Dipping back into being high income

With DH re-employed, we’re back to being high income.  (Not 1% high income, but more than anybody really needs high income.)

You will recall I had just started loosening up on spending and was buying travel not connected with a conference, visiting DH’s parents’ house, or a wedding for the first time *ever* and then the pandemic hit taking our 20th anniversary trip to Portland, OR with it.  And then it sounded like DH’s job was going to go away, so I started stockpiling, and then it actually did go away, and my income was back to my take-home pay just about exactly covering our expenses on average (though some lumpy expenses, like summer camp etc. came out of DH’s unemployment and summer money/honoraria for me).  I was careful to buy the on-sale things at the grocery store and didn’t go too crazy with my jetpens habit.

To be honest, I felt more comfortable on just my income.  High income is freeing, but I definitely feel guilt along with it.  And uncertainty– I don’t know what I’m supposed to be doing with it all.  Is it stupid not to spend?  Should I be saving?  How much waste is moral?  Should I be buying more ways to save time?  Laura Vanderkam would not approve!

And now we’re back to DH’s take-home being higher than mine (I have more retirement account options) and us being able to live off just his take-home pay.

If we stay here forever, we’ve hit our savings goals.  Our house is paid off.  Our retirement accounts are being maxed every year.  We finally renovated the kitchen.  Our cars aren’t very old.  DC1 will have to pay full-freight for college.  But we’ve also got a LOT saved in a 529 already and although we will probably save more for DC2; we won’t know how much more until DC1 actually goes to college.  It’s not really clear where extra money should go.

That said, we’re in a shakier position than we were before.  DH’s job may not last longer than two years.  We both really want to leave this state and move someplace where the government isn’t actively trying to kill people.  We want to live in a Blue state with high taxes and expensive housing. I’m not sure I can get an academic job, especially one with tenure.  Is there age discrimination in Tech?  I don’t know.  Will DH be able to keep getting jobs?  Probably if he’s willing to move (or if he’s willing to do something outside of his main focus– everyone is shocked at how good a programmer he is)… but will they pay enough to live someplace fancy?  We don’t know.

We would need another 3 million dollars in savings to safely move to one of these fancy blue cities and not worry about employment or health insurance or housing (less with jobs lined up).  That’s a LOT of money.

I asked DH what he wanted to do now that we’re rich again.  He said he wanted freedom most of all.  So maybe we should aim for that 3 million.  I don’t know how long it would take to get it, but the more we put away now, the longer it has to grow and the more freedom we will have if DH’s new company goes under or he gets laid off or I move without a job or etc.

But also he wants fancy J. Herbin fountain pen ink (emerald) and either the Peloton app or that fancy online personal trainer thing Wheezy Waiter is always talking about (he picked the latter, and just bought $300 of dumbbells).  And a workout mat to put in his office ($200!  except then amazon said just kidding it’s actually backordered and he got a cheaper one).  I think we can handle those.  And upgrading my iPhone 7 to a newer model with a working battery (I will do this before school starts in the fall).  And maybe even upgrading my ancient computer (though DH may upgrade his and I’ll take his as a hand-me-down).

But I really need to start some kind of monthly savings plan where I just put money directly into Vanguard instead of letting it pile up in savings where it just kind of stares at me and makes me forget its true value.  (I start saying dumb stuff like, “DH, we could totally just buy this $32K house near your parents so everyone has a place to stay at Christmas.”  Narrator:  We should *not* buy a fixer-upper house in a rural area that we will go to maybe 2 weeks out of the year.)

No questions, just being obnoxious.  Commentary accepted even without questions! 

41 Responses to “Dipping back into being high income”

  1. CG Says:

    You may or may not be looking for advice here, but…it seems to me that your job is the big factor. If you could get a good job in a nice blue city, that would let you move without needing that daunting $3 million in savings. DH is relatively portable. You’ve said you’d like to wait until DC1 has gotten into college/graduated, but that’s pretty soon. What if you started putting feelers out this year or next just to see what’s out there?

    • nicoleandmaggie Says:

      I am planning to (and have been putting feelers out). But it is non-trivial!

      There really aren’t any jobs for me in Silicon Valley– I’m too good (expensive) for the regional/religious schools and not good enough for Berkeley or Stanford. SoCal is more of a possibility, but with the pent up supply of amazing phds from the pandemic that may not be realistic in the next year or two. Boston is also a possibility, though they were really the only place hiring last year (and schools out there landed some really amazing people) so they may be done for the short term. There are also think tanks in LA and Boston but not so much in Silicon Valley, but I’d have to lose some important parts of my identity to do that (not just philosophically– like I would literally lose benefits I currently have if I moved to a think tank).

      We do want to let DC1 graduate from high school though. Now is not a great time to move. In two more years it will be easier.

      • CG Says:

        Blue midwest? Chicago? DC?

      • nicoleandmaggie Says:

        No jobs for DH. :( His particular area of work is really centralized in three specific locations.

        DC there are jobs for me, but the good schools are in Virginia and politics makes me uncomfortable generally and my friends who work in DC seem to live and breathe it.

  2. Jessica Says:

    I love these posts!

    Sounds like you have some time before you want to make any moves, but are you talking about moving to the actual cities you mention, or just nearby? I’m from Massachusetts and you can definitely live much cheaper outside the city while still being nearby. Or even live in very southern New Hampshire and still work in the city if you’re willing to put up with the commute when you need to go in. From what I’ve seen of home costs in coastal California, they are way higher than homes in the greater Boston area. And I can’t imagine DH not being able to get a tech job in the Boston area! (Though obviously I don’t know his specific focus).

    • nicoleandmaggie Says:

      DH can definitely get a job in Boston– it’s just me who is the problem! We would probably want to live in one of the expensive suburbs to take advantage of the insanely good school districts (while DC2 is still in school). Once the kids are in college our housing options open way up.

      • First Gen American Says:

        I was thinking the same thing. Blue states can be affordable. I’d challenge you to look outside the 495 perimeter. There are still universities and jobs and even good school districts out of the immediate vicinity of Boston. My kids go to a blue ribbon school and I’m about as far away from the city as you can get.

        You can also do private school and live in a cheaper town. I think this goal is a good one to take seriously and is very viable given your backgrounds, but admittedly much harder to do on one income. Property prices are always fairly high but crash down to something feasible about once in every 10 years and take a few years to recover. Last time it took over 5 years for homes to get back to pre-subprime mortgage crisis levels. You can make a bunch of money on housing if you are patient and time it right, so it’s not just a sunk cost gone forever. That is when we bought our home in the expensive town we live in…home prices were at their lowest in 2 decades.. still expensive but an amount I could stomach). Also, Boston and California were some of the only places that were hiring in 2009 during the big recession.

      • nicoleandmaggie Says:

        We would likely only move to Boston if we both got jobs there.

  3. SP Says:

    “DH, we could totally just buy this $32K house near your parents so everyone has a place to stay at Christmas.” LOL!

    It seems like a combination of small splurges and a regular savings plan makes sense. At any rate, more savings gives you options, you can figure out details later.

    I don’t know if I would try to save up “another $3M” (on top of everything you already have!) to live in an expensive blue coastal city, but as someone who lives in an expensive blue coastal city…. it is hard for me to defend that statement really, because we are spending a ton to be here. We do regularly talk about moving abroad (Germany specifically), but that is mostly a contingency plan because I worry the US is going to fall apart, and it may be feasible to get hired there. (But also, much more family friendly gov’t policies. Or really, much more human-friendly.)

    We are still in the stage of building up college savings (indirectly…) and scheduling a few big house maintenance projects (spread out over several years) with our “extra” money.

    • nicoleandmaggie Says:

      Just to be clear to readers– we do not currently have $3M! Basically if we sold our house we could get a downpayment on a modest 2BR CA house in a decent school district. And then I think we could survive for a year selling off our taxable. I haven’t actually done the numbers (and haven’t looked at ACA costs). In theory DH would get employed sooner than that if he was actually local, but… age discrimination in tech? We don’t know yet!

      • SP Says:

        I didn’t mean to imply you did either. :) I just assume what you have in retirement isn’t insignificant, plus you have lots of savings for college done. Maybe $3M is the right number, but it just sounds so high.

      • nicoleandmaggie Says:

        I figured—but wanted to make sure other readers didn’t assume it.

      • nicoleandmaggie Says:

        It maybe doesn’t sound so high if one thinks of it as the retiring early someplace expensive number. 2 million for the house and 1 million for living expenses until retirement money is needed and available.

      • nicoleandmaggie Says:

        Though I just checked and if we moved right now, rents are lower than they had been. There’s even housing available in Los Altos, which never happens. Oh well.

      • SP Says:

        I was thinking about your $3m number, and yeah, it seems not so high if you need $2m for the house itself, which probably is a reasonable number in some areas. I think I’d want something approaching $2.5M in investments (i.e. excluding the house) to stay in this area early retired. That assumes I’d have to pay non-mortgage house costs (property taxes, maintenance), ACA health insurance, income taxes, modest travel costs but no childcare.

      • nicoleandmaggie Says:

        Its likely doable with a lot less, but that’s a number for which one would not have to worry, you know?

  4. Natka Says:

    Just a thought on spending vs saving.
    Saving is great, no arguments, but… Sometimes, **** happens. Pandemics, cataclismic events because of global warming, civil war, economic crash, etc, etc. Oh, inflation, too. The money we are saving – there is no guarantee we will be able to use it in 30 years. Not if there is no more US. I mean, doomsday stuff, i know, unlikely to actually happen.
    But my family lost whatecer meager savings we had when USSR collapsed.
    So, maybe some meaningful splurges NOW are a good thing. Travel, good produce from local organic farms, a houskeeper, super gadgets – whatever makes your family happy ( and maybe helps the world a little).

    • nicoleandmaggie Says:

      Enough savings sometimes means you can buy your way out of a country…

      That’s another reason that I have decided not to consolidate all our accounts– the hope that the government can’t grab all our assets at once without warning, especially if some of them are foreign assets.

      And don’t worry– we do spend a LOT! Basically we spend my entire take-home pay, and with just my income we’re upper middle class. No need to worry about us taking cold showers to save pennies.

  5. sarah Says:

    As someone who recently moved from Chicago to SF for a job, once I got over the initial shock of how expensive everything is, I realized our quality of life is so much better here. As you noted, the proceeds from our Chicago house is just enough for a downpayment on a very modest house in SF (my child goes to private school and school district is less important) and economically we are likely in the same place as before the move, however, life is exponentially easier, healthier, and happier in SF and we feel fortunate that the moved worked out.

    • nicoleandmaggie Says:

      It is a kind of paradise! If it weren’t for my career we probably would have moved out there right after college. And then we’d genuinely be rich because most of the guys we know who moved out there hit it big in startups during the dot com boom and surely one of them would have hired DH on the ground floor.

  6. nicoleandmaggie Says:

    Email from indivisible:
    Quick update: A LOT happened or was at least announced in the past week. First up, after receiving tons of movement pressure from the Moral March on West Virginia and light brigades from our Indivisible groups, Joe Manchin announced he is open to passing the For the People Act. He also shared some of his proposed changes to the bill. Although his proposal leaves out some critical provisions, it’s still good news that he came to the negotiating table. You can read more here about what this means for the bill1. And then, as if on cue, Chuck Schumer announced he would bring up S. 1 for a vote on Tuesday. That’s tomorrow!

    Now, keep in mind, we don’t actually expect it to pass tomorrow or any time before recess since we still have the filibuster to contend with. But don’t worry, if there’s a vote tomorrow and it’s filibustered, we’ve still got a chance — tomorrow’s vote is on what’s called a “motion to proceed,” which would allow the Senate to actually consider the bill. If or when that vote fails, that only means the motion to proceed fails, not that the For the People Act failed. After that, what matters is that the Senate goes home to their states and sees a big, bold nationwide movement of visible public events to demand democracy reform, no excuses.

    That’s where you come in.

    In the end, winning this fight depends on showing up as a movement over the next three weeks. Last week, we launched the Deadline for Democracy, a movement-wide, all-hands-on-deck campaign to get the For the People Act passed in July so that critical provisions will be in place in time for the 2022 midterm elections. This email is your invitation to meet the deadline June 28-July 10, and it’s your only weekly to-do! Click here to find an event near you and RSVP today.

    We asked you to pledge to take action, and wow, did you! We had thousands of Indivisible pledgers from every state plus D.C.! Now it’s time to fulfill your pledge by taking action. We have events registered in 32 states plus D.C., both online and in-person, and if one is near you, it will appear below! Not in one of those states? No problem — you will instead see ways you can take action from wherever you are. Can’t wait to scroll down to see your nearby events? You can click here to search the map yourself or here to host an event if you don’t see one close by. If you don’t see an event near you, events are added every day, so be sure to check again later this week.

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    • nicoleandmaggie Says:

      I should have mentioned– DH and DC1 went to a protest to protect voter suppression on Sunday (I stayed home with unvaccinated DC2). There were a LOT of people there. Even though it was insanely hot.

  7. Debbie M Says:

    I feel for you that it’s weird to be in a position where from one perspective (staying in a red state) you are set up to have everything you need forever, but from another perspective (moving to a blue state), your goals seem quite difficult to achieve. And so your goals are quite different depending on perspective. It seems like you should go for the $3 million while also allowing for little luxuries (everything you mentioned except the spare house).

    I’m in a similar situation. Basically everything is perfect and I have enough extra money to renovate to have a dishwasher, more storage, and covered parking! On the other hand, if I need or want to escape from my current residence for some reason (like democracy fails, or fracking earthquakes my house to death, or the ocean rises over my property, or I can no longer pass as someone that the powerful people don’t want to abuse), all of my second-favorite places to live (blue states, The Netherlands, Norway, Belgium) are too expensive and my other back-up ideas (Oklahoma City, Panama City) might also not be good. Similarly, if something happens to my pension, everything else added together (Roth IRA + Social Security + paid-off house) isn’t enough unless I sell the house and move somewhere ickier.

    So should I look for jobs to keep adding to my investments? Or do I keep enjoying my currently fabulous retirement? I did take a job with elections last year, because it was important, but I am not applying for a job with Admissions this year, because bleh.

  8. revanche @ a gai shan life Says:

    Yay! I’m always happy when good people make the good income because they do better things with their money.

    Drat I was rooting for you to come here but your response to CG suggests that’s a no go.

    I dunno what the age discrimination in tech looks like. I have friends who work for, respectively, Google and Apple, and they’re in their 50s. I don’t know if there’s the age discrimination that just blocks older people from being hired in but their continued presence suggests that it’s maybe not leading to older folks being pushed out once they’re in and established. I do wonder if they have insight into recruiting practices in the area.

    We’re obviously paying through the nose to be here and we economize in lots of ways to make it work because we don’t make Silicon Valley money. Sometimes I wonder if we made mistakes with regard to our industries and our housing choices but modest is what we can afford to live in a place in CA where weather and traffic aren’t soul-destroying. Our money would go a lot further elsewhere but for now, unless we’re talking about an escape hatch, I don’t particularly want to go anywhere else. I like it here. Though sometimes we think we could use some more room and I’d REALLY like 3 more feet of clearance in our garage.

  9. Omdg Says:

    The peloton app is. It that expensive AND exercise is good for you. I say splurge.

  10. Bee Says:

    Hey, as far as fountain pen stuff goes, Emerald of Chivor is pretty cheap! It’s not even the most expensive ink out there. What pens does DH have?

    • nicoleandmaggie Says:

      Most of his ink is Noodlers Ink, which isn’t quite as pricey.

      Um… I knew the answer to what pens he had a couple weeks ago when he was talking about getting a new one. One of them is a um… Pilot Vanishing Point? And the other he says is a Lamy Safari. The new one is a Faber Castel emotion pitch black. He recommends them all.

      • Bee Says:

        Cool!

        True, there is cheaper ink, for sure. (Though I wasn’t expecting you to say Noodler’s given the “want to move to a blue state”.) But lots of ink is (mostly) cheaper than lots of pens. Which is good when using pretty colored ink is my favorite part. (I wouldn’t say I have a lot of ink either, especially compared to some people’s giant collections, but I have a good variety of colors and like sampling new ones.)

      • nicoleandmaggie Says:

        Oh no, what is wrong with Noodlers?

      • nicoleandmaggie Says:

        So all I can find is people on the internet saying that the founder is “political” but they don’t care about politics and thus they will say no more. And that he made an ink based on Bernie Sanders that is socialist red and quick drying for lefties (which… sounds cute?) There’s a suggestion he’s libertarian, but is he a Ron Paul style libertarian or is a Rand Paul style “libertarian”? Also weird that he never moved from MA to NH if he wants less government.

      • Bee Says:

        Your reply is actually why I hesitated in answering you, because I couldn’t cite my sources (and as a person with an English degree I believe in doing so!). I just generally hear of people avoiding his inks because he’s too extreme right-wing for them.

      • nicoleandmaggie Says:

        If he espouses stuff that hurts people (like Chick Fil-A), then DH will stop buying, but if he’s a genuine libertarian who genuinely just wants smaller government and is consistent with that stance in a way that doesn’t suspiciously focus on hurting minorities and oppressing women, well, as an economist I can understand that even though I prefer a different point on the production possibilities frontier. Like, I would buy ink from Ron Paul, who understands that feeding children (regardless of their race or ethnicity!) saves government money in the long run and is thus something libertarians should be in favor of, but not Rand Paul who is just a social conservative pretending to be libertarian.

      • nicoleandmaggie Says:

        Though to be fair, he just discovered Colorverse inks and it may be a while before he goes back to noodlers.

  11. Cloud Says:

    The trick to feeling less guilt about your high income is to have friends/acquaintances with even higher incomes. I joke! Sort of.

    I’m with your DH: I want to figure out how to use our high income to buy freedom. I’ve succeeded to a certain extent. If either of us got fed up at our job we could just quit without too much worry. It helps that we both have careers in fields that have a lot of opportunities. We might have to take a pay or title cut to land something quickly but we could do it and be OK. I am very protective of that feeling that I could say “take this job and shove it” anytime I wanted and just recently realized that is one reason why I am not 100% onboard with my husband’s idea that we should buy a second house and rent out the one we’re in.

    My current thinking is that we need to make a plan that makes it so I could choose to retire/downshift significantly when my kids are out of high school. Which is in 7 years. I may not choose to make any changes then, but that is when we COULD make drastic changes without uprooting anyone else and so I’d like to feel like it was all on the table at that point.

    I guess that means that in your shoes, I’d be saving that $3 mil to have the options when the time came!

    • nicoleandmaggie Says:

      One of my colleagues who is probably in the 2nd or 3rd percentile of family income recently told what she thought was a funny story about one of her 1 percentile friends being worried about her (my colleague’s) family not being able to afford fancy things in the joint beach vacation they were taking. She’s also got friends who get free food because they’re on restaurant boards because they’re rich. Me… not so much!

      I guess many of my conference friends are richer (and have highly paid personal assistants and extremely fancy vacations and other trappings of the working 1 percent). I’m not sure if that makes me feel less guilt though. Hm… I mean, I do want what they have… but also realize it’s excessive! It’s probably better to stay grounded than to just associate solely with the wealthy.

      We won’t have 3 million more in 2 years when DC1 is done with high school, but maybe we’ll have something!

      • First Gen American Says:

        We saved more than we thought we would the first 5 years after paying off our house. It’s not the easiest thing to spend more when you’ve been a saver for decades. We realized we needed another 6 figures saved before we could buy our current house without jeopardizing our current savings philosophy of keeping debt below certain thresholds. I don’t think you need 3 million more unless you really want a cute house in downtown San Francisco. There are other places that are equally cool that you can get for a lot less. I am sure you can modify this goal to something achievable that still aligns with your values and dreams.

      • nicoleandmaggie Says:

        If I’m going to give up my career and my personal identity then I am not going to want to make other compromises (other than, of course, a much smaller house).

        Also no, not SF, Silicon Valley, and we are very familiar with the housing costs and schooling choices and commuting options —we can afford suburbs where the schools are crap but not suburbs where they’re decent. The reason nearly identical houses in two suburbs next to each other on the same commute line have hugely different housing prices is 100% because of the schooling options.

        Actually we are familiar all three places we mentioned in terms of job locations, commute options, and school districts.


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