Is a $180,000/year income considered high in Australia?
Considering total taxes of $60,000 brings it down to $120,000 whearas someone earning say, 80,000 only pays $20,000 you're still earning double that amount, which most would consider a high income I think it's pretty goodIf, however this money is being earned through one's own company business, you can deduct whatever expenses you have throughout the year which may drop your income to a lower amount, thus paying less tax but also earning less. Though deducting cars, travel, fuel, clothes, etc etc is a perk that only business owners can claim, whereas the employee has to pay for out of their own pocket. Only further increasing the already ‘high’ income.Lets say you have depreciation on a $50,000 vehicle, $12,000 deduction over 3 years right there. Fuel of $7,000. Repairs of $1,000. Clothing of $1,000. Business gifts $1,000. Phone and internet costs $1,000. The employee pays for this him/herself whearas the business owner only pays 60% for (because 40% is claimed as a deduction) You can see the perks of business, thats $8,800 extra the business owner gets to keep hold of that the employee does not
Is 100k per year a good salary in Australia?
Well salaries are quoted before tax. So say that is 100,000 a year before tax.According to this Australian government website Individual income tax rates people earning $100,000 AUD in Australia would fall into the $87,001 to 180,000 tax bracket. Everyone in this bracket is charged $19,822 AUD plus .37 for every dollar earned over that.So for a person earning $100,000 AUD after tax they will take home just over $75,000 AUD per year.Then of course it depends on what Australian city you live in. In Sydney that money is not going to go anything like as far as other Australian cities but then on the other hand you are most likely to get a job that earns that much in Sydney than anywhere else in Australia.So in Sydney you will you have to watch what you spend and how much you spend. You certainly won’t be buying brand new cars every 4 or 5 years that is for sure, you would be driving a normal car, probably a 2010 Honda Civic or something. A 7 year old car. You also would not be living in Sydney’s most expensive suburb either but you probably wouldn’t have to live in the most slummy suburb either.I don’t live in Sydney but my guess is you could probably live in Sydney on that salary but you would have to make sure you did not waste money and you would not be living the rich and famous lifestyle by any means.This is just a guess of what I think your lifestyle would be like.
We live in Sydney, earn $180k a year, have no debt no kids and no mortgage. What can we do as a couple to become wealthy in the next five years?
With such a short time frame only high risk. And according to odds, considering high risk with such big figures, market volatility and liquidity won’t help you.Check my Retirement Plan sheet. If you start investing in dividend paying stocks, starting with 100k, and investing/adding 80k each year, on a diversified portfolio with an average of 4% dividend yield payout, you will achieve in 20years a payout of 104k in dividends after year 20 and beyond annually. Considering if the stock values would not change, you would have a portfolio worth 2.7 million and a yearly payout of 100k after year 20. Its a long term plan, but unfortunately there is no short cuts to long term wealth. Berkshire Hathaway Warren Buffet’s has achieved an average yield about 15% per year. With the same investing conditions, staring with 100k and adding 80k for 20years, this would turn your portfolio at year 20 worth 11millions and each year beyond would yield 1.4millions. All the risk would be in one asset, but his historical performance is worth more than tousand words.https://docs.google.com/spreadsh...
Has being wealthy made your life truly better?
Unquestionably.To be sure, I’d characterize myself as “moderately wealthy.” My wife and I own a home and (for the first time in about 20 years) a car. We live in Cambridge, Massachusetts, which is a high cost of living area.But if you account for the high cost of living, our lifestyle doesn’t differ too much from a typical middle class lifestyle in, say, Oklahoma City. We don’t have maids or “domestic help,” we don’t take extravagant vacations, we don’t have a lot of expensive toys, etc.But the one thing we do that we couldn’t do without money is… sleep well at night. What do I mean?We have well in excess of 6 months’ expenses in cash. We have investments that just barely cover our monthly expenses. So in theory, if suddenly we lost our jobs but our investments didn’t change, our lives wouldn’t be too disrupted. Sure, it’d be a lot of beans and rice instead of restaurants, but we wouldn’t have to even consider selling the house even in a long-term interruption in employment.The same phenomenon from another angle: if something fixable goes wrong, we can just fix it. Leaky roof? Dishwasher stops working? Anything along those lines can be solved with a phone call and a check. It can be solved the right way, not the cheap way.Or said yet another way: in one of life’s cruelest ironies, it’s expensive to be poor. In various guises, we’re all often faced with the problem of spending a lot of money up front but less money long term, or to spend a little money up front but spend more money long term. If you don’t have that initial chunk of cash to spend, you’re forced to spend the little bit up front, but pay more long term.If you’re poor, you might need to dip into your credit cards to get by for a month. Great, now you’re paying interest — often exorbitantly high interest — next month.Maybe you can’t afford to buy a car, so you take public transportation to work. Or maybe you have two jobs and no time. Or maybe you live in a food desert because that’s the only place you can afford. Whatever the reason, you don’t have time to cook. So you have to decide between feeding yourself and your family on overpriced and unhealthy fast food, or even-more-overpriced healthy fast food.These things add up, and make climbing out of poverty a daunting task indeed.