ONLY 30%?
Seriously?!?
Either their study-mean is higher-than-average income, or they’ve found some dirt-cheap rents at least by current standards.
I can’t find anything at less than 60% of my current income, for love OR money.
That’s 30% of their gross income. Rent is probably more like 50% or more of their net income.
Thirty percent is a nationwide figure, so it depends largely on where someone is living. The article cites over 68 percent for New York City, for example.
I am in the higher middle income group at this point in my life (could retire tomorrow or in 5 years, who knows).
I just did some rough calcs on my numbers. I figure my fed and state income taxes and SS (not including sales taxes) at 22%. My retirement contributions are 15%. So that leaves 63% as disposable income. Not too bad really.
My home mortgage which I locked in at 2.25% is about 28% of my take home pay, but only 16% of my gross.
Five years ago I moved out of CA after ~20 years of living there. I would say that there my mortgage/rent (depending on where I was at the time) was closer to the 30% of gross pay number. Life was much more stressful then. It was clear to me that that was not how the American dream was meant to be spent.
My rent is free. Long as I pay the property taxes.
And then add in utilities
and its more like 80-90%.
The government thinks rent (and) utilities together should be 30% of your income but it hasn’t been like that for me...ever.
30% is just the dividing line. It’s industry standard that you don’t get approved if the rent is more than 30% of your household income, because you won’t be able to pay it.
And even that has been recently changed to be more accommodating. It used to be 20-25%.
“ONLY 30%?
Seriously?!?”
I was thinking the exact same thing. This is way flawed. My kids are paying at least double that on rent and mortgages.