Housing out of college - do you include expected bonus in 30% of salary calculation?

swae's picture
Rank: Senior Monkey | banana points 77

I'm looking for housing in NYC and have heard to aim for rent to be around 30% of annual salary, and ignore bonus because rent is paid monthly. Considering that many of us have bonus' that are expected to be a significant portion of annual income, do you guys factor that in?

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Comments (6)

Most Helpful
Jan 8, 2019

You should treat a bonus exactly like what it's called, a bonus. All your living expenses should be calculated off your base salary. Treating your bonus like an expected paycheck is not necessarily the right way to approach finances and can potentially leave you in a tough situation the moment it isn't as high as what you expected. Realistically speaking, let's just say you're at a bank similar to DB and were living like your bonus was guaranteed and all of a sudden they announce that you're not getting a bonus... tough times may be ahead. This is obviously pretty extreme, but it's definitely a real scenario.

    • 5
Jan 11, 2019

This is actually really helpful and the risk didn't occur to me. brb while I revisit my housing choices...

Jan 8, 2019

As long as you don't work for Deutsche Bank

thots and prayers

    • 2
Jan 11, 2019

30% of Salary or 30% of Salary after taxes?

Jan 11, 2019

"If you ain't first, you're last!" - GOAT

    • 1