Occam's Razor

Sometimes life’s milestones go almost unnoticed. In filling out the paperwork for my car loan this week and totaling up my income I discovered that my income alone was now just barely in the six figure range.

So why don’t I feel richer?

I always figured that if I were making this kind of money that my life would be a heap more upscale. Maybe I’d be driving a Lamborghini, but if not that at least a Lexus. Instead I have this lovely brand new but modest 2005 Honda Civic Hybrid. This hardly screams midlife-crisis babe-attracting-magnet mobile.

With a six figure income isn’t it time to get a McMansion with a three car garage? We seem content with our modest three bedroom single family home. The McMansions are all over the place in my community. It would not be out of our reach for us to trade up to a grander house. But the truth is I don’t want a McMansion. My income is now in six figures but apparently my neighbors have much deeper pockets. They have the McMansion, three cars in the driveway and a wife who stays at home and drives the children to ballet classes. But not everyone can be an executive vice president. Where do these people get the money? Am I underpaid at $100K a year?

Perhaps I could buy a vacation home, weekend getaway or timeshare condominium. But I don’t want any of them. I don’t want to spend my weekends driving somewhere to have some stolen moments in the country. I don’t want the hassle of maintaining another piece of property. I can hardly keep up the one I have. And I doubt that even on six figures that I could really afford two mortgage payments.

While I no longer struggle from paycheck to paycheck I find that my experience with poverty and struggling to make ends meet for so many years still controls my behavior. I cannot be reckless with money. I largely practice pay as you go. I won’t carry a credit balance. I typically buy used cars and keep them until they are just short of falling apart. (This new car is the exception, but even so we put $10,000 down.) As for style, I have none. I have no sense of fashion. Blue jeans and T-shirts supplied by technology vendors account for much of my wardrobe. My daughter says I need a visit from the Queer Eye for the Straight Guy folks. I have no idea how to be hip. Worse, I have zero desire to be hip. I am comfortable being indistinguishable from the crowd.

Still I have noticed the income creep over the years. A family vacation in Hawaii a few years ago would have been unthinkable at one time. It probably cost us $7000. It was paid for by extra paychecks and by dipping into savings a bit. I hardly noticed the cost. Similarly this year my wife elected to get some cosmetic surgery. The operation cost us $6000 or so. We paid for it out of savings and paid ourselves back within a few months.

Such things are helped by having low housing costs. Our mortgage payments are about $1500 a month. At one time the payment seemed obscene, but now new residents have a hard time renting a decent apartment for that kind of money. We have been fortunate in the timing of our housing decisions.

I spend money in places and in quantities I didn’t before. I give a lot more money to charity not just because I can but because I want to. And I gave thousands of dollars to political candidates and political organizations in the last election. It was too bad I didn’t get a better return on those investments.

So I’m certainly not complaining. Poverty sucked. Some part of me continues to be scared that I will be impoverished again. On some level I realize this is foolish. I have 401Ks, mutual funds and hundreds of thousands of dollars in equity that can be tapped in emergencies. It gets easier to spend money with every large or frivolous purchase. But I still feel the need to horde my money. I pay myself first but I often wonder why. Am I afraid to live the larger life? Or am I simply comfortable living in the trappings of a modest life even though our financial reality suggests more expansive possibilities?

I don’t know. But I often feel I should be more financially savvy. Trading up to a bigger house would make a certain sense at this stage in my life. Perhaps the class of my neighbors would improve (not that I have many problems with my existing neighbors). Perhaps the Rotarians would ask me to join. Perhaps I would feel what it would be like to be “in” or at least a member of the somewhat moneyed crowd.

But overall I sense that passing this particular milestone doesn’t mean that much anymore. There are plenty of other people in my fortunate boat and we are all trading up. This means that prices are going up, which means that my income doesn’t mean as much as I think it does. I’m doing well. I consider myself fortunate. But I still can’t see coming up with $24,000 a year to send my daughter to Sidwell Friends School, something she’d like us to do. I can’t see buying her a car when she gets her license. Although we have money set aside for her education I can’t see her in a preppy private school somewhere when a public university will do just as well. All these things still feel beyond our financial reach, or at least don’t seem prudent.

Perhaps I’ll do it if I ever reach the $200,000 milestone.