Author Topic: NYC Salary - How much to be able to responsibly save?  (Read 5889 times)

9ft5wt

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NYC Salary - How much to be able to responsibly save?
« on: March 28, 2015, 10:56:28 AM »
Greetings,

My wife and I have just been offered teaching positions in Brooklyn with a combined income of $141,000.

Does anyone here have direct experience with working and saving in NYC? We would obviously max our tax-deferred contributions (4% employer match to 403b) but would attempt to live a Mustachian lifestyle in order to stash some cash.

We are expecting a 10% (state plus city) and 25% federal income tax.

It seems that our higher salaries in NYC allow an opportunity to save more. Anyone have direct experience?

the_gastropod

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #1 on: March 28, 2015, 12:42:06 PM »
Fellow Brooklynite here! You should be able to save well over 50% of your salary making that much. Outside of rent, NYC isn't that much more expensive than other cities in the U.S. As long as you don't live the silly lifestyles of the Wall St crowd or the Williamsburg trust-fund kids, you'll be just fine. Last year I spent around $37k. $24k was for rent (I live alone in a studio apartment in a probably-too-expensive neighborhood).

gradstudent

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #2 on: March 28, 2015, 01:00:32 PM »
I'm married in Manhattan. NYC in general is a surprisingly cheap place, if you realize that 1) you don't have to have a car here 2) you don't have to have the same size apartment you did back home 3) you don't have to eat out every day. We don't do any of those 3, and manage to get by on an income 50% the size yours will be and still save around 35%. We also go to Broadway plays, concerts, take trips, and eat in delicious ethnic restaurants about once week so we certainly don't live a spartan, boring lifestyle. Even if we made more money, other than paying more in taxes, our spending wouldn't go up so you should be able to easily save over 50%. We spend less than the_gastropod in rent (around $1600) for a 1 bedroom 750 sq ft apartment in a non cool but very safe neighborhood, and around $2k per month for everything else.

It really is a great city-maybe not to stay for 20 years, but we've had a blast here so far.

RexualChocolate

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #3 on: March 28, 2015, 01:04:19 PM »
For teachers NYC makes a lot of sense. The salaries are higher to compensate for the higher cost of living.

Expense management techniques include living in less desirable neighborhoods and commuting. Getting an address right out of the city would save you 4500 or so a year.

I'd just live where you want though as long as savings is above 30 percent. I don't know of you're exempt from social security with your pension so you will need a marginally higher savings rate to offset pension risk.

9ft5wt

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #4 on: March 28, 2015, 02:34:54 PM »
GREAT to know. I estimated, based on budgets given to me by a few friends, that we could save roughly $47,000.

When you mention a savings percentage, are you talking about a percentage of gross or net pay?

Which neighborhoods in the Brooklyn area would you guys recommend?

RexualChocolate

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #5 on: March 28, 2015, 03:15:07 PM »
I always do gross. My rate is 35 percent in Chicago which is insanely easy. Not that focused on early retirement yet.

lise

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #6 on: March 28, 2015, 03:55:02 PM »
where are your jobs in Brooklyn?  Then I could recommend some neighborhoods (maybe walk to work?).
Lisa

Krnten

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #7 on: March 28, 2015, 09:05:01 PM »
I would plan where to live almost exclusively based on the job locations, trying for a reverse commute if possible, or walkable or bikeable.  The subways seem to be getting worse here so prioritize a short subway commute.

nycstash

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #8 on: March 28, 2015, 11:11:29 PM »
Glad to see you chose NYC and ignored the haters! I think $36K in savings per year is an easy goal and $50k is doable.

9ft5wt

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #9 on: March 29, 2015, 06:41:25 AM »
We haven't accepted them yet! They've given us until Tuesday, and we also have offers from a boarding school in rural PA and a great school in Baltimore city.

Both NYC schools are in the vicinity of Prospect Park.

MoneyCat

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #10 on: March 29, 2015, 08:35:36 AM »
Depending on how you structure things on your tax return, you could end up paying a lot less than 25% on your federal income taxes, particularly if you are maxing out your 403b.  Are you planning to rent or buy?  The mortgage interest deduction can save you a lot if you buy an apartment instead of renting -- and I believe there are some programs for teachers to buy with tax incentives in some of the less desirable neighborhoods that make buying very attractive despite the expensive real estate market in NYC.

lise

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #11 on: March 29, 2015, 10:07:20 AM »
You'll find affordable housing around Prospect Park depending on what side you are on. Even if the school is on the expensive side you can walk/ride across the park to the cheaper sides!

So as another poster said, look close to where you are working- walk, easy subway or bike ride away.

Krnten

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #12 on: March 29, 2015, 11:25:48 AM »
Agreeing with Lise- a cross park commute would be an absolute pleasure!  Good luck, I bet you'll find something great.

nycstash

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #13 on: March 30, 2015, 08:29:41 PM »
If you're already working out by Prospect Park, then you can reduce housing costs considerably and still have a walkable, or at least bikeable, commute. I would revise my estimate to say that you could probably save closer to $50k per year.

9ft5wt

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #14 on: March 31, 2015, 01:09:56 PM »
Things are happening quickly!

We just had new offers made that total 170k salary, plus 7k 'settling-in' allowance, 5k shipping allowance and a 9% employer match.  We're moving from Africa.

We would be insane to pass this up, right?
« Last Edit: March 31, 2015, 01:12:10 PM by Merd »

mxt0133

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #15 on: April 04, 2015, 08:04:40 PM »
Where is the position?  Is it still in NYC?

9ft5wt

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #16 on: April 06, 2015, 07:33:13 AM »
Accepted the positions in New York City! We're up for the challenge of a mustachian lifestyle in the Big Apple.

pinkysmith

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Re: NYC Salary - How much to be able to responsibly save?
« Reply #17 on: April 06, 2015, 09:28:42 AM »
Congratulations on your new jobs!

Wanted to chime in as I currently live in Brooklyn (a couple blocks from Prospect Park West) and have been living and working in NYC for over a decade.

As others have mentioned, if you are looking to live in Brooklyn around Prospect Park, there are significant differences in housing costs and neighborhood "feel" depending upon what side of the park you are considering. Neighborhoods to the west side of the park are generally more expensive than those to the east side of the park and those in the north are generally more expensive than those in the south.

While you are apartment hunting, I suggest you also diligence proximity to affordable grocery stores and subway stations with more than one line if you will not have a car in the city.

I agree with others that on a $170K salary, saving $50K or more (exclusive of retirement accounts) is definitely doable.