Estimate for big ticket items

Big ticket items include house, cars, and child education. This is to assume you've got proper health insurance coverage for your family.

So How much should I estimate for those big ticket items?

House:

For a home of $400,000, with $100,000 down and $300,000 loan. An easy way of estimating the total payments is to take down-payment + 2 times of the loan amount. In our example, it's $700,000. But you get the tax benefits, and the appreciation of the house value.

Cars:

If you acquire 6 cars in your life time, and each in average costs in total $20,000, and if you do not borrow car loan, the total cost would be close to $120K.

Kid's college education:

The college tuition and fees rise faster than inflation. In current situation, one kid attending a 4 year public college, cost about $10,000 tuition and fees and $10,000 living expenses. Four years will cost around $80K. If your kid is in elementary school now and will go to college 10 years later, this figure may be at $150K.

Here is an example -

San Francisco State University

With Parents On-Campus Off-Campus Fees 3,456 3,456 3,456 Books and Supplies 1,386 1,386 1,386 Food and Housing 3,474 11,500 11,500 Transportation 1,242 1,242 1,242 Misc, Personal 2,718 2,718 2,718 TOTAL $12,276 $20,302 $20,302

These big ticket item estimates are high level and ball-park estimates. If you purchase better cars, if you live in cheaper or more expensive area, or if you send your kid to a private school, the cost would change drastically.