How a Couple Earning $360K Does Money

Amy (not her real name) is a 30-year-old insurance professional living in Seattle.

So, Amy, tell us a bit about your finances.

I am very comfortable with my finances. I think that’s a pretty unique position that I don’t see people discuss much.

I think a lot of that is attributed to the fact that my husband and I make quite a lot, which takes some of the pressure off.

There are a couple of reasons behind it. One is that my husband and I have received a lot of help over the years from my parents, so we were very fortunate there. They paid for my college and my first car.

The second reason is that my husband is a very frugal and high-earning individual. I notice that I don’t feel any pain when I spend money. Whereas he is more likely to say “no, let’s not do something” because it hurts a little mentally to spend it.

So how much do you earn?

This year, we will earn $360K which is a normal amount for us.

My husband and I have very similar incomes. I read on your website that it’s hard to earn a lot of money when only one person works. That may be obvious to others but I learned this on my own a few years ago. We save a ton more money now than when I was single.

Yes, with a few exceptions, having two incomes generally means earning more money than having just one! Do you think your income or your frugality contributed more to your feeling comfortable about your finances?

I don’t think we are very frugal, but we have a few habits that help. For example, we are both homebodies and tend to stay in. We both bring our lunches to work, not to save money but to save time (i.e. we don’t have to go someplace and buy something).

This year, I think we’ll spend about $100K total. That’s higher than normal since we bought a house this year, and the $100K doesn’t include our down payment. The past two years, it was closer to $80K. I’m sure no one is impressed that two people can live on $80K.

I think I’m comfortable also because I track all of our expenses and there are no surprises.

That is really interesting. A lot of people track their savings, not their spendings. Tell us more about how you track expenses. Why did you start doing it?

Well, originally it was because I thought I should do some budgeting. So I wrote down everything I bought, and put it in categories. The idea was that, eventually, I would look at it and find ways to trim the amount we spent.

However, once I tracked everything, I found that I wasn’t willing to make any cuts to anything I was currently spending on. I think it’s because we don’t have a financial goal. Some people may want to get out of debt, or buy a house, or other things. We don’t have debt, we have a house now, and it’s not clear what exactly the purpose of making cuts to our spending would do.

So, I think if we really had a passionate goal such as wanting to start a business or save for really early retirement, then we would be more serious about budgeting.

I think we save quite a lot, but I don’t have any way to evaluate how well we’re doing.

Do you have any kind of savings goal? Like, not a “want to start a business” savings goal, but like “we’re going to save $100,000 this year” or whatever. Or do you mostly save what’s left over?

No, I wouldn’t say I have goals. At our current savings level, we can save about $150-$200K a year (including matching funds from work). That seems fine to me and I haven’t really tried to increase it over time.

This year, we bought a house. So I guess my goal was to get our non-house assets back to where they were at the end of last year. But that is arbitrary, and it’s not a big deal to me if we make it or not.

Do you think at all about whether you have enough for retirement, or do you figure you’ll have enough?

I think we’ll be okay for retirement if we keep working. We have $550K currently in retirement accounts, so a few more years of saving will get us to an okay spot for when we’re 65+. I’m not sure how much earlier we can retire.

I can’t imagine working until I’m 65, so I hope it’s earlier. But I don’t have a burning passion to do something else, so I’m not in a huge hurry either. I know there are some personal finance people who have retired very early, in their 30s even. I don’t think we can do it before 40 or 45 unless we change our habits.

It would be nice to have the choice not to work though. That appeals to me. I like the idea of having more freedom. Sometimes, I don’t like the fact that I have to work for money. I’m sure that sounded very spoiled!

No, very few of us like the fact that we have to work for money! So is there anything that worries you about your finances? Or are you sailing a smooth stream?

Well, I don’t worry much but there are some things I think about. What if something bad happens and one of us loses our job or I get injured/sick? I think that’s a normal thought and that has occurred to me before.

Also, my husband and I work a lot and I wonder if we could make it doing something else with our lives. I think I would be disappointed in myself if I gave my whole life to the insurance industry. But it’s difficult to make changes because we are comfortable now. Still, I understand that’s on me to find my path in life and if I want to do something else, I need to prioritize that and do something about it.

Prioritization is how things get done.

Yes! Sadly, I think that is where our problems come from. I don’t have goals, like I mentioned. I haven’t taken the time to really think about what I want in life. So, even though we are comfortable, it feels like we’re floating in space and not heading anywhere.

But so is the International Space Station, and it’s pretty cool.

That was a very optimistic viewpoint!

Not everything needs to be full-tilt towards a goal. This is one of the things I’m learning in adulthood!

I am very goal-oriented, so that is a struggle. But I agree that it hinders happiness to always think about it that way. You are wise.

We are all wise in our own ways. With that in mind, last question: What advice do you have for Billfold readers?

I’m a big proponent of tracking everything you spend. That helps you understand what your situation is, and you can make appropriate changes if needed. And even though we just talked about this (I’m stubborn), I still think having financial goals is important and allows you to make more progress.

Photo credit: Tiffany Von Arnim

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