Do they use any special math for calculator like this or just simple compounding? I think this one is too optimistic.
It is difficult to classify based on income because not all income is treated the same tax wise as hayden wrote.
Wealth matters too.
However, we are talking about middle class incomes and what middle class incomes can buy. These are two different things. What is happening is middle class incomes are stagnating. The cost of living is rising in many areas and places that were once affordable for the middle class are no longer affordable. Purchasing power for the middle class is decreasing in many areas.
If I make $250,000 in Alabama and then I move to SF, I am now middle class?
Or are some upper middle class people no longer able to buy a home in SF?
I don’t think SF real estate is a middle class investment anymore. When I look at areas like Daly City and South SF, areas where the middle class live, with home prices escalating, the middle class is in trouble.
The San Francisco middle class is moving to Patterson. 
Agreed dstark. Its the buying power. In SF, I dont think there is a middle class. Seems like there is the “starving student” level and the “love my yacht” level.
So if a person made $250K in Huntsville, AL, they’d need to require a salary almost double that ($442K per the calculator) to relocate to SF and maintain a similar lifestyle.
Why do you think the calculator is too optimistic, DadII?
You are putting in the variables.
Yes, I did put in variables but the outcome is too good to be true. That is why I asked about the background math.
Middle class is going away from SF…but to Patterson? I hope nobody is doing a Patterson to SF commute.
We have a lot of people commuting from Vallejo and parts of the east bay to Marin. Somebody I know commutes from Oakley to Marin. That commute is prettty bad.
If you drive 60 miles each way for a commute, and the driving cost is 50 cents a mile, that is $60 a day. A lot of the pay is going to commuting.
There are commuter vans to the Dublin BART station. I know it’s crazy. My kid did Manteca to Walnut Creek last summer. Patterson is a little extreme but there is at least one guy doing it. This afternoon I met a girl whose family moved from a 3 bedroom house in San Jose to a 6 bedroom in Riverbank. I don’t think any of them are commuting but they moved due to cost of living and she is an adult with her own business living with her parents. It’s the new middle class lifestyle. And it stinks.
Not to mention living in your car for probably 1 1/2 hrs at least each way with that traffic. Crazy.
This is crazy and this does stink. Manteca to Walnut Creek… Omg.
A middle class person used to be able to buy a home in the Sunset District in SF. In the 70’s… We were alive in the 70’s.
Now these homes are a $1,000,000. My wife hates the Sunset. I grew up there so I kind of like it.
Daly City was lower middle class to middle class…
Now the homes are $600,000 to 750,000.
And the weather is foggy.
Pacifica is $600,000 to 750,000. I don’t know if anybody here knows Pacifica.
I am not trashing these places…I have family living in these places…but the cost of living…
A few years ago a guy was visiting from London. He said he couldn’t believe how cheap homes are in the bay area. I have heard the same from people who have lived in Hong Kong. It is relative.
DadII, did you take out taxes?
If your after tax income is higher than your expenses and inflation is less than your after tax returns… You should be in good shape.
Why wouldn’t you be?
Hawaii has some of the worst traffic in the US–the roads are just not enough to handle the huge volume of cars regularly running on it. My bailiff said that one day he was catching the regular express bus home and his wife asked him if he was OK–he had caught the bus at 4:30 and was still on the bus at 8pm. There was nothing in particular slowing traffic, it was just the normal. He only lived about 25 miles from where he caught the bus!
Other people I know have to drive into town at 4:30 am to avoid the heavy traffic to just get those 25 miles to get their kids to school on time. They get to town early and then have to have the kids nap and fed before heading to class. I’m sure this all takes a toll on folks.
Incomes in HI are NOT correspondingly higher with our higher cost of living, which is why we have a HUGE brain drain, with many of our brightest leaving our state because they can have a much better work/life balance and lower cost of living with good income elsewhere. It’s a huge problem. They don’t want to be struggling and stuck in traffic and have to share housing with multiple generations.
good question.
"Estimated tax rate during retirement (%): " I have no idea what this should be. DW does all the taxes.
If I use 3% as the typical inflation, 6% return rate for investment and 15% tax rate. That thing says I could retire in 4 years, have more than enough $$ to live to 95, plus a 7 figure estate. That is just too good to be true.
Well…the variables aren’t a given but you are in good shape.
Himom, those commutes are ridiculous. Hawaii is great, but wow!
To commute just a few miles (I think under 10), is 20-30 minutes if you leave by 6:30. If you leave later, it can take 60-90 minutes and be utterly miserable. People really have no idea and there are NO alternate routes for many of us–the freeway is clogged and the side streets are as well. There is a bus system on Oahu–bus comes about every 30-60 minutes, if you’re lucky.
When I have any choice in the matter, I try to scheule things after 9am and by 2:30pm at the latest, to minimize my time in traffic. I really dislike traffic and LA traffic is in many ways easier, as there are multiple routes that you can figure via your GPS or phone.
The tax code is written that way because of the Golden Rule:
He who has got the gold makes the rules …
@dstark Here you go - I have a guy who works as a maintenance person in one of our buildings - he commutes from Stockton to Oakland every day. He arrives at 6am and leaves at 3:00pm, and it takes him 2-2.5 hrs each way. He does this for $17/hr. It’s insane but he is a great worker and a wonderful person, so I’m not going to be the one to talk him out of the craziness.
Cameron121, that is insane! The things people do to put food on the table.
Some of us are very fortunate…
Hope that maintenance job has great benefits!