How Rich Were The McCallisters In Home Alone? Ep #233
Happy Holidays and welcome to a special Christmas Eve episode of Retire with Ryan!
To celebrate the season, I’m embracing the holiday spirit with a financial twist on the iconic Christmas movie, Home Alone. This 1990 classic has become a Christmas staple, featuring young Kevin McCallister, who’s accidentally left behind while his family flies to Paris for Christmas vacation. Armed with creativity and courage, Kevin outsmarts two bumbling burglars with a series of clever traps before his family returns home.
But today, I’m looking at Home Alone through a different lens. As your financial advisor, I’ll break down the McCallister family’s finances. How rich were they? What would their stunning Chicago home be worth today? And what kind of jobs could support such a luxurious lifestyle?
With a budget of just $18 million, Home Alone has grossed nearly $500 million worldwide—and I’ve probably contributed to that total with how many times I’ve rewatched it! So, grab some eggnog, settle in by the fire, and let’s explore the McCallister family’s financial plan.
You will want to hear this episode if you are interested in...
[1:25] Sign up for my weekly newsletter and get a free chapter of my book!
[3:19] How much is the McCallister house worth?
[5:19] Calculating how much the McCallisters made
[7:48] What did the McCallisters pay in taxes?
[10:47] What was their cashflow?
[13:13] College costs for a family of five
[15:03] How much are they saving for retirement?
[18:43] Did the family have life insurance?
[19:36] The type of estate planning they had
How much is the McCallister house worth?
In the 1990s, the McCallisters were firmly in the wealthiest 1% of Americans. The house featured in Home Alone’s outdoor scenes is a real property located in the Chicago suburbs. The New York Times has estimated its value at $2.4 million at the time of filming, and today, it’s listed for sale at a staggering $5.25 million. This iconic home boasts five bedrooms, six bathrooms, over 9,000 square feet of living space, a three-car garage, and sits on a half-acre lot.
To purchase this house today, a buyer would need an annual income of approximately $1.3 million to stay within the recommended 28% mortgage-to-income ratio. For context, the top 1% of earners in the U.S. today make $780,000 or more annually. Back in 1990, the McCallisters would have needed an income of around $305,000 per year to afford this home—still putting them squarely in the top 1%.
Their estimated monthly mortgage payment would have been about $7,176, or $86,000 annually. Hopefully, the McCallisters either refinanced at a lower rate later on or managed to pay off their mortgage entirely!
What did the McCallisters pay in taxes?
Speculation abounds about Kevin’s parents’ professions. Many believe Peter McCallister worked in finance, possibly at the Chicago Mercantile Exchange, while Kate McCallister might have been a clothing designer (a theory supported by the mannequins seen throughout the movie).
Assuming they earned $307,000 in 1990, what would they have paid in taxes? At the time, the U.S. tax code had three primary brackets: 15%, 28%, and a “bubble” rate of 33% for married couples filing jointly on income between $78,000 and $168,000.
To crunch the numbers, I downloaded a 1990 Form 1040 and estimated their income: Peter earning $207,000 and Kate earning $100,000, both with W-2 wages. Assuming they each contributed the maximum to a 401(k) plan ($7,979), and factoring in the average annual health insurance premium for a family in 1990 ($2,566), here’s how it added up:
Federal Taxes: After deductions and adjustments, they would have owed $59,450 in federal income tax, resulting in an effective federal tax rate of 19.36%. Their higher income also required them to complete the Alternative Minimum Tax (AMT) schedule.
State Taxes: Illinois had a flat state income tax rate of 3%, meaning they paid an additional $8,600 in state taxes.
After taxes, the McCallisters were left with approximately $220,000. Subtracting their $86,000 annual mortgage payments, they had about $134,000 remaining for other expenses.
Want to know how I calculated their monthly budget? Stay tuned as I break it down in the episode!
How much are they saving for retirement?
In the 1980s, many companies started offering 401(k) plans, and I’m assuming both Peter and Kate participated starting in 1987. If they consistently contributed the maximum amount until retirement, here’s how their savings might have looked:
The maximum 401(k) contribution in 1987 was $7,300. I also assumed their employers matched 5% of their salaries annually and that their investments grew at an average rate of 8% per year. Over 30 years, Peter would have contributed $346,000. By the time he retired at age 70, his 401(k) would have grown to an impressive $2.5 million.
But what about Kate’s savings? How did her contributions and career impact their overall retirement plan?
Tune in to this episode to hear the full breakdown and see how the McCallisters prepared for their golden years!
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