How Much Do You Really Spend on Your House?
I read this morning in Real Simple (You have a problem with that? Say it to my face.) that well-known financial advisers recommend the following ratios for spending and saving take-home pay: either 70% to "needs" (like rent or mortgage), 20% to "wants" (fun money), and 10% to savings; or 50% to
Posted — UpdatedI read this morning in Real Simple (You have a problem with that? Say it to my face.) that well-known financial advisers recommend the following ratios for spending and saving take-home pay: either 70% to "needs" (like rent or mortgage), 20% to "wants" (fun money), and 10% to savings; or 50% to "needs", 30% to wants, and 20% to savings. Sounds reasonable, right?
So let's make a sum: For a house that costs $300,000, you'll be paying around $6,000 a year to maintain it. Plus add on property taxes as, say, $6500 per year. That's already $12,500 per year, before we even get to the mortgage. Say you're spending about $2000 per month on a mortgage. That's $24,000 per year. We reach a grand total of $36,500 per year spent on the house, or $3,041.67 per month. In order for $3,041.67 to be 28% of someone's monthly income, his take home pay would have to be $10, 863.12 per month, or $130,357.286 per year.