A list of puns related to "Budget Rent A Car"
TL;DR: Is it reasonable to consider your base salary + your RSUs when establishing how much rent or car payment you can make?
I am a 23 years old software engineer in the Bay Area. Here is my financial situation:
I have 0 debt.
I own a brand new car with a full bumper to bumper warranty for the next 2 years, and a powertrain warranty for the next 7 years, so I don't think I will have to spend a lot of money on emergency repairs. The car was paid in cash, so I have no payments to make.
I am single with no kids.
My base salary is $140k. I will receive a sign-on bonus of $30k next week (this amount will be taxed). Based on the current value of my company's stock, I will receive $190k of RSUs per year for the next 4 years. My RSUs vest quarterly, so I should receive $47.5k of RSUs every 3 month. My company is growing at a great rate and our business is going well, so I doubt the stock price would decrease over the next years. Before anyone asks why I receive as much RSUs as I do, I signed the offer 9 months ago and was promised an amount of shares based on the price at that time. The shares have since increased significantly.
My monthly spending excluding rent is around 1140$ (55$ phone bill, internet is paid by employer, around 500$ for food, 85$ car insurance, 200$ for gas, 300$ on random household items).
I just moved to the Bay Area and I am in an Airbnb for the next 2 weeks while I do some apartment hunting. I wanted to know if it would be reasonable to consider my monthly income to be my base salary + my quarterly RSUs amortized over 3 months. If I don't take into account my RSUs, my monthly income pre-tax is $11.6k, or around $7.5k post-tax. If I take into account my RSUs, my monthly income pre-tax is $27.4k ($11.6k + $47.5k/3), or around $16k post-tax.
From my understanding, a good rule of thumb is to spend no more than 30% of your net monthly income on rent. By excluding RSUs from my income, then I should spend no more than $2250 on rent. By including RSUs in my income, I should spend no more than $4800 on rent. Obviously, I am trying to spend as little as possible on rent as possible to build savings, but I find it a bit difficult to find a decent place in the Bay Area for $2250. Most places that I find for that amount are either far away from my workplace, or are in serious need of renovations. I wanted to know if I would be acceptable to spend $3000 on rent given my current financial situation. This would help me live in a be
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