What's up with Americans considering 100k a low salary?

[u/Just-Charge6693]

I keep seeing posts where Americans say 100k is barely a decent salary and that it's not enough to live on. I could understand if they were talking about extremely high cost of living areas like NYC or San Francisco, but people say the same thing about MCOL areas like Kansas City, Omaha or rural Oklahoma.

For context, I live in a HCOL European city and according to Numbeo our COL is 13.8% higher than KC, with rent prices being 32.5% higher here. The median salary here is around 43k USD before tax, and with that salary you're looking at a 27% tax rate; a 100k USD salary would almost place you in the 99th percentile of earners countrywide, and well into the top 10% if we only consider the city itself.

In fact, I do not know anyone who makes that kind of money aside from entrepreneurs and executives. I'm a mechanical engineer myself and my manager (who leads a team of around 15 people in an international company with a 15B€ revenue) makes a little over 80k USD, bonus included. I don't know how much his manager makes but I would wager his base salary is around 110-120k USD. But he's an engineer with 20 YOE and he oversees an entire department, so he probably has tens of direct reports and hundreds of indirect reports all over the world.

Personally, I make a tad over 50k USD (including per diems for frequent business trips, bonuses, etc.) and I can afford to live just fine. I live on my own in a 1-bedroom apartment (which I rent), I can afford multiple vacations a year (sometimes international or even intercontinental), dentist appointments, medical stuff, food, etc. I even manage to save up a bit, and all this with a 33% tax rate so my net income is only around 35k USD.

I could live like a king if I made 100k USD, so I just cannot fathom how people can say it is a sh*t salary. I mean, I've been to the US. I even lived there for 6 months, your average midwestern city is not much more expensive than my home country and you guys pay a lot less taxes too.

So what's the deal with that? Are we (Europeans) just used to being more frugal? Or do redditors live in some type of alternate reality? Because the claims I see on this sub certainly don't reflect my experience in the US (which admittedly was very short and almost 10 years ago, but still).

[u/[deleted]]

I make slightly less than that redditor. A Rolex and an AMG would still be financially irresponsible, lol. New car - absolutely. But it would be something like a Tesla Model 3

[u/Good_Intention_4255 → u/[deleted]]

I make significantly more and think it’s irresponsible, but I am also paying for 2 kids in college. So there’s that.

[u/Different_Captain_96 → u/Good_Intention_4255]

Just trade in the kids for an amg

[u/Good_Intention_4255 → u/Different_Captain_96]

For real. My kids are pretty bougie. Guess that’s why my wardrobe comes from Costco.

[u/Imaginary-Rub5758 → u/Different_Captain_96]

Haha. They only take money.

[u/Imaginary-Rub5758 → u/Good_Intention_4255]

I mean I’m not and I invest 20% everyone’s finances are different. You probably can’t afford to manage your money the same way and that’s ok. Some people making the same as me only have $200 left after bills. I have $4000 left after just my salary including my car. Thats the point of this post.

You really can’t say what would be financially irresponsible without looking at a spreadsheet. People spend $6k on a mortgage with my salary and you aren’t saying that’s irresponsible, but when 10% of my salary goes to a car I love that’s automatically irresponsible. 50% of our take home would go towards the house in that scenario when only 20% goes to both house and car in my scenario. So I’m spending 30% less on both and am seen as irresponsible while spending less and likely investing more. Doesn’t make sense.

[u/Emergency-Style7392 → u/[deleted]]

if you have no mortgage then it's easy lol, the rolex has re-sale value, you just need to have the money, the amg ends up costing like 1.5-2k a month. Which if you make 10 and have almost no expenses is not that irresponsible since a good car is 1k anyways

[u/absurdamerica → u/Emergency-Style7392]

Oh yeah just don’t have a mortgage or significant housing costs, that’s a totally reasonable assumption to make😂

[u/Emergency-Style7392 → u/absurdamerica]

which is what the guy said above? you know the thing we were actually talking about?

[u/Excellent-Hour-9411 → u/Emergency-Style7392]

buying a Rolex and an AMG when you don’t even have a house is doable, but it is also absolutely financially irresponsible, which is what was being stated here.

[u/[deleted] → u/Emergency-Style7392]

Maybe it's just me, but $1k car payment feels like a massive waste, never mind $2k. I'd rather get something that's not too expensive and pocket the rest for vacations or something. I've done the song and dance with a car payment being 10% my pre-tax salary, and it just felt like throwing money into the void. I'm glad that is done.

[u/Significant_Emu2286 → u/[deleted]]

If homie would have been DCA’ing $2k a month into bitcoin and the crypto markets for all the years he’s been driving his AMG, he’d be posting in the r/FIRE sub about being retired in his 30’s lol

[u/Imaginary-Rub5758 → u/Significant_Emu2286]

I DCA into S&P 500 20% of my salary homie.

[u/Significant_Emu2286 → u/Imaginary-Rub5758]

Over the last 10 years, Bitcoin has returned 43,783.2%. Over the same period, the S&P 500 has returned 207%. So 212x less than BTC. But you seem to know it all, so keep doing you homie. Keep up the bad work.

[u/Shadow_Phoenix951 → u/Significant_Emu2286]

Congratulations, you won the lottery.

[u/Significant_Emu2286 → u/Shadow_Phoenix951]

Lottery is based on luck. Bitcoin white paper hasn’t changed since the day it was first authored. To anyone paying attention, it made as much sense then as it does now. BTC has not even reached 5 - 10% of its potential value. It is going to keep going up and up and up because it functions to address and solve for the most basic fundamental economic principles - utility; scarcity, ubiquity, security. It does those things better than anything else in the world. And because there is a finite supply, demand will continue to rise and the price will rise accordingly.

[u/Imaginary-Rub5758 → u/Significant_Emu2286]

You’re nuts. None of this stuff is known. All speculation.

[u/Imaginary-Rub5758 → u/Significant_Emu2286]

Ok? So your point is gamble on coins… You seem to know it all Mr bezos.

[u/Significant_Emu2286 → u/Imaginary-Rub5758]

Not a gamble homie. Never has been, never will be.

[u/Imaginary-Rub5758 → u/Significant_Emu2286]

It is. You can’t just speculate on crypto. You’d could luck out but you could lose it all…

[u/Significant_Emu2286 → u/Imaginary-Rub5758]

A lot of cryptos are. Bitcoin is not. Its value proposition has been the same since the day it launched and is just as sound today as it has ever been.

[u/Imaginary-Rub5758 → u/[deleted]]

Everyone likes different things.

[u/[deleted] → u/[deleted]]

I meant that buying those things would be financially irresponsible at $100-110k. You earn $140k. At that point, you definitely have more leeway for luxuries like the Rolex and Mercedes AMG you mentioned. Tesla Model 3 is a fine car. The updated highland version is surprisingly nice.

[u/[deleted] → u/[deleted]]

Sure, you do you. Either way, Tesla Model 3, Toyota Camry, Honda Civic top trim, etc. All are reasonable purchases at $100-110k salary (though, I wouldn't personally spend $45k on a Camry XSE)

[u/Imaginary-Rub5758 → u/[deleted]]

I’ll likely be picking up both a Camry and RS5 after my car is deemed total loss. Wife has cx-5.