hello once again guys welcome back to
the channel hope you're having a great
day so far so what we're gonna be
talking about in this video today is why
$100,000 $100,000 salary is what I call
are going to be seriously questioning my
sanity after I say that but I want to
show you guys with actual numbers why
earning $100,000 per year is not really
much money at all based on the average
expenses people have in their lives now
I just want to preface this by saying I
am in no way you know putting down
anybody who makes less than a hundred
thousand and it really doesn't matter
how much money you're making what
matters at the end of the day is the
kind of expenses you have in your life
and I've known people before that made
you know forty thousand dollars per year
and they had you know extra money every
single month I've also known people who
made six figures and they were paycheck
to paycheck so it has absolutely nothing
to do with how much money you're making
and everything to do with how you're
managing your money but what we're gonna
be doing here is going over the average
budget for somebody earning a hundred
thousand dollars per year based on the
average expenses and seeing if this
really is a lot of money now for me I
always learned when I was a kid that you
know earning $100,000 per year meant
that you were rich and I always thought
that it meant you were driving you know
mercedes-benz you lived in the nicest
houses and I want to show you guys why
that just is not the case so first of
all with that hundred thousand dollar
salary right off the bat you're going to
pay taxes so I did these numbers here
based on living in New York which is
where I live and so right off the bat
you pay twenty eight point six percent
in taxes meaning that your take-home pay
is seventy one thousand four hundred
dollars or five thousand nine hundred
fifty dollars per month so that right
here is going to be your budget of five
thousand nine hundred fifty dollars per
month so now let's go ahead and talk
about what are the major expenses that
you're going to incur right off the bat
well first of all you have to have
somewhere to live and the average
mortgage out there for somebody who owns
their home right now is about one
thousand thirty dollars per month and
that includes both you know your taxes
as well as your monthly
insurance payments for homeowners
insurance so that right there is the
biggest expense for most people next we
have car payment the average car payment
right now five hundred thirty dollars
after that health insurance a lot of
people don't think of this one but this
can be a very costly monthly expense and
the average health insurance premium for
a single person on a health insurance
plan is four hundred forty dollars per
month which is what you are paying in
towards your health insurance next let's
talk about retirement contribution
hopefully you're doing this if you're
making six figures or any amount of
money but let's say on average you're
putting away a hundred dollars per week
and we're gonna say that's a $400
retirement contribution now yes you may
be putting away you know pre-tax income
but let's say it's ultimately costing
you a hundred dollars of your post tax
dollars every single week out of your
paycheck going into your retirement and
then finally let's talk about student
loan debt the average student loan
payment for a month is three hundred
ninety dollars and if you're making a
salary of $100,000 we're going to assume
that you have some kind of student loan
debt in order to be making that amount
of money so after you pay all of these
monthly expenses that you ultimately
have very little control over how much
money do you have left so out of that
five thousand nine hundred fifty dollars
you now have three thousand one hundred
sixty dollars left over for all of your
other expenses so the next biggest
expense for most people is your
groceries now this number varies based
on whether or not you're buying
name-brand groceries are you buying
organic produce personally you know I
buy pretty high quality food and so for
me it's usually around five hundred
dollars per month in groceries but for
some people that might be a slightly
different number next up let's talk
about cable and Wi-Fi about $150 per
month for most people
two hundred dollars per month on gas you
also have to factor in your car
insurance cost for that five hundred
thirty dollar car payment that you have
for that new vehicle the average car
insurance payment right now is $120 per
month for that insurance premium beyond
that you have your utility bill for your
gas and electricity figured for a house
you know since you have a mortgage about
two hundred fifty dollars per month and
then you have a
cell phone bill I'm putting that at 150
because most people these days have some
kind of foam that they're paying off on
top of their cell phone bill so we're
gonna say that's $150 per month and then
let's say you're putting $100 per week
into savings to go towards maybe your
next car or any kind of unforeseen
medical expenses or maybe your house is
going to need a new roof someday or a
new furnace so let's say $100 a week
going into savings and then a hundred
dollars per week going towards your date
night so maybe you go out to dinner and
you go out to the movies or you just
spend this money on general
entertainment we're calling that $100
per week or $400 per month so after all
of these expenses how much money are you
left with
well you're going to have nine hundred
ninety dollars per month leftover out of
that initial three thousand $160 now
notice what we don't have on here we
don't have a gym membership
we don't have Netflix we don't have
Spotify we don't have all these other
monthly recurring expenses that people
often take on and they could also be
subtracting from your monthly surplus
and then the final item we're going to
include on here is taking just one
vacation per year now what is the cost
of a vacation it's all relative to where
you go I have find that on average for a
one-week vacation if you're going to go
anywhere worthwhile it's gonna cost you
around $3,000 between your airfare as
well as food and dining your hotel and
then any kind of excursions so let's say
you want to take one vacation per year
at $3,000 well if you budget that out
per month that is $250 per month going
towards your vacation fund so ultimately
how much money does that leave you with
well you're going to be left with just
seven hundred forty dollars per month or
one hundred eighty-five dollars per week
and it was really amazing to me going
through these numbers just how fast you
blow through $100,000 per year salary
and when I think of rich or somebody who
is you know wealthy I don't think of the
average lifestyle here because literally
what we're looking at is the average
house the average car you know
everything here is average not the above
average lifestyle and
that is why I believe $100,000 is the
new broke now am I saying this to put
people down and make you feel bad for
your salary obviously not I'm simply
pointing this out because when I was
younger my goal was always to make a
hundred thousand dollars and then I
ultimately ended up in a job that would
have allowed me to make this amount of
money but I was able to see that it
really wasn't a good goal in the
beginning and it wasn't a lot of money
because of how easily you burned through
a one hundred thousand dollar salary and
again I just want to point out there are
so many other random expenses that are
being left out here entirely let's talk
about clothing or any kind of repairs
for your house or like I said Netflix
Spotify gym membership CrossFit
memberships so many of these other
random things that 740 dollars per month
is going to disappear pretty quickly and
it's just amazing to me you know how
quick you go through a 100 thousand
dollar salary so my point of making this
video is to set the bar a little bit
higher in terms of your goals for
yourself in terms of your earnings
because I always set that goal for
myself of making a hundred thousand but
when you actually look at the numbers
that is not a lot of money but anyways
guys let me hear what you guys think in
the comments section below I think this
is kind of a controversial topic saying
that you know six figures a hundred
thousand dollars is the new broke I
would love to hear what you guys think
thank you so much for watching this
video if you enjoyed it make sure you
subscribe and I will see you in the next
one
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