How to Blow Through a $100,000 Budget
Have you ever wondered what it would be like to spend 6 figures per year?
Housing, Transportation, and Food are the 3 necessities that will usually eat up a good percentage of your income. As a 6 figure spender, it’s up to you how much you’ll cut back on these 3 expenses in order to travel more, vacation more, and do fun things with friends & family.
Below we’ve created a fake lifestyle of someone living in a typical suburb of a metro-city. This person sacrificed on the home, spending just $500,000, whereas your typical home on the west coast around the technology cities can run you easily $800,000+ for a regular home.
We also chose our simulated person to have a modest luxury business vehicle, a Mercedes Benz, instead of balling out on a Porsche 911 or Ferrari Italia 458.
Food we spent the typical $4,000 on groceries, but our person also eats out often and at higher end restaurants with family and clients. Therefore, the eating out tab runs about $400/month if paying for just 1 person and not the whole group. It could easily be higher, but we’ll assume this person cuts back to spend more money on vacation.
Entertainment includes the usual sporting events, movies, bowling, and all of the various subscriptions people pay monthly fees for in today’s technology world online.
Health care for one person may run $3,000 or more so we picked a standard coverage.
When it comes to vacation, our person sacrificed a larger home, nicer car, and less eating out in order to afford 3 luxurious vacations/retreats per year. We kept it cheaper for 2 of the 3 and then had 1 expensive but awesome vacation where it is money well spent.
Finally, after you’ve covered all of the basic living costs: housing, transportation, food & health, entertainment, you are left with miscellaneous expenses that people don’t think of right off the top of their head. This section cleans up the remainder of our $100,000 budget.
Takeaway: $100,000 in today’s world doesn’t get you very far. Housing can easily eat up a large portion of your income on its own if you live in popular cities. The Midwest is an area that you could maybe stretch your income more because housing prices are cheaper. Check out the breakdown below:
$100,000 Budget of a Typical Metro-City Worker
- Mortgage Repayment $31,000 ($2,580/month)
- Property Taxes $8,000 ($667/month)
- Property Insurance $6,000 ($500/month)
- Property Maintenance $8,000 ($667/month)
- Mercedes Benz $14,000 ($1,167/month)
- Fuel $3,000 ($250/month)
- Insurance $3,000 ($250/month)
Food Cost: $8,800
- Groceries $4,000 ($333/month)
- Eating Out $4,800 ($400/month)
- Gym $600 ($50/month)
- Movies, Fun Activities $1,200 ($100/month)
- Music/Movie/Online Subscriptions $400 ($34/month)
Health Care: $3,300
- Insurance, Medical, Dental Coverage $3,300 ($275/month)
- Mexico Resort $1,500
- Rome, Italy $1,500
- Atlantis, Bahamas $4,900
Here are some other informative and fun articles on the cost of living:
- Cost of Living in Popular Metro Cities
- How to Calculate Your Financial Freedom Dollar Amount Needed in Savings
- Why You Should Pay Yourself First Before Anyone Else
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- Online Entrepreneur/Website Resources
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Be great today,
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