The only debt we have is our mortgage and I don't really consider that a debt, its really more of an investment.

We were in a lot of debt a few years ago and worked really hard to pay it off so I would consider any debt to be too much for us.

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DS-16
DD-13
DD-5
DS-3

Yep Thats a heck of a reason to Stress !!

I also agree it does come down to percentages -

although My Bro and My Sis Make the same amount - yearly - Roughly about 60,000 each -
As I Said My sister would rather have 10 Grand in the Bank then Make Payments On a 10,000 CC

My Bro and His Wife think money in the Bank is there to spend - credit cards are for every other Necessite and Emergency in life - Therefore their Debt will always be High.

sis has a 1500 Mortgage - Bro has a 2500 Mortgage
Both live in the Same area -
Bro has 2 kids, sis has 1

Its just amazing what people do with their money and how they use it ....

I am not a Huge Saver - but I am not a Huge Spender either - I shop too much but mainly its way too much of a good Deal Things I Am buying And I pay cash.

My mortgage was $498 a month, it is paid off now. I know people whose mortgages were up to $2000 there is no way I would pay that much to have a house.

We keep our month to month debt less than 2/3 of my pay. His pay goes towards retirement and the business.

CC debt is minimal, we use a card that earns frequent flier miles for all our spending and bill paying. I make the payment 3-5 times a week to keep it paid off.

Anything beyond our mortgage and car payment is too much debt for me. We pay off our credit cards in full every month.

Our mortgage is a little over $1000 a month - very reasonable for this part of the country (we got in at the right time) - and affordable for us. The tricky part will be finding a way to afford upgrading to a bigger house when the time comes (we've already made plans to stay in our current house for longer than we'd planned because we don't feel like we can afford something bigger right now).

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Stephanie
Mom to: Caleb (8/03), Ian (9/05), & Lucas (11/08)

For us, any debt for anything that decreases in value is too much debt.

The only things we have ever borrowed for are the mortgage, and some student loans. Both of these things increase in value.)

We are just more comfortable saving up for what we want, including for cars (and now for school). We live simply and buy less but my debt threshold is low.

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My house and taxes combined are 40% of our income! I know...YIKES!!!! WE moved here for a better job and now I can stay at home. Unfortunately the taxes are sooooo high and so are the houses. ANyway....Finanancially we are better than before because even thogh we took a pay cut, I am home with my kids no need to pay for daycare which ate a chunk out of our budget before! I guess it is all relative. Also as your income rises it seems that you can afford a larger % going to your house. For example if you were living on $2000 a year 40% going to housing would not allow enough $ for other areas! But say if you were making $5000...40% could be manageable. Luckily we are done with cc, car and student loan debt. Our house is our only debt. Seems high...but I am hoping to go back to work in 2 years which will up our income and hopefully pay for at least the monthly mortgage and taxes and leave extra for saving! We also decided to get a house that we could grow into...we were so smooshed in our last one...then prices went up so high and we couldn't afford to upgrade. So we went a bit higher...but allowing enough $ to meet our other needs with the assumption of my going back to work eventually in a few years. Now if we had cc debt or no emergency fund we would have never sprung for this! Hope this makes sense!

I have a question - when you talk about mortgages, do you include homeowners insurance and taxes? In other words, when you say you wouldn't want to pay more than 20% of your take-home, does that include the ins and taxes?

I dont' know if this was directed to me, but since I feel that 20% is a bit much, I 'll answer...
Yes, I mean with taxes and insurance. We live in an area of Texas that is relatively inexpensive to live in (plus we bought at the right time, as prices have gone up since). Mortgage for our home, taxes and insurance, divided up monthly is only about $550 a month. SInce we bring in about $4500 a month after tax, that's about 12% of our monthly income. I can't imagine spending anything over $900 for all of that, unless we built a brand new home here. Which we will, in a few years. But with that said, we will also be making more money then, and will be without any other debts, so that won't matter as much then, as it does now. But those that pay $2000 a month on all that, I can't imagine what their income would have to be to support that. That's my curiousity though. Again, it's all relative, compared to what other bills you have, whether or not you could support that kind of price, it's just not for me.

Yes, I include insurance and property taxes which I calculate the percentages. Some people include utilities too (anything that has to do with the house itself ~ electricity, gas, water, sewage, etc).

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I guess I would consider any cc debt too high because it freaks me out since it really just wipes out good deals with interest. We use credit cards for rewards (ad store cards for discounts) but we pay them off every month.
We do have car payments, but they are almost paid off (which will be so great!) and our mortgage is 2000, which does not seem like a lot to me. It is a little over 24% of our take home. However, our take home could be higher if we needed, we just put a lot into retirement right now because of some tax issues, but even at 24% it is completely managable to us and our income keeps going up, but our mortgage is staying the same.