Skip to main content

A Tale of Two Cities

Well, I survived the annual screwing by Uncle Sam. Bye bye money that could have bought a lot of Lilly. I'm ticked off this year because some of my deductible expenses exceeded the allowable deductible cap so I had more income taxed than I should have if the system was fair, boo! But anyways, my sorority sister SM made a comment on my FB post on also getting screwed on her state income tax. God Bless the great state of TN for our conservative legislature and no income tax. But it got me to thinking, even though I do pay less taxes I also make less than my yankee friends, am I really winning here in the south? Any y'all know how I answered that question, I graphed it. :)
 
Ok, so we have two sweet, nice looking girls in the same sorority and upon graduation they tearfully hug goodbye and go their separate ways. One moved up to NYC and the other back to her hometown of Memphis. By age 30 NYC girl is making $100,000 and Memphis girl is making $55,000 (I just picked 100,000 as the NYC salary to keep it even then looked up the type of job that would pay that and found the Memphis salary). Both are on the company insurance plan and pay the flat single person contribution costs. Both girls are smart and take advantage of their 401K and set aside 6% of their income. Now NYC girl winds up paying 25% of her income in state and federal taxes while Memphis girl is paying 15%. Side note, why is NYC so full of democrats given this horrible tax rate?
 
With their take home pay both girls also set aside 10% in personal savings. Memphis girl is able to keep her total housing costs at 35% of her income while NYC girl needs to go to 40% to live in a safe neighborhood and have more than a closet. NYC girl spends an average of $20 a day on cabs while Memphis girl has a car and buys gas. Both girls buy groceries and have a nice dinner and drinks with friends once a week. Both girls have the same student loan expense and both girls set aside the same portion of their income for fun stuff, i.e. entertainment and looking nice.
 
Now Memphis girl has used up all of her income while NYC girl still has a little left, so she puts that into savings as well. Both girls are living very similar lives, NYC girl gets to dress fancier but we'll get to that in a minute. The real difference isn't affecting these girls today, it's when they go to retire, NYC girl will have twice the retirement account as Memphis girl so if they both go down to Florida to retire they are going to have very different retirement accommodations. The only way Memphis girl can ever hope to match this is if she buys her home while NYC girl rents, then she will have 5 years or no mortgage payment to divert to savings and be able to sell her home for cash. Now one or both of these girls might get married and have kids which would drastically change this model, but the point was to show the long term effects of the income  / tax/ cost of living gap.
 
On a personal level, this really put my love for designer clothes and accessories into perspective. I'm wanting a NYC wardrobe (ok, really a Palm Beach wardrobe) on a Memphis budget. Memphis is not perhaps less fashion sophisticated than bigger cities, it's just that a $300 purse is a bigger purchase here than it is elsewhere. Don't get me wrong, I still love my living situation in Memphis but I'm realizing it might not be the worst thing ever to consider moving one day.
 
Here's the actual numbers for my fellow math nerds if a visual helps.
 
    NYC Memphis
Income   100,000.00 55,000.00
       
Insurance   2,400.00 2,400.00
401K   6,000.00 3,300.00
Taxable   91,600.00 49,300.00
Taxes   24,598.60 8,254.00
NET   67,001.40 41,046.00
Expenses:       
Savings 10% 6,700.14 4,104.60
Housing   26,800.56 14,366.10
Transportation   7,300.00 6,980.00
Food   10,400.00 6,500.00
Student Loan   3,000.00 3,000.00
Entertainment 5% 3,350.07 2,052.30
Clothing and Beauty 10% 6,700.14 4,104.60
       
Additional Disposable   2,750.49 -61.60
       
       
Annual Savings   19,450.63 9,666.20
       
35 year    1,440,000.00 742,220.00
Inflation Adjustment   496,457.00 255,589.00

Comments

  1. Hm. This is an interesting comparison. Even CT to Memphis is an interesting comparison. It's cheaper to live in the South in general, but at the same time, the wages are lower. So it does somewhat even out at that level. Very interesting.

    ReplyDelete

Post a Comment

Amazon

Popular posts from this blog

Loft Plus Size In Store Launch

Loft recently launched the plus size collection size 16 to 26 in 50 stores across the US. Although I will make a few exceptions I really prefer to shop in person to try on items so I was very excited to hear my local store would be one of the 50 locations offering plus sizes. The Carriage Crossing location in Collierville, TN is the only location in the entire state to feature the collection in store and I was on hand to celebrate in full force at the recent launch party.

The team at Loft Carriage Crossing is so sweet and set up the sweetest in-store celebration.

Cupcakes by Buttercup brought the A game with the sweets - these are so moist and tasty!

Ehblooms provided the most beautiful bouquets in the perfect colors to celebrate fall fashion Sarah Howard with Limelife provided makeovers which was really fun. This was my first time experiencing this makeup line and I loved the pigmentation of the eye shadows - here's my finished look:
But of course we were all there for some fab…

Lane Bryant x Girl With Curves Try On

If you wear a size 12+ unless you aren't on social media you've probably heard that Lane Bryant has launched a 20 piece collaboration with blogger Girl With Curves. With items selling out online on the launch day I knew I had to hurry up if I wanted to see things in store and try them on. 
The in-store display at the Southaven, MS location
The fitting room lighting was not great and while I'm not a fan of the mirror selfies sometimes you've got to work with what you have and I do want to be able to show you how these items fit. But, please don't judge my poor photo quality too much.
The item I wanted the most - like every other curvy girl apparently was the navy blue trench dress and this sold out online and was not in my local store. But, I was able to try on the other items I was most interested in.

The pleated lace black dress had a nice fit and I like how instead of a plain elastic waist it had a faux belt look. I think this dress would look waaaaay better …

Holiday Mail

I love sending Christmas cards, I also love getting Christmas / holiday cards. Growing up Christmas cards were serious business. My Mom kept a book of who she sent them to and who sent one to us, three years and no card you were off the list. It's something my friends and I discuss today, seems like lots of moms ran their card list that way and now I find myself being a little less strict but keeping up with my list the same way. You would think that by 29 I'd have a pretty firm list of people I send Christmas cards to, but nope, it continues to change every year. Of course, the fact that I lost the disk with all the addresses from the prior year hurt a lot, that address list had every single person who attended my mom's memorial service or sent a card, it was a very handy but sad way to keep up with my non immediate family. A few years ago I use to think that I'd send a card to anyone that if I was to become engaged would make it onto my wedding guest list. Now that…

Birthday Discounts

Woohoo! It's my birthday week y'all! Birthdays are always a great time for brands to make customers special and each year I'm able to take advantage of some pretty good discounts in July so I thought I would share the love and talk about some of my favorite discounts and how to get them.

My absolute favorite discount is from Kendra Scott! During your birthday month you can receive one regular item at 50% off. It's your first time you'll have to show your id in store and sign up for their email list but then once they have you on file you can just go into the store and say that you would like to apply your birthday discount to your purchase and give your email address. This year I purchased the Tatiana Long Pendant Necklace which usually sells for $175. This necklace takes the look of the popular Rayne necklace and really amps it up.  
If jewelry is your thing you can also get a $10 credit from Charming Charlie - this discount is sent to Charm Rewards members at the…

Easy At Home Teeth Whitening

Recently I was asked to submit a headshot and y'all I was so embarrassed - my teeth were yellow! So I decided to use the Smile Brilliant teeth whitening system to take care of it - sure I could just edit my photos to make my teeth look white but I'd rather have a bright white IRL smile.
Over the years I have used many whitening products - toothpaste, lights, strips and make at home trays but the reality is no matter how great the solution is getting it to stay on the teeth is the key to whitening and there's simply no match for a custom fit tray - which is exactly what Smile Brilliant offers.

In order to get a custom tray without having to visit the dentist  Smile Brilliant provides the materials needed to make molds of the teeth at home to be sent off for fitting. When I received my kit it came with all the instructions and enough materials to make three molds - this way if I got it wrong on the first try it was no big deal - I had enough materials to try again. Howeve…