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skipdogg posted:What? Having kids had almost zero effect on my housing expenses. Yes, that's why it's the number thrown around by idiots. http://time.com/money/4629700/child-raising-cost-department-of-agriculture-report/ posted:The price jump is a 3% increase from the previous year, according to the report, with housing taking up a bulk of the expense at 29% of the cost. Food took the second biggest expense at 18%, according to the report. Transportation is apparently 15% as well  It's like these reports figure no one has any idea how to not give every child their own dedicated room and car.
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Jul 11, 2018 17:20
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skipdogg posted:What? Having kids had almost zero effect on my housing expenses. Day care is another mortgage payment basically.
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Jul 11, 2018 17:33
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If not more. My last mortgage was less than 1300 (I sold my house a few months ago). Summer care for both kids is over 1800 a month (230/wk/per kid plus activity fees). Luckily it only last 11 weeks. They're both school aged now so I can offset the costs over the year by utilizing the school's after school program which is only 300/mo for both. Back to house buying though, I close on my new place next week, and the list of stuff to do is so overwhelming I just don't even know where to begin. Just trying to tell myself we don't have to do it all at once, and we're going to be in the house at least 12 to 15 years so I have plenty of time. I'm also a bit cranky about the mortgage company requiring 10 months of property taxes up front, but not much I can do about it. They just get to hold on to like 6K of my money for a year or so, pay zero interest on it, so I can get it back later.
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Jul 11, 2018 17:48
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I just got a spreadsheet of furniture and other things in the house I'm closing on next month. I knew this was going to happen. They pretty obviously need to be downsizing, so I just couldn't imagine they'd have a place for 14 rooms of furniture wherever they are going. These are the people who wanted to negotiate over a kegorator, 300 lb/day commercial ice maker and a spare fridge in the garage as part of the home purchase. I told them "I'm not negotiating used appliances: take them all, I don't care" .......and they're leaving them all, just like I suspected, and now trying to sell off furniture by the pound.
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Jul 11, 2018 17:56
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I'm not sure this is really the thread for the discussion, but who knows where is. Bad with money? Kids are definitely BWM. Anyway, the news-bite versions of the reports are predictably bad, but if you look at the actual report itself it acknowledges a lot of the limitations of its model and also discusses the alternatives that could be used for making estimates and the problems that arise that led them to not use those methods. For Housing, the report bases the amount on extra housing costs associated with an additional bedroom in a home. It's certainly not perfect (because it doesn't account for the fact that children may share a room either with their siblings or parents) but their argument is that the method is actually more conservative than alternatives because it doesn't factor in additional housing expenses that a family may incur that are the result of children that isn't just a bedroom - such as paying for a premium for a home with child-centered advantages like schools, parks, etc., and additional spending in a house that would be child-centered but not a bedroom - play-rooms, family rooms, additional furnishings in common rooms. It's certainly possible to have a child and not pay anything additional for housing, but the purpose of the report isn't to recommend what you should be doing, it's to try and estimate the actual spending patterns of people relating to their children, so the fact you can Harry Potter a kid under the stairs and not incur any costs doesn't matter unless that reflects the average behavior of families in the country. Having said that, in terms of approaching your personal spending, Housing spending is probably the easiest one to restrain and control because you can simply not buy/rent a new house and rearrange your life to make your current arrangement work as well as possible - whatever that may be. Our child spending is much less flexible, because you can't really just keep buying the same amount of food and split it among more people (well you can, but its not good) or just not spend money on childcare and hope your kid won't die during an 8-hour shift unattended. The transportation spending is done simply by looking at the expenses of 'family related' transportation (ie, not employment related or commuting) and allocating that among the family as 50/50 between parents and children and then broken down per-capita-child (so with three kids, each kid is allocated 16% of your family-related transportation spending). They acknowledge that isn't great but is their best attempt to determine the expense, because it's a very difficult thing to pin down. And again, the report is attempting to be descriptive, not prescriptive, so while can certainly whittle away child-related transport costs, the reality is that a bunch of people do drive their kids around to school, activities, friend's houses, etc., especially when they live somewhere that doesn't have any sort of functional transit. So you can say '15% is a stupid amount of money to spend on kid's transport', but you may want to consider whether that reflects a problem in the study methodology, or whether it's more likely the average household is just dumb about spending their money and it's describing that. 
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Jul 11, 2018 17:59
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Motronic posted:I just got a spreadsheet of furniture and other things in the house I'm closing on next month. I knew this was going to happen. Tell them to throw it on nextdoor or facebook marketplace. They'll get rid of it pretty quick if they want to. Any of it good?
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Jul 11, 2018 18:20
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I suppose the houses I'm looking at are a 25% premium because of school districts, but I don't know that I would include that 25% increase in the cost of raising my child because after 18 years my house will still be worth 25% more than the one in a bad school district. Other childcare expenses can't be salvaged in that way. Children depreciate. I think a number of child-free people end up buying in nice school districts strictly because of resale value.
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Jul 11, 2018 18:22
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I would think these days college tuition is a huge part of the expense?
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Jul 11, 2018 18:27
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“Children depreciate” lmao
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Jul 11, 2018 18:35
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Leperflesh posted:I would think these days college tuition is a huge part of the expense? Like anyone is going to be able to afford their kids college tuition. My kids better hope they earn a scholarship somehow.
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Jul 11, 2018 19:00
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Motronic posted:These are the people who wanted to negotiate over a kegorator, 300 lb/day commercial ice maker and a spare fridge in the garage as part of the home purchase. I told them "I'm not negotiating used appliances: take them all, I don't care" .......and they're leaving them all, just like I suspected, and now trying to sell off furniture by the pound. I got left with oh, I don't know, 2000lbs of wood (lumber) when I moved into the current place. Considering most of it was crap (e.g. old bed frame boards, boards with nail holes/paint, old/used trim), I had to spend considerable time with my table saw outside reducing it to pieces I could throw out with my trash (over 2 months.) I didn't raise a stink about it during my final walkthrough, as the seller did also leave a lawn tractor and extension ladder that I otherwise needed. At least getting rid of all the wood didn't cost me monetarily (only time), and I have a pile of stuff to burn in the fireplace this Winter. On kid cost chat: I know *why* they factor in housing prices they way they do, but it did always strike me as a miscalculation given that most DINKs I know aren't scrimping in a 800 sq/ft apartment in the bad part of town. Sure, housing costs will go up if you have/plan to have children, but it won't be anything close what's usually estimated.
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Jul 11, 2018 19:01
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send me that ice machine
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Jul 11, 2018 19:11
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skipdogg posted:Tell them to throw it on nextdoor or facebook marketplace. They'll get rid of it pretty quick if they want to. Any of it good? I honestly don't remember. I'm gonna go look at it in the next few days. I can probably use some of it - this place is way bigger than my current house so I knew I'd be buying a bunch of furniture eventually. They were big spenders so I'm guessing most of it is pretty good (it's been very obvious throughout this process that they are very cash strapped - and yes, I absolutely used that to bully them around and get what I wanted during the negotiations)
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Jul 11, 2018 19:27
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Wow, thanks for all the great replies! Re: current state of our house. I didn't think selling without updating kitchen/bath was a remotely good idea, but it looks like we will definitely reconsider. We can finish the bedroom (is currently half-plastered, just needs final plaster coat, sanding, and paint) and the hallway (needs sanding and paint). There's nothing technically wrong with the kitchen and bath, they're just extremely ugly. We took down the drop ceiling and some fake brick paneling in the kitchen, and cut off the short end of an L shaped counter to make room for a dishwasher. There is some extremely shoddy electrical work that was revealed after removing the drop ceiling, and some holes thanks to the electrical work in the actual ceiling. In the bathroom, we only took down the drop ceiling, and there's really gross olive, orange, and gold sparkle cardboard paneling left. I believe the toilet and tub were pretty new when we bought it. Our dining room could use some fresh paint but it's not necessary. We also put in a new furnace, new water heater, installed a sump pump, and redid the front porch, in addition to redoing all the other rooms in the house. I regret believing we could handle redoing an entire house by ourselves, but I'm happy we got it when we did because the mortgage is so cheap we've been able to save a lot of money. This panicked "I have to move right now" feeling has only been a recent thing. Re: Getting an apartment and selling. I'm a big fan of this idea, but my husband is not. I like it because it would be an immediate solution for my issues, and we could sell our house without feeling pressured to immediately buy another. However, we've got a house full of stuff, a dog, and a cat. My husband doesn't want to move more than once in the next several years, he doesn't want to rent, and apartments around here are insanely expensive, the same if not more than a mortgage on a new place. Re: childcare costs. Our work schedules are opposite (I'm straight overnights 11p-8a and my husband is evenings (1p-9p) and we weren't planning on having any childcare. I have a couple friends with my same schedule who have small babies, and while they hardly sleep, they've made the no-childcare thing work. Re: selling this house first and then buying another house. Is that a common thing? Unless we get a contingent agreement, we'd have to get an apartment, right? Re: Not falling in love with a house and finding faults. Trying hard to do this with the river house. I guess, for one, the school district is terrible, and one of the major reasons I want to move is for our hypothetical kid(s). I guess what this all comes down to is we need to talk to a realtor and get our house listed, and not worry about the kitchen/bath situation. We failed as fixer-uppers, but I can live with that.
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Jul 11, 2018 19:57
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Ugh closing costs are so expensive. Between lawyer fees, title search, title insurance, mortgage fees, filing fees, survey, and escrowed taxes - gonna be like 9k. At least there's no water anywhere.
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Jul 11, 2018 20:00
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It is common to have contingencies on home sales so you would sell/buy without having an apartment in between, but in your situation it seemed like a bad idea. We can't really give you any advice on your next home without detailed financial info: Monthly household income after taxes What other debt do you have How much cash do you have for down payment/closing costs What is the expected sale price of your current home How much is owed on the mortgage Also, if your house is still in the sub-$100k range I really don't know how much any of that remodeling matters at all. People buy $80k homes because they cost $80k, not because they are remodeled to their liking. My brother's house is worth about that much and his kitchen looks like a child played Mr. Potato Head with hand-me-down appliances and furniture. Andy Dufresne fucked around with this message at 20:06 on Jul 11, 2018 |
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Jul 11, 2018 20:03
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Koivunen posted:Re: Getting an apartment and selling. I'm a big fan of this idea, but my husband is not. I like it because it would be an immediate solution for my issues, and we could sell our house without feeling pressured to immediately buy another. However, we've got a house full of stuff, a dog, and a cat. My husband doesn't want to move more than once in the next several years, he doesn't want to rent, and apartments around here are insanely expensive, the same if not more than a mortgage on a new place. You said earlier that you were in a hot market, e.g, houses are selling fast. If you as a buyer present an offer that has a sale contingency, that is a high risk to the seller that you may be unable to fund and the sale could fall through at the last minute. This puts your offer at the absolute back of the line compared to all other offers that lack such a contingency, including offers that are thousands of dollars less. So you(r husband) needs to understand that being unwilling to put stuff in storage and rent for a month or two while shopping means potentially having to offer a lot more money in order to win a multiple-offer scenario, and/or simply not having your offer accepted. I don't want to totally overstate this: people can and do buy houses with sale contingencies attached. It's just a significant obstacle that, combined with your financial situation of having to really stretch to make two payments at once (which in turn likely affects the rate and terms a lender will offer you), it's definitely to your advantage to sell first and then buy. I'm sympathetic about the pets, though. Finding a month-to-month rental where you can have a dog and a cat may be a pain in the rear end as well. So it comes down to how much risk and money you're willing to accept and spend for the convenience of only moving once.
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Jul 11, 2018 20:16
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Leperflesh posted:I'm sympathetic about the pets, though. Finding a month-to-month rental where you can have a dog and a cat may be a pain in the rear end as well. In many places it's not a pain in the rear end, it's straight up impossible.
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Jul 11, 2018 20:59
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Koivunen posted:Re: Not falling in love with a house and finding faults. Trying hard to do this with the river house. I guess, for one, the school district is terrible, and one of the major reasons I want to move is for our hypothetical kid(s). This is a bad sign that you're thinking with your heart and not with your head. A terrible school district is usually a pretty strong indicator that the area sucks in general: more renters than owners, mismanaged/broke local government, poor job prospects and future outlook. This is especially true if the area used to be nice... the lovely schools are a canary in the coalmine that the area is in rapid decline. Remember, you have hypothetical kid(s) coming and so would many of the other families that you would eventually sell this house to. It will be much harder to sell a house in an area with bad schools.
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Jul 11, 2018 21:29
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B-Nasty posted:This is a bad sign that you're thinking with your heart and not with your head. Or the area is/was super racist! Pasadena, CA in a bid to not have to desegregate gutted their public school to lower taxes so rich white folk could send their kids to private schools. The courts had to get involved for them to take action at all: https://www.csmonitor.com/1983/0128/012850.html
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Jul 11, 2018 21:56
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no you see it's okay to hate poor people, even if the venn diagram of poor and minority is basically a circle
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Jul 11, 2018 21:59
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Andy Dufresne posted:I suppose the houses I'm looking at are a 25% premium because of school districts, but I don't know that I would include that 25% increase in the cost of raising my child because after 18 years my house will still be worth 25% more than the one in a bad school district. Other childcare expenses can't be salvaged in that way. Children depreciate. Eh, we bought in our area of suburban Orange County explicitly for good schools, and moved from an area with middling schools. And because we didn't want to move anytime soon, (due to high transaction costs) we bought a house that was big enough to accommodate kids that we do not yet have. Extremely costly. If we didn't want to have kids we probably would have bought a nice condo that we toured a few years back in an up and coming area of downtown Long Beach, it would have been much much cheaper and the neighborhood is less family oriented/more fun young professionals. The elementary school is rated like a 2 but I think the neighborhood is nice, getting nicer, and much nicer than it was 10 years ago.
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Jul 11, 2018 22:34
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skipdogg posted:Like anyone is going to be able to afford their kids college tuition. My kids better hope they earn a scholarship somehow. My state lets me put in 529 money tax free. That's a 5% discount. Money grows tax free. Even if I never spend it on education, it's only a 10% withdrawal penalty. You can start 529s well before having kids too!
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Jul 11, 2018 23:11
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baquerd posted:Even if I never spend it on education, it's only a 10% withdrawal penalty. Plus income tax. So you are now 10% poorer than just putting it in taxable brokerage. Your point here?
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Jul 11, 2018 23:14
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Motronic posted:Plus income tax. You're missing that I'm not paying state income tax on it going in, plus tax free growth. It's not better than a straight brokerage for non educational expenses, but it's not as bad as -10%. On educational expenses, it is strictly superior though. You can even use it for your own educational expenses if you want to dick around with e.g. welding at a community college. Or just have the kids and let them use it as intended.
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Jul 11, 2018 23:21
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It really sucks that the way i picked my new house was based off of zillow and greatschools.com, but hosed if im gonna pay for private school
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Jul 12, 2018 01:13
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baquerd posted:You're missing that I'm not paying state income tax on it going in, plus tax free growth. .......until you take a non-education disbursement and then you owe state taxes plus 10% on the principal. Then state and federal taxes plus 10% on the gains.
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Jul 12, 2018 01:19
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Tnuctip posted:It really sucks that the way i picked my new house was based off of zillow and greatschools.com, but hosed if im gonna pay for private school Yeah but whats the over/under on living in a bad neighborhood but paying for private school
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Jul 12, 2018 01:23
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poisonpill posted:Yeah but whats the over/under on living in a bad neighborhood but paying for private school about 3.5
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Jul 12, 2018 01:24
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poisonpill posted:Yeah but whats the over/under on living in a bad neighborhood but paying for private school Not having firecrackers thrown at you?
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Jul 12, 2018 01:32
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marsisol posted:Ugh closing costs are so expensive. Between lawyer fees, title search, title insurance, mortgage fees, filing fees, survey, and escrowed taxes - gonna be like 9k. At least there's no water anywhere. Yeaaaah. Our sellers are moving due to relocation, so technically they're selling to the relo company, who are immediately selling it to us. By using their title company (who both realtors knew and vouched for) we'd save some of those fees. They dropped the BS document fees, and gave us a discount on lender's title insurance. I asked about it, and they dropped the recording fees as well, which netted about $500 more saved. Still lost the school tax game, had to repay the sellers 50 out of 52 weeks, and pay 6 weeks into escrow because the first payment won't be until Sept. Woo. Closing is Friday morning!
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Jul 12, 2018 01:52
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My state gives a 20% state tax credit on 529 plan contributions. Super sweet discount but the limit is $1000 of credit a year so 2 out of 3 kids ain't going to a good college. Sorry kids state schools for you.
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Jul 12, 2018 01:59
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Elephanthead posted:My state gives a 20% state tax credit on 529 plan contributions. Super sweet discount but the limit is $1000 of credit a year so 2 out of 3 kids ain't going to a good college. Sorry kids state schools for you. lol, with that cap that might cover a single semester at a good school if you save for every year of the kid’s life
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Jul 12, 2018 02:55
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that's a limit on the tax credit, not a limit on how much money you can put in.
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Jul 12, 2018 03:04
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Andy Dufresne posted:I think a number of child-free people end up buying in nice school districts strictly because of resale value. School districts were a 0% consideration for me. I know that my property has to be within a school district, but I have no idea which one. You could tell me my school district was actually just a cottage with a single person teaching all grades ala 1850 and I'd have no evidence to refute it. I hadn't even considered that someone might consider a school district valuable vis-à-vis purchase price until this very discussion, it's just not something I would ever normally think about.
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Jul 12, 2018 10:14
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baquerd posted:You're missing that I'm not paying state income tax on it going in, plus tax free growth. It's not better than a straight brokerage for non educational expenses, but it's not as bad as -10%. Yes, a 529 is better for education expenses (e.g. the entire point of one), but undeniably worse otherwise. Like you shouldn't even bother opening a 529 if you don't plan on spending all of the growth on education expenses
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Jul 12, 2018 12:54
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QuarkJets posted:Yes, a 529 is better for education expenses (e.g. the entire point of one), but undeniably worse otherwise. Like you shouldn't even bother opening a 529 if you don't plan on spending all of the growth on education expenses Agree completely. My point is that if you plan to have kids and plan for them to go to college, it's not like you lose everything in the 529 if that doesn't pan out and it's better to start early rather than later.
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Jul 12, 2018 13:04
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baquerd posted:Agree completely. My point is that if you plan to have kids and plan for them to go to college, it's not like you lose everything in the 529 if that doesn't pan out and it's better to start early rather than later. Way to move those goalposts. Your av is a sound general warning that I should have heeded.
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Jul 12, 2018 15:07
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Koivunen posted:Re: Getting an apartment and selling. I'm a big fan of this idea, but my husband is not. I like it because it would be an immediate solution for my issues, and we could sell our house without feeling pressured to immediately buy another. However, we've got a house full of stuff, a dog, and a cat. My husband doesn't want to move more than once in the next several years, he doesn't want to rent, and apartments around here are insanely expensive, the same if not more than a mortgage on a new place. The extra move sucks, as does finding a place that'll accept both a dog and a cat, but it sucks much less than making a rushed decision on a new home because you're stressed out by the one you're currently in.
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Jul 12, 2018 22:13
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Motronic posted:Way to move those goalposts. Your av is a sound general warning that I should have heeded. You read way too much into what I wrote and now you're trying to blame me? Class act here.
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Jul 12, 2018 23:29
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