Impossible To Live On $500,000 In Manhattan

As surviving Wall Streeters confront the reality of government-imposed pay caps, the NYT dutifully recalculates the cost of an upper-middle-class Upper East Side existence.

Bottom line?

$1.6 million pre-tax.

A few people in Manhattan do manage to survive on less than that, so intrepid bankers will no doubt find a way to make do.  But it will apparently involve considerable hardship and shame.

The details:

  • Two vacations a year, sun and slopes: $16,000.
  • Modest three-bedroom apartment for $1.5 million [very modest]. Monthly mortgage of about $8,000 and a co-op maintenance fee of $8,000 a month. Total cost: $192,000.
  • Summer house in Southampton for $4 million, annual mortgage payments of $240,000.
  • Car and driver. Chauffeurs make $75,000 – $125,000 a year, more if you want one with a gun. Garage for the car is $700 a month.
  • Personal trainer at $80/hr, 3X a week: $12,000 a year.
  • Ball gowns for charity galas. Total cost for three: about $35,000.
  • Tutor to supplement $32,000 private school to ensure admission to Ivy League: 30 weeks for $3,750.
  • Two children in private school: $64,000.
  • Nanny: $45,000.
  • Food.  $15,000.
  • Incidentals: Restaurants. Dry cleaning. Suits.  Dog walking.  Kennels.  Furniture.  Computers. Gifts. Doorman tips.  Parking tickets.  Walking around money.

Add it all up, and you get about $800,000 in annual cash expenses, or $1.6 million pre-tax.  Cut the “extras” like the chauffeur, house in Southhampton, ball gowns, personal trainer, and tutors, and it’s still around $400,000, or $800,000 pre-tax.

Good thing Wall Street has already found ways to get around those salary caps!

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