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This topic comprises 2 pages: 1 2
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Author
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Topic: Cost Of Living Expenses
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Paul G. Thompson
The Weenie Man
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Posts: 4718
From: Mount Vernon WA USA
Registered: Nov 2000
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posted 04-04-2003 08:12 PM
In another thread, I mentioned something about those workers "not being able to make it" on a $10.00 per hour job. I think you will find there is more truth to it than BS. I made some rough calculations and they look very grim. Here they are:
At $10.00 per hour based on a 2080-hours per year (260 working days per year), the worker makes $20,800. Of that, $1,654 has to be held to pay Federal Income Tax on their earnings. That leaves $19,146.
Presuming a person rents a modest home for $600.00 per month. Rent paid towards that will be $7,200.00 per year leaving the worker with $11,946.00. Let's say it costs about 100 bucks per month for utilities (heat, lights, water, and sewer). That will cost an additional $1,200.00 per year, leaving the worker $10,746.00.
Most States have a State Income Tax. Based on probably about 2%, that would be $416.00 per year based on a $20,800 income. This leaves the worker with $10,330.00.
Automobile insurance - about $500.00 per year, just a guess. This leaves $9,380.00.
Social Security Taxes run 6.2% of the gross earnings and an additional 1.45% is withheld for Medicare. This total is 7.65% - which calculates to $1591.20 per year, leaving the worker with $7,788.00 per year.
If the worker has a good reliable running car (that has a clear title) it might cost about $.17 per mile to drive it. That might include fuel and maintenance for an average of 12,000 miles per year. That comes up to $2,040 per year, leaving the worker trying to survive with $5,758.00 per year.
Now, add in your phone bill and garbage bill. It would be close to maybe $40.00 per month, (if you don’t make any long distance calls) or $480.00 per year. This leaves the worker with $5,278 per year.
Now, let's divide that by 12, and that gives the worker $439.83 in his/her pocket per month, or $109.95 per week to spend on items such as food, clothes, health insurance, life insurance, renter’s insurance, replacement of broken or worn out furniture, appliances, unexpected additional expenses, car payments (if any) and entertainment.
Congratulations - you just about "broke the bank!"
Now we know why the average credit card holder is $7,000 in debt. Now we know why there are so many personal bankruptcy claims. The overall situation does not look very good at all!
To add a slight twist, there is an old saying: Two can live as cheaply as one." But I have to add this: "For half as long."
OK, this is an edit to correct my orginal calculation. The bottom line was only $25.89 in error in your favor. Orginally, I posted $84.06. [ 04-06-2003, 01:11 AM: Message edited by: Paul G. Thompson ]
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Ian Price
Phenomenal Film Handler
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Posts: 1714
From: Denver, CO
Registered: Jun 99
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posted 04-05-2003 03:41 PM
Ok, I'm going to look at this a different way. The communists said "each according to their need." The following example uses me as a model. I'm 40-years-old, single and live in Santa Rosa, CA, where costs are a bit higher than the national average.
These are not my actual numbers, but a solid representation of present conditions. My rent is a bit less, I don't pay for phone, health insurance, movies, retirement and my car is 9-years-old and paid for.
Monthly
$1,000 Rent (one bedroom apartment in a nice place.) $100 Utilities (Heat, Garbage, Water) $40 Cable $25 Phone $300 Car ($15,000 financed for 60 months) $170 Auto running costs ($.17 mile for 12,000 miles per year.) $80 Auto Insurance $300 Health Insurance $300 Food, (I like to eat out a bit.) $25 Clothing $70 Entertainment (One movie with popcorn and soda per week) $90 Vacation $300 Retirement (10% Net) $1,650 Tax load (+50% for Fed, State, SS, Medicare)
$4,950 Monthly
$59,400 Annual Salary
$28.56 Per Hour!
Note: You should buy a house instead of rent. But the average house in Sonoma County is $400,000! So if you gave up the new car and mom gave you the down payment, you might be able to afford a $200,000 house.
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Ian Price
Phenomenal Film Handler
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Posts: 1714
From: Denver, CO
Registered: Jun 99
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posted 04-05-2003 07:14 PM
Let's look at the extremes.
Ok, lets try to pare this down a bit to local minimums.
Monthly
$600 Rent (Very modest or crappy one bedroom apartment or studio, or two bedroom with roommate.) $50 Utilities (Heat, Garbage, Water) $0 Cable $25 Phone $0 Car (Paid off) $170 Auto running costs ($.17 mile for 12,000 miles per year.) $80 Auto Insurance $0 Health Insurance (Either paid for by the employer or not at all.) $200 Food, (Brown Bag it) $25 Clothing $25 Entertainment (One movie per week bargain show) $0 Vacation $0 Retirement (10% Net) $590 Tax load (+50% for Fed, State, SS, Medicare)
$1,765 Monthly
$21,180 Annual Salary
$10.18 Per Hour!
Now lets look at how I should be living. This assumes single income, married, and 2 children.
Monthly
$5,600 Mortgage ($700,000 home, in Sonoma County this gets you a 4 bedroom 4 bath 2,500 sq foot house.) $200 Utilities (Heat, Garbage, Water) $350 Cleaning Lady (I'm not vacuuming a 2,500 sq foot house) $180 Yard Service $180 Pool Service (Wishful thinking on my part, but hey, it's a fantasy.) $100 Cable $300 Phone (She likes to talk to her mom in Connecticut every day.) $300 Cell Phone (One per family member) $1,550 Cars (Two car leases, mine is a BMW 525 and Hers is a Lexus Sport Utility) $500 Auto running costs ($.25 mile for 12,000 miles per year.) $300 Auto Insurance $1,000 Health Insurance $1,000 Food, $200 Clothing $300 Entertainment (One Movie per week for a family of 4 with one play per month for the parents) $500 Vacation $2,000 School (I'm not sending the kids to public school) $1,456 Retirement (10% Net) $8,008 Tax load (+50% for Fed, State, SS, Medicare)
$24,024 Monthly
$288,288 Annual Salary (Let's just say $350,000 to start)
$168.30 Per Hour!
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Phil Hill
I love my cootie bug
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Posts: 7595
From: Hollywood, CA USA
Registered: Mar 2000
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posted 04-05-2003 08:17 PM
Ian, If you're a relatively financially secure single guy living in a "preferred" place in Los Angeles, here is a rough guide as to what it costs...
Monthly:
$3,600 Mortgage ($800,000 home with $300,000 down payment. In Hollywood Hills this gets you a 2 bedroom 3 bath 1,900 sq foot house.) $300 Utilities (Elect, Gas, Water) $000 Cleaning Lady (I'm remolding and I let the place look like shit!) $100 Yard Service $000 Pool Service (Don't have a pool any longer….) $90 Satellite HD TV ...Cable sucks $200 Phone & DSL $120 Cell Phone $000 Cars … Explorer Sport Utility - paid for. (ex STILL!!!!! Has my Corvette!) $500 Auto running costs ($.25 mile for 24,000 miles per year.) $105 Auto Insurance $400 Health Insurance $1,500 Food … in & out $200 Clothing & personal items $1000 Discretionary and Entertainment (All forms) $000 Vacation…Didn't have one for 14 years, now I'm on a permanent vacation! $000 School (Been there, did that) $1,100 Retirement $6,500 Income Tax load...FIT, SIT, FICA, SDI, etc. (Singles really take it up the ass!) $600 Property taxes
About $16,315 Monthly Gross
$196k Annual Salary
$94.00 Per Hour
By the time you look at all the hidden taxes, like city services, phone services, sales tax, etc, …we are being double and triple taxed to hell!
At least as far as income goes, I wish the hell they would do the flat tax thing where EVERYONE pays a fixed percentage of their income….fair to ALL!
>>> Phil
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