Home Economics No. 6: Childfree-by-Choice Newlyweds Living in Chicago on $160,000 a Year
$2,053 for rent, $80 for coin-operated laundry, and more than $6,000 toward retirement
Welcome to The Purse, a newsletter about money and women and motherhood and careers and all that good stuff!
Before I get to today’s Home Economics, I just want to say a big thank-you to all of you who reached out, left a comment, and signed up as paid subscribers after reading last week’s newsletter. The response has been just amazing! I haven’t been doing a good job keeping up with the comments, but I’ve read them all, and I really do appreciate the feedback.
While I sometimes feel lonely, hearing from so many of you was a good reminder that I’m not alone. And I think we’re building such a special community here—one where people are kind but also honest, and they aren’t afraid to share their own experiences. I feel so lucky to be a part of it, and I’m excited about what the next year holds. I’ve also got a few new things in the works that I can’t wait to roll out over the summer. Stay tuned!
Just a reminder that paid subscribers now get access to an extra Home Economics each month. (The first one will go out on Saturday, June 22.) All paid subscribers will also be entered to win a monthly giveaway. This month, paid subscribers will get a chance to win a copy of Matt Schulz’s new book, Ask Questions, Save Money, Make More, along with the Revitalash Cosmetics Double-Ended Volume set (which includes primer and mascara)1.
Now onto this week’s Home Economics! And just a reminder, I’m always looking for new submissions.
Age: 32
Location: Chicago
Relationship status: Married (1 year this summer!)
Age of partner: 34
About me: I am originally from a small town in Colorado, and I moved to Chicago shortly after graduating college. I had never been to Chicago before moving here aside from a 12-hour visit for my job interview, but I completely fell in love with the city. I met my husband, a Chicago native, a year into living here, and we married last year in my hometown. I work as a financial analyst and have been with the same company for the past seven years. I love running on the lakefront path, listening to audio books, and hanging out with my cat.
Income:
Your job title/salary: Financial analyst, $95,000 plus ~$30K in bonus
Partner’s job title/salary: Chef, $65,000
Your monthly take-home pay (paycheck amount after taxes and other deductions): $4,551.61 (doesn’t include bonus)
Partner’s monthly take-home pay (paycheck amount after taxes and other deductions): $2,264.02
Additional monthly income (freelance/side hustle/rental property; include any that apply): ~$500 a month from my pet-sitting (house-sitting and drop-ins)
Total monthly take-home pay: $6,815.63 (doesn’t include pet-sitting side hustle)
Account balances:
Checking account balance: $8,759
High-yield savings account balance: $21,749
Monthly contribution to savings account: $300
Retirement account(s) balance:
401(k): $130,741 (me) and $34,821 (my husband)
Roth IRA: $26,417 (me) and $9,477 (my husband)
Traditional IRA: $13,943 (my husband)
SEP IRA: $1,624 (me)
HSA: $36,624 (me) and $18,385 (my husband)
Monthly contribution to retirement accounts:
401(k): $833.33 (me) and $1,916.67 (my husband)
Roth IRA: $500 (me) and $500 (my husband)
HSA: $525 (me)
Note on savings: I get an annual bonus and use a big chunk of it to max out my 401(k)—this year, for example, I invested $13,000 from my bonus into my 401(k). My employer doesn’t match contributions, but they provide a profit-sharing contribution each year ($9,300 this year). All in, we’re investing over $6,100 a month in our retirement accounts.
Investment account balance: $34,267 (me) and $58,907 (my husband)
Monthly contribution to investment accounts: $800 total
Goals-oriented savings accounts: We have two T-bill accounts we earmark for our honeymoon and out-of-pocket medical expenses for our high-deductible health insurance (we plan to do all the medical stuff this year). Right now, there’s $5,000 in each account.
Total in checking, savings, and investment accounts: $405,713
Housing:
Size of your home: We rent a two-bedroom, one-bathroom apartment six miles north of downtown Chicago.
Rent: $2,053, includes rent, parking, a small storage cage, WiFi, water, and gas
How long have you lived in this apartment: We’ve lived in the apartment since 2019. Rent was $1,740/month when we first leased the apartment, and it has increased pretty much every year.
Renters insurance: $25
Electricity: $65 on average.
Cell Phone: $100 for our two lines on a shared family plan with my family.
Laundry: $80 to use the machines in our apartment building.
Husband's family’s shared vacation house: $150. This will be going up to $350 soon.
Transportation:
Monthly car payment: $300. We have a 2.99% interest rate, so we’re not in a rush to pay this off.
Car insurance: $125
Gas: $40
Car maintenance: $30
Monthly public transportation: $150. This comes out of my paycheck pre-tax.
Ride shares (Uber, taxi, etc.): $0. I despise this method of transit and basically refuse to use it.
Children:
Number of children and their ages: We don’t have kids, and we don’t plan to have any. My family will tell you that when I was growing up, I always said I didn’t want kids. But as an adult, I’ve gone back and forth. One of the big reasons my husband and I decided against it is the financial aspect of having kids. I’ve run the numbers, and I realized that I can either have a life where someone completely depends on me, and I’m constantly worrying about money and how the choices I make impact my family, or I can skip having kids and kind of live my best life. And I thought more about what I really wanted to do; I want to choose myself and my husband.
I’m 32, and I feel like there’s so much I haven’t done yet. I’m still in this place where I’m working to live. I can’t imagine adding a child into the equation and having to work more to pay for them. I know financially it would be really difficult for us. And I like not having to worry about money too much after years of worrying about it a lot.
Debts:
Student loan total balance: $25,001 for my student loans. My balance started out around $75,000 for four years of in-state college, plus one year of grad school (concurrent degree program). I went to school far from home, so although I worked, I still took enough out to cover my living costs. The interest rates on my loans are below 4%, and we still qualify for student loan interest deductions. Sometimes I’ll put lump sums toward the balance, but I’m not in a hurry to pay them off while interest rates are so high on high-yield savings accounts. My husband paid his student loans off shortly after we started dating.
Monthly student loan payment: $280
Credit card balance (if you carry a balance month to month): $6,143 left on a 0% APR card. We are leaving the balance in our high-yield savings account, and pay about $800 a month to take advantage of the interest arbitrage, but we will have it paid off prior to the end of the 0% promo period. (I don’t include this in our monthly budget since the money is already set aside.)
Food:
Groceries: $309 (We are both very fortunate to have breakfast and lunch provided at our offices for free.)
Dining out: $455
Socializing and Entertainment:
Subscriptions (streaming services, magazines, etc.): $32 on average. This includes an annual subscription for You Need a Budget (YNAB), as well as Apple Music and HBO Max. We pay annually where we can to save.
Memberships (museums, etc.): $5 for Costco membership.
Movies, concerts, other events: $92 for various dates, activities, movies, etc.
Miscellaneous:
Clothing: $165 average
Home supplies: $85 for toilet paper, kitchen gadgets, cleaning supplies, etc.
Exercise: $41 mostly for running shoes for me.
Personal and self-care (haircuts, manicures, massages, etc.): $89 on average, covers husband's monthly haircut, plus 1–2 haircuts a year for me, and the occasional pedicure.
Pet supplies: $56 for food, litter, and vet expenses for indoor cat.
Pet insurance: N/A
Donations: $50
Travel: Averages out to $475/month. Three to four times a year, we travel to my husband’s family vacation cottage, which is about a five-hour drive. We fly to visit my family at least once a year. We also tend to take one bigger, week-long vacation per year, although this year, we have two week-long vacations for our honeymoon (we split them up), and last year, we took no vacations due to the wedding.
Gifts: Averages out to $408/month. This includes birthdays, holidays, and random gifts to friends and family.
Insurance:
Life insurance: $0
Health: $300. We have high-deductible medical, dental, and vision through my work.
FSA: $0
Total Monthly Expenses: $5,651 (This does not include deposits into investment or saving accounts or any pre-tax expenses that are withdrawn from their paychecks, such as public transport or 401(k) deposits.)
Tell us more:
What are your top financial priorities?
We are focused on becoming financially independent so that we can step down to lower-paying and lower-responsibility roles and travel more. We eventually want to retire early, but in the medium term, I’m more interested in the flexibility of being able to work on whatever I want and take roles that may pay less (like for nonprofits) or try out new work that excites me. We are not as gung-ho on homeownership as many of our peers, and I’m a very analytical person, so I’ve done the math a billion times, and homeownership just doesn’t make sense for us. However, we’d like to be in the position to buy if the perfect place at the right price arises. I just won’t buy out of FOMO.
How do you feel about your current financial situation?
I feel really good about where we are, and I’m especially grateful to have a partner on the same page financially as I am. We are very frugal because we both grew up without much money, and having a large safety net of funds is incredibly important to us both. The flexibility that comes with not needing your next paycheck is something I value above most other financial goals.
What are your money stressors?
My husband is not interested in the minutia of financial planning (and he doesn’t understand it), so all of the heavy lifting of managing our accounts falls on me. The stress comes from trying to keep my husband involved when the subject matter bores him to tears, and he defers most financial decisions to me “because I know where we stand” with the money, which leads to some decision fatigue for me.
Do you expect to receive (or have you received) an inheritance from a family member?
A few years before we got married, my husband inherited around $90,000 when a member of his family died. Because he was so behind in saving for retirement, I did the work of distributing this money so he could max out his tax-advantaged accounts over the course of three years. We didn’t use the money for the wedding, per se, but it did allow us to pay for the wedding without having to forgo our retirement savings goals. We do not expect to receive anything else in the future.
Do you receive any financial support from your family?
No.
Do you financially support any family members beyond yourself and your nuclear family?
No, although we are considering opening 529 accounts for our nieces and nephews.
How do you and your partner split your finances? How did you decide to go that route?
Once we got engaged, we completely combined finances. I manage our household funds using the YNAB app, and my husband just spends what he spends, and I categorize that.
As mentioned above, he is not interested in the minutia, whereas I find it fascinating and enjoy optimizing our finances and finding tax advantages. We have a quarterly budget meeting to go over our goals and spending, and he has the YNAB app on his phone to check how much is in various budget categories before spending. Luckily he’s not a big spender to begin with.
What is one financial goal(s) you still want to achieve?
I’d love to take a year off to travel the world once we achieve financial independence. I don’t have a specific number in mind that I’m trying to achieve.
I’ve always been careful at budgeting, and a few years ago, I decided I wanted to learn more, so I read a lot of Mr. Money Mustache—the article “The Shockingly Simple Math Behind Early Retirement” had a big impact on me. I had a light bulb moment where I realized I was sitting on too much cash, and I needed to invest it smartly. At the time, I’ll admit, I went a little bit insane and went kind of extreme on how much we could cut out of our budget with the goal of saving enough so I could quit working as soon as possible. I had a dream that we’d become digital nomads and travel the world.
But I’ve since moderated, so we’re saving but also enjoying life today. (My husband’s a chef; he missed eating out in restaurants when we were extreme budgeting!) I feel like we’re in a good spot now, where I or my husband could quit our job if we needed to. And in the long run, I still have a fantasy where I only have to work some of the time. I love doing taxes, so I would love to spend January through April doing people’s taxes, and then the rest of the time, I would work part-time or volunteer, and we would have more time to travel. I don’t want to stop working completely; I just want to do it on my terms.
Tell us about one financial accomplishment you’re proud of.
I’m really proud that I don’t worry much about money anymore. I feel as though much of my life has been shadowed with the specter of money—largely not having enough. I was raised by a single mom, and we always struggled with money. Many of the decisions I made throughout young adulthood were based around how I could avoid being in the same position as my mom was—including choosing my college major, where I decided to live after graduation, and the jobs I accepted. And while I made a lot of mistakes along the way, I feel fortunate to not feel hard-pressed when unexpected expenses come up now.
What do you regret spending your money on the most?
I bought a photo booth a year before our wedding with hopes to turn it into a side business (and avoid paying $900 for one at my own wedding). I’ve done basically nothing with it, and I really regret getting swept into the marketing for how much I could potentially make using it as a side hustle.
What is one thing you spend money on that makes your life better?
I never thought I would be one to spend $50,000 on a wedding, but I definitely don't regret it. We had a blast in my hometown, and it was like a big family reunion. I thought I would regret the expense, but even close to a year later, I’m really happy we spent what we did.
What is one thing you spend money on that drives you crazy?
Laundry! It’s $2 per wash and dry, and the units are tiny, so you have to use multiple washers and dryers for one load. We could have easily bought two sets of high-end washers and dryers in the five years we’ve been renting in this apartment, and I hate lugging laundry down to the basement of our building!
Is there anything else you would like to add?
We have decided to aggressively save for retirement over saving for a home, and that has put us in a very different category from a lot of our peers. However we’re really happy with our frugal lifestyle, and I haven’t truly worried about money in a long time. The peace of mind of being completely in control of our finances is invaluable!
Please comment with kindness!
Random Extras:
Ken and I have been on a bio-doc kick lately, and we just watched Ron Howard’s Jim Henson: Idea Man. As I mentioned last week, we’re big Muppets fans in our house, and we all really loved the documentary. I think there’s probably a fascinating article to be written comparing this documentary with the others we watched recently about Steve Martin and Martha Stewart. I’ve loved learning about their creativity and empire-building, but it’s also interesting to learn how their success impacted their personal lives. Can someone write that?
My friend Jason Feifer writes a great newsletter called One Thing Better that is packed full of all kinds of good life advice. I particularly liked this recent edition about how to reframe rejection. If you don’t already subscribe, I highly recommend you sign up.
I’m trying to convince Ken we should get a Costco membership. My friend
recently sold me on the idea. I’ve always been reluctant because we’re a small family living in a small apartment, but she also has a small family living in a small apartment, and she swears by it. Help me convince Ken: What do you buy and love from Costco? Fill out this survey!2
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Your answers might be inspiration for a story at some point!
I love this edition, perhaps because my heart resonates with the desire to live fully or maybe it is the beauty of having a financial analyst present us with such an exquisite breakdown of a family budget. Either way, I hope our writer recognizes the gifts she clearly possesses to help others lead a financially stress free life by their 30s. Wow! Kids or no kids, this is the most clear sighted thinking on the subject of finances and life that I have read in long while.
I’m new to substack and a brand new subscriber to the purse. This post motivated me to stop all things and enroll in a Roth 401k plan with my company. I don’t entirely understand everything that I selected. But this publication has prompted me to educate myself more, and prioritize moving this up on my to do list. I’m 33 and this my first true effort I’ve made in preparing for retirement. Patting my self on the back for an adulting win inspired by you. Thank you.