How a Program Manager in Seattle Does Money
Deedee (not her real name) is a 30-year-old Program Manager in Seattle.
So, Deedee, how much are you making?
$93,500. I also received a bonus at the beginning of the year. One of my “reach” goals for turning 30 was to make six figures, and with the bonus I am counting it as a win!
Congratulations! Do you get a bonus every year, or is this one of those special tax-plan-related bonuses?
This was my first year with the organization, so I don’t know if bonuses are typical. It was not expected and I’m fairly certain it wasn’t tax-plan-related.
I guess you’ll have to see if you get a bonus next year, LOL.
Yeah, fingers crossed! I won’t plan on it though.
How does your income compare to your expenses?
It’s great, I live very comfortably. My barebones expenses are approximately 40 percent of my take home pay. If I want to enjoy myself, more like 60–70 percent.
Do you think of “wanting to enjoy yourself” as a barebones and/or essential expense? This was something that came up when I was writing about what I planned to do with my tax refund — some people were like “treat yourself!” and then other people were all “but treats should already be built into your normal budget.”
To a degree, I definitely think that enjoying yourself is an essential expense. Austerity rarely works for a long time, at least for me! When I think about enjoying myself I think about eating out and shopping, things that I could definitely do without in unusual circumstances, like being unemployed.
For sure. Although you may still need that money for new interview clothes, or at least I did during my job-hunting seasons!
That’s so true. I guess then I would probably think of that as less enjoyable and more “emergency” spending.
Good point. I’d never thought about using your emergency fund for interview clothes (or other job-hunting expenses) but it makes total sense.
Let’s go back to your expenses, though. What’s your living situation like?
I am renting with my sister. We have a two-bedroom two-bathroom in a brand-new building and got a promotional rate. I think it’s a little below market price, but still expensive since we live about two miles from downtown.
I’m scared about what rate they’re going to renew us at!
Well, if they go above a 10 percent increase at least they have to give you 60 days notice! (Yay Seattle tenant laws!)
What other major expenses do you have? Car payments? Student loan payments?
I’m super lucky to not have any other major expenses. My student loans are all paid off and no car payments — I moved here from DC where I didn’t have a car and loved not having that expense. Here my sister and I share an OLD family car that was a gift.
Nice! I hope parking isn’t too expensive.
It’s not bad. About $125 a month for our garage spot, and we split it. We went back and forth about taking the car, because we could both theoretically take public transit to work and other places. But it’s nice to have when we want to visit family and friends that don’t live in the city.
So what about the 30–40 percent of your income that doesn’t go to barebones necessities and enjoying life? Are you saving? Investing? Socking it away for retirement?
I give about 10 percent to charity — I was raised in the church and tithing was a big thing. I still go to church and consider myself a Christian, but the way that the American evangelical church responded to cultural and political events over the last five years really upset me and turned me off. So I give to several organizations whose missions I support.
The rest I save for retirement, travel spending, and recently I’ve been trying to invest as well. I put part of my bonus into my Roth at the beginning of the year, and have plans to max it out again this year.
If you hadn’t gotten the bonus, would you not have maxed out your Roth in 2017? Or would you have pulled cash from another source?
No, I definitely would have maxed it out, I would just have less to spend on travel and fun.
Got it. How do you budget for everything? Do you have a system? Or are you more of an intuitive spender?
Until recently, I would say I was more of an intuitive spender, but with more money comes more responsibility. I now have goals (like buying a house and retirement) I want to plan for in a more intentional way. I currently track all my spending and my budget in a spreadsheet that I revise monthly.
I love spreadsheets. Are you planning to buy in Seattle?
Not any time soon! The market here is crazy and I’m nowhere near being able to afford it. I’d like to build up a down payment over the next five years and see where things are then. I love being in the city and hate commuting so if my job is in Seattle, then I’d like to stay here. I currently work remotely, so I could technically live somewhere cheaper.
It worked for me!
I know! I enjoyed following your journey/thought process!
What do you think you do really well financially and what do you wish you could do better?
I’m fairly proud of my ability to invest wisely, when it comes to my retirement accounts. I wish I could stick to my intended budget better. Because there’s plenty of wiggle room, I feel like I too often justify purchases that are unnecessary or could be delayed. On your recommendation I readThe Value of Debt in Building Wealth and really loved it. So I’ve been trying to build up my cash reserves and it’s been harder than I anticipated.
I’ve found saving money to be relatively easy… but building up a large cash reserve is hard. The math is not in your favor, even if you save 15 percent of your income.
Exactly! It would take YEARS.
And then you have to put it all towards a down payment and start over!
It’s a little depressing. I regularly joke that I need to marry into Amazon money.
I suppose that’s one option.
Last question, then: what advice do you have for Billfold readers?
I would say talk with your friends (especially your girlfriends) about money. It’s awkward at first but I’ve found that when we regularly talk about it, not only are our relationships deepened, but I’m also encouraged to “do better” (whatever that means to you). I’ve learned hard things about my friends that makes me understand them better, I’ve gotten significant raises due to their encouragement, and I’ve learned better investing strategies! I also think it’s our feminist duty. You’ll never know if you’re being underpaid if you never talk about it!
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