| Tuesday, February 06, 2007 |
| Surviving (and thriving) on $12,000 a year |
Donna Freedman writes in this MSN article: Surviving (and thriving) on $12,000 a year - I've made my choices, and they include no more husband, a college education and huge changes in the way I spend money. My 2007 "income," the money I can actually count on, will be $12,084. I know this because it consists of alimony and a portion of a school grant. (I went back to college last year; the grant covers tuition and books with a little left over.) I already know my big-ticket annual costs, too: rent of $6,300 and $1,200 for car insurance. Subtract these from my income and I'm left with $382 a month for food, utilities, clothes, medical deductibles and co-pays, gasoline, renter's and life insurance and any help I give my daughter, who lives on even less than I do. Yikes! I applaud her taking this bold step - but doubt someone could follow her example in a city like Boston. Rent alone here would eat up that $12,000 a year! |
| posted by Boston Gal @ 4:31 PM *
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| 10 Comments: |
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That is pretty brave of her. However, I take issue with you that she'd eat up all $12,000 on rent alone in Boston. I live in Boston and pay $6600 a year in rent. She'd have to live with three other people, but she could do it. :)
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Hi Joshua,
As an almost 50 year old I presume it would be very difficult for her to find the kind of roommate type housing in the Boston area that you describe.
The older you get the harder it is to find people who are willing to share housing with you and the harder it is to settle for that kind of life style.
Would you consider her for a roommate? Would your housemates?
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$12000 is still more than the current Federal minimum wage (though less than 1/2 of one percent of workers earn that http://biz.yahoo.com/ap/070201/minimum_wage.html?.v=19). We pay our grad students a minimum of $14,500. If they're foreign they can't work off campus in the summer. They and her can get medical care through the school.
But she mentioned baby-sitting and she could work through the summer. Unless she is taking full time classes then.
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Boston Gal,
You bring up an interesting point and I didn't mean to be glib in suggesting that she could live with roommates. I just assumed that people in this area with low incomes (either 20-somethings just starting out or 60-somethings who work for NGOs) lived together. I can't fathom how else people could possibly afford to live in the area.
So I'll put the question back to you -- Where do people of moderate income live? Do they move out of the city? Do they share a house with someone? What's a single person making $40,000 to do?
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We get by on a whole lot more that 12k a year, but sometimes (often lately) I wish we would live like we had less.
However, the wife will NOT allow me to have the heat lower than 74 degrees when she's in the home, and she expects it to be 74 when she walks into the house.
See what I'm up against?
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Hi Joshua,
$40,000 a year is a long way from $12,000 a year - but I believe I get your point.
Someone earning $40,000 per year can afford to live alone in an apartment in Boston - but not in the Back Bay or Beacon Hill. Rather they are likely to reside in East Boston or similar low rent neighborhood. However, if the $40,000 per year Boston resident has large student loan balances, credit card debt, a car, etc. etc. they likely would find it easier financially to live with roommates or with a partner.
It is common for women to cite financial reasons for staying in an unhappy marriage or relationship. Lower income singles are more likely to jump into living together because of the cost savings than wealthier singles. Economics can and do impact peoples love lives.
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One word --- wow! It certainly puts things into perspective when we consider our own financial situations. I could not even imagine living on $12,000/year, but clearly this shows that it is *possible*. Although, I'm not running out to try it anytime soon. :)
N.W.
http://www.networthchallenge.com
PS
Clever Dude --- my wife is the same way. Anything below 74 in the winter is unacceptable in her mind. I'm not looking forward to this month's gas bill. :(
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I'm serving in Americorps and I work full time and make a little less than $12,000 a year (the poverty level for Massachusetts, I think). I'm not allowed to take a 2nd job even if I wanted to. Some of my team members live in Boston and get paid the same amount and yes, they all have 2 or 3 roommates. Food stamps also helps a lot of us. I've been reading your blog for a while so I laughed when I saw this. I still feel like I spend too much money on shopping but I also still get excited about my savings account grows $20 at a time.
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I blogged about this article too. The article that floored me more (I think a link is provided in the article) is the one where the family was barely scraping by on $150,000 a year! Unbelievable! Proving the theory that we can never have ENOUGH money!!
Kudos to her for making it work!
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What an inspiring story, thanks for posting it. Does make me realize that I am doing just fine on my $42000 salary!
BTW, you have a REALLY great blog here and I always look forward to your posts!
~leanne
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That is pretty brave of her. However, I take issue with you that she'd eat up all $12,000 on rent alone in Boston. I live in Boston and pay $6600 a year in rent. She'd have to live with three other people, but she could do it. :)