MAMEWorld Forums - The Loony Bin - Re: It's really true, no one is ever happy...

Living beyond your means is not reserved for only people who dont have money...

It is not only *easy* to do so. In many ways our economy encourages it. Can not tell you the number of people who I know who were telling me I was stupid to pay off my house so I could 'get the deduction'. It is amazing the number of people (even bankers) who do not do the math...

Lets say for example you buy a high end car (what someone who makes 350k would do). He would make about 192k after taxes. Lets say it costs you 1200 a month (not out of reach for say a basic 7 series bmw) You are spending 24k a year just on payments. Then insurance 4-5k a year. Then gas another 60 bucks a week. You are looking at 33k per year for 5 years. That is nearly 10% of his gross. Then most people seem to follow the 30% rule when financing a house. Or about 100k a year for this fellow. Oh and the wife should have a nice car too. Now your up to ~60k. That is just 160k and not even accounting in other things... Such as the home owners insurance, car ins, private school, home association fees, taxes, etc etc etc... Even without the 'extra' stuff he is down to 30k to pay for everything else.

So yeah you can outspend yourself if you just follow the 'basic rules of thumb' most financial people seem to set out.