Most people discuss personal finance rules in absolute terms. I hate it! I truly believe there are almost NO SET PERSONAL FINANCE RULES. Rather, personal finances are well just that…personal and as I was reminded the other day local. When I read posts about other personal finance bloggers and their housing expenses I become jealous (read: angry). Well today I got a reminder that how local personal finance is and that it is all relevant. I live and grew up in one of the most expensive parts of the country (Long Island), but was shocked talking to a buddy today who is moving to New York City next month.
When he told me his rent I wasn’t flabbergasted since I have had a bunch of friends who have lived in the city at one point, but I certainly had a “what the F” moment. Yes, I put flabbergasted below what the f. I just couldn’t resist the opportunity to figure out how much of my monthly nut is encompassed by just his rent. He didn’t mind too much since I have known him since we were twelve and he is moving to “the city” under the best of conditions.
Before looking at my particular example I think some perspective is needed. In 2009 (post crash) the mean single family house where I grew up was over $680,000 while the mean of my new town was $575,000 in 2009. Mean is probably a terrible way to describe the housing costs, but it is the data I have to go off from City Data.
With that in mind lets look at my information:
- My Original Note was for $388,000 (put 20% down on a $485K home).
- 30 Year Fixed
- Taxes are about $11,000
- No Idea about Homeowner’s insurance cost but they are factored in
- My Payment all in is just shy of $3,000.
His rent was more. The Wife’s leased minivan (man, do I hate that thing) is $369/mo. His rent is still more. I pay about $130 for my triple play package…now we are getting closer.
Does Any of this Matter?
Nope! But I was reminded of a very valuable lesson that I have seem to have forgotten over the years. Beyond the basics about credit card debt personal finances are very personal and thus very local. For instance, someone borrowing money to buy a pick up truck would make zero sense to me unless that person was a contractor, however, there were about 200,000 of them sold in July 2013 apparently the rest of the Country feels differently! Similarly, someone’s housing and food costs matter a lot where they live.