me this. I couldn't imagine trying to live on that little amount of money. Broken down that is about $412/week.
iVillage Member
Registered: 12-07-2003
Tue, 03-05-2013 - 2:15pm

mycherubs wrote:
Ok, so not sure why you are telling me this. I couldn't imagine trying to live on that little amount of money. Broken down that is about $412/week.

You seemed to be hung up on the fact that the cost of living in your area is so much higher that no one could possibly live in $14,000 in your area.  But, if you adjust for cost of living, $14,000 would be the equivalent to $21,446 in your area.  You can't see living on that amount of money because you have made choices that make in impossible to do so.  My family couldn't live on $14,000 or even $21,446 in my area unless we made some radical lifestyle changes.  

iVillage Member
Registered: 10-01-2010
Tue, 03-05-2013 - 2:22pm
This is from February 2013: The Federal government defines poverty as "a family of four making less than $23,050 a year before taxes." Yet, despite this, local economist Pearl Kramer showed that $71,913 a year to make ends meet in (my area). By now, that would be $75,000.--------- As you can see it is MORE than just the choices I have made to make it impossible to have such a low salary as that amount is defined as living in poverty. Not sure how many people would CHOOSE to live in poverty.
iVillage Member
Registered: 12-07-2003
Tue, 03-05-2013 - 2:39pm

mycherubs wrote:
This is from February 2013: The Federal government defines poverty as "a family of four making less than $23,050 a year before taxes." Yet, despite this, local economist Pearl Kramer showed that $71,913 a year to make ends meet in (my area). By now, that would be $75,000.--------- As you can see it is MORE than just the choices I have made to make it impossible to have such a low salary as that amount is defined as living in poverty. Not sure how many people would CHOOSE to live in poverty.

If you read the legislative report where that appears, they define the poverty level for your county at $46,100.  The federal poverty level is inadequate for almost all areas of the country at this point for a variety of reasons.  My guess would be that the actual poverty level in Las Vegas is also much higher than the federal poverty level.  My only argument is that there are some people who could live on below poverty wages even in your area.  Cost of living isn't really the issue here. This family has made some very smart financial decisions, which will allow them a lot of flexibility in the future.  I mean, they could have said, "Screw it." and run up a bunch of credit card debt or taken out thousands in student loans instead of cutting expenses to the bone, but I imagine they will be very grateful when the husband graduates and they don't have to start repaying huge amounts of debt.  I wish we had done that in graduate school, and our student loans are really minuscule compared to a lot of people's.

iVillage Member
Registered: 10-01-2010
Tue, 03-05-2013 - 2:50pm
$38,000 to $40,000 a year for a family of four------ My bad, it is more than that so that is even worse according to the difference between Vegas and my area. They are way below poverty level then. Again, not sure why anyone would CHOOSE to live that way.
iVillage Member
Registered: 12-07-2003
Tue, 03-05-2013 - 3:07pm

mycherubs wrote:
$38,000 to $40,000 a year for a family of four------ My bad, it is more than that so that is even worse according to the difference between Vegas and my area. They are way below poverty level then. Again, not sure why anyone would CHOOSE to live that way.

Because it's temporary?  Once you start adding debt, you are in a cycle that's hard to break out of.  When this guy graduates from college, their income is very likely to double or triple and they will have a paid for house and no payments for anything.  And they planned for this drop in income, by making smart financial decisions (buying a house outright, making sure they had two paid for cars, etc.).  They will basically have $14,000-$28,000 or more each year that they can use on whatever they want.  They could save it to buy a bigger house, fully fund their kids' college funds, buy a new car outright, really buy whatever they want.  We haven't been quite as smart, but our income has tripled since 2007.  We still do a lot of the same frugal things we did when our income was much lower (no cable, no car payment, etc.), so we have a lot more discretionary income to spend on fun things and on repaying debt.  If we didn't have the debt, we would have even more room for fun things.

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