The Plight of the Barely Affluent

Today I was thinking about how few people in the United States are really making it. Between the ridiculous cost of housing, energy prices, the price of childcare and education, and a medical system that has become completely irrational, nearly everyone is challenged to make ends meet.

My own household is a case in point.

We do better than most. We're both college educated. Forty-six and forty-three. My wife has a Master's Degree in Social work. She works for the county and has excellent family benefits. I've headed the same non-profit for 13 years, and earn exactly the median income for Seattle, which is $52K. Last year, between our primary work and some minor side income, we earned $111,401. We paid 8.72% of our income to the federal government in taxes.

This places us well inside the top quintile of family income in the United States, which begins at $88,030. Having two income earners makes us typical of those households in the top two quintiles. We have twin four year olds, making us a 4 person family. The graphic at left shows U.S. income distribution represented as a 30 story building. Our household would live somewhere around the 28th floor.

Those next two floors must be real doozies.

We have what we need. Healthcare. Housing. Enough food. Broadband internet, a gym membership at Bally's, and a subscription to Netflix. The graphic at right represents income distribution in the United States as a peanut butter sandwich. We have scaled the US class ladder to what are dizzying heights. And yet, it doesn't seem like quite enough.

Everyday, for example, lunch at work is the same grilled chicken and bell pepper with kashi grains microwave dinner from Costco. Sometimes I go for the teriyaki bowl. They cost around $2.30 each. With two four-year-olds and both parents working, who has time to cook?

The girls are in a Montessori daycare, which costs close to $1,700 a month. We skip the frills like dance and swim lessons, and buy all their clothes at thrift stores. We leave the Gymboree bullshit to those higher on the peanut butter pinnacle than ourselves.

Our beige carpet is more of a mottled brown. Renting a steam vac runs about $50 a pop, so I try and only do it around three times a year.

We have no cable TV. The girls watch cartoons on PBS, and I watch Lawrence Welk on Saturdays. Despite the allure of James Taylor, Roy Orbison, and the Mamas and the Papas, we do not contribute to public television.

We have a 19 year old cat who pees on our bed once or twice a week. We'd have him put down, but we don't have the $200, so instead, we wait.

The 97 Accord wagon isn't seeming quite as new as it did a few years ago.

Our second car, a '94 Toyota Corolla, just got its third cracked front windshield this year. We're unlucky that way. That'll be $200. We also need to fix the brakes and flush the transmission. The maintenance will cost more than the car is worth. We'll do it anyway, because at least it's paid for.

These are the sorts of things that put us another $500 or so in credit card debt each month. This is where the tax return goes. This year we got about $1,500 off our taxes for being homeowners, and another $1,200 in daycare credit. We'll get about $3,700 back, bringing the debt down to a manageable $2-3K.

Each week, I get around 3-4 offers to refinance the house, and another 2-3 loan offers for $30-50K at attractive interest rates. Apparently, bankers see our relatively low income-to-debt ratio and see great untapped potential.

We have no savings. At 46, I have no retirement plan. My first 35 years or so were more or less spent in poverty, so social security isn't looking too lucrative just yet. Our 1,080 square foot house, which we bought in Shoreline two years ago for $252,000, should be paid off in 2035. I'll be 70.

Zillow says our house is worth $306,000 now. That's a bit better than 10% appreciation a year. We should probably feel like we made a wise investment, but I mostly feel like I'm shoveling money to a mortgage broker. Most of what we pay each month is interest.

At this rate, by the time I'm 70, our little '52 rambler of a house will be worth well over $1,000,000, and I'll achieve my lifelong dream of retiring as a millionaire. If, instead, the housing market crashes, we'll be debt slaves like everyone else. Woo-hoo!

And this is the view from the 28th floor. I hate to whine, but seriously, if this is affluence, it kind of sucks.