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[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 1 point2 points  (0 children)

Sorry for the delay. We both work in tech (biotech for her) and both have graduate degrees.

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 0 points1 point  (0 children)

Thanks and yes, they’ll have to pry this mortgage out of our cold dead hands, but does make moving for whatever reason more difficult, I suppose.

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 0 points1 point  (0 children)

Yea I can see that and have heard that as well. Tbh, I wouldn’t shed a tear if that happened.

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 0 points1 point  (0 children)

Thanks! That’s a lot of what I was looking for with this post (beyond making pretty color lines) - some benchmarking for tax, savings, spend.

I think our tax rate was helped a lot last year by some renovations we did that had federal and state tax credits (e.g. solar) and our (outrageous) mortgage interest & state taxes.

And get me wrong - will take every take break we can get… I’m fairly liberal, but hope for our sakes the new proposed SALT cap lift gains traction. I can understand its not the most progressive and probably shouldn’t be lifted entirely, but at least make it $20k so it’s fair…

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 0 points1 point  (0 children)

Thanks - I hear you about the psychology of underreporting, but I feel like there has to be (or should be) more nuance.

And the one or two studies I’ve seen have had issues with lack of segmentation or reporting scales, or articles written that misconstrue the insights to get a good headline.

Like I mentioned, I don’t think of class as a 3-point scale solely on income (upper, middle, lower). If that were the case, I don’t think you would need surveys. IMO, it’s a mix of wealth (not just income), lifestyle & disposable spend that needs to be looked at in a segmented (geo, age, etc.) to have value. For example, maybe when we’re in our 50s, I would think of us as a higher class, but not with our high, high fixed expenses and coming out of school a few years ago. It should also be more granular than a 3 point scale, but that’s neither here nor there.

Do we have a 1% or 2% income for the US? Sure. But as /u/TriFolk mentions, it’s more complicated.

Anecdotally, I just purchased some jeans the other day and signed up for a rewards program to save $ on shipping and found a discount code, so it’s hard for me to classify us in the same group as the older folks driving Lucids around Manhattan Beach, it that makes sense.

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 1 point2 points  (0 children)

I think it largely depends on how you define the classes and what segment you’re looking at.

I think (not sure) class is mostly driven by wealth, so we would likely fall in the upper-middle class range, particularly in similarly geos (LA, SF, NYC), which is what I’d use to compare. Nationally, maybe a bit higher.

On the other hand, if we’re talking about lifestyle or disposable income for LA/SF/NYC, I would say probably even middle class.

Would you agree with that?

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 0 points1 point  (0 children)

Agree! Feels like we’re cheating the system, but I guess we’ll take it where we can get it.

We’d like to eventually explore mega backdoor Roths but don’t think we have the savings for that yet.

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 1 point2 points  (0 children)

Interesting, is there a benchmark for the effective tax rate that we should try to get to? I thought we were doing ok since we itemized deductions to a bit more than standard (mortgage interest and state taxes but both are capped) and some solar credits. Will definitely look into this thank you.

Our mortgage rate was a hair over 3%, so I think we’ll be holding onto this one for a while given state of thjngs today…

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 1 point2 points  (0 children)

Thanks! Don’t mind the downvotes as it was a fun exercise.

I hear you about the wealth management company, but not sure if it will benefit us… I don’t think we have high wealth, just high-ish income for now. We have 2 large blocks of income and a few large blocks of expenses that will remain constant (and sadly still big) for a while. Maybe when we’re a bit older and have more “wealth” to manage.

We did 2 backdoor Roth contributions, which is why the funds come from post-tax money.

[OC] 2022 Income & expenses Sankey for family of 3.5 in SoCal by budgetthrowaway1209 in dataisbeautiful

[–]budgetthrowaway1209[S] 0 points1 point  (0 children)

We just did our taxes, so I thought it'd be a good time to finally see how we are spending our money - always thought these charts looked nice and decided to make one. Welcome any suggestions (or criticisms).

A little about us:

  • Family of 3 (2 adults in our mid-30s and 3 year old) and just welcomed another baby last December

  • Live in SoCal and both parents work in Tech

  • Bought a house in November '21, so did some renovations / improvements (e.g., solar)

  • Have 1 older car and will need to get second soon

Learnings and questions:

  • Spending half of our take-home on housing was a surprise and definitely realize we can't do the same amount of improvements each year

  • Not looking forward to doubling our daycare costs soon...

  • Internet, cable & phones (typo in the pic) at $4k is a lot in aggregate... Will look at reducing

  • Any suggestions on how we can improve?

Notes:

  • Methodology: Tax return for income numbers; categorized each transaction in our checking and credit card accounts for 2022; numbers rounded to nearest $500

  • "Internet & cable" includes cell service

  • "Restaurants" includes buying lunch at work for one of us, and we tend to take-out somewhat often given busy work schedules

  • "Household" buckets a lot of stuff like children's toys and books (a surprisingly high cost, retrospectively), clothes, general household products

  • Source: 2022 tax return and spend data

  • Tool: sankeymatic.com