Ask the grumpies: An invitation to rant about @#$@# who think 300K/year (or more!) is middle class.

Anoninmass requests:

I just read on another blawg a comment that declared $400,000 a year was middle class. Discuss…

Chacha1 asks:

what does “middle class” even mean, anyway?

Clearly we think that idea is ridiculous.  Even in Manhattan.  There’s not any set definition of middle class, even in economics.  I think in practice we mostly use Obama’s “Under 250K” definition, even though that’s from a couple presidential campaigns ago, or we use something like 25th percentile to 75th percentile of household or family income.  If you’re curious, that’s something like 29K to 106K for household income .  There might be adjustments for cost of living, but cost of living isn’t going to get to 400K.  You can also look at median incomes by state, but with the caution that you shouldn’t cut the geographic area too small– it is likely that 400K complainer is living in or wants to live in a big house in Atherton or one of the nicer LA suburbs or Battery Park in Manhattan.  There are plenty of places in the same commuting zones with decent schools that have wider ranges of income and housing prices.  (And even there, 400K is well above median household income!)

Anyway, we don’t need to go on too much at length as this topic went around the blogosphere this past Spring.  Here are some links worth reading.

Is frugality inspiration porn?

Fire Blogger Manifesto– why it’s important to be transparent about income.

Who is the audience for this blog?  (This one also has especially great comments.)

Some forum commentary on the FrugalWoods higher than expected income.

Delagar discusses life in the lower middle class when you started out with medical debt.

Here’s another forum thread on why the post from Financial Sam about needing 300K/year to be middle class in SF is so much BS.  (I’m leery about sending more traffic his way though because that rewards him for spewing crud.)  That post did finally get me to stop clicking on his click-bait headlines when they pop up in blogrolls though.  He’s another blogger with an extremely limited lens.  His post probably emphasizes the point most of all (by the way he completely misses it) that middle-class people have to make trade-offs within the set of middle-class lifestyles.  If you can have all of the variants of middle-class lifestyle (geographic location, house, schools, cars, vacations, no college debt, insurance, stuff, no real money worries), then you’re not actually middle-class.

Middle class:  What everyone claims to be, but nobody knows what it actually is.

Discuss

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Trying out recipes that sound kind of gross

The first recipe I remember as an adult that fit this category was egg and onion soup from Help! My apartment has a kitchen!  The name sounds awful.  But this turns out to be a quick and amazingly delicious soup that became part of our regular rotation until our children started mobilizing against diced tomatoes.  It’s a comfort food that blends different textures and feels healthy without tasting too vegetal.

Most recently we bit the bullet and made eggs sardou Cooking Light style (so hard boiled eggs instead of poached and a faux hollandaise).  Basically:  frozen artichoke hearts, spinach, green onions, with sliced hard boiled eggs on top, then covered in a roux that has a touch of thyme, pepper, and Parmesan.  Finished with Parmesan and paprika sprinkled on top.  It came out and looked terribly healthy.  But… it actually tasted good.  Hard boiled eggs, cooked spinach and all.  And it didn’t make me feel at all gross like eggs Benedict recipes often do.

This has me wondering if I should try the next appetizer in the Gourmet Magazine cookbook— it is a chicken liver pate (we’re in the crostini section).  I am not a fan of liver in any form (disclaimer:  have not tried foie gras) and hate the smell of it being cooked.  (One of my grandmothers LOVED calf liver and onions, and although I loved my grandma, I did not love that dish.)  But maybe it’s worth a try?  [Update:  it was ok– the first taste was kind of yummy, then it was ok, but then I didn’t like the aftertaste.  So not as horrifying as I’d predicted, but also not something I feel the need to make again.]

Have you tried out any foods lately that sounded gross but turned out to be ok, even good?  Have your tastes changed as you’ve aged?

Vanguard Admiral Shares are pretty cool

I wanted to add a little more international exposure to our portfolios (if I’m reading things correctly, the IRA Roth is a great place to put international exposure because there might be higher taxes with international stock gains?  I’m not 100% clear on this– I also read something that said the opposite), so when we recently did backdoor Roths, I put the money into an international index and an international ETF.   The index (VGTSX) has an expense ratio of .18% and the ETF (VXUS) has an expense ratio of .11%.

If I have 10K invested, then I can convert my VGTSX investor shares into  VTIAX admiral shares, which will decrease the expense ratio from .18% to .11% (same as the ETF).   For most of the index funds that have admiral shares at Vanguard, the switch from more expensive investor shares to cheaper admiral shares occurs when the account has more than $10,000 invested in that specific index.  Basically Vanguard gives you a discount on the index if you have a lot invested in them.

My 2017 IRA investment was only $5,500, but it is a new year so I contributed another $5,500, which, if the stock market doesn’t crash, adds up to more than 10K, meaning I should be able to switch to admiral shares to get the lower cost fund.  So that’s what I’ve done.

I’m wasn’t entirely sure where to invest DH’s IRA this year.  He had less invested overall and thus needs less international exposure and already had the lower cost ETF.  (I know that since we’re living in a community property state that I should be looking at our accounts as a complete whole, but since I don’t know what the future will hold, I want to make sure that he’s also protected.)  I will have to see what holdings he currently has one of these days.  I suppose we’re due for one of those financial fitness days sometime so I can go through and readjust our assets etc., but maybe I’ll wait another year.  We’ve got a lot of stuff going on and can afford to put it off, especially since I’m not really sure what asset mix we should be aiming for in the first place.  In the end  I gave him more VXUS.

Do you pay attention to expense ratios?  How do they change your investment patterns?  Any preferences between Index vs ETF?

Here comes the link love

A compendium of things we wanted to share with you this week.

Publishing nonsense:
Tried to warn youSneaky buttons.

#2 wants you to know that she’s never heard of this garbage man, so maybe his scholarship isn’t very high quality.  The creator of Ren & Stimpy is a (male, of course)  garbage person.

The many tweets of this week:

Not incisive, but worth remembering:

Garbage people, part 9million and three:

 

Tweet-thread that’s somehow not a blog post:

Dat Elmo life:

I’m not sure what this means:

Other links:

Adjustable sweater!  We’re from the Midwest.

Not pictured:  delicious photo of food that #2 sent me this week.

The Berry Bros.:

 

Depressing and important:  open-plan offices STILL suck.

Grumpeteers, what’s good?

Ask the grumpies: anything you wish you’d done before marriage and/or kids?

yet another pf blog asks:

Is there anything you wish you had done before you were married? How about before you had kids?

#1:  One of us doesn’t have kids so the point is moot over here. (#2, got anything?) What would I have done differently before I got married? I can’t think of anything. Being with my partner has made the rest of my life easier and more fun.

#2:  Hm, I got married young.  I can’t really imagine single life before marriage.  I mean, I did date some losers in college, mainly because I didn’t know how to say no and a small amount because of the novelty of guys thinking I was amazing.  Those are not good reasons, so it was a huge relief in grad school to be able to stick my hand up and point to the ring when loser guys hit on me.  So definitely not dating other guys (or other people, more generally– I used to think I was DH-sexual, but now I’m fairly sure I’m… what was that word I discovered on captain awkward?  I can’t remember but it’s the one where you have to really get invested in a person before you find them physically attractive, so it seems like asexuality, but it really isn’t.  That’s what I am.  Except younger Pierce Brosnan– he’s still hot, but who knows, maybe I just liked Remmington Steele.).  Everything else I can do while married, I think.

Before kids we didn’t have money.  Now we have money.  Perhaps I wish we had money before kids?  Though getting money at the same time as kids was pretty useful and caused our standard of living to go up instead of down, so maybe not that.  Yeah, I got nuthin’.  I’m not big into regret… maybe it’s time spent in LA with the constant message that everything happens for a reason.  Or maybe it’s just the sunk cost moving forward training in economics.  I guess I wish I’d published more!  But I wish I’d published more after kids too… it’s sort of a never-ending thing with an academic career.

Grumpy nation, is there any day seizing you wish you’d done in the past?

For our peeps in grading jail: How do you motivate/reward yourself while grading?

I’m in the middle of grading final projects and exams and completely tuckered out.  And yet, I have to keep chugging.

I tend to work best when I set myself a reward like, “after grading each problem for all exams, I can watch a 4 min youtube video or read a part of a book chapter”.   If the procrasinatory mood is right, I might be able to “reward” myself with less pleasant things like switching out the laundry or loading the dishwasher.

How do you keep yourself going when the grading gets rough?  Non-academics, how do you motivate yourself to do long repetitive boring tasks that are frequently disappointing?

Thoughts on ways to become more obnoxious with money

I was reading through the Gourmet magazine cookbook I got for my birthday the other day (used because Gourmet is sadly defunct).  In the entertaining section it has a couple of pages recommending that when you throw a party, you just hire caterers and be sure to rent 3x the wine glasses you think you’ll need.  I guess not unexpected advice from a book that starts with 33 pages of cocktails*, though perhaps a bit unexpected from a cookbook that one has bought, presumably, to cook the recipes therein.  I’ve been to catered parties for work, but I’d never thought of actually throwing one myself.  In fact, other than Thanksgiving and the occasional playdate (either DC1 or DH will have a friend or two over to play boardgames, and/or in DC1’s case, video games), we really don’t throw parties at all.  That year in paradise we would have people over and we’d get take-out (usually dips and salads from the local Israeli place), which is sort of like catering, but much less expensive.  Here, presumably, we’d go into the city the weekend before throwing a party and get lots of frozen canapes from WF and TJ’s to reheat.

The military couple who owned our house before us set up the kitchen for caterers with lots of warming trays and heat lamps and an entire wall of our huge pantry filled with alcohol (the side where we keep tupperware, plastic cutlery, the mini fire extinguisher, extracts, and where the children keep their personal candy stashes).  So maybe catering is something that “normal” upper-middle-class people do, or more likely, they catered a lot of work events so someone else was paying.  The state-side military seems to be into government funded catering.

I wonder at what income/wealth point people hire personal assistants and if we will ever get there.  I’m guessing not.  (What would we use a personal assistant for, you ask?  This weekend we decided that finding a competent handi-person was too difficult so DH is in our back yard pressure-washing the deck himself and after it dries, 3/4 of us will work on staining it.  A good personal assistant would find a handi-person and negotiate a reasonable rate for hir services.  Similarly this PA would find a reasonable yard service that doesn’t have to be told every single week not to cut the grass so short, not to use leaf blowers, etc.  So, I guess a good PA would mainly find ways to spend more of our money.  I’m guessing we will never get to that point.)  I do know economics professors who have personal assistants, but they’re dual-economist couples at top schools who are jointly making somewhere around $500K/year (or more).  So, maybe the answer is $500K/year, adjusted for inflation?  Must be nice.

Is this why obnoxious people say you cannot possibly be rich in the Bay area on a mere 300K/year?  Because they can’t afford to live the life of movie stars from the 1930s?  Is this why the evil rich want more income inequality, so it’s easier to hire competent servants?

How could you become more obnoxious with (lots more) money?  Giving to charity or saving it not allowed for this thought exercise!  Hiring a toothpaste sommelier, on the other hand, is totally allowed.

*Two thumbs up for their Moscow mule.  Also the chocolate egg creme.