Homeowners: How much spending cash do you have per month?
Original post by DjPiLL
I normally don't need advice on things like this... but I am torn on this issue so if anyone wants to offer up... please do so. Here is my story... sorry for the length.
I was about to put in a binder for a house and after discussing with my wife last night... I chickened out because I was concerned I would be stretching myself too thin every month.
My wife doesn't make too much... but I make very decent money... and its VERY decent when I am DJing. I am well over six figures with DJing on just my salary alone.
The problem is... I have been DJing for four years straight now and never really had to 'budget myself'. So I am unsure how much it takes a month to be on a good budget. Plus any budget I set... I CANNOT include my DJ cash because that is not guaranteed work for me.
Another issue I have is... I put a LOT of cash into my 401k every month (over $1000 pre-tax a month). That could be a lot of extra spending cash if needed. I am also curious if people who own houses are still able to contribute nicely to your 401k. I currently put in 15% of my salary (the max at my job).
So... feel free to offer your opinions... or if you want to remain anonymous... just vote the poll.
I am mainly asking... after all the bills are paid... how much money is left each month. As far as bills go.... only count stuff you actually write checks for and mail out (like mortgage, electric, cable, cars, etc.).
When figuring out how much 'spending money' you have... factor in stuff like gas... groceries... clothes... etc... INTO your spending money amount.
Thanks in advance! DJ
DjPiLL
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Re: Homeowners: How much spending cash do you have per month?
Getting back a huge refund at the end of each year is like giving the government a nice interest free loan.
Some people don't mind it... but there are better options.
Interest rates on CDs are GREAT right now... so there are definitely better ways to invest your cash.
I said I would change my withholding this year to fix that... but I never got around to it. So I am just as guilty.
Maybe next year... now that Vanessa is living with me fulltime now.
violet
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Re: Homeowners: How much spending cash do you have per month?
Yeah I claim 0 now so I have so much tax taken out of my paychecks, so I think I get back a crap amount compared to how much tax they take for the entire year. I have been working a lot of OT too, so they really get me then too. I'm going to call an accountant about this because I saw a gorgeous 2 BR, 2.5 BTHS condo (only attached on one side b/c it's corner prop.) with a yard and 2 floors and a garage in Queens, and if I can find a way to afford it, I want to get it now!
Blu-ize
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Re: Homeowners: How much spending cash do you have per month?
Posted by DjPiLL
Getting back a huge refund at the end of each year is like giving the government a nice interest free loan.
Some people don't mind it... but there are better options.
Interest rates on CDs are GREAT right now... so there are definitely better ways to invest your cash.
I said I would change my withholding this year to fix that... but I never got around to it. So I am just as guilty.
Maybe next year... now that Vanessa is living with me fulltime now.
Can you claim her as a dependent? That could help too. If she makes under a certain amount you can claim her and get a deduction.
fleeflee
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Re: Homeowners: How much spending cash do you have per month?
Posted by DjPiLL
I think if I actually had a clue what I spent each month... i would be more confortable with budgeting the house.
That was EXACTLY our problem. We really had no idea. We started using our AMEX for all groceries, gas, diapers, lunches, restaurants, clothes, travel, gifts ... everything. it's been about 7 months now and our average bill is $1800/month. It's easier for us to see where everything goes when we see our monthly statement and we get reward points too.
DjPiLL
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Re: Homeowners: How much spending cash do you have per month?
Posted by Blu-ize
Posted by DjPiLL
Getting back a huge refund at the end of each year is like giving the government a nice interest free loan.
Some people don't mind it... but there are better options.
Interest rates on CDs are GREAT right now... so there are definitely better ways to invest your cash.
I said I would change my withholding this year to fix that... but I never got around to it. So I am just as guilty.
Maybe next year... now that Vanessa is living with me fulltime now.
Can you claim her as a dependent? That could help too. If she makes under a certain amount you can claim her and get a deduction.
Do you know how much that is (salary wise)? I am not the biggest accounting expert... so I only take deductions I KNOW i can get.
september2004
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Re: Homeowners: How much spending cash do you have per month?
Posted by DjPiLL
Thanks for the suggestions. I recently did a 20year term life insurance with State Farm this month so my wife is protected well.
how did you pick state farm?
DH is looking into disability insurance outside of what work provides and is having a tough time...it's expensive, but supposedly increasingly more people need to tap into disability than life
we are still unclear what to do...
violet
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Re: Homeowners: How much spending cash do you have per month?
Just a question about the filing dependents or withdrawals issue, is that allowed to file more than 0 dependents (when you really don't have anyone dependent on you) to give you more money back on taxes? I'm still trying to understand that.
september2004
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Re: Homeowners: How much spending cash do you have per month?
Posted by violet
Just a question about the filing dependents or withdrawals issue, is that allowed to file more than 0 dependents (when you really don't have anyone dependent on you) to give you more money back on taxes? I'm still trying to understand that.
i believe you can claim what you want as long as you pay in the end...
i know so many who do it (trying to figure out for us how we should approach because i would personally like to owe rather than receive a refund - like DJPill said the govt is making interest off of your $$, i don't want to give them more than i have to) but is one technically 'allowed' i have not a clue...
violet
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Re: Homeowners: How much spending cash do you have per month?
And the thing is it would supposedly be even more to your advantage when you have a house because you get more tax money back then. And I'd like to figure out with an accoutant, if I got a house in Queens in the upper 400's and told him how much taxes and interest I would be paying, what I would have to claim to make me break close to even at the end of the year and how much more would I get each paycheck. So I can know if it would be affordable. I just don't know how to go about it, but I guess I'll ask mine for advice.
september2004
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Re: Homeowners: How much spending cash do you have per month?
Posted by violet
And the thing is it would supposedly be even more to your advantage when you have a house because you get more tax money back then. And I'd like to figure out with an accoutant, if I got a house in Queens in the upper 400's and told him how much taxes and interest I would be paying, what I would have to claim to make me break close to even at the end of the year and how much more would I get each paycheck. So I can know if it would be affordable. I just don't know how to go about it, but I guess I'll ask mine for advice.
that's exaaaaaaaaaaclty what we are trying to figure out now post buying the house! we have calls into our accountant as well...
DjPiLL
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Re: Homeowners: How much spending cash do you have per month?
Posted by september2004
Posted by DjPiLL
Thanks for the suggestions. I recently did a 20year term life insurance with State Farm this month so my wife is protected well.
how did you pick state farm?
DH is looking into disability insurance outside of what work provides and is having a tough time...it's expensive, but supposedly increasingly more people need to tap into disability than life
we are still unclear what to do...
Mine is just life - for now. I filled out an online quote at statefarm.com. Then a local agent called me about the quote. I ended up paying a little bit more a month cause I didn't qualify for the 'super premium' rate. I just got 'premium'.
DjPiLL
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Re: Homeowners: How much spending cash do you have per month?
You guys are getting a little confused with the term 'dependants'.
On the W4 form you fill out at the job... you claim Single/Married... then a number. That number is theoretically called dependants... but its not meaning dependants as 'kids / wife / etc'.
Its just a number that tells your job how much tax they should take out of your paycheck. The higher the number... the less money gets taken out.
When you do your actual taxes at the end of the year... you have to put on that form (1040)... how many dependants you are claiming. THATS THE FORM WHERE YOU ACCURATELY PUT YOUR DEPENDANTS. Thats totally different.
On my 1040... I accurately claim I have zero dependants. If I had a kid... I would put one and I get a little bit more of a refund.
But on the W4... if you own a house... you put a much higher number using the W4 witholding calculator to find out how much you put.
Like I said in my example... I would put Single-11 on my tax form. With doing this... instead of my job taking out $15,000 a year in taxes from my total paychecks... they would only take out say $9,000 a year... which gives me more cash a paycheck and a much less refund.
I still on that 1040 form at tax time put 0 dependants in my case... there is no place on that form I filed single-11 on my W4.
But if after all my RE taxes and mortgage interest... I only owe the government $9,000 of taxes... thats all I owe... end of story.
The government will not care I filed single-11 on the W4. They just want their money at the end.
But if you only have one kid... and on the 1040 tax form you say you had 10 dependants... thats a major audit flag obviously.
Hope this explains the confusion.
Blu-ize
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Re: Homeowners: How much spending cash do you have per month?
I don't but you can look it up on the web. Not sure of the address..although it would be the same as a child. It may be $3000/yr?
violet
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Re: Homeowners: How much spending cash do you have per month?
Thanks for clarying the 'dependents' issue DJ or else I could have gotten in some big trouble! That's what was confusing me.
DjPiLL
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Re: Homeowners: How much spending cash do you have per month?
Yeah... the average person... if they have two kids... they commonly claim Married-2 on their W4.
But the problem arises when you have to itemize your deductions (cause you own a house). Then everything gets confusing because a house will give you PLENTY more deductions than any amount of kids would ever do.
DjPiLL
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Re: Homeowners: How much spending cash do you have per month?
And actually above... i should correct myself slightly.
I said I would put Single-11... thats on my W4 I put that.
But like I said.... on the 1040 form at tax time... I still claim zero dependants.
There is no common link between the W4 and 1040. What you put on the W4 can bear no resemblence to the 1040.
The 1040 is the important document you want to make sure is 100% accurate.
Oh.... and be careful not to claim too many exemptions on the W4. If you are taking out too little tax and claim too much on the W4... you could theoretically get a call from the IRS asking you to pay a quarterly 'catch-up' tax.
HearzBellz
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Re: Homeowners: How much spending cash do you have per month?
We both cut back on how much we put into our 401K at work. It gives us over our savings an additional $500 - $750 per month for incidentals (like vet visits, paint, etc...)
What we did do, is join a credit union, which gives us additional $$ on our savings as a dividend. This also helps to balance things a bit.
btrflygrl
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Re: Homeowners: How much spending cash do you have per month?
I didn't answer the poll because we don't really keep a count on it. I know I don't live in NY, but I figured I'd contribute what we do here. With my working PT which will soon be 35 hrs a week off the books (a measly salary, but off the books, it's awesome for us and DH financial aid for school), DH makes a little over $30K. Not much. We make all our bills plus have enough to do our food shopping which normally is about $100-$150 every other week (including luxuries like ice cream and snack food). We have 2 dogs, 2 cars (one is paid off), and our house.
If I had to put a number on our 'free' spending money I'd say about $200-300 a month, could be more, could be less. Not sure.
MArried life has brought a sense of relaxation, stability, and normalcy to our lives. We prefer to get take out and rent a movie than go anywhere. Maybe it's a married thing, maybe it's just us.
I think with your salary, you'd be able to easily afford a house....look at what you spend that 'free' money on and see what you can eliminate to save some $$.
