I’ve been through this before, but Gawker finds more clueless, degenerate wealthy people who feel sorry for themselves on the UrbanBaby site (boldface mine):
Last year $650k. This year $375-450k depending on bonus. I know rationally we are doing well, but we still feel pinched. We try to save our bonus and spend our base ($275k) and with 2 DCs in private pre-school, modest place on far UWS, and pretty modest life, we rip through that $275k incredibly fast. But for those haters, here is the math: $275k = $137k after tax. That is a bit more than $11k per month. After rent, it’s $6200. Annualize preschool and subtract, we are down to $3500. And between all of our other expenses, somehow we burn through that.
Actually, I’m not a hater, I’m a ‘contempter.’ There’s a difference, but I digress. Let me get this right. This family lives on the Upper West Side, sends two kids to private school, saves ~$75,000 – $100,000 per year, and has, after all of that, $3,500 per month to spend. And this, apparently, is a bad year.
(We are aware of all internet traditions!)
By the way, where did the $100,000 post-tax from last year go? Just asking. Those people are so irresponsible and never save. As Brad DeLong noted about another $450,000 per year narcissist:
Only rich families in America today live in detached houses with spare bedrooms in high-tax high-cost areas (and get the services and amenities those buy), spend $36K/year on mortgage payments, $4K/year on clothes and dry cleaning, $8.5K/year on eating-out and bringing-in, $3K/year on gifts and holidays, $20K/year on daycare, babysitting, and summer camps–and still save $75K/year. That is what rich families in America do: that is how they spend their money. The fact that after they have spent their money and paid their taxes there is only $75K/year left for savings is not a sign that they are not rich.
But this from another whiner pretty much sums it up:
Obviously we are totally over extended. If we could get out of this mess, we would, but we can’t.
Good thing you’re not a poor single minority mother, because then, it would totally be your fault. According to Newt Gingrich anyway.
I guess the rest of us are just doomed to lives of squalor. Austerity for thee, but not for me….
“$275k = $137k after tax.” Dang! Looks like the liberal, socialist, free-loaders actually got their tax hikes passed without my noticing it!
I’m no expert, but is there anywhere in country with a 50% tax rate?
If these numbers aren’t completely fictitious, they must include retirement deductions, health care contribution, tax on bonuses, etc. etc. Try subtracting all that out of the average wager-earners salary and see whether you still get over three thou. a month to live off of.
A 50% tax rate is realistic in NYC (hence “UWS” or Upper West Side). We have federal, state, and city taxes here.
I make a tiny fraction of what they make and (having worked my effective tax rate out once) I’m still paying around 40%. Things are even worse if any of that is considered self-employment income, because then there’s a doubled SSI/Medicare hit.
All the more reason not to send your kids to a private PRE-school, but I digress…
Are Phoebe Fay’s numbers below (which give a 37% rate) correct?
As far as the preschool goes, I’m inclined to give them a pass on that, unless NYC offers a good public preschool option. Here in the Boston area, there are no public options until your kid gets to kindergarten or first grade, so two working parents are going to have to pay for some private option, and what they’re paying there isn’t much more than what I pay here. (Though it does mean that if they hang in there for another year or two, they can save that $32 grand a year by sending their kids to public school.)
Correction: They won’t be able to save the full $32K, since they’ll have to pay for after-school care and summer camps; and that’s still going to run in excess of $15K, most likely.
Income tax on 275,000 (assuming 0 deductions or adjustments) = 59493
SS taxes (assuming both working & earning more than 106,000) = 4486 x 2
Medicare taxes = 3987
Total fed = 72452
New York State tax, 6.85 = 18838
New York City tax, $3,071 plus 3.648% of excess over $90,000 = 9820
Total = 101,110
After tax income = 173,890
(And that’s all assuming they have a really lousy tax adviser who gets them zero tax breaks)
So, they’re lying.
Hmm. It’s possible they’re both paid as independent contractors, which would invoke self-employment tax and business taxes — though that would make you wonder why they’re getting bonuses.
More likely they’re either using a rule of thumb & thereby overestimating taxes for conservative budgeting, or (even more likely) they’re counting the tax on the bonus against the base salary.
I’m not trying to come up with justifications to defend these people, who are obviously completely out of touch with reality ($5k in rent per month is a modest place? Unless “far UWS” means “the 70s”, well, my roommates and I used to rent a 4BR on 134th St. for about $2400, wasn’t a nice neighborhood but *that* was modest). I just suspect that part of the delusion afflicting mes amis du Schnausel is that they sincerely believe what they’re saying, rather than simply lying to strangers on the Internets.
These sorts of things inspire one very consistent reaction from me – Bwafrugnugabligraglle?!
…yeah, that, consistently. How the hell do you earn a 350K bonus (assuming the base was the same the previous year)?
yes, I can subtract, it’s translating that into typing that’s problematic.
“How the hell do you earn a 350K bonus”
Now that’s obvious; simply knock a 350K guy down and take his money..
Why the hell do they earn a 350K bonus?? I could live a nice thirty or fourty years of earnings like that
I feel so bad for these asshats. My wife and I only had $30 to spend on groceries for this week…Breakfast, lunches and dinner.