# Does society have a skewed view on what constitutes a good income? **URL:** \ **Category:** Great Debates\ **Created:** [November 4, 2013, 9:06pm UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096 "2013-11-04T21:06:02Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [November 4, 2013, 11:02pm UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/21 "2013-11-04T23:02:36Z")
My wife and I make six figures combined- substantially more than most of our friends, many of whom have kids- and yet they are constantly jetting off to Vegas and buying new cars and we are driving 100,000 mile econoboxes and haven’t had a vacation in years. We’re not saving that much, either, though we’re paying substantially more than our minimum mortgage payments. ---
**Author:** ![Duckster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/duckster/32/1244_2.png) [@Duckster](https://boards.straightdope.com/u/Duckster)\ **Post date:** [November 4, 2013, 11:08pm UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/22 "2013-11-04T23:08:13Z")
[![](https://img.youtube.com/vi/QPKKQnijnsM/maxresdefault.jpg "Wealth Inequality in America") ](https://www.youtube.com/watch?v=QPKKQnijnsM) The video may address wealth but it does illustrate just how far off people assume wealth and income distribution in America. ---
**Author:** ![Finagle](https://avatars.discourse-cdn.com/v4/letter/f/b19c9b/32.png) [@Finagle](https://boards.straightdope.com/u/Finagle)\ **Post date:** [November 4, 2013, 11:55pm UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/23 "2013-11-04T23:55:32Z")
> [@Stil](#): > > I guess the most distilled form of my question is, how can so many people view a 90th or 95th percentile income as anything other than fantastic? I guess maybe everybody on the internet is in the 50th percentile and up? It just makes me chuckle sometimes. I actually feel bad for somebody that thinks, say, $100,000/year isn’t that much. ``` I'm not sure if you've noticed, but life is full of little expenses that make, say, $100K not actually all that much. I'm going to guess that after state and local taxes, that might actually be $60K/year of actual spendable money. $5K/month sounds pretty sweet, yeah? ``` 1. No one has pensions anymore. So let’s put $500/month of that in a 401K. That’s at the low end. $4500/month. 2. You have a house – nothing special, but it still costs $250K-$300K. That really is nothing special in most places, but it gets you a $1500/month mortgage and another, say, $600/month in escrow and local taxes. You get some of the mortgage back in taxes for the first few years, paying $1800/month leaves you with: $2700/month. 3. You have a car, nothing fancy, but between payments and insurance, let’s call it a humble $300/month. $2400/month 4. Remember that house you bought? You have to heat it, pay utilities, and fix it when it breaks. You are going to put $2K of repairs into it every damn year (roof, furnace, painting, appliance repairs) because houses are like that. Forget remodeling, because you’re humble. $2100/month. 5. Remember that $500.00/month you’re putting in your 401K? That’s kind of laughable in terms of retirement. If you were a single dude, you’d be putting some of that away for retirement or to cover the mortgage in case of unemployment or for a big capital expenditure like remodeling the house or marriage. 6. So far it’s looking pretty good. You’re not dining on caviar and Dom, but $1100/month of mad money is nothing to sneeze at. So life as a single dude with no responsibilities and $100K/year income is pretty awesome. 7. And then you get married and have a couple of kids. And this is where your $100K starts looking distinctly paltry. ``` Well, now you've got $1100/month, and food for a family of four is well, sonuvacrap, I was going to come up with other costs, but apparently [food for a family of four is about $1000/month](http://www.loweryourspending.com/average-grocery-bill-for-family-of-4.html), so we're already out of money. And we haven't even bought the kids jumpers and Thomas the Train books yet. Guess little Megan and Tiffany aren't going to Harvard after all. ``` So budget for $100K and guess what? It’s easy to live a prudent, modest life. But you’re not doing more than that. You’re not buying second vacation houses, and you are going on nice vacations, but only once every year or two. You have retirement money in the bank, but not as much as you’d like. When stuff breaks around the house or the car needs new brakes, you can pay for it, but it still hurts. And when the roofing guy says that the new roof is going to be $6000.00, your answer, more often than not, is “Maybe we can do it next year instead.” ---
**Author:** ![thisishowwepray](https://avatars.discourse-cdn.com/v4/letter/t/7feea3/32.png) [@thisishowwepray](https://boards.straightdope.com/u/thisishowwepray)\ **Post date:** [November 4, 2013, 11:55pm UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/24 "2013-11-04T23:55:34Z")
> [@Simplicio](#): > > I’m always amused by people saying things like “100,000 isn’t really enough if you live in Manhatten” (or some other place in the US with high cost-of-living). > > Obviously cost-of-living does effect how much your salary is really worth, and that factor should be considered in discussions of income. But the effect isn’t anywhere near that extreme, the median income in Manhatten is under 50k. To be approved for an apartment in Manhattan, you generally need to make 40 times the rent in yearly income. If an apartment is 2k a month (most studios are at least this, and a small fraction of 1 BRs WAY uptown where almost no one wants to live), you need to prove 80k/year. We (boyfriend, 45lb dog, and I) live in Manhattan making less than 80k. We have an impossibly lucky housing situation involving rent control. My boyfriend is on food stamps but we don’t receive any other government assistance. We buy things from thrift stores and struggle a bit paying for things we need but overall we’re happy and like living in the city and working in helping professions enough for it to be worth it. There are plenty of free concerts and I still get into most museums for free with my grad school ID. If we lost our place we would be in big trouble financially, though. We can’t afford 2k rent and we probably can’t get approved for it. 100k seems like a lot to me, but realistically if you’re used to the lifestyle it affords you in Topeka you’ll be shocked to see how different it is here. ---
**Author:** ![clairobscur](https://avatars.discourse-cdn.com/v4/letter/c/839c29/32.png) [@clairobscur](https://boards.straightdope.com/u/clairobscur)\ **Post date:** [November 5, 2013, 12:11am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/25 "2013-11-05T00:11:41Z")
I think that a lot of people just don’t realize how good they have it. I was personnally shocked when I realized I was in the top 20% income-wise. I would have guessed top 40%. Then I realized that my 4 brothers and even my retired mother were all in this top 20%. I never would have guessed it. And secondly, I think a lot of people don’t realize that the overwhelming majority of people really don’t make much. Really high income is concentrated in a very small part of the population, and people believe there are way more people making a lot of money than there really are. Top 20% isn’t much. Someone in the top 30% is only a nice raise away from the top 20%. Someone in the top 40% is only a modest raise away from the top 30%. The overall difference in quality of life between myself and a perfectly average income earner isn’t really striking. On the other hand, the chance I will reach the top 10% is essentially nil, and the top 5% just live in a different world than myself and almost everybody else. Even here in France where incomes are more equally distributed than in the USA, the wide majority of people have a modest income. Only a few make really good money, and people in my opinion vastly overestimate how common those high income are. ---
**Author:** ![Bone](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bone/32/407_2.png) [@Bone](https://boards.straightdope.com/u/Bone)\ **Post date:** [November 5, 2013, 12:16am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/26 "2013-11-05T00:16:23Z")
A lot of this is local. Compared to world wide per capita income, everyone in the US starts to look pretty well off. It doesn’t matter how much you make with respect to the population - it only matters if you can afford the lifestyle you want. ---
**Author:** ![clairobscur](https://avatars.discourse-cdn.com/v4/letter/c/839c29/32.png) [@clairobscur](https://boards.straightdope.com/u/clairobscur)\ **Post date:** [November 5, 2013, 12:18am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/27 "2013-11-05T00:18:54Z")
> [@Duckster](#): > > [http://www.youtube.com/watch?v=QPKKQnijnsM](http://www.youtube.com/watch?v=QPKKQnijnsM) > > The video may address wealth but it does illustrate just how far off people assume wealth and income distribution in America. I happen to have come across the result of this study last week. Something mentioned in the article I read, and not in the video, is that the ideal income distribution according to Americans is much more equalitarian than the real distribution of wealth in the most equalitarian European countries. The average American would want wealth to be more equally distributed than it is in the most “socialist” countries. ---
**Author:** ![Amateur\_Barbarian](https://avatars.discourse-cdn.com/v4/letter/a/59ef9b/32.png) [@Amateur\_Barbarian](https://boards.straightdope.com/u/Amateur_Barbarian)\ **Post date:** [November 5, 2013, 12:20am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/28 "2013-11-05T00:20:43Z")
> [@clairobscur](#): > > I happen to have come across the result of this study last week. Something mentioned in the article I read, and not in the video, is that the ideal income distribution according to Americans is much more equalitarian than the real distribution of wealth in the most equalitarian European countries. The American people would want wealth to be more equally distributed than it is in the most “socialist” countries. Americans are firmly convinced we are a classless society. This faux egalitarianism is what drives most of the idiocy in politics and social choices. To begin with, “middle class.” ---
**Author:** ![Stil](https://avatars.discourse-cdn.com/v4/letter/s/a183cd/32.png) [@Stil](https://boards.straightdope.com/u/Stil)\ **Post date:** [November 5, 2013, 12:27am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/29 "2013-11-05T00:27:26Z")
> [@Finagle](#): > > 1. And then you get married and have a couple of kids. And this is where your $100K starts looking distinctly paltry. Only if your spouse doesn’t work, which is pretty rare these days. If one makes $100k and the other makes $50k, suddenly you’re humming along quite nicely again. > [@](#): > > So budget for $100K and guess what? It’s easy to live a prudent, modest life. But you’re not doing more than that. You’re not buying second vacation houses, and you are going on nice vacations, but only once every year or two. You have retirement money in the bank, but not as much as you’d like. When stuff breaks around the house or the car needs new brakes, you can pay for it, but it still hurts. And when the roofing guy says that the new roof is going to be $6000.00, your answer, more often than not, is “Maybe we can do it next year instead.” That sounds like the life of somebody making $50k/year. Honestly, you’re describing a modest, middle class lifestyle, which is something someone on a school teacher or secretary’s salary can have. I dunno, maybe it comes down to where you live? Maybe in some areas half the people make $100,000k? ---
**Author:** ![Chronos](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chronos/32/134_2.png) [@Chronos](https://boards.straightdope.com/u/Chronos)\ **Post date:** [November 5, 2013, 12:47am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/30 "2013-11-05T00:47:46Z")
> [@](#): > > Quoth **Finagle** : > > I’m not sure if you’ve noticed, but life is full of little expenses that make, say, $100K not actually all that much. As a matter of fact, I haven’t notice. But you’d think that I would have, given that I’ve spent the last two years basically living off of my rainy day fund (thankfully, my “rainy day” is now coming to an end). And given that I built up that rainy day fund while making between $12k and $15k a year. But you know what? I’ve managed. I’ve managed by realizing that the vast majority of those expenses that most people think are indispensable, really aren’t. My total expenses are somewhere in the neighborhood of $750 a month, and all things considered, I really do live a pretty good life. ---
**Author:** ![Richard\_Parker](https://avatars.discourse-cdn.com/v4/letter/r/35a633/32.png) [@Richard\_Parker](https://boards.straightdope.com/u/Richard_Parker)\ **Post date:** [November 5, 2013, 12:52am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/31 "2013-11-05T00:52:26Z")
> [@Stil](#): > > Only if your spouse doesn’t work, which is pretty rare these days. If one makes $100k and the other makes $50k, suddenly you’re humming along quite nicely again. $50k is about equal to the economic benefit of having a stay-at-home parent with two kids (depending on the age of the kids). Daycare/afterschool care _alone_ for two young kids could eat up the after-tax pay of a $50k earner. Kids are obviously a choice like any other. But two-worker households with kids need the other parent to make more than $50k to break even in a lot of places. ---
**Author:** ![Finagle](https://avatars.discourse-cdn.com/v4/letter/f/b19c9b/32.png) [@Finagle](https://boards.straightdope.com/u/Finagle)\ **Post date:** [November 5, 2013, 12:58am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/32 "2013-11-05T00:58:54Z")
> [@Stil](#): > > Only if your spouse doesn’t work, which is pretty rare these days. If one makes $100k and the other makes $50k, suddenly you’re humming along quite nicely again. Well, now you’re just moving the goal posts and asking why $150K/year doesn’t sound like so much. Take my analysis and assume two people earning $50K/yr got hitched. They’re still not living the life of Riley. > [@Stil](#): > > That sounds like the life of somebody making $50k/year. Honestly, you’re describing a modest, middle class lifestyle, which is something someone on a school teacher or secretary’s salary can have. I dunno, maybe it comes down to where you live? Maybe in some areas half the people make $100,000k? Housing will obviously affect the analysis, but I made very modest assumptions about prices. I just described an income level where you don’t break into a cold sweat when the furnace fails and where you can put money away for a rainy day. But throw retirement savings and college funds and kids into the equation, and your original question is answered – that’s why earning (low) six figures is no big thang. ---
**Author:** ![Bone](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bone/32/407_2.png) [@Bone](https://boards.straightdope.com/u/Bone)\ **Post date:** [November 5, 2013, 12:59am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/33 "2013-11-05T00:59:13Z")
> [@Chronos](#): > > As a matter of fact, I haven’t notice. But you’d think that I would have, given that I’ve spent the last two years basically living off of my rainy day fund (thankfully, my “rainy day” is now coming to an end). And given that I built up that rainy day fund while making between $12k and $15k a year. But you know what? I’ve managed. I’ve managed by realizing that the vast majority of those expenses that most people think are indispensable, really aren’t. My total expenses are somewhere in the neighborhood of $750 a month, and all things considered, I really do live a pretty good life. I’m just curious, 12-15k/year is below minimum wage. Is that full time work and how do you live on 12-15K/year? I’m glad you were able to save and that your situation is improving, but I think this really does speak to the fact that for the most part, what really matters is if you can afford the lifestyle you want. If you can that’s great. If you can’t you’re not earning enough. ---
**Author:** ![zoid](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/zoid/32/336_2.png) [@zoid](https://boards.straightdope.com/u/zoid)\ **Post date:** [November 5, 2013, 1:04am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/34 "2013-11-05T01:04:02Z")
> [@Richard\_Parker](#): > > I’m not so sure. A lot of the people I know making six figures but feeling like it’s not enough are thinking about how to take care of their parents who lost their retirement funds in 2007; trying to afford to take their kids out of a public school that can no longer afford a music program (or paying for a music teacher); and trying to plan for retirement in world in which we all live to be 120 (and social security and Medicare become means-tested). > > That’s not what I think of as “consumption-centric” even though all of those things can be described as buying goods. This. Between my wife and I we’re in the lower 6 figs and we don’t feel rich at all. We have 3 kids in private school, we’re saving for college, putting away for retirement, trying to help out with the parents, every few years the wife wants us to go overseas to see her family, I have a sister I’m afraid we’ll end up supporting, both our cars are getting old and we need a third for the oldest kid, the little ones need braces, there’s always a birthday party or dance we have to buy a present or dress for, we like to throw the church a few bucks if we can, groceries get more expensive every month and we simply don’t eat out because of the cost… Before you know it - poof! ---
**Author:** ![Finagle](https://avatars.discourse-cdn.com/v4/letter/f/b19c9b/32.png) [@Finagle](https://boards.straightdope.com/u/Finagle)\ **Post date:** [November 5, 2013, 1:19am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/35 "2013-11-05T01:19:45Z")
> [@Chronos](#): > > As a matter of fact, I haven’t notice. But you’d think that I would have, given that I’ve spent the last two years basically living off of my rainy day fund (thankfully, my “rainy day” is now coming to an end). And given that I built up that rainy day fund while making between $12k and $15k a year. But you know what? I’ve managed. I’ve managed by realizing that the vast majority of those expenses that most people think are indispensable, really aren’t. My total expenses are somewhere in the neighborhood of $750 a month, and all things considered, I really do live a pretty good life. ``` I'm not sure what your point is. People can exist in the Kalahari existing on nothing but insects pulled from termite nests. Monks living in seminaries can exist with nothing but a mat to pray on and some rosary beads. I don't know what your story is, whether you're in grad school, or under-employed, or sick, but you've undoubtedly made compromises that most people don't want to make. I'm * guessing * that you're not raising a family on $9000/year. You likely don't have a car, and you probably share your living quarters with a few other people. I remember my grad school days, and living on approximately that much money (well, 25 years ago, when that was actually a reasonable sum of money.) And you know what? It was totally possible, until stressful things happened. Having to find a new place to live that only cost $300.00/month? That sucks. ``` That’s what a decent income buys you. Relative freedom from that kind of stress. Insulation from, for example, knowing that your rainy day fund is dwindling faster than your supply of rainy days. If you want to call that luxury, then OK, it’s luxury. ---
**Author:** ![suranyi](https://avatars.discourse-cdn.com/v4/letter/s/e36b37/32.png) [@suranyi](https://boards.straightdope.com/u/suranyi)\ **Post date:** [November 5, 2013, 1:21am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/36 "2013-11-05T01:21:09Z")
> [@Finagle](#): > > Well, now you’re just moving the goal posts and asking why $150K/year doesn’t sound like so much. Take my analysis and assume two people earning $50K/yr got hitched. They’re still not living the life of Riley. No, but assuming that each one of them was making ends meet on their own when they were earning $50k, they should have no trouble doing so as a couple with twice the household income. Sure, some expenses go up but total cost of living doesn’t double. Of course, when children come into the picture, that’s an entirely new calculation. ---
**Author:** ![clairobscur](https://avatars.discourse-cdn.com/v4/letter/c/839c29/32.png) [@clairobscur](https://boards.straightdope.com/u/clairobscur)\ **Post date:** [November 5, 2013, 1:53am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/37 "2013-11-05T01:53:00Z")
> [@suranyi](#): > > No, but assuming that each one of them was making ends meet on their own when they were earning $50k, they should have no trouble doing so as a couple with twice the household income. Sure, some expenses go up but total cost of living doesn’t double. > > Of course, when children come into the picture, that’s an entirely new calculation. The overwhelming majority of people with children manage to live a comfortable life on much less than $ 100 000/ year. Stating that such an income only brings a modicum of comfort and security as **Finagle** does is preposterous and IMO is a blatant example of people having no sense of realities. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [November 5, 2013, 2:01am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/38 "2013-11-05T02:01:06Z")
> [@Great\_Antibob](#): > > It’s a fairly new phenomenon my friend calls the “working rich” vs wealth. You can afford a fair number of luxuries as long as you keep working. But as soon as something happens - you lose your job, you get hospitalized, etc - BAM, you lose a lot of your material wealth. There’s a fair bit less certainty in lifestyle unless you become independently wealthy. Income inequality can be a real pain. Which isn’t any different than the middle class - when they lose their jobs, they get BAM, too. The biggest difference there is that if the working rich choose to live like the middle class, they can set aside enough money to maintain their standard of living through several years of famine. That, however, is tough to do when you are the only Junior Partner at Dewey Cheatham and Howe driving a four year old Jetta. But when the working rich think of the wealthy - they think not of annual salary income, but of wealth - money that makes enough money to be able to live comfortably on. “Fuck you” money. (Then, when a lot of them get there, and sometimes they do, they tend to keep working because they are frequently responsibility junkies who actually wouldn’t know what to do if they didn’t work). ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [November 5, 2013, 2:04am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/39 "2013-11-05T02:04:07Z")
One big factor is your age. We live in a nice neighborhood, not the best in town but far from the worst, where houses range from $550 K - $900K. Now if you’ve been in the house forever you bought it for a lot less, your mortgage is relatively low, and your taxes are low thanks to Prop 13. If you have just bought it your mortgage and taxes are high. Two people living next door can have very different expenses, forget about fancy cars and the like. $250K? You couldn’t buy a shack for that in my town. I’m not talking about McMansions by the way, I’m talking about 3 - 5 bedroom homes which are 50 years old and part of a development. There are many places where we’d be damn rich, but of course I wouldn’t make what I make there. The people really getting screwed are those in low paying jobs in the midst of an area with lots of high paying jobs. ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [November 5, 2013, 2:16am UTC](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096/40 "2013-11-05T02:16:58Z")
> [@clairobscur](#): > > I happen to have come across the result of this study last week. Something mentioned in the article I read, and not in the video, is that the ideal income distribution according to Americans is much more equalitarian than the real distribution of wealth in the most equalitarian European countries. The average American would want wealth to be more equally distributed than it is in the most “socialist” countries. I’d like the wealth to be more equally distributed. I just don’t want the government to distribute it. [Previous page](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096.md?page=1) [Next page](https://boards.straightdope.com/t/does-society-have-a-skewed-view-on-what-constitutes-a-good-income/673096.md?page=3)