00,000 Salary = BROKE (here’s why)

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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 being broke now i know a lot of people 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

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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

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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

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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

Transcribed from video
$100,000 Salary = BROKE (here's why) By Ryan Scribner

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