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> Of course, stepping from 40K to 100K in salary is practically life altering. Unless you absolutely suck at budgets you can easily get out of debt and start ha

> Of course, stepping from 40K to 100K in salary is practically life altering. Unless you absolutely suck at budgets you can easily get out of debt and start having real vacations. You can afford hobbies, etc. I live in the Netherlands where 40K is quite a reasonable income. I really dont get why you would need 100k to do the things you need. Perhaps people need to become a bit more frugal? People here in general don't have any debt (except for mortgages) and a vacation to an Asian country is 1-2k/month'(yes people sometimes do take 2 months vacations here). Even a month of Australia is only 3-4k. Hobbies? I don't know what kind of exotic hobbies people have in the bay area but even flying drones (relative expensive) is relative affordable if you get started with a cheap Chinese drone before you buy an Expensive one. Rent, family size, location, etc probably makes a huge difference but I really don't think 100k is the magical number that you need to become happy.

aldanor 9y ago
I guess that is the whole point? I.e., you stop needing to be frugal and/or don’t have to count € when spending money on basic things like food or transportation. Also, more things become ‘basic’. Another point that makes a difference is that if you ever want to get a mortgage and buy a house, the maximum the banks will give you is a constant multiplier times your annual salary. In Ireland it’s 3.5x — good luck trying to buy a house on a €140k budget in Dublin. In my case, my total effective comp increased about 8x in the last 5 years after being corrected for taxes and CPIs of the countries I lived in, and I kind of concur with the OP in that it’s more of a log curve than linear. Things get progressively ‘easier’ but less lifestyle-changing over time.
- IkmoIkmo 9y ago
  > the maximum the banks will give you is a constant multiplier times your annual salary. The multiplier isn't constant or fixed but dependent on interest rates. So there are certainly multipliers that work in certain periods, like about 4x now in the Netherlands. But that'll go down once rates rise, it's only a constant insofar as the long-term interest rates appear somewhat constant (or rather, sticky) in a given period of time. At the end of the day they look at ability-to-pay, and interest rates factor in to that, which are variable.
fujiters 9y ago
A month in Australia for 3-4k? I want a cost breakdown for this. Say you get a deal and airfare is $500, that leaves about $100/day for the month. You could probably find a hotel at that rate, but then you're left with nothing to spend on food and activities. What am I missing? Friends and relatives who'll let you stay with them?
- jon_adler 9y ago
  I believe it would only be possible to maintain yourself as a backpacker on $100 per day. This might be lower in the bush but true in most urban locations in Australia.
- xya3453 9y ago
  Van rental is $40/day. Leaves a budget of $60/day for fuel, food and fun. Quite easy if you prepare most meals yourself and limit purchases that are prohibitively expensive in Australia, e.g. alcohol, cigarettes, taxis, restaurants, etc.
- asdasd23234 9y ago
  Exactly, AUS is an overpriced polished turd. It's called "land of plenty" for a reason... plenty of sheep happy to get ripped off. So why not milk them for their cash...
withdavidli 9y ago
student loan debt. there are many that graduate with $20k-$100k+ of debt. I'm frugal/cheap, got by with 30k salary in big city a year out of school was tough. Many coworkers that were more normal in spending habits were breaking even or using savings to make ends meet. At 30k salary, I was able to save $400-$500/month in Boston. It would have been near zero if I had student debt (6%+ interest). Frightening thinking back, but I was always one major repair on my car or mid level health issue away from spending an entire years worth of savings.
- zaarn 9y ago
  The obvious fix is that graduating shouldn't require someone to go into 100k+ debts. The entire cost for my graduation is probably come in under 1000€ total, 800€ will be tuition and the rest directly university related spending. (There is an additional 2k€ spending on stuff like a new laptop, software, etc. that wasn't necessarily required but made things easier).
  - withdavidli 9y ago
    Fixes are obvious, implementing it is the hard part. The propaganda for everyone to get a college degree is ingrained into the system. This sprouted countless for profit colleges charging obscene rates of $20k-$30k per year. Another obvious fix would be to spread good jobs around the country so we don’t have such concentrated HCOL cities. That’s as easily done as the suggestion of lowering cost of graduation to your sugessted price point. We have an entire political party against free or near free education, which means more taxes to pay for it. I don’t fully disagree with some of their stances. Many degrees don’t provide financial value, and can be learned online or have meet ups to discuss topics. A college degree for a college degree sake is what’s happening to much of the populous.
    - zaarn 9y ago
      Obviously it wouldn't be easy. The US education and employment system would have to ease of college degrees. Where I live, about 80% of my class had a job by the time they graduated secondary school. 20% went on for a higher education afterwards, of which only about 30% (or 6% of the original class) moved into College/University (the difference is muddy here). And at every step, people jumped straight into employment from school. US High School should focus on that. If a student graduates they should already have a job offer signed, that should be their primary target. If they don't they should be moving into higher education. College and other Institutions should have the same goal.
ProblemFactory 9y ago
> I live in the Netherlands where 40K is quite a reasonable income. I really dont get why you would need 100k to do the things you need. Perhaps people need to become a bit more frugal? What I have found is that the majority of "happiness from money" comes from the financial security, not actually spending the money. The reduction in stress going from a chronically broke PhD student to having 5 years of living expenses in savings is huge. It's the knowledge that you can immediately solve almost every problem that pops up with a bit of money, and figure out the details later. Missed your flight? Book another one. Car trouble? Call assistance and take an uber. Lost your job? Take a short vacation and then hit up your network on LinkedIn. And in most countries in Europe, you can feel secure with a lot less in income/savings than in the US. You don't need to worry about what your health insurance does not cover, probably don't have any student loan debt - and probably don't need to worry about a college fund for kids, can commute by public transport in cities, have better unemployment protections, and so on.
- ikeyany 9y ago
  > It's the knowledge that you can immediately solve almost every problem that pops up with a bit of money, and figure out the details later. Missed your flight? Book another one. Car trouble? Call assistance and take an uber. Lost your job? Take a short vacation and then hit up your network on LinkedIn. And then your expectations shift, you require more expensive things to acquire that base level of prosperity and satisfaction, and you have a whole new set of problems which feel just as stressful, relatively speaking.
  - bitexploder 9y ago
    This is probably not true based on what I have read. Of course some people get stuck on a hedonistic treadmill, but most people don't. I think when you can take time off from work and afford safe living and food is no longer a concern, indulge in hobbies, that is enough for most people to be happy. Studies I read say that experiences will provide longer term happiness over "stuff". You can always jump off the treadmill of needing the next better possession.
faitswulff 9y ago
I don't know how health care works anywhere else, but health expenses can range from $250 for a standard checkup, which I just got (note: it's supposed to be covered for free, but apparently insurance companies are now rejecting claims willy nilly in order to save money) to $10,000 for delivering a baby, to astronomical numbers for anything else. It really leads to a persistent feeling of danger, so yes, making 100k instead of 40k could literally save your life, or at least keep you from being an indebted loan shark victim for the rest of your life.
- IkmoIkmo 9y ago
  > It really leads to a persistent feeling of danger, so yes, making 100k instead of 40k could literally save your life, or at least keep you from being an indebted loan shark victim for the rest of your life. Right, that problem just doesn't exist in the Netherlands. Basically everyone pays, I would guess, around $150 a month median for insurance, with a standard deviation of probably around $25. That covers anything life threatening and quite a bit more. There's a bit of co-pay on things like dental and there's a mandatory own-risk of about $500 a year on certain procedures. If you're about 10% below the median income in the Netherlands you get an insurance subsidy which tops out slightly above $100 a month.
  - gambiting 9y ago
    And also, most importantly, even if you lose your job you are still 100% covered. If you get some weird condition that requires a dozen operations and expensive medicine, it won't have any effect on your payments either. There's no such thing as denied coverage due to preexisting condition or anything silly like that - essentially if you are a lawful resident you can just go to hospital and get treated for free, regardless of your financial status.
  - ivanhoe 9y ago
    But on the other hand taxes are significantly higher than in US, in order to finance that system. It's a trade off...
    - 9y ago
IkmoIkmo 9y ago
It's probably important to note the Netherlands has a high degree of decommodification (i.e. a lot of state provisions), with the US having some of the lowest in the developed world. The result of that is that distributive justice is a lot stronger, and the impact of a regressive tax system is magnified. A median salary in the US might generate unsatisfactory, whereas in the Netherlands even a below-median salary has quite good outcomes because of this. For example, the median healthcare insurance expenditure in the Netherlands is about $1.5k a year, and healthcare outcomes are quite good. Tuition fees in university for undergrad and graduate degrees are about $2.5k a year across the board, with a tiny fraction of students being the exception like dental or piloting schools. Student loans are currently at 0% and set to go to 1% next year. Tuition-waving subsidies exist for children of poor parents. Childcare is heavily subsidised. Traffic policy and public infrastructure is such that a car is not necessary, and employers tend to reimburse all public transportation costs for most employees. Lastly, it just feels like culturally the Netherlands is slightly more sensible with its consumerism and interest in toys. Most seems to be spent on things with higher lifetime values, meaning the effective value of money seems to do a bit better, but that's just intuition from anecdotes. In short, when you get your after-tax income, you tend to be able to spend a very large portion of it on things you don't really need, but just enjoy. Nice food, vacations, hobbies. There just isn't an need for a $100k salary for your kids to go to a nice school, have childcare or a good insurance, or a car to get your family places. Nor do you need $100k to cover interest payments + principal on 6% student debt of $100k. That having been said, your numbers on Asian/Australian vacations definitely cater to a certain tourist. I've done a month in Asia on 1k, but I was 19. Similarly I could do 3k in Australia, but I'd be a certain kind of vacation. You AirBnb and eat some simple Asian takeaway like food and travel by bus. That's not everyones idea of a holiday. It's a different vacation from getting taxis to hotels and eating in restaurants.
saiya-jin 9y ago
Those numbers are not true at all if you have family, or even 2 people where one earns little. Vacation in Australia? For 4 people it's impossible to spend less than 5000 euro on just flight tickets alone. Expect to spend another 1500/week if you do it very, very frugally. And that's exactly what you should do - travel half around the world to have a mediocre vacation just to save a bit of cash on site. To explain - I am backpacker, will never travel any other way (family or not), avoid any luxury on purpose (reduces the intensity of whole experience) and surviving with 500 USD/month in India for months was a breeze for me. But your numbers are just plainly wrong. You need tons of cash if you want to travel to exotic places, even really cheap ones (ie remote Indonesia). Travelling properly is great but needs quite a lot of cash, unless you can afford to spend months doing it every year, which is unrealistic for most of us. Plus many of us prefer to have 3-4 shorter vacations per year, but still travel quite far and have intense experiences. Then you have sports - I am not into snobbish activities, but I also don't chose sport based on price of equipment. Paragliding? More than 3000 euro for a started pack of used equipment (new would be more like 4k). Ski alpinism? Maybe 2500 euro for skis, boots, avalanche airbag. Not even going into clothing. And those numbers are for a single person. Oh, and you want to support your parents because they live in a EU country where 500 eur is quite OK salary? You need cash. You want to save for the pension, create a cushion for rainy days, retire early, invest, whatever? You got it, you need cash, the more the better. I have not met a single person who wouldn't like to do that if they could. Simple, sad fact is, exciting life in many cases costs quite a bit. One should optimize since plenty of things can be experienced almost for free, but this strategy will get you only that far. If you are happy with little, great for you. I have certain plans and expectations from life, and they require cash, tons of it.
meuk 9y ago
I also live in the Netherlands and feel the same. I make less than 2k a month and already don't know what to do with my money. That being said, it probably helps if you have a reasonable healthcare system. If you get ill in the US, you're basically screwed.
- icebraining 9y ago
  I make less than 2k a month and already don't know what to do with my money. In my experience, the best way to fix that "problem" is to get some kids :)
aianus 9y ago
Just a house for your family will eat up all of that 40k here in Toronto (that’s basically interest-only on the average $1m house in the suburbs). You’d have nothing left. Although we still live very well in absolute terms, a lot of people I know have and will have a worse quality of life than their parents did, despite being more successful and earning more money! It’s kind of depressing.
AnIdiotOnTheNet 9y ago
It's cultural, I think. In the US, we are very consumer driven. We are bombarded with propaganda constantly telling us that the one thing missing from our lives is whatever that person is selling. Some of those people are selling credit. That wouldn't be so bad, except that Americans are also highly competitive. We hate losing, and someone else having more stuff than us is losing. Our entire measure of the value of a human being is their wealth. Consequently, many Americans spend nearly everything they make on stuff that ultimately contributes very little, if anything, to their contentment. Since buying those things didn't actually make them happy, they figure they need more money, and more debt, to buy more things. It's a trap we've created for ourselves. Oh, and our health care system is ridiculously expensive.
mathgladiator 9y ago
So, I think a difficult aspect of frugality is that is borders close with cheapness. Cheapness is a problem, and imagine if all your customers became cheaper and you lost a few. Well, you would have to become more frugal which means firing providers of services. It becomes a negative trend. I live near Seattle where $100K is probably a reasonable income (give or take $30K). Now, I make more than that by a large margin where my cash target side of the house is roughly $300K not including stocks. I live pretty well, so what do I do with the extra money? Well, I trickle down. I have four employees for my house and land. When you not only provide for yourself, but you provide for others then I claim that there is extra happiness to be had. My house keeper, for instance, makes $40K with an average of 20 hours of week, flexible timing, and a monthly stipend for benefits. You can buy happiness, but only if you spend it on people rather than things.
- mailshanx 9y ago
  Wow, that's an awesome salary! What do you do for a living, and how did you get there?
  - mathgladiator 9y ago
    Principal Software Engineer: I write ridiculous amounts of code, and I lead teams with an emphasis of building up people.
BeetleB 9y ago
>I really dont get why you would need 100k to do the things you need. Perhaps people need to become a bit more frugal? No one said you need it. They're saying at that income a lot of pain points go away. As others pointed out, much of it has to do with a reduction of stress. A lot of small problems can be solved with money. It doesn't mean that people will solve them with money - but knowing that you can eases the brain quite a bit. And then of course, there's health care. With good employer paid insurance, the deductible for a couple is about $3300. So if you have any kind of chronic medical condition, you'll pay that much each year at least. If your employer did not pay and you had to purchase it (e.g. you are self-employed), it'll cost perhaps $500/mo for the premium, with a deductible anywhere from $6000 to $10K. >Perhaps people need to become a bit more frugal? There is that as well. People here tend to change their smartphone every 2 years, and always buy a brand new expensive one. They'll pay a pretty high fee for cable TV. They'll insist on 50-100 Mb/s Internet, when, in my experience, 15Mb/s was fine for a couple (no degradation in quality for services like Netflix). They'll generally pay $15-30K for new or recently new cars. And many people change cars too often.
didibus 9y ago
> but I really don't think 100k is the magical number that you need to become happy. -> Most thorough study yet about the subject comes out, says 100k is the magical number. You: Well I'll keep believing my thoughtless, data less opinion anyway. Me: Rolls Eyes Sure, you can be skeptic, but at this point, if you needed to take a decision based on this, you'd do better go with the 100k magic number, the odds are definitly more in its favor then your belief.

aldanor 9y ago

I guess that is the whole point? I.e., you stop needing to be frugal and/or don’t have to count € when spending money on basic things like food or transportation. Also, more things become ‘basic’. Another point that makes a difference is that if you ever want to get a mortgage and buy a house, the maximum the banks will give you is a constant multiplier times your annual salary. In Ireland it’s 3.5x — good luck trying to buy a house on a €140k budget in Dublin. In my case, my total effective comp increased about 8x in the last 5 years after being corrected for taxes and CPIs of the countries I lived in, and I kind of concur with the OP in that it’s more of a log curve than linear. Things get progressively ‘easier’ but less lifestyle-changing over time.

IkmoIkmo 9y ago
> the maximum the banks will give you is a constant multiplier times your annual salary. The multiplier isn't constant or fixed but dependent on interest rates. So there are certainly multipliers that work in certain periods, like about 4x now in the Netherlands. But that'll go down once rates rise, it's only a constant insofar as the long-term interest rates appear somewhat constant (or rather, sticky) in a given period of time. At the end of the day they look at ability-to-pay, and interest rates factor in to that, which are variable.

fujiters 9y ago

A month in Australia for 3-4k? I want a cost breakdown for this. Say you get a deal and airfare is $500, that leaves about $100/day for the month. You could probably find a hotel at that rate, but then you're left with nothing to spend on food and activities. What am I missing? Friends and relatives who'll let you stay with them?

jon_adler 9y ago
I believe it would only be possible to maintain yourself as a backpacker on $100 per day. This might be lower in the bush but true in most urban locations in Australia.
xya3453 9y ago
Van rental is $40/day. Leaves a budget of $60/day for fuel, food and fun. Quite easy if you prepare most meals yourself and limit purchases that are prohibitively expensive in Australia, e.g. alcohol, cigarettes, taxis, restaurants, etc.
asdasd23234 9y ago
Exactly, AUS is an overpriced polished turd. It's called "land of plenty" for a reason... plenty of sheep happy to get ripped off. So why not milk them for their cash...

withdavidli 9y ago

student loan debt. there are many that graduate with $20k-$100k+ of debt. I'm frugal/cheap, got by with 30k salary in big city a year out of school was tough. Many coworkers that were more normal in spending habits were breaking even or using savings to make ends meet. At 30k salary, I was able to save $400-$500/month in Boston. It would have been near zero if I had student debt (6%+ interest). Frightening thinking back, but I was always one major repair on my car or mid level health issue away from spending an entire years worth of savings.

zaarn 9y ago
The obvious fix is that graduating shouldn't require someone to go into 100k+ debts. The entire cost for my graduation is probably come in under 1000€ total, 800€ will be tuition and the rest directly university related spending. (There is an additional 2k€ spending on stuff like a new laptop, software, etc. that wasn't necessarily required but made things easier).
- withdavidli 9y ago
  Fixes are obvious, implementing it is the hard part. The propaganda for everyone to get a college degree is ingrained into the system. This sprouted countless for profit colleges charging obscene rates of $20k-$30k per year. Another obvious fix would be to spread good jobs around the country so we don’t have such concentrated HCOL cities. That’s as easily done as the suggestion of lowering cost of graduation to your sugessted price point. We have an entire political party against free or near free education, which means more taxes to pay for it. I don’t fully disagree with some of their stances. Many degrees don’t provide financial value, and can be learned online or have meet ups to discuss topics. A college degree for a college degree sake is what’s happening to much of the populous.
  - zaarn 9y ago
    Obviously it wouldn't be easy. The US education and employment system would have to ease of college degrees. Where I live, about 80% of my class had a job by the time they graduated secondary school. 20% went on for a higher education afterwards, of which only about 30% (or 6% of the original class) moved into College/University (the difference is muddy here). And at every step, people jumped straight into employment from school. US High School should focus on that. If a student graduates they should already have a job offer signed, that should be their primary target. If they don't they should be moving into higher education. College and other Institutions should have the same goal.

ProblemFactory 9y ago

> I live in the Netherlands where 40K is quite a reasonable income. I really dont get why you would need 100k to do the things you need. Perhaps people need to become a bit more frugal? What I have found is that the majority of "happiness from money" comes from the financial security, not actually spending the money. The reduction in stress going from a chronically broke PhD student to having 5 years of living expenses in savings is huge. It's the knowledge that you can immediately solve almost every problem that pops up with a bit of money, and figure out the details later. Missed your flight? Book another one. Car trouble? Call assistance and take an uber. Lost your job? Take a short vacation and then hit up your network on LinkedIn. And in most countries in Europe, you can feel secure with a lot less in income/savings than in the US. You don't need to worry about what your health insurance does not cover, probably don't have any student loan debt - and probably don't need to worry about a college fund for kids, can commute by public transport in cities, have better unemployment protections, and so on.

ikeyany 9y ago
> It's the knowledge that you can immediately solve almost every problem that pops up with a bit of money, and figure out the details later. Missed your flight? Book another one. Car trouble? Call assistance and take an uber. Lost your job? Take a short vacation and then hit up your network on LinkedIn. And then your expectations shift, you require more expensive things to acquire that base level of prosperity and satisfaction, and you have a whole new set of problems which feel just as stressful, relatively speaking.
- bitexploder 9y ago
  This is probably not true based on what I have read. Of course some people get stuck on a hedonistic treadmill, but most people don't. I think when you can take time off from work and afford safe living and food is no longer a concern, indulge in hobbies, that is enough for most people to be happy. Studies I read say that experiences will provide longer term happiness over "stuff". You can always jump off the treadmill of needing the next better possession.

faitswulff 9y ago

I don't know how health care works anywhere else, but health expenses can range from $250 for a standard checkup, which I just got (note: it's supposed to be covered for free, but apparently insurance companies are now rejecting claims willy nilly in order to save money) to $10,000 for delivering a baby, to astronomical numbers for anything else. It really leads to a persistent feeling of danger, so yes, making 100k instead of 40k could literally save your life, or at least keep you from being an indebted loan shark victim for the rest of your life.

IkmoIkmo 9y ago
> It really leads to a persistent feeling of danger, so yes, making 100k instead of 40k could literally save your life, or at least keep you from being an indebted loan shark victim for the rest of your life. Right, that problem just doesn't exist in the Netherlands. Basically everyone pays, I would guess, around $150 a month median for insurance, with a standard deviation of probably around $25. That covers anything life threatening and quite a bit more. There's a bit of co-pay on things like dental and there's a mandatory own-risk of about $500 a year on certain procedures. If you're about 10% below the median income in the Netherlands you get an insurance subsidy which tops out slightly above $100 a month.
- gambiting 9y ago
  And also, most importantly, even if you lose your job you are still 100% covered. If you get some weird condition that requires a dozen operations and expensive medicine, it won't have any effect on your payments either. There's no such thing as denied coverage due to preexisting condition or anything silly like that - essentially if you are a lawful resident you can just go to hospital and get treated for free, regardless of your financial status.
- ivanhoe 9y ago
  But on the other hand taxes are significantly higher than in US, in order to finance that system. It's a trade off...
  - 9y ago

IkmoIkmo 9y ago

It's probably important to note the Netherlands has a high degree of decommodification (i.e. a lot of state provisions), with the US having some of the lowest in the developed world. The result of that is that distributive justice is a lot stronger, and the impact of a regressive tax system is magnified. A median salary in the US might generate unsatisfactory, whereas in the Netherlands even a below-median salary has quite good outcomes because of this. For example, the median healthcare insurance expenditure in the Netherlands is about $1.5k a year, and healthcare outcomes are quite good. Tuition fees in university for undergrad and graduate degrees are about $2.5k a year across the board, with a tiny fraction of students being the exception like dental or piloting schools. Student loans are currently at 0% and set to go to 1% next year. Tuition-waving subsidies exist for children of poor parents. Childcare is heavily subsidised. Traffic policy and public infrastructure is such that a car is not necessary, and employers tend to reimburse all public transportation costs for most employees. Lastly, it just feels like culturally the Netherlands is slightly more sensible with its consumerism and interest in toys. Most seems to be spent on things with higher lifetime values, meaning the effective value of money seems to do a bit better, but that's just intuition from anecdotes. In short, when you get your after-tax income, you tend to be able to spend a very large portion of it on things you don't really need, but just enjoy. Nice food, vacations, hobbies. There just isn't an need for a $100k salary for your kids to go to a nice school, have childcare or a good insurance, or a car to get your family places. Nor do you need $100k to cover interest payments + principal on 6% student debt of $100k. That having been said, your numbers on Asian/Australian vacations definitely cater to a certain tourist. I've done a month in Asia on 1k, but I was 19. Similarly I could do 3k in Australia, but I'd be a certain kind of vacation. You AirBnb and eat some simple Asian takeaway like food and travel by bus. That's not everyones idea of a holiday. It's a different vacation from getting taxis to hotels and eating in restaurants.

saiya-jin 9y ago

Those numbers are not true at all if you have family, or even 2 people where one earns little. Vacation in Australia? For 4 people it's impossible to spend less than 5000 euro on just flight tickets alone. Expect to spend another 1500/week if you do it very, very frugally. And that's exactly what you should do - travel half around the world to have a mediocre vacation just to save a bit of cash on site. To explain - I am backpacker, will never travel any other way (family or not), avoid any luxury on purpose (reduces the intensity of whole experience) and surviving with 500 USD/month in India for months was a breeze for me. But your numbers are just plainly wrong. You need tons of cash if you want to travel to exotic places, even really cheap ones (ie remote Indonesia). Travelling properly is great but needs quite a lot of cash, unless you can afford to spend months doing it every year, which is unrealistic for most of us. Plus many of us prefer to have 3-4 shorter vacations per year, but still travel quite far and have intense experiences. Then you have sports - I am not into snobbish activities, but I also don't chose sport based on price of equipment. Paragliding? More than 3000 euro for a started pack of used equipment (new would be more like 4k). Ski alpinism? Maybe 2500 euro for skis, boots, avalanche airbag. Not even going into clothing. And those numbers are for a single person. Oh, and you want to support your parents because they live in a EU country where 500 eur is quite OK salary? You need cash. You want to save for the pension, create a cushion for rainy days, retire early, invest, whatever? You got it, you need cash, the more the better. I have not met a single person who wouldn't like to do that if they could. Simple, sad fact is, exciting life in many cases costs quite a bit. One should optimize since plenty of things can be experienced almost for free, but this strategy will get you only that far. If you are happy with little, great for you. I have certain plans and expectations from life, and they require cash, tons of it.

meuk 9y ago

I also live in the Netherlands and feel the same. I make less than 2k a month and already don't know what to do with my money. That being said, it probably helps if you have a reasonable healthcare system. If you get ill in the US, you're basically screwed.

icebraining 9y ago
I make less than 2k a month and already don't know what to do with my money. In my experience, the best way to fix that "problem" is to get some kids :)

aianus 9y ago

Just a house for your family will eat up all of that 40k here in Toronto (that’s basically interest-only on the average $1m house in the suburbs). You’d have nothing left. Although we still live very well in absolute terms, a lot of people I know have and will have a worse quality of life than their parents did, despite being more successful and earning more money! It’s kind of depressing.

AnIdiotOnTheNet 9y ago

It's cultural, I think. In the US, we are very consumer driven. We are bombarded with propaganda constantly telling us that the one thing missing from our lives is whatever that person is selling. Some of those people are selling credit. That wouldn't be so bad, except that Americans are also highly competitive. We hate losing, and someone else having more stuff than us is losing. Our entire measure of the value of a human being is their wealth. Consequently, many Americans spend nearly everything they make on stuff that ultimately contributes very little, if anything, to their contentment. Since buying those things didn't actually make them happy, they figure they need more money, and more debt, to buy more things. It's a trap we've created for ourselves. Oh, and our health care system is ridiculously expensive.

mathgladiator 9y ago

So, I think a difficult aspect of frugality is that is borders close with cheapness. Cheapness is a problem, and imagine if all your customers became cheaper and you lost a few. Well, you would have to become more frugal which means firing providers of services. It becomes a negative trend. I live near Seattle where $100K is probably a reasonable income (give or take $30K). Now, I make more than that by a large margin where my cash target side of the house is roughly $300K not including stocks. I live pretty well, so what do I do with the extra money? Well, I trickle down. I have four employees for my house and land. When you not only provide for yourself, but you provide for others then I claim that there is extra happiness to be had. My house keeper, for instance, makes $40K with an average of 20 hours of week, flexible timing, and a monthly stipend for benefits. You can buy happiness, but only if you spend it on people rather than things.

mailshanx 9y ago
Wow, that's an awesome salary! What do you do for a living, and how did you get there?
- mathgladiator 9y ago
  Principal Software Engineer: I write ridiculous amounts of code, and I lead teams with an emphasis of building up people.

BeetleB 9y ago

>I really dont get why you would need 100k to do the things you need. Perhaps people need to become a bit more frugal? No one said you need it. They're saying at that income a lot of pain points go away. As others pointed out, much of it has to do with a reduction of stress. A lot of small problems can be solved with money. It doesn't mean that people will solve them with money - but knowing that you can eases the brain quite a bit. And then of course, there's health care. With good employer paid insurance, the deductible for a couple is about $3300. So if you have any kind of chronic medical condition, you'll pay that much each year at least. If your employer did not pay and you had to purchase it (e.g. you are self-employed), it'll cost perhaps $500/mo for the premium, with a deductible anywhere from $6000 to $10K. >Perhaps people need to become a bit more frugal? There is that as well. People here tend to change their smartphone every 2 years, and always buy a brand new expensive one. They'll pay a pretty high fee for cable TV. They'll insist on 50-100 Mb/s Internet, when, in my experience, 15Mb/s was fine for a couple (no degradation in quality for services like Netflix). They'll generally pay $15-30K for new or recently new cars. And many people change cars too often.

didibus 9y ago

> but I really don't think 100k is the magical number that you need to become happy. -> Most thorough study yet about the subject comes out, says 100k is the magical number. You: Well I'll keep believing my thoughtless, data less opinion anyway. Me: Rolls Eyes Sure, you can be skeptic, but at this point, if you needed to take a decision based on this, you'd do better go with the 100k magic number, the odds are definitly more in its favor then your belief.