Is $160,000 enough to live on?

Question

For a family of 5

Answer 1

My family of five lives in the San Diego area. In a nice house that has a clear view of the ocean, bay and city. (Do you know how expensive San Diego is?)

Guess what our income is? $65,000 per year.

Learn how to spend your money properly. SAVE SAVE SAVE!

Spend an average of 50K-60K a year. Keep the rest in a savings. After 10yrs, the savings will be around 1M.

Then the compound interest will have you set for life! Make sure to find a 5-10% interest account..etc.

Answer 2

Hi,

It depends on many factors, and everybody is different.

Where I live $160,000 income falls to about $100,000 after tax. That's only $2,000 a week - not exactly living like a King, but it keeps you off the streets.

For others, $160K a year would be more money than they could possibly imagine.

What sort of lifestyle do you want?

It's one of Parkinson's famous laws that our living standards always rise to meet the income we have.

10 years ago one of my friends was broke and living in shared accommodation, making less than $20,000 a year. Today he lives in a $4 Million waterfront mansion and makes several million dollars a year.

$2,000 a week after tax is great if your expenses are only about $1,000 a week.

But if you think that $160,000 a year will put you in a life of luxury, think again. You'd be very surprised to see how expensive your new lifetsyle will cost.

Upgrade to a bigger home in a nice area, upgrade the cars and take some holidays with your partner and children, and you'll soon discover that $2,000 a week won't stretch very far.

No matter what your income, work to a budget, otherwise you'll blow it.

I hope this is helpful.

Warmly,

Slav

Answer 3

I would have to agree with the previous post. It is going to depend on a lot of things. There is so much to consider, especially if your children are younger, if you live some where that the public school system isn't up to par, if you have a certain type of car, if you want pets, and of course, how much debt you want to be in. Remember, most financial advisers recommend a debt to income ratio of about 20% debt to 60% income leaving the other 20% for savings, retirement and investments. Please double check those numbers because they do vary from person to person. But before anything, download a free Excel budget template from Microsoft. Plug in some fake numbers to see where you would stand. When you see it on paper, then you know if the figure that you are asking about is enough or not. Hope that this helps.

Answer 4

YES,yes, yes. I know plenty of families of five living on less than 20,000 a year and less than that. Be very thankful for that much money and save, save, save, and have a budget. The budget does not have to be a bad thing. A budget is just simply knowing what you will buy and how much you will spend, plus what you will have over. With that much money, you should be able to have pretty much anything you want, even if it is just a small amount or a little bit of it!!! I hope that one day I can make this much!!!!!

Answer 5

Considering our family of 4 lives comfortably in the San Francisco Bay Area for half that much, if it's really a question for you, you need to re-examine your lifestyle.

It should be easy to live a relatively luxurious life anywhere in the U.S. on that kind of income.

Joe

Answer 6

Depends on where you want to live and what kind of lifestyle you want to have. Is that an annual salary? Do you already have a home? Will you require childcare for 3 kids? Are the kids school age, will they go to public school or do you need to work out tuition from that salary? What kind of debt do you currently carry, do you have car payments?

Answer 7

I can't believe you don't know. were you previously making a lot more money and took a pay cut?

That is plenty of money to live off of unless you spend more than you make. If you are doing this, then perhaps not. Budget accordingly and you should live quite well with your family off of 160K per year

Answer 8

yes? i have a family of 5 and my wife and i make jointly 63k a year. everything adds up very quick the more u make the more u spend. my only advise is save invest some amount every pay check and hit the 401k. about 10% sounds good. rent food clothes gas cars fun insurance credit cards and so on! your 100k up on me.

Answer 9

More than enough, unless you waste a lot on extras, our family of five probably lives on less than 50 thousand and we even have a little left for extras.

Answer 10

It depends on your lifestyle, location, income from other family members, etc... I understand that a family of 5 in Biafra live quite comfortably on that!