-
-
Ad Space
(728 x 90)
Mark and Jenn live in a two-bedroom-plus-den in Carroll Gardens, Brooklyn, with their two-year-old daughter, Olivia, and ten-month-old son, Andrew. They pay $2,800 a month in rent. “It’s a lot for us,” Mark says, “but buying anything big enough for us to live in comfortably that’s in a good school district will be at least $600,000.” Jenn is eager to own, but Mark is reluctant. “I don’t want to buy somewhere where I don’t love the schools, and then have to pay for private school on top of a mortgage,” he explains.
They could likely handle the monthly payments on a $600,000 place: With 20 percent down, a 6 percent interest rate and a $600 maintenance fee, payments come to about $3,500 a month; factoring in tax savings, the final out-of-pocket costs would be about $2,500. However, finding $120,000 for a down payment would be a real struggle.
Mark, who works in publishing, and Jenn, who’s a sales account manager, bring in a combined income of about $170,000, and they both contribute aggressively to their 401k plans—they’ve amassed a $150,000 retirement nest egg. But after their payroll deductions, their take-home is about $6,400 a month, and by the time they cover rent, child care ($2,200 a month) and expenses (including groceries, entertainment, utilities and the occasional sitter for a night out), “there’s not a lot left over,” Mark says. “We don’t have any savings.” For now, they’re happy in the apartment, though eventually the kids will probably need their own bedrooms.
NEXT: WHAT THE EXPERTS SAY »
