Ask the grumpies: Questions about living in paradise

Mid A asks:

[W]ould [you] want to live in paradise permanently, now that you have experienced it as a family? What income would you ideally generate to live a comfortable life (fancy cheese, travel to relatives, satisficing for keyboards, etc.)? Is the school environment more competitive and if so, what is your take on it?

Would we want to live here permanently?  Well… if I could move my job here, sure.  But I can’t.  Or if we were idle rich and not Mr. Money Moustache definitions of rich– like actually rich and could afford to buy a reasonably nice (for paradise) house someplace reasonably nice with cash and pay taxes and so on.  We knew we liked it here before living here as a family, though there are other paradises that we like more for some things and less for others.  So, given that I can’t move my entire department here, we’re going to stay in our small town.  If DH loses his telecommuting job, we will reconsider.  But up until that point, we’re staying put.  I honestly don’t know what I would do out here.  There are some SLACs, but they’re small, so there’s no guarantee they’d even have openings in my field.  Prestigious schools might have soft money openings.  Non-prestigious schools sound like high teaching loads and low salaries.  There’s not a ton of government or industry in my field of interest around here.  So who knows.

5 years ago when rents weren’t so high (3k/mo instead of 5k/mo — we’re currently paying 4k/mo because we got a deal on this place), I sat down and made that calculation including the increased tax burden and came up with 120k/year as a renter. That includes high quality full-time daycare for one kid for a year but only one car. And it is possible to get deals on housing if you keep your eye out for lazy landlords, so there are still places if you move quickly and are attractive to lazy landlords where you can get even 2K/mo for a 1200 sq ft 2-bedroom, but you have to be fast and seem like you’re going to stay for a long time.  We also have friends who bought at a good point and are paying less than 3K/mo on their mortgage.  In addition to rent increases, inflation has also happened since then.  So the answer would be something more than 120K/year if we’re renting and aren’t going to make a whole lot of sacrifices.  I don’t know what the answer would be exactly, though I will probably do that calculation at some point after we’re done, maybe without dealing with the additional tax burden though because that’s a pain to figure out if you don’t have to.

The school environment we’re in isn’t very competitive.  However, there are a lot of communities around here that have different levels of competition and different types of competition.  We were limited in where we ended up by DC1 wanting to stay grade-skipped (which knocked out one reputationally very competitive district and several not at all competitive districts), our inability to afford an extremely expensive place, and most landlords at the top of our price range not wanting us as tenants (cats, kids, the one year thing).  On top of that, within our district, many of the competitive parents send their kids to a lottery school that you can only get into by lotterying in the spring before kindergarten.  So my answer to that:  if you’re worried about too much competition, there’s a lot of heterogeneity across districts and within districts.  The same is true of preschools.  Here and in other paradises.  (And if you *want* the competition you may have difficulty being allowed to compete since the most competitive places tend to require waitlists or lotteries.)

Have any of you done the “What income would I need to live comfortably in paradise” calculation (for your paradise)?  Are you living in your paradise, why or why not? 

46 Responses to “Ask the grumpies: Questions about living in paradise”

  1. Catwoman73 Says:

    I am most definitely NOT living in paradise, primarily because I don’t particularly enjoy my work, I’m stressed out and tired all the time, and we haven’t achieved as much financial freedom as we would like. My idea of paradise is much less about a particular place (though I sure am missing warm weather right now!), as it is about a lifestyle. I want to work less, but not have to worry about money. I want to spend my time doing things I love, rather than things I need to do just to pay the bills. Based on my calculations, I should be able to do this in retirement, but that’s still 12-14 years away. Sigh… hoping I can live in partial paradise (by going part time at work) in about a decade. If all goes according to plan, we can make it happen. Fingers crossed!

  2. College Town Says:

    Well, we did the reverse by leaving an expensive city in the northeast for a much less (2/3 less price by square foot on housing) expensive small city in the southeast. I did the numbers on the front end constantly, which made it easy to jump when the opportunity came to move. Re: schools. They were great, but when the NYTimes ran a piece about the competition around vying for spots at Williams with a place like Davidson being considered a backup, we definitely wondered what that would be like for our children. We had lived in 1800 square feet and knew we’d prefer more space with less commute, AND we knew that paying more was not a wise decision even though peers were doing it. We bought and sold at the right time, and were able to plough that equity into our new home. We might call our old city paradise if we hadn’t lived there and seen the financial downside and how your friends disperse into multiple suburbs so it’s actually challenging to maintain a social life. We can still love our old town but feel good about the decision. I feel lucky that we lived there when we were young and got the kind of professional experience that launched our careers.

    • nicoleandmaggie Says:

      We made that jump from grad school to our first jobs. We may talk about it in the next mortgage post.

      • College Town Says:

        Would love to read that. If I had to advise 22-year-olds it would be: go to the best grad school you can, and, if you are curious about city life, do it NOW. You can build incredible career capital at the right place before you have children (if that is what you want) with only yourself (and possibly a partner) to worry about. Read another way: position yourself to have options even if you can’t see what they may be.

      • nicoleandmaggie Says:

        It’s actually a future mortgage post– not next month.

  3. jjiraffe Says:

    Interesting post! We’re in a paradise of sorts (high incomes and lots of jobs available for what we do) coupled with, of course, crazy high cost of living. There’s only one other place that would provide the same opportunities (NYC) and I have zero desire to live there right now.

    To live in this paradise, we hustle. We rent our house on Airbnb when we visit family (pays for cost of travel), we forgo lots of things others don’t that we know (eating out, travel for fun, etc). We bought a house that was a hot mess because we could afford it. We saved for 5 years to do a remodel. We did a remodel last year and so we’re on a tight budget as a result for two years to pay off but then we’re good. I’m not a SAHM like most of my friends. So yeah, choices are made. And I’m ok with all that.

    • nicoleandmaggie Says:

      We have friends who bought a 3br and Airbnb the 3rd bedroom (it’s an addition, so it’s sort of separated from the rest of the house). Their kids share a room so they can do that. Of course, most kids seem to share rooms in paradise!

  4. Mrs PoP Says:

    We feel like we’re pretty much living in one of our own paradises right now (though we’re more than willing to test out other paradises in the future, too!).

    As far as how much it costs, that’s pretty subjective. Our annual spending for two (excluding major home improvements) is right around $50K to live within jogging distance of the beach and biking distance to pretty much everything else we want. But a good chunk of that depends on circumstances that couldn’t (or wouldn’t) be replicated by most today. Specifically, a house like ours would cost about double (likely more…) what we paid for it in 2009, which would add another ~$10-$12K in mortgage payments to the annual budget (and renting would likely be about the same amount). Our killer deal on solar panels isn’t offered anymore, so energy costs would be more than $1K higher. We also in-source pretty much everything, which is very uncommon around here. Most of our neighbors wouldn’t dream of doing their own yard work, but that’s another easy ~$2K/yr. They also might not want to share 1 car between two people, so that’d add even more…

    So I guess I’d pin the current annual cost to live in a modest house in our neighborhood somewhere around $65K or so. More if you have kids since kids cost more than a cat. =P

  5. Cloud Says:

    I occasionally toy with the idea of doing something of the reverse: moving from my own expensive corner of paradise to a less expensive place. There are a lot of less expensive places I’d like to live, but my husband is really attached to living near the ocean. Even with that limitation, we could probably find some place a heck of a lot cheaper than San Diego! But… we really like it here. So we stay. Leaving for some place cheaper would also be me closing the door on ever going back to full time salaried work in biotech, and I’m not at all ready to close that door.

    I do sometimes try to do the calculation of what it would take to be able to spend a month or two a year in New Zealand (another paradise I really love!) once the kids are in college… but that seems really out of reach right now, so I let it go.

  6. Katherine Says:

    I live in an uncool big city in the South, but a lot of people here really, really do think it’s paradise – my husband and I don’t. We’re expecting to move this summer (hopefully) for my job, to an as-yet-undetermined place.

    I lived in a big city in the northeast for undergrad, and I loved it. I would love to live there permanently, IF I was rich enough to own an apartment and maybe also a vacation home outside the city. I will never live with roommates again! My husband hates my college town and every other big city with a passion.

    Our current idea of paradise is a house with a barn and one or two acres just outside a small city. Midwest, Northeast, Mountain West, or Pacific Northwest would be fine with me, husband would prefer the South to be closer to his family.

    If I were truly rich I would buy a vacation home in mine and my dad’s country of origin – I think it is one of the most beautiful places on earth and I miss the part of my family who live there. But the kind of academic job I want doesn’t exist there, and my husband doesn’t speak the language, so living there full time would probably never be possible.

  7. middle_class Says:

    I’m living in paradise if you consider the weather and opportunities, but it’s a hell because of traffic and high cost of living. I think we would need yearly income of at least $120,000 in order to buy a house here but I’m willing to live in a more modest neighborhood and don’t feel like I need a large house.

  8. chacha1 Says:

    My comment turned into a rant so I’m probably going to take most of it over to my blog, here are the *responsive* parts of it. LOL

    We are living in other peoples’ paradise (weather, opportunities, culture = L.A.) but as above, it’s hell because of traffic (and pollution) and high cost of living. Our AGI has averaged 95K for the past ten years and we could afford to buy a residence (note I do not say “house” because it would probably be a condo, which, ugh) in the city only by doing absolutely nothing else.

    I have noted here previously that our 2 BR 2BA apartment, at $2600/mo, is an absolute steal in the current rental market; and to buy the same square footage – IF we could find it in a condition that did not require a 100K renovation – would be on the order of $6500/mo. Not to mention the down payment. So we would need an AGI of at least 175K before we could buy AND live the way we currently do, which is not at all extravagant.

    • nicoleandmaggie Says:

      I just wouldn’t feel comfortable buying in our Paradise without a secure income. Making huge mortgage payments in the event of a job loss is a scary thought! Though if we had enough saved, that would be less scary. Right now though the proceeds of our house wouldn’t even be a 20% downpayment anyplace we wanted to live.

  9. Calee Says:

    We live in paradise. It’s expensive and beautiful and Whole Foods is in walking distance. A family of four can make 96k per year and still qualify for affordable housing, so it’s rough for anybody, particularly for people trying to move here. We could live somewhere less expensive, but our families are here and I really, really like the weather.

  10. noemi Says:

    Would you be willing to do a bit of a budget break down to show how you came up with $120K a year as a minimum for being able to live in “paradise?” If you say that rent would be $3K a month for a decent deal, wouldn’t that be 40ish percent of your take home? Maybe I’m doing the calculations wrong… I think I live somewhere with a similar COL and I’d love to see what kind of budget you’d stick to in order to live in Paradise on $120K a year, which seems kind of low to me (at least if you wanted to save for retirement, college and just generally).

    • nicoleandmaggie Says:

      We don’t budget. The calculations were based on actual expenditures plus adding in more for the full tax burden. I don’t want to go into more detail than that for privacy reasons, and it’s not going to matter to you anyway. And yes, we have spent more than 40% of our take-home pay on rent before (for about half our married life, actually) and still been able to save.

      I don’t know what to say to you other than we have been helped by paying off debt immediately so as not to have that additional monthly loan burden. Also we cook. If you think we’re lying/miscalculating, well, then you can think that. And, as we said, that number is ~5 years old when rents were lower, though daycare costs were higher.

      You might enjoy Natural Scientist’s recent post. A lot of what they were able to accomplish is also because they didn’t have debt and did have a safety cushion.

      • noemi Says:

        I don’t think you’re lying or miscalculating, I just don’t understand how you came to that number, and I was hoping to get a better idea of it so I could recognize areas of overspending in my own life. I should have phrased my confusion for what it was, a feeling of certainty that I could not live in a high COL area for that much, and a real desire to know how one might manage it. If you don’t budget, and or don’t want to share that is totally fine–I apologize if I was out of place in asking. I really do just want to get a better idea of how you live so comfortably, even in places with a higher COL, so that I might make similarly responsible choices, but I totally understand if you don’t want to share that. It’s absolutely your prerogative.

      • nicoleandmaggie Says:

        There are plenty of bloggers who put that information out there (Frugalwoods, for example, though Boston is currently less expensive than SF).

        The best way to see where you’re overspending is to write down everything that you’re spending. What we do and what we consider reasonable spending is irrelevant to your situation.

        There are also plenty of people in the SF bay area living under 120K/year or whatever that inflates to because they have to. I know you’re certain that you can’t do it, and I don’t know what to tell you about that other than you’re going to have to make some sacrifices at some point because as you have pointed out many times, you can’t spend what you want to given the choices that you’ve made.

    • Leigh Says:

      My boyfriend and I spent about $90k combined in 2015. We live in a high cost of living city in the US and make significantly more than that combined – that is not a very large portion of our combined incomes. That breaks down to approximately:
      * $24k on housing for a two bedroom, two bathroom condo in the city, including property taxes, mortgage payments, HOA dues, utilities, maintenance, etc.
      * $10k travel: Christmas flights for two, Thanksgiving flights for one, a trip for a friend’s wedding for two, and a month long trip to NZ for two that was partially paid for in 2014
      * $6k on clothing for me and another $6k in other shopping (replacing my 4 year old laptop and 6 yaer old desktop, a new home office desk and chair, etc.)
      * $5k on joint groceries
      * $5k on restaurants jointly and mine (not sure about his breakdown)
      * $4k on gifts jointly
      * $3k on health, fitness, and personal care jointly
      * $2k on transportation (we have one paid off car and hardly drive)
      I’m clearly missing some things (namely his discretionary spending) since that doesn’t all add up to $90k. But with things like the condo, we’ve chosen to live very much below our means. We have no student loans anymore, no car payments, no credit card debt, and a small mortgage. Friends bought a similarly priced three bedroom house not quite as in the city and have similar housing costs for a family of four. There’s also a lot of discretionary spending in here.

      If we made a combined $120k, our spending would be a bit of a different story. Neither of us has any interest in spending this close to our income – we’re far too saving inclined for that. If our after-tax income was $120k like nicoleandmaggie mention, that would leave room for about $30k in savings, which is enough for two Roth IRAs and one pre-tax 401(k), which doesn’t seem too bad. I would probably reduce some of the discretionary spending in order to fund a second pre-tax 401(k) and then have a bit more buffer for after-tax savings as well.

      • nicoleandmaggie Says:

        120K wasn’t actually after-tax, it was pre-tax (though not counting employer match which at the time was 3% and we did contribute to IRA Roths and a 529 that year but did not max out our other retirement saving).

        It is a lot easier to spend close to your income (or in our case this year, beyond our income) when you have a huge savings buffer. We’d be cutting back a lot if we hadn’t saved specifically for this year.

      • Leah Says:

        Don’t forget needing to save for actual savings. We shovel a good bit into savings each month. I suppose we could fully fund one of our 403(b) accounts if we didn’t do that, but we like the ability to have the liquid savings.

      • Leigh Says:

        Yup and that’s why I say that we would reduce spending if we earned that much less. Savings savings is important too.

  11. Leah Says:

    I don’t live in paradise, but I really like where I live (for the most part). I can’t even imagine paying the high housing costs. I’ve lived in various paradises and lived off of very little, but I always had work-provided housing (and was young, single, no kids, etc). That skews the data somewhat.

    I grew up in Seattle and still have friends there. I can’t believe what they spend!

    To actually live in Seattle, or near the ocean (my idea of Paradise), I think I’d need to make around $100k a year, and I don’t see that happening. But I could foresee a day in which we do get to move to a little paradise once we are retired and not needing to save money for college, retirement, etc.

    In terms of a paradise, I would be very happy living someplace where I could walk or bike everywhere I needed to go, had some variety in the seasons, and had ready access to good food and a library. So maybe part of it, for me, is what my expectation of paradise is. If I were stressed out by money, I don’t think a certain place would be paradise for me.

    • nicoleandmaggie Says:

      I’m not that crazy about the ocean myself (I mean, it’s ok and all) but I do love coastal climates. Walkability is SO important. Being able to walk to the library is the best part of where we’re living right now. I don’t need variety in teh seasons so long as it is perfect year round. :)

  12. Debbie M Says:

    Oh, man, the other paradises are too expensive. I might like Oklahoma City (though even that’s too cold for my test, not to mention the tornados and now earthquakes) or New Braunfels, Texas (a smallish town on the highway between Austin and San Antonio). And we still haven’t visited the triangle in North Carolina.

    But the other paradises all cost way more–all of urban California, London, all of Switzerland and The Netherlands. It turned out I don’t even really like Seattle, WA or Burlington, VT. If the next batch of politicians trashes the country too much more, I’m not sure where we could go.

    I need a place I can afford on 27K/year gross (with a roommate). Even my current paradise is affordable only because I’ve paid off my house, but if the current trend towards gentrification continues, property taxes could get out of control. But then, we might be able to retaliate by building a garage apartment we could rent out.

    • nicoleandmaggie Says:

      Having a paid-off house definitely helps!

    • Leah Says:

      I like Portland, Oregon, better than Seattle. I grew up in Seattle and love it, but it’s always a hot mess of crazy traffic, crazy politics, and insane prices. I do love the proximity to water and hiking there. Oregon doesn’t quite have as much water, but it still has good hiking. The traffic is almost as crazy, but the mass transit is much better.

      I live in Minnesota, somewhat near the Twin Cities, and I really love it here. But I’m not bothered by cold weather. I live outside of the urban ring, so traffic isn’t typically an issue for us — we try to work around the bad traffic times when we want to head into the cities. I don’t know if I’d define it as paradise, but I do really enjoy where we live.

  13. SP Says:

    I have mixed feelings about living in paradise. A lot of the things I love about my life would be attainable in less expensive places. I don’t love the fact that one of us needs a high paying job to make it all work, but I also think that T’s job is relatively secure. Mine is less stable/secure, but I have options if it were not to work out. Options I don’t like as much, but options.

    I’ve talked before about how buying a house here was a risk, but so was staying in the rental market, and we were committed to staying here for quite some time…. so pick your poison. I don’t find that I worry about money though. I like mortgage prepayments because it is buying down some of that risk, but it isn’t something I’m particularly worried about.

  14. J Liedl Says:

    I live in a frigid hellhole. They pay me extremely well – on a par with the R1 salaries in our country’s biggest cities (jobs which I could not get even if they were hiring, which they aren’t at present). I call these my golden handcuffs. They lock me to a location which makes my partner froth at the mouth for lack of work opportunities and hellish weather. We enjoy an enviable standard of living due to relatively low real estate prices (again, in comparison to the Big Smoke where we would love to live) and to a host of other financial incentives – low auto insurance, low commuting costs, etc.

    We look far ahead to retirement prospects and realize that returning to our favourite city won’t be possible given my partner’s being hampered on earning for all of these years and the worries about Autistic Youngest’s financial future. We figure that we’ll probably retire to one of two border communities which enjoy somewhat moderate weather and don’t cost the earth. If we have to support Autistic Youngest for life and beyond, we’ll be able to do that by making paradise just a place we visit!

  15. moom Says:

    We are living in Paradise in Canberra, Australia. Only downside is it is a long way from everywhere, but that improved last week when Singapore Airlines announced the first international flights direct from Canberra to Singapore and Wellington NZ. Australians think it is cold here but the climate is really like southern France or Northern Italy, or maybe parts of Oregon/New Mexico mixed up. There are lots of local wineries… Some people think being 100 miles from the beach is a problem, but I like mountains and you can get to the (beautiful) coast in 2 hours.

    The city is big enough to have most things I’d want (metro area of 500k maybe) but yes lacks a bit in the vibrancy department. Upside is little traffic and no pollution. House prices are high, but compared to southern England say you get twice the amount of house for the price. We have a household income of $US180k and our house cost just over $US500k. It’s 2000 square feet with a nice view etc. but on a block of only 0.1 acre. Income taxes are similar to New York or California, property taxes are low.

    For those working in policy related or academic spheres it is an interesting place to be, being the federal capital with one of Australia’s top research universities plus 3 other universities/colleges and the headquarters of the government lab system, CSIRO. Opportunities are limited in things like high tech of course unless it is consulting to the government.

  16. Leigh Says:

    I’ve thought about this post all day. I never really considered a particular place Paradise. Although I definitely didn’t want to stay in College Town – I had a N year plan to get out of there when I got there. I don’t really have a plan to get out of Current City and it meets many of my requirements for a good place to live. I don’t think it’s Paradise though – there are a few things missing. We certainly need a much higher level of income here than in College Town, but we also both moved here for these high income jobs. If we go to have children at some point in the future, that will bring us to discussions of how much we want to spend on housing going forward vs where we would prefer to live. But that’s a very tabled discussion.

  17. anandar Says:

    I suppose we live in Paradise (Bay Area), in the sense that we don’t want to live anywhere else, and we’re willing to put up with a very high cost of living. We feel wealthy (it certainly helps that we bought our modest house at a market low), but it would be easy to feel poor if we wanted to compare ourselves to grad school colleagues with more lucrative jobs, or if we wanted to live in a quote-unquote “nicer” neighborhood or school district.

    I think a lot has to do with one’s frame of reference. So many people are struggling so hard where we live, due to high housing costs, including many of the families at our daughters’ school. It may be Paradise, but it certainly isn’t Utopia!

  18. gasstationwithoutpumps Says:

    I’ve been living in Santa Cruz for almost 30 years, and it is hard to imagine a place I’d rather live. Our worst weather is like an English summer; I can bike everywhere I need to go; there is a lot of cultural activity (college town and tourist town); the Bay Area is accessible by public transit; local organic produce is the best in the world; …

    Downsides: housing is very expensive (but I’ve paid off my mortgage, so that affects me only indirectly); there are a lot of homeless people downtown; too many drunk drivers (also too many cars and too many drunks, even when not combined).

    My wife would prefer to live in San Francisco, but the tradeoffs are not so good (closer access to high-brow culture, but higher housing prices, more homeless people, more crime, poorer bicycling conditions, more people and less community).

  19. MutantSupermodel Says:

    I live in what other people call paradise. It has drawbacks like everything I think. I stay here because of my family being so deeply rooted and awesome. I’m pretty sure that I won’t spend my whole life here but I haven’t really given thought to how much my future paradise would be. Since I live in a paradise already it seems most other paradises are comparable in cost. Besides, I have a feeling that my idea of a paradise would be cheaper than my current location because I’m not sure it’d qualify as paradise for many other people….

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