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Old 06-27-2019, 04:16 AM
 
71,456 posts, read 71,629,249 times
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Quote:
Originally Posted by Wartrace View Post


2009 anyone? There were mass layoffs and yes people went a year or more without working; particularly older workers.

Seems to me there were a lot of people during the great depression that were out of work for years as well.

Not only those two examples. What about someone that becomes disabled? If they lack disability insurance they are screwed. It often takes well over a year to qualify for SSDI.
we can find exceptions to everything in life .. there is never anything that will not have something not apply to it .

but we don't plan and live our lives around the exceptions ...we plan and live our lives based on what was -what is - and what stands a reasonable chance of continuing ..

if we planned around everything that could happen at some point to someone we would all never fly , drive or cross the street .
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Old 06-27-2019, 04:21 AM
 
Location: Wartrace,TN
5,546 posts, read 8,882,501 times
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A lot of people believe they can "afford" things based on what their monthly payment will be. This works out fine until they hit a bump in the road.

I believe true "affordability" is when you can pay cash for something. Living an unleveraged lifestyle allows you to survive in the long run.
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Old 06-27-2019, 04:26 AM
 
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the problem is people are mis-lead to think that because they are living on less then they bring in and are to quote my hated term " living below their means " that they are somehow fine ..


but what makes things fine is not just living on less then you bring in but maintaining a healthy ratio of discretionary to non discretionary spending ... if most of the budget is non discretionary stuff then when push comes to shove there is little to cut back on .

people really do not know how to spend and there is little info out there to guide them . that term i hate is really meaningless and not actionable in any meaningful way at all .

we could have moved to manhattan and lived below our means .. but our ratio of discretionary to non discretionary spending would grow so small even though the budget is the same ..

one bump in the road and there would be little we could cut back on with such high non discretionary expenses . so here in queens is our better option where we have lots of wiggle room .

two identical budgets , both " below our means " to quote the meaningless term , yet the outcomes from that bump would be very different.

afterall how much below your means is good ? how much should you be spending on non discretionary spending ? how much should you be saving ? means is always changing . it changes with inflation , with income , with markets , with interest rates , with divorce , illness , job loss , etc .... so people need to learn how to spend so they have things allocated in a good way . .

Last edited by mathjak107; 06-27-2019 at 04:39 AM..
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Old 06-27-2019, 04:35 AM
 
Location: Wartrace,TN
5,546 posts, read 8,882,501 times
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Quote:
Originally Posted by mathjak107 View Post
we can find exceptions to everything in life .. there is never anything that will not have something not apply to it .

but we don't plan and live our lives around the exceptions ...we plan and live our lives based on what was -what is - and what stands a reasonable chance of continuing ..

if we planned around everything that could happen at some point to someone we would all never fly , drive or cross the street .
Yes but the statement made was this.... "Originally Posted by Thatsright19
Was there ever a time or place in human history where citizens could not work for a year? Or 3 months?"


This is so clearly FALSE and so recent that I wonder where "Thatsright19" was during this time. I am also wondering if the poster has any grasp of history to make such a false statement.

In answering your post; is it not reasonable to expect a recession soon? Are we not near the peak of the credit cycle? Debt levels are at an all time high; who is going to borrow MORE at this point to keep the ball rolling? At some point people will need to cease forward spending (borrowing) and pay back what they owe.
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Old 06-27-2019, 04:41 AM
 
71,456 posts, read 71,629,249 times
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Quote:
Originally Posted by Wartrace View Post
Yes but the statement made was this.... "Originally Posted by Thatsright19
Was there ever a time or place in human history where citizens could not work for a year? Or 3 months?"


This is so clearly FALSE and so recent that I wonder where "Thatsright19" was during this time. I am also wondering if the poster has any grasp of history to make such a false statement.

In answering your post; is it not reasonable to expect a recession soon? Are we not near the peak of the credit cycle? Debt levels are at an all time high; who is going to borrow MORE at this point to keep the ball rolling? At some point people will need to cease forward spending (borrowing) and pay back what they owe.
the only answer is to have enough wiggle room ... there are no absolute answers to the unknown . no one can predict what even enough wiggle room means . but we structured so we are about 50/50 as far as a spending ratio. that is our best shot we can take . then we have insurance in place for those events that could be most devastating . there is nothing else we can do or will do , so it is what it is . we have zero debt so that adds a cushion . but we are retired so that adds a negative to the income side of things .

Last edited by mathjak107; 06-27-2019 at 04:55 AM..
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Old 06-27-2019, 04:59 AM
 
3,714 posts, read 3,116,335 times
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The average debt in the US in 2018 was;

mortgage: $176,222
student loan: $49,905
auto loan: $28,948
credit card: $16,748

The average new car buyer in early 2018 borrowed more than the average per capita income.
Americans were twice as likely to owe between $5,000 and $25,000 than they were to have that much in savings.
13% reported they'll likely owe money for the rest of their lives.
Just 23% of Americans carried no debt in 2018.


Source: study by Northwestern Mutual. If you don't agree with the numbers argue with them.
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Old 06-27-2019, 05:03 AM
 
71,456 posts, read 71,629,249 times
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is anyone ever average ???? if you pack half your body with ice and put the other half to the fireplace are you actually on average comfortable ?

i never really cared what is " average " or " median " i care what i need to live the life i want to live , where i choose to live ....

on average the numbers would be a lot different including the billions in the underground income category . do you really think the stats on the hood average incomes are even close ?
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Old 06-27-2019, 05:10 AM
 
12,676 posts, read 14,059,781 times
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Quote:
Originally Posted by Thatsright19 View Post
Was there ever a time or place in human history where citizens could not work for a year? Or 3 months?
Your remark sounds to me as if you are suggesting that there is really nothing new or unusual in the purported present precarious financial situation of Americans. Is that correct?
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Old 06-27-2019, 05:26 AM
 
Location: Washington State
18,438 posts, read 9,548,793 times
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Quote:
Originally Posted by Vana360 View Post
So I am having a hard time understanding/processing all of the information we read out there relating to salaries, house prices, student loan debt, food costs, transportation, etc. Is almost everyone living on a financial edge? If you simply take the median household income of $61k, how are people paying for housing wherein the median price in the U.S. is around $300k? Hell, even if that median household income was $80k its still not enough!

After you had your mortgage, and some basic living expenses like food and gas for your car there is not much left over. How are you then paying student load debt, spending on other consumer products (e.g., consumer spending is at all-time highs), paying your car note (the car debt is at an all time high as well - over a trillion dollars), where the average car transaction sale is around $30k per KBB. Ohh and dont forget to save for retirement as well.

Curious to hear what other people think. I know the numbers above are not perfect, however, I would say they are accurate enough for this discussion.
The numbers don't seem to add up, especially in high cost areas where I am now in Kirkland, Wa (Seattle Eastside) and I wonder how people make it given the cost and median incomes. My daughter just got back from a trip to LA and it's much worse there.

Some mitigating factors are:
- Many people purchased their homes years ago when they were cheaper
- Some people have wealth and not necessarily a high income
- Some have inherited money
- Some live together and/or rent out part of their house
- SOme people have a business where they can take some of their living expenses out before it becomes (income).

I think many are living on the financial edge but I'm not and neither are most of my family. We (wife and I) got off the financial edge by getting educated, taking jobs that were tough for better income, spending less than we made, and investing over time.
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Old 06-27-2019, 05:53 AM
 
Location: ATL, GA
1,170 posts, read 673,085 times
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Quote:
Originally Posted by Wartrace View Post
A lot of people believe they can "afford" things based on what their monthly payment will be. This works out fine until they hit a bump in the road.

I believe true "affordability" is when you can pay cash for something. Living an unleveraged lifestyle allows you to survive in the long run.
AGREED!

I know people that finance their furniture?! Why on earth would someone finance furniture? You are paying interest on your couch and coffee table. The only debt I have is my mortgage. Sometimes I feel like I "cheated" somehow, because I don't have student loans, car notes, cc debt, etc. Aside from real estate, just pay cash for it! If you can't pay cash, you can't afford it. I just don't understand how some people are a flat tire away from financial catastrophe.
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