Income and what you can afford
For 2022, taking into account current inflation, what income level corresponds to what milestones?
For example, what income level can you afford a nice apartment in HCOL, eating out once in a while, nice gym pass, etc. When can you afford to send your kids to private school? What about a cook, cleaner, driver? 1M+ income?? A private jet??
Yes, this is a bit of a shallow question, but it can actually be important so that we as professionals know when we should take our foot off the gas a little bit and focus on other things in our life if we are at an income level that can afford the kind of lifestyle we want.
This is going depend a lot on your marital/kid situation. For me personally (assuming single no kids), this also depends on preferences as if you really value a nice gym, you can afford that if you don't want a nice apartment/car, etc.
Nice Apartment (with Roommates): $100k
Eating Out: $120k
Nice Gym/Cleaner (every other week cleaning): $150k
Luxury Car (lease): $180k
Nice Apartment to yourself: $180k+ (depends on how nice)
Private School: $200k for cheap catholic ones, $400k+ for elite
Cook/driver - >$1mm (and probably more than that, most people I know in this range do not have this)
Private Jet - $10mm+ (this is a WAG)
I would adjust eating out to 70k per year given that OP said occasionally, and the average cost of a meal out can be $20-50.
I would bump cook / driver up to 10M per year and private jet to 25M per year. Sure, you could probably afford those at the salaries you listed but given general lifestyle creep many cannot.
Additionally, based solely on my anecdotal network, no one making 1-5M per year has a cook / driver, and those that make 10M+ per year do not have a PJ but will opt to use services like wheels up
Agree on most of this. Eating out I had conflated the "nice" in the nice gym with nice eating out (~$100+ per person once/twice per month), eating out occasionally is definitely in the ~$70K range (though I guess it could be lower too if you consider $5 Little Caesars or something like that).
On the cook - I've seen it where the family has a live in nanny that also cooks meals in that range. Nobody I know has a driver.
Private Jet - this is more dependent on net worth than salary from what I've seen, but yeah, it's somewhere way up there.
Totally agree. The wealthiest people I know essentially have some variation of a butler, someone who flies from property to property to clean / grocery shop / handle packages, but doesnt technically cook meals. I too dont know anyone with a driver.
I knew one person with a PJ and agree with you, his salary was never crazy high but his NW was 75+. He only had it because he loved to fly, and flew it himself.
I had one former boss who had a driver. He had a Rolls Royce and an S500. The Rolls Royce was a coupe and he would ride shotgun in it, but would sit in the back in the S500. He also gave $10 million to my undergrad business school. Baller.
I think it all depends on the type of lifestyle you want / enjoy. Too many variables to really lay it out imo
Total household comp of $500-600k is IMO where you can get more comfortable and the incremental money matters less - kids can go to private school as long as it's not NYC elite schools at $70k a pop, cleaner comes occasionally, living in a nice situation and not nickel and diming yourself to go to dinner.
No one really needs a cook, driver, private jet, would say you need to make far north of $1M to barely afford your own cook/driver, like $5M+ to really justify it (those will each run you ~$100k a pop if you want them to yourself). Think something more reasonable is a live in nanny / house manager but they still make six figures for a highly qualified one.
Obviously the comfortable lifestyle threshold is easier if your wife is also earning a decent living
I think I need $2k for my life, but I don't earn it :(
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