Editor’s note: This article originally appeared in the Feb., 1930 issue of Fortune.
Before we were married, Anne and I were certain that when I earned $15,000 a year we could live in regal splendor. That was ten years ago. Today we have two children, and have to check the grocery bills to do it on $25,000.
Here’s the situation: my salary is $15,000, and my revenue from securities gives the other $10,000. Clearly we can’t talk about what we want to do with our money until we’ve disposed of the things we have to do with it. First, income tax: after making all proper deductions, I have to pay the government about $830. Second, insurance: you’ll admit that $1,000 a year is modest, and the same for $2,500 savings. Sound economics would increase the latter from a tenth of our income to a third, but hopes of inheritance have scaled it to the minimum. Taxes, savings, insurance: $20,670 left, and December still twelve months away!
Household
Much the larger half of this $20,670 must go to household expenses, and it does. We hadn’t the capital to build a home, our families didn’t give us one, and we couldn’t afford to run it if they had, what with caretakers, janitors, property taxes and fuel, so we rented an apartment on what real estate agents like to call “the smart North side”. $333 a month, $4,000 a year, the building doesn’t even have a proper doorman, but presto!—the $25,000 is less than $17,000 before we’ve had a scrap to eat or a shirt to our backs.
Obviously, somebody’s got to cook the scrap and somebody’s got to put it on the table, shake up the beds, and break the glasses. Add a nurse for the youngster (our eight-year-old’s at the Chicago Latin School, with his tuition cracking $500) and away goes $3,300 for service alone. This may seem high to some of our friends, and of course I suppose Anne could take care of the children herself, but it does seem as if she ought not to have that eternal responsibility, and no hostess may excuse herself properly between soup and nuts to quiet the nursery.
Then the food itself runs to more than $200 a month, not counting the dinner parties at home. It is entirely false to assume that we will be reimbursed for the dinners we give by the dinners we get from others. Food, then, is $2,600 per year, just for ourselves. Mark you, this is allowing only $7 a day to feed seven people! Of course, if Anne fails to count the vegetable and soup cans, and doesn’t remind the cook that yesterday’s roast is today’s hash, the food bills could easily be twice as large. I know that such petty vigilance and economy have come hard to a girl accustomed only to pushing buttons and giving orders, but unless she learns to practice them, she loses an extra opera cloak or a more expensive car. Accordingly, she can hold gas and light bills inside of an annual $300. Perhaps it is too much to expect her to turn out the bedroom light when she goes in for a tub, but she can certainly see that lights don’t burn all night in empty rooms. The same for the telephone: if Anne would swallow her pride and install a nickel-in-the-slot device, she’d not only add considerably to her luxury allowance, but avoid the catastrophe that happened to a friend of ours, who didn’t stumble on the sentimental long distance interludes of his lonely parlor maid until they had cost him $100 in a single month. As it is, our phone stands us, together with an occasional telegram or cable to our Europe-doing relatives, about $200 a year.
Six hundred dollars is none too much for laundry, nor is $350 for pressing and cleaning. When you remember that we’re trying to keep our end up in the younger married set, it’s plain that soiled shirts and spotty frocks would lose us more than we’d save. Similarly, $400 goes to put the apartment in shape: waxing floors, new curtains, repapering, and the various things we might argue out of the landlord if life were longer.
Next come the thousand and one little whatnots that drain your pocketbook dime by dime, quarter by quarter, until they finally run into a couple of hundred dollars. I mean the magazines, silver polish, cosmetics, toilet articles, writing materials, and all the rest of their tribe. For instance, a subscription to the Chicago Tribune costs $12.50, and there are at least five other publications that you have to take to keep in step. Believe it or not, $200 a year is putting it mildly, and the only way you can do it on less is to grow a beard.
Rent, food, servants, power, laundry, pressing and cleaning, upkeep, telephone, miscellany—the total runs to $11,950 a year, or nearly my entire salary, and, my compliments to Anne, it requires skillful housewifery to do it on that. We are now left with less than $9,000 to provide for all the rest, which includes the ills as well as the amenities of life.
Other necessities
Of the remaining $8,750, at least $500 must be set aside for His Implacable Necessity, The Doctor, and $200 for H.I.N., The Dentist. Our younger child was born four years ago at a total cost of more than $500. A tonsil operation cost, in all, $200; the abstraction of one of our four appendices, $400; and upon a slight astigmatism to which I must personally plead, I have spent some $200 during the last four years. Of course, to some the oculist is a necessity, while the psycho-analyst is a delightful luxury, so that no budgets will be the same. But a touch of flu for father and of croup for baby may be regarded as characteristic of our kind, and these added to the less universal ailments wherein we exhibit our individuality take a remarkably steady toll of $500 from the income of those who do not desire bargains in doctors.
The economics of our little roadster need little examination—$750 per year should take care of it and buy a new one, although it must be confessed it is our pleasure to buy somewhat more frequently than this allowance would literally justify. As to pocket money, both Anne and I realize that more than the allotted $500 dribbles from us, and we suspect that we must win more at bridge than we lose.
To the matter of clothes, we have given serious attention. An ordinarily good New York dressmaker estimated that her clients spent from $2,000 to $7,000 a year on clothes. But many well dressed women spend less. Take Anne, for instance, on her $1,500, and see what she does with it:
Winter suit: $150.00
Afternoon gown: $100.00
2 Dark dresses, new or made-over old ones: $60.00
Spring or summer suit: 90.00
5 Sport dresses @ $30: $150.00
2 New evening dresses: $300.0
2 New evening dresses home made or bought at sales: $100.00
2 Remodeled evening dresses: $50.00
Total: $1,000.00
Hats, 3 winter and 2 summer: $70.00
Shoes—bought only at sales:
4 prs. evening shoes: $50.00
2 prs. heavy shoes: $20.00
4 prs. fancy day shoes: $40.00
Bedroom slippers, tennis shoes: $15.00
Total: $ 195.00
Stockings at $1.75 a pr., 3 doz.: $63.00
Bags, gloves, beads: $55.00
Lingerie:
As Anne would scorn buying her undergarments off the bargain counters, she has the child’s nurse make her chemises and nightgowns at home, the lace for which she begs off the family, who buy it at a reasonable figure in Paris at bargain counters. With crepe de chine at $3.50 a yard, she probably averages 100.00
Luckily, she wears only three pieces of under-clothing at any one time.
Total: $ 218.00
Grand total: $1,413.00
With $87 left, she will get a new motor coat if her old one bores her too much; or she may buy brocade and fur for an evening wrap; or a shawl for summer evenings; or have her fur coat made over; or she may deposit it at the savings bank to swell the fund for a new fur coat. By the time she has saved eight hundred dollars, the sealskin coat her uncle gave her for a wedding present will have been remodeled seven times, and it will probably finish its long life keeping the daughter warm when she skates to school.
It amuses Anne to be seen at Madame Lazarre’s where nothing costs less than four hundred per garment, but she knows that a hundred dollars on her figure and with her bluff will do almost as well.
Though Anne takes $1,500, I manage on $500, and $500 takes care of the children. My purchases are more or less as follows:
10 Day shirts @ $2.00: $20.00
2 Evening shirts: $10.00
1 white vest: $10.00
15 ties @ $2.00: $30.00
6 underwear suits: $12.00
3 prs. shoes @ $12: $36.00
4 hats: $30.00
12 prs. socks: $12.00
2 suits: $200.00
1 coat: $80.00
2 prs. white flannels: $30.00
1 sweater: $20.00
Miscellaneous: $10.00
Total: $500.00
We have thus completed the analysis of all the so-called Necessities, and we find ourselves with $3,770 left for Good Will, Emergencies and Luxuries.
Good Will
Many are the expenses which business happily taught me to classify as Good Will—the things that keep peace on earth and oil in the social machinery. Presents, for example: Anne’s birthday, our wedding anniversary, the children’s birthdays, Christmas, and other people’s weddings. The maids and the elevator boy would be surprised if Anne forgot to put something in their hypothetical stockings. Friends can scarcely be retained with less than a $300 investment. Contributions to our church, to our political party, and such sound civic enterprises as the Field Museum, the Art Institute, the Chicago Historical Society, the Junior League and the Service Club, the tickets to the Harvard Hasty Pudding, the Yale Glee Club, or the Princeton Triangle performances, will barely be covered by $500.
On the less frivolous side, my business requires membership in at least one good lunch club, because there’s lots of good will in a good meal, and a ripe cigar may be the straw that breaks a camel’s sales resistance.
There was no use in having my name put on the Chicago Club waiting list because it’s too hostile to resident non-members for me to ask them in for a bite to eat or a highball. The University Club—$200 dues—is more cordial, while the club we entertain in is the Casino, which this year costs us $270, because of an extra assessment. For health’s sake, I can’t afford to drop my golf, and Anne likes to play occasionally herself. I find myself paying about $400 a year for this good cause. $1,000 won’t take care of all club dues and incidentals.
Whether we dine our guests at home or at the club, the cost averages two dollars per person. Here is Anne’s typical dinner for twelve. The food tastes better than at the club, but most of our friends would rather go to parties at the club.
Dinner for twelve:
Appetizers: $0.60
Soup, clear: $1.40
Rolls and butter: $1.00
Turkey: $9.00
Mushroom sauce: $0.60
Vegetables: 3.00
Salad with mould: 1.50
Cake: 1.00
Ice cream: 2.50
Coffee, cream: $0.40
Extra waitress: $3.00
Total (without liquors): $24.00
Last year we had a hundred and fifty-six guests. This counts ourselves as guests, since the host’s dinner costs as much as that of one of his guests. That was an average of thirteen per month, which is not many. Thus our dinners cost us $312.
Some of the dinners precede a theatre, others a Subscription Ball. If we have four theatre parties a year with six persons in each, and tickets cost $4.40 each, we spend $105.60 on the theatre. Subscriptions to the Assemblies, the Bachelors, and Benedicts, and the Twelfth Night Ball come to $50.
Finally, under this general category of Good Will we allow $500 for liquor and tobacco. As I said, we have to practice economies, but less than $300 for liquor (domestic gin at $30 a case; Bourbon at $80) and $200 for tobacco are not among them. When my income is thus so nearly exhausted, I might well blush at this item, but au contraire, I like my environment, and admit that to this degree, I am subject to it. Perhaps this item will not appear on my son’s budget when it comes his turn to earn and spend; but, as for me, I am not prepared to delete it.
If you will now refer finally to the chart you will discover that we have just $1,000 left.
Now comes the item of emergencies or luxuries. Definitely, they are alternatives, when both have to be covered by $1,000.
Anne and I naturally cooperate on the question of luxuries. If I want to go East to my college reunion, she gives up the Kentucky Derby. If she has her heart set on her trip to New York, I forego my duck hunt, which I took this fall. Both of us agree that the kids ought to be taken out of town during the summer. We can rent a house in Lake Forest for anything from $800, but this is a gilt-edged community, and it’s just as pleasant to stay at one of the more distant resorts, where I can join them over the weekends.
Obviously, almost none of these things can be done on the $1000 which remains available. Practically what happens is that by June we must go right back to the beginning of the budget and draw upon that $2500 for savings which now looks gigantic. Then, why all this budgeting if savings—Article One of Faith—is to be renounced? The reason is that Anne and I have always provided for “savings” and it has been precisely by spending those savings that we have come to the end of each year happy—and solvent. And now, dear Father, with my $5000 raise in salary, we are really hoping that this year’s savings will be quite permanently added to the capital account.
Budget for a young married couple in Chicago society
Taxes (Income, earned $15,000, unearned $10,000): $830
Insurance: $1,000
Savings: $2,500.00
Household expenses:
Rent: $4,000.00
Food: $2,600
Power, Gas, Light: $300
Servants: $3,300
Laundry: $600
Pressing and cleaning: $350
Upkeep: $400
Telephone: $200
Miscellaneous: $200
Other necessities:
Clothes—
For Anne: $1,500
For children: $500
For me: $500
Doctor: $500
Dentist: $200
School: $500
Pocket money—
Anne: $200
Me: $300
Automobile: $750
Goodwill:
Friends: $300
Donations: $500
Clubs—Dues and expenses: $1,000
Dining: $312
Theatres and subscription dances: $158
Liquor and tobacco: $500
Emergencies: $2770
Luxuries: $1,000
Total: $25,000