cost of living v income

I am used to living paycheck to paycheck. I am an Admin Assistant and DH is a teacher. I will have my masters in education in December, but know that the chances of finding a job are slim to none. So...

I know that for a while we will be living the way we are now, which is paycheck to paycheck.

We are purchasing a house. We CAN afford the mortgage AND a baby (god willing).
BUT there will be no extra money left over. Every penny is accounted for. Every single one.

Is this common? Please tell me I am not alone..

Re: cost of living v income

For a short time, that could work. But not forever. You have to allow for the oops, and omg, my heater blew up expenses. For us, we could not NOT have anything left over. My dh would stroke out worrying about it. So, we made sure we bought well below our means, and live benethe them too. Kid and all. We splurge, but not like we used to. First 6 months in the house we replaced a few costly things. Wasnt planned, but thank whoever we had the cash on hand.

Re: cost of living v income

Coming from someone with a Masters in Education, you are NOT alone!

I had some health complications back in November of 2009. On top of not being able to find a teaching job and my per diem subbing salary, DH and I have been living paycheck to paycheck. I became pregnant in October and SOBBED because I thought we were going to have to live in the car.

Budgeting has helped us tremendously. We are both involved in our finances. I keep him up on what's coming in and what's going out. I felt like a failure for a long time because of my career situation. Once the baby comes I'm planning on looking for something outside of substitute teaching. We are VERY careful with our spending and bills and have cut down a lot on the frivolous stuff. We have some credit card debt (which used to be a LOT more), and slowly but surely we have made it work.

Just be honest with each other with the finances and know that this situation isn't going to be forever.

Re: cost of living v income

Re: cost of living v income

If I could do it all over again, I would NOT have agreed to have bought a house, in this area just because it's "what you do when you get married".

I feel like we were royally cheated "living up to the American dream".

It's more like the American nightmare IMHO living here on LI.

DH had one really bad year and our savings was totally shot.

Take it from me, your and your DH are NOT in the financial position to buy a house. I'm sorry if that's not what you want to hear, but if I can help one couple think before they take on the financial burden of becoming homeowners when they are not ready......then I hope I am doing someone some good in this world.

Re: cost of living v income

You are not alone! DH got laid off years ago and had to basically start over. I too have a Master's in Education and only sub! We have been living this way for a while, and yes it's hard. You just have to be very careful with your money, and learn to live with things you would rather not. I am hoping that things will be looking up for us very soon. DH is up for a huge promotion, with a big raise. I am changing careers, and hopefully will be making some real money in a year or two.

Re: cost of living v income

When you say that every penny is accounted for and there's nothing left over, are you budgeting for saving money every month in that? Or do you mean every dollar is literally already earmarked for expenses?

If it's the latter, then I have to say, I don't think you're in the best position to buy a house right now. Once you're in a better job situation, at that point I would purchase a house, but for now, I'd rent, etc. There are a lot of hidden costs that come with owning a home - something could break down out of no where; how would you pay for it. What if your car has a problem? What if one of you is unemployed? As much as we should think positive, etc., you also have to be prepared at least partially for the unforseen.

DH and I haven't bought a house yet because even if we can afford it on paper, I don't want to be scraping by (be house poor). Too stressful.

Re: cost of living v income

I also wanted to add that no one should ever consider themselves a failure if they cannot afford, or find themselves struggling to live on Long Island. I think it's more the MAJORITY that have difficulties with the COL here, but you would not think that by just looking around. I too have a Master's degree and DH also has his own business, and we live paycheck to paycheck, with some small savings left to spare.

Honestly, I know A LOT of people who APPEAR to be doing well, because they bought a house, but are really living paycheck to paycheck.

I am sure things will improve down the road for a lot of us (DH business is already doing better this year), but I don't mind sharing my story to say that yeah, we probably should have waited.

I never think we should measure our self-worth by some teeny-tiny 50+ year-old $300K+ house that very often will require $100K in renovations at some point.

OK, off the

Re: cost of living v income

Re: cost of living v income

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

Re: cost of living v income

Re: cost of living v income

Posted by KS13

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

Re: cost of living v income

Posted by KS13

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

Re: cost of living v income

Posted by nov04libride

Posted by KS13

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

I know you asked about baby expenses, but did you factor in daycare? We moved into our home when I was 9 months PG, and in the first year here our fridge died ($1200 to replace), dryer died ($800 to replace), tree fell down and needed removed ($800), and roof needed replaced due to leaking ($9000). All of this was unexpected, and thankfully, we had the savings to cover it. Additionally, we put in more cosmetic changes, that were optional.

My mother had been watching DS so we hadn't planned on childcare. Well, my mother was diagnosed with cancer after minding DS for 6 months, so we needed to factor in childcare, and I needed to take days off to care for my mom and bring her to surgery/chemo.

If anything, prepare for the unexpected. I would never feel comfortable living paycheck to paycheck, esp. w/ DS.

Message edited 4/5/2011 5:54:56 PM.

Re: cost of living v income

Posted by annoyedTTCer

Posted by KS13

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

Having just had a baby in March 2010 I'll say you'll be amazed at how much your expenses go up once a little one arrives.

You might want to pace yourself in the new place - take decorating and renovations slow and maybe not aim to have a child in the first year in order to give yourself time to create a little rainy day fund.

A home is a huge money pit in the beginning, just remember that and you should be fine

Message edited 4/5/2011 5:58:04 PM.

Re: cost of living v income

Posted by KS13

Posted by annoyedTTCer

Posted by KS13

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

Having just had a baby in March 2010 I'll say you'll be amazed at how much your expenses go up once a little one arrives.

You might want to pace yourself in the new place - take decorating and renovations slow and maybe not aim to have a child in the first year in order to give yourself time to create a little rainy day fund.

A home is a huge money pit in the beginning, just remember that and you should be fine

Congratulations on the baby!

Yes, we are putting money into the house to begin with unfortunately...but I know it is necessary..I think what I am going to do is keep the renovations to the bare minimum at first in order to keep more money in our savings.

Re: cost of living v income

Posted by annoyedTTCer

Posted by KS13

Posted by annoyedTTCer

Posted by KS13

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

Having just had a baby in March 2010 I'll say you'll be amazed at how much your expenses go up once a little one arrives.

You might want to pace yourself in the new place - take decorating and renovations slow and maybe not aim to have a child in the first year in order to give yourself time to create a little rainy day fund.

A home is a huge money pit in the beginning, just remember that and you should be fine

Congratulations on the baby!

Yes, we are putting money into the house to begin with unfortunately...but I know it is necessary..I think what I am going to do is keep the renovations to the bare minimum at first in order to keep more money in our savings.

If you are good about putting money aside I'd get a Home Depot card and take advantage of the 12 months plans

Trust me, you'll be there every weekend and sometimes twice in one day and those little trips add up quickly

Thanks, having a kid is the greatest thing in the world despite the $$$ and sleepless nights

Re: cost of living v income

Posted by KS13

Posted by nov04libride

Posted by KS13

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

I know you asked about baby expenses, but did you factor in daycare? We moved into our home when I was 9 months PG, and in the first year here our fridge died ($1200 to replace), dryer died ($800 to replace), tree fell down and needed removed ($800), and roof needed replaced due to leaking ($9000). All of this was unexpected, and thankfully, we had the savings to cover it. Additionally, we put in more cosmetic changes, that were optional.

My mother had been watching DS so we hadn't planned on childcare. Well, my mother was diagnosed with cancer after minding DS for 6 months, so we needed to factor in childcare, and I needed to take days off to care for my mom and bring her to surgery/chemo.

If anything, prepare for the unexpected. I would never feel comfortable living paycheck to paycheck, esp. w/ DS.

yes, we have daycare taken into account thank goodness...I hope your Mom is OK

Re: cost of living v income

Posted by nov04libride

Posted by KS13

Posted by nov04libride

Posted by KS13

You see its so funny though. I totally expected more people to say that yes they live paycheck to paycheck but they make it work somehow, etc etc.

I am constantly being told that we should be buying a home while the market is a buyers market etc etc. And truthfully, there is no way that I am backing out of the house that we are in contract for. I have taken into account all of the expenses of the home, a baby (that isn't even conceived yet ) and our "spending" (i.e., fun) money. We have no consumer debt at all. We own our vehicles and have no credit card outstanding balances. I am I guess trying to convince myself that we can make it work..but now I'm scared

I know you asked about baby expenses, but did you factor in daycare? We moved into our home when I was 9 months PG, and in the first year here our fridge died ($1200 to replace), dryer died ($800 to replace), tree fell down and needed removed ($800), and roof needed replaced due to leaking ($9000). All of this was unexpected, and thankfully, we had the savings to cover it. Additionally, we put in more cosmetic changes, that were optional.

My mother had been watching DS so we hadn't planned on childcare. Well, my mother was diagnosed with cancer after minding DS for 6 months, so we needed to factor in childcare, and I needed to take days off to care for my mom and bring her to surgery/chemo.

If anything, prepare for the unexpected. I would never feel comfortable living paycheck to paycheck, esp. w/ DS.

yes, we have daycare taken into account thank goodness...I hope your Mom is OK

Sorry I sounded like debbie downer. I just felt like that whole year was a cruel joke about how much I could handle!

Re: cost of living v income

Just popping in to say that Suze Orman (love her) would tell you that YOU CANNOT AFFORD IT.

Rent for a little while longer and before you get pregnant or have that baby --- one of you (or both) go out and get a second job!!!!

Sell stuff on Ebay.

Babysit.

Do WHATEVER YOU CAN.

Stick it all off to the side.

THREE MONTH EMERGENCY FUND. OR ELSE.

But seriously - that's what she would tell you.

DH and I live in a small one bedroom apartment. Same situation as you. He's a teacher -- I don't make much. But we are paying off all our credit cards and are determined to have a three month emergency fund saved up before we try to conceive. And then before we buy a house -- that will get even more boosted up.




Just because the market for houses has such 'good deals' doesn't mean it's a good deal for you guys... right now.

Re: cost of living v income

thanks everyone...we'll see what happens..

Re: cost of living v income

Personally I would go for the house...but I live paycheck to paycheck.

Re: cost of living v income

I would probably go for the house also since as you said you have no debt.

But that would also depend on if you are putting money down on the house or if you are financing most of it. If you have to put a little less down and leave more in the savings.

Re: cost of living v income

Maybe we will just do the mandatory make the house aesthetically livable renovations and chuck the rest of the money into savings..that should give us three months of expenses worth of savings sitting in the bank in case of emergency..the rest we can squirrel away when DH gets side jobs (he does construction on the side)...

Re: cost of living v income