What is the perfect salary to be happy?

[Mike Hoxbig]

What would school fees be for 2 kids per month? Levies for the complex? Just there your 12k into your 40. Bond on 2m, another 14k or so. Not much left for a car,food,electricity, insurance,cell, internet.

I stay in a 3 bedroom unit in a complex. Paid 1.2m for it 3 years ago. Bond was 900k = 5.5k pm for me but at prime it would be about 7k. Levies are 2k. Rates and taxes are R750. Electricity is about 2.5k, but I use a lot. Most people can get away with far less.

So you're looking at about 11k to put a roof over your head.

Living expenses like food, clothing and amenities are different for everyone so I won't get into that.

For schooling, the Curro Castle up my road is 6k pm, Curro primary and high school ranges from 7k - 10k pm. BUT you don't need to put your kid through private school, there are plenty of decent government schools that would cost a quarter of that. Private schools are not the reserve of the middle class, you'd have to be doing relatively well to be able to afford it.

The point being that you don't need fancy stuff to lead a middle class lifestyle. You can get away with far less than 40k by managing your money properly and living with certain choices...

 

[notayoba]

I stay in a 3 bedroom unit in a complex. Paid 1.2m for it 3 years ago. Bond was 900k = 5.5k pm for me but at prime it would be about 7k. Levies are 2k. Rates and taxes are R750. Electricity is about 2.5k, but I use a lot. Most people can get away with far less.

So you're looking at about 11k to put a roof over your head.

Living expenses like food, clothing and amenities are different for everyone so I won't get into that.

For schooling, the Curro Castle up my road is 6k pm, Curro primary and high school ranges from 7k - 10k pm. BUT you don't need to put your kid through private school, there are plenty of decent government schools that would cost a quarter of that. Private schools are not the reserve of the middle class, you'd have to be doing relatively well to be able to afford it.

I think our sums differ a bit. Nothing 3 bedroom in a complex near me for under 2.5m. Government schools are 4k pm if you can get space. Otherwise it's maar kak en betaal for a private school. If you bought a property a while ago the sums are easier. If you bought recently, 40k is going to leave you in a hole each month.

Talking pre tax. 40k after tax should just about squeeze you through.

 

[charlieharper]

Money makes me extremely happy.

I don't disagree, but I don't agree either.
I reached a certain financial goal a year ago, thought it would make me "happy".

I'm not unhappy, but turns out absolutely nothing changed.

I think for most of us, once you can make enough to cover living costs and can keep lifestyle creep from blowing it on useless stuff, it just becomes a game to get the number as high as possible.

 

[Pineapple Smurf]

Yeah no thanks, 1 is enough, I'm not here to repopulate

Uppa-da-bum no babies

 

[notayoba]

I guess the number varies wildly depending where you live and how long ago you bought property. A paid off house or one with a bond from 2005 will make a massive difference. But even then, basics like electricity and food prices have gone absolutely bonkers recently.

 

[konfab]

Happiness isn't a worthwhile goal. You could be the richest person in the world, but you will still feel like k@k if your cat gets run over. Then what do you have if happiness is your only goal?

Pursuing meaning is what is important. Happiness will come as a side effect of that.

So with that in mind, your salary needs to be enough that you can afford the time and money to do something meaningful.

 

[netstrider]

Double your expenses and monthly savings in pension, medical aid etc. That is "comfortable".

The simple rule of buy it if you can afford it twice.

Add a tad extra and you're rich.

 

[rvZA]

I guess the number varies wildly depending where you live and how long ago you bought property. A paid off house or one with a bond from 2005 will make a massive difference. But even then, basics like electricity and food prices have gone absolutely bonkers recently.

Correct. In my area, we pay on average around R4800 a month (some months around R4400 and some R5200, depending on when actual readings are done) for electricity and municipality bill and another R1,000 for pre-paid water. We are a family of 5.

School fees for next year are R10,500 for three kids in a government high school.

We managed to cut down on groceries and meat for a whole month to around R10k. This excludes daily things like milk, bread, cigarettes for me, fruit or vegetables, etc. I spend on average another R4k a month on these expenses alone.

So, without rent, cellphone costs, internet expenses, petrol, vehicle finance, clothing, other school expenses, medical aid, we are already at around R31k.

South Africa is bats**t expensive, unless you do not mind living like a pauper.

 

[JohnStarr]

Twice what I earn now. I'd even do with 1.5x.

 

[Mike Hoxbig]

I think our sums differ a bit. Nothing 3 bedroom in a complex near me for under 2.5m. Government schools are 4k pm if you can get space. Otherwise it's maar kak en betaal for a private school. If you bought a property a while ago the sums are easier. If you bought recently, 40k is going to leave you in a hole each month.

Talking pre tax. 40k after tax should just about squeeze you through.

I think we just view money differently. Just because you're taking home 40k pm doesn't mean that you have to live at the limit of it. With a bit of planning and a bit of sacrifice, you can build more wealth than people earning more than you.

I'm not posting the below to brag, but to give you a bit of perspective.

3 years ago when I bought my place, I was clocking 1m+ pa ctc. My bonus was around 250k IIRC. I didn't go immediately buy what I could afford, but rather what I needed with a long term plan in mind.

My current place is now paid off. We're moving to a house soon. I plan on renting this place out for 10k pm, for a take-home of about 6k after levies, agent fees etc. Going to then buy a second rental property, dump the rent from this into that, and look at paying that off within the next 5 years. And then snowball it until I have 4-5 rentals by the time I retire. No need to draw from my RA/PF, that's going to be my travel money.

By doing this I'm better off than people earning more than me, with just a little bit of sacrifice.

Now to put that into perspective, if you're relatively young and taking home 25k, it doesn't mean that you have to go and take out a 1.5m bond because you can afford it. Slum it for a few years in a 600k - 700k place, put the idea of kids off for a while and pay that off ASAP. Once you're bond free and have a small safety net, then you can think about having kids and moving to a bigger place.

But in the mean time you're already better off than people earning more than you, and can now look at building a property portfolio, something very few people have the flexibility to do because they're poor at managing money.

Oh and fsck the cars, seriously. Get something that works and drive it until the wheels falls off. IMO it's the biggest wealth inhibitor out there...

 

[JibbersCrabst]

I have posted about this before. If you are married and have 3 kids, around R45k a month, at minimum, is required to make a very basic living. You will not live in a 4-bedroom house. You will not drive a big SUV. Your kids will not go to private schools. You will not have the best medical aid package. You will not be eating takeaways once a week. You will not be going to the movies once a month.

Living costs in SA are astronomical compared to the rest of the world.

Obviously haven't been to "the rest of the world"..

 

[notayoba]

Correct. In my area, we pay on average around R4800 a month (some months around R4400 and some R5200, depending on when actual readings are done) for electricity and municipality bill and another R1,000 for pre-paid water. We are a family of 5.

School fees for next year are R10,500 for three kids in a government high school.

We managed to cut down on groceries and meat for a whole month to around R10k. This excludes daily things like milk, bread, cigarettes for me, fruit or vegetables, etc. I spend on average another R4k a month on these expenses alone.

So, without rent, cellphone costs, internet expenses, petrol, vehicle finance, clothing, other school expenses, medical aid, we are already at around R31k.

South Africa is bats**t expensive, unless you do not mind living like a pauper.

Now your sums add up and makes sense to me. I think some other posters either don't know what things cost, or are in denial what happy or middle class means. It really is very expensive to live even a modest middle class life in South Africa. Or at least the western cape. We pay 1st world prices and earn 3rd world pay.

Also. The topic is how much to make you happy. Not how much to barely stay alive.

 

[notayoba]

Happiness isn't a worthwhile goal. You could be the richest person in the world, but you will still feel like k@k if your cat gets run over. Then what do you have if happiness is your only goal?

Pursuing meaning is what is important. Happiness will come as a side effect of that.

So with that in mind, your salary needs to be enough that you can afford the time and money to do something meaningful.

That's actually very true. It's hard to pursue something meaningful when fighting off the sheriff, or you have to hitchhike to a minimum wage job. Too much money also traps you.

 

[The_MAC]

Enough to cover your expenses with a good extra amount for leisure - key is to settle on a lifestyle and not keep increasing it with every pay rise

 

[Prim0]

TLDR; don't have kids.

 

[cguy]

What is the perfect salary to be happy?​

I would say that the answer to this is usually, "as much as possible". The reason being, that one really wants to reach a point where you don't need a salary, as quickly as possible. Thereafter, it's less of a factor. Of course, one could argue that one can be happy while having one's family financially threatened by your unemployment, illness, death, etc., but from my experience there's a different quality to happiness before and after this point. Perhaps I'm just too much of a worrier...

 

[Mike Hoxbig]

I would say that the answer to this is usually, "as much as possible". The reason being, that one really wants to reach a point where you don't need a salary, as quickly as possible. Thereafter, it's less of a factor. Of course, one could argue that one can be happy while having one's family financially threatened by your unemployment, illness, death, etc., but from my experience there's a different quality to happiness before and after this point. Perhaps I'm just too much of a worrier...

100%, I follow a similar train of thought. You're only truly happy if you don't have to work and still have an income. Everything that I do is always done with the question "what will they do if I'm not here tomorrow?" in mind...

 

[Rocco1]

That is hardly a basic middle class existence jees...

in Cape Town a normal decent middle class 3 bedroom house is R3 million going up to 4 mil... School fees R60k/pa per kid..

 

[cguy]

100%, I follow a similar train of thought. You're only truly happy if you don't have to work and still have an income. Everything that I do is always done with the question "what will they do if I'm not here tomorrow?" in mind...

Yup - I never bet on having income tomorrow. I'm amazed at how many people I know who think that they're going to be able to work forever, and that their (pretty decent) paycheck-to-paycheck existence will be sustainable into old age.

 

[RedViking]

If I can get 25k nett I will be so happy. I want to buy a decent 2 or maybe 3 bedroom flat. A modern car and then pay my bills with the rest.

Life will be epic!

When was the last time you checked what a 3 bedroom flat cost and a modern car?