$230,000 a year: not enough for my family of four.

January 28, 2024
1 min read

A family of four needs to earn over $230,000 a year to live comfortably in California’s San Francisco Bay Area, according to former Goldman Sachs analyst Sam Dogen. Dogen, who retired at the age of 34 with a $3 million net worth, revealed in a recent blog post that he had to cash out a significant portion of his investments to buy a property for his family. With his investments now on track to generate $230,000 before taxes, Dogen estimated that he would need to earn around $420,000 a year before taxes are taken out to cover his projected annual expenses of $288,000. His estimated expenses include private school tuition for his two children, healthcare costs, food expenses, and housing expenses, which are expected to reach $68,400. Dogen stressed that his budget breakdown is meant to be comparable to those of other two-parent, two-children families living in expensive areas, and while he acknowledged that there are areas to cut, he described his budget as a realistic and comfortable lifestyle.

Dogen’s candid look at his finances highlights the struggle of raising a family in an expensive city and the challenges of saving for retirement while maintaining a high standard of living. His story is likely to alarm many Americans who are grappling with rising costs of living and stagnant wages, with the average annual salary in the US currently standing at $59,428. Despite the high expenses, Dogen emphasized the importance of saving aggressively and investing wisely to combat inflation and build wealth over time.

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