How much to survive?
(Baboon, 141
Points)
on 10/19/11 at 3:42pm
So today I got an offer from a great company. The only problem is this: I live in NYC and work at a crappy company so far (I'm making enough money that covers my $3,100 a month budget).
This company is offering me a 50k Base salary + Commission (pays out every 6 months) and I need to know if this 50k base is enough to get me going (considering I basically have 0 savings).
I've tried to figure the net pay by hand, by ways of internet website, etc and keep getting different #s, so as stupid of a question this may be, how much is 50k gross going to net me on a bi-weekly basis. My friend is currently getting 50k and claims hes netting exactly $3,100 a month, but somehow I don't quite believe him. Please shed some light on the subject, monkeys.
Are you mentally retarded?
Are you mentally retarded?
I did this quickly but I
I did this quickly but I believe:
Federal Income on 50k = 8625
SS = 2100
Medicare = 725
State = 3500
City = 1634.55
Total after tax = 33,415.45
divided by 26 = 1285.21
That's your take home assuming single and subject to NYC state and city tax. This of course doesn't take into account 401k contributions, insurance contributions, etc that may be taken out of your pay check.
At 50k base, I'm netting
At 50k base, I'm netting about $2,800 a month after paying out taxes, 401k, HSA, insurance etc.
I get by just fine but I'm not living in NYC, so the cost of living is way less and we have lower taxes. If you're married you'll have less withheld, and you can always choose whether or not to contribute to an HSA or 401k to get higher net pay obviously.
Friends of mine working at BB in NYC (1st year is $70k base plus bonus) struggle to save anything, and most people I speak to say you need at the very least $100,000 per year all in to live in Manhattan and not be miserable.
I'd look at places in Brooklyn or Hoboken.
Dude only you want to live
Dude only you want to live regally than $50k base is not enough for your living. Since your salary is that of a normal entry-level job so I assume that your living is not so lavish and you can enjoy life by common means of living. Ok so in particular, an apartment in Manhattan with even a personal study cost you around $2-3000, just read in a recent NY Times column so I guess it'll cost you around $1500 if you don't need a full apartment or can share it with roommate(s). I live in a remote part of Brooklyn (20-30 mins to Manhattan) and I am paying $600 per month. You can find a place to live in other Bklyn neighborhoods like Williamsburg, BoCoCa, Brooklyn Heights or Park Slope which are just across the bridge from Manhattan and are (really) nice neighborhoods with the same money. Proof: http://nymag.com/realestate/neighborhoods/2010/65374/
Subway fare costs you $100 per month. No idea in case you want to drive your sports car around town. Average meal is around $10-15. Assume you have one meal outside everyday and the rests are at home: groceries cost you at most $500/month, one restaurant meal per day: $15 x 30 = $450. Let's throw in $50 for the phone bill.
So the bottom line: It is $1500 + $500 + $450 + $100 + $50 = $2600 and this is quite lavish to my standards, you can definitely tune it down. If your budget is bigger than this then you can spend the rest on random trips to pubs, steak-house., fancy restaurants, to pick up chicks whatever..
Greed and stupidity are the roots of all evil
just sleep in the office bro
just sleep in the office bro
http://www.wallstreetoasis.co
http://www.wallstreetoasis.com/user/45023/track
How many topics can this guy create?
Definitely consider Hoboken
Definitely consider Hoboken or Jersey City. No city tax. With a roommate, you're looking at half of $1700/month for an apartment in Hamilton Park. So you're down to $850/month in rent.
Do $3.50 Healthy Choices for dinner and stick to Barefoot wines for drinking. The Jersey City ShopRite has them for $10 for a 1.5 L. That works out to 80 cents per glass (Standard 4oz pours, not 6oz restaurant pours).
Carrots and broccoli make cheap vegetables. Pasta + Ragu twice a week lets you do two dinners for about $2 each.
Try to socialize with friends over lunch. $8 lunch is a lot cheaper than $12 for drinks or $25 for dinner.
Pack lunch once or twice a week. Instead of spending $8 on lunch, you are spending $3 on PB&J. I would also do Annie Chun's noodle bowls for $3.
Tresemme is a huge bottle of shampoo or conditioner that lasts 6 months and costs $3 on sale. No-brainer.
Budget:
$1700/2= $850/mo rent, utes included, Hamilton Park (safe, but quiet families and boring.)
$150/month commute ($60 PATH, $90 MTA); $100 if you can pay pretax.
$8 for lunch x 21 workdays/month = $168/month on lunch - 8 days bag lunches x$5 = $148/month
$4x 10 non-work days/month= $40/month
Breakfast- bagel w/ CC or cereal + fruit- $1.50 x 31 days/year = $50/month
Dinner- Healthy choice + veggies and wine- call it $7 x 31 days/year= $217
Total food spending= $455
Toiletries, soap, shampoo, toothpaste, etc= $15/month
Haircuts= $15/month (yes, I do tip on a $15 haircut- not that cheap, but I space out haircuts every 5-6 weeks.)
Suits, clothing, etc= $80/month (Buy 100% wools at JCP for $180, they last for 18 months at 1x/week)
Cabs, other transportation= $30/month.
Dentists, medical copays= $35/month
Internet access (split with roommate)= $30/month
Other recurrent spending + 10% margin of error= $250/month
Total necessary spending to scrape by as a professional= $1760/month or $21,000/year
Obviously an extra $200-300/month for food and drinking makes life a lot more fun, but I think $21K/year after tax and health insurance is the minimum to get by working in Manhattan.
In terms of federal tax, your liability is going to be $0 on the first $10K, $4K on the next $30K, and 25% of the last 10K for a sum total of $6.5K. Let's round up to $7K for a small measure of conservativism.
State tax in NY typically works out to 0% on your first 7.5K, 5% on your next $20K, then 6.85% on your last $33K. Call it $3.5K.
FICA (Soc. sec + medicare) is 5.65%= $3K.
Total federal and state taxes= $14K.
SALARY: $50K
TAXES: $14K
MANDATORY SPENDING: $21K
Surplus available for additional spending or savings: $15K or $1250/month. Recommend contributing $1K+/month into emergency savings until you have 9 months x $1750= $16K.
Work hard, play hard.
Go to Hoboken or Jersey City.
Go to Hoboken or Jersey City. I've lived in both easier to save, easy commute, bigger/nicer apartments.
Illini have I mentioned that
Illini have I mentioned that you are the GOD of frugality
I have a 65k base, around
I have a 65k base, around 3800 net after everything and I try to save 800. Rent 1500
IlliniProgrammer
Definitely consider Hoboken or Jersey City. No city tax. With a roommate, you're looking at half of $1700/month for an apartment in Hamilton Park. So you're down to $850/month in rent.
Do $3.50 Healthy Choices for dinner and stick to Barefoot wines for drinking. The Jersey City ShopRite has them for $10 for a 1.5 L. That works out to 80 cents per glass (Standard 4oz pours, not 6oz restaurant pours).
Carrots and broccoli make cheap vegetables. Pasta + Ragu twice a week lets you do two dinners for about $2 each.
Try to socialize with friends over lunch. $8 lunch is a lot cheaper than $12 for drinks or $25 for dinner.
Pack lunch once or twice a week. Instead of spending $8 on lunch, you are spending $3 on PB&J. I would also do Annie Chun's noodle bowls for $3.
Tresemme is a huge bottle of shampoo or conditioner that lasts 6 months and costs $3 on sale. No-brainer.
Budget:
$1700/2= $850/mo rent, utes included, Hamilton Park (safe, but quiet families and boring.)
$150/month commute ($60 PATH, $90 MTA); $100 if you can pay pretax.
$8 for lunch x 21 workdays/month = $168/month on lunch - 8 days bag lunches x$5 = $148/month
$4x 10 non-work days/month= $40/month
Breakfast- bagel w/ CC or cereal + fruit- $1.50 x 31 days/year = $50/month
Dinner- Healthy choice + veggies and wine- call it $7 x 31 days/year= $217
Total food spending= $455
Toiletries, soap, shampoo, toothpaste, etc= $15/month
Haircuts= $15/month (yes, I do tip on a $15 haircut- not that cheap, but I space out haircuts every 5-6 weeks.)
Suits, clothing, etc= $80/month (Buy 100% wools at JCP for $180, they last for 18 months at 1x/week)
Cabs, other transportation= $30/month.
Dentists, medical copays= $35/month
Internet access (split with roommate)= $30/month
Other recurrent spending + 10% margin of error= $250/month
Total necessary spending to scrape by as a professional= $1760/month or $21,000/year
Obviously an extra $200-300/month for food and drinking makes life a lot more fun, but I think $21K/year after tax and health insurance is the minimum to get by working in Manhattan.
In terms of federal tax, your liability is going to be $0 on the first $10K, $4K on the next $30K, and 25% of the last 10K for a sum total of $6.5K. Let's round up to $7K for a small measure of conservativism.
State tax in NY typically works out to 0% on your first 7.5K, 5% on your next $20K, then 6.85% on your last $33K. Call it $3.5K.
FICA (Soc. sec + medicare) is 5.65%= $3K.
Total federal and state taxes= $14K.
SALARY: $50K
TAXES: $14K
MANDATORY SPENDING: $21K
Surplus available for additional spending or savings: $15K or $1250/month. Recommend contributing $1K+/month into emergency savings until you have 9 months x $1750= $16K.
And if you pretend to be homeless and eat at a soup kitchen twice a week, you can save even more...
Seriously, cutting back on big ticket items like luxury housing or bottle service makes sense because those savings can be sizable, but eating carrot and broccoli because they're cheap vegetables? Cheap wine from ShopRite? Cmon. Why work so hard if you're not maintaining the standard of living that you are fortunate to be able to enjoy from that work.
And I think it's gonna be a long, long, time
Going Concern
Seriously, cutting back on big ticket items like luxury housing or bottle service makes sense because those savings can be sizable, but eating carrot and broccoli because they're cheap vegetables? Cheap wine from ShopRite? Cmon. Why work so hard if you're not maintaining the standard of living that you are fortunate to be able to enjoy from that work.
Because you don't know how the first year is going to work out- especially when headcounts in the industry have been shrinking for the past four years.
Everyone needs eight months of emergency savings. You need it even more if you work in a volatile industry like finance.
but eating carrot and broccoli because they're cheap vegetables?
I can afford raspberries now at $4/carton. But when I was a college student and when I was first starting out, I couldn't. If eating carrots, oranges, and broccoli instead of raspberries every other night meant saving an extra 1-2% of your take-home pay, wouldn't you do it, at least for the first few months?
Cheap wine from ShopRite?
Franzia is cheap wine. Barefoot is half a step up and comes in a bottle. And if you toss some ice cubes in and drink it with some sharp cheddar (generic=$2/ 8 oz brick), it tastes pretty good. If I were truly cheap, my wine would come out of a box. Have to have a few small luxuries in life.
Why work so hard if you're not maintaining the standard of living that you are fortunate to be able to enjoy from that work.
New York is an expensive city and it's a lot easier to save money early if you've just spent four years living like a college student. If there's a time and place to be living frugally and saving money, this is it.
We are a country with 9% unemployment and historically folks working in finance have made a lot less relative to the public than they do today. Things could always revert to the median for any of us, and when that happens, it's good to have a lot of cash in the bank and ideally some dividend payments coming in. You don't want to be that guy wearing a garbage bag in an alley on the SNL skit asking Suze what to do since he's unemployed and homeless and she's telling him to tap emergency savings and 401ks that he doesn't have.
And I'm not saying that you must live on $1750/month. I think I averaged $2K/month (albeit with $750/month rent so I was spending 35% more on non-rent stuff) my first year, but I'm saying you can do it if you have to.
Whatever you do, don't live in Manhattan and don't spend more than $900/month on rent.
Work hard, play hard.
IlliniProgrammer wrote: Have
Have to have a few small luxuries in life.
If you have to cut costs, you have to, and there is no alternative. But I've known people that once may have had to, but then no longer did, and were frugal anyway, mostly because they derived a sense of satisfaction from it, and partially because of habit. They had constructed a self-imposed framework where a sense of gratification was always obtainable from saving money on everyday things, even if they didn't really need to. And some were honest that they liked saving money for its own sake, not really for any other reason, and I can understand that, and respect the honesty.
But excessively cutting spending because of fear of losing your job in the future is like assigning more probability to a future negative event vs a current negative one (ie getting hit tomorrow by a taxi cab while crossing Park Avenue, and making all those savings irrelevant). It's the journey not the destination, as they say. And I'm sure most people have family and friends that can help if things get really bad. But is the inevitable frustration from not living comfortably (ie being limited to only a few small 'luxuries') really worth the value of the hedge.
And I think it's gonna be a long, long, time
Going Concern wrote: But
But excessively cutting spending because of fear of losing your job in the future is like assigning more probability to a future negative event vs a current negative one (ie getting hit tomorrow by a taxi cab while crossing Park Avenue, and making all those savings irrelevant). It's the journey not the destination, as they say. And I'm sure most people have family and friends that can help if things get really bad. But is the inevitable frustration from not living comfortably (ie being limited to only a few small 'luxuries') really worth the value of the hedge.
Well, the OP was asking how much it costs to survive. This was not necessarily my recommendation, just what I thought the minimum was. And my suggestion to most first-year analysts in New York is that $1 saved today in NY means ~$0.10/year next year in Chicago or Houston or Miami with 6% dividends. Or you can let it compound for a while and have $12/ 72 cents/year worth of dividends at 65 (again, more if retiring outside New York)
Also, the probability of death looking at the actuarial tables for a 22-year-old is about 1 in 1500. These are 10x worse than the odds of every major NYC bank going bankrupt and traders and bankers starving. The odds of becoming unemployed during a bad year in the market? More like 1 in 5 if you work in finance. You need to allow yourself some basic luxuries your first year, but it's important to quickly build a nest egg.
Work hard, play hard.