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What annoys me are the people who say that phones are the reason young people don't get ahead.
The reason I say old people are clueless is because my parents and their peers were among them. My dad would say stuff like "if they wouldn't get smartphones and flat screen TVs, they'd be doing better!"
No, Dad. You know that house that you bought in 1983 for $90k? It's now worth $425k. It is STILL a starter house built in the 1960s, but instead of an $18k downpayment (cost of two average cars in the 80s), a buyer now needs $85k (cost of three or four average cars today). No amount of asceticism on phones or TVs is going to close that gap. Certainly not TVs. I don't get how people fail to understand how cheap TVs are now.
Boomers wasted money on different stuff while their prime expenses (housing, education, health care) were less. That is all.
I don't think that it's the $1,000 phones, t.v.s, lattes (insert luxury of choice/blame), but spending on such things when a person barely has the proverbial pot to **** in is often indicative of overall poor spending and lifestyle habits. Not always, of course, but often.
The following statement that I'm about to make is anecdotal, but I grew up around people who spent on whatever was "thing(s)" of the moment to their own detriment; I've lived and worked with and around them. I've dated them (but never for long as that sort of spendthrifted-ness puts me off).
I have former coworkers who, after being laid off due to COVID, were spending up to the hilt on non-necessities when the federally padded unemployment benefits were still in effect. Some of these same folks are now stressing about how they're going to get by this month now that the extra cash is no longer being doled out. In these instances, I find it rather hard to muster up much sympathy for the grasshoppers among us. For those who were already doing the best that they could under challenging circumstances made all the more difficult by recent events, I do my best to help them out as I can because the meager rainy day funds that they were able to scape together ran out due to the unexpected deluge that is COVID. Life happened in an epic way that no one could have foreseen.
That flat screen (to use the above example) might have been relatively cheap when compared to t.v.s of not so very long ago, but unfettered spending when you're already living hand to mouth (or close to it) makes it an unaffordable luxury item. The lack of financial self-discipline in the average American of all classes and incomes is appalling, but changing deeply ingrained financial habits is just as difficult as changing eating habits. People as a whole really didn't learn much from the fallout of 2008; I saw that long before the events of these past several months. They want what they want when they want it and damn the consequences.
Where I do truly feel for the younger generation is when it comes to the unprecedented levels of student loan debt that so many of them carry for jobs/careers that, for many of them, up until relatively recently did not require the level of education (or even a degree) that they now do.
That debt really does throttle their economic growth. I think that those of us who are in the Gen-X cohort were the last to have affordable higher education readily available to us.
What annoys me are the people who say that phones are the reason young people don't get ahead.
The reason I say old people are clueless is because my parents and their peers were among them. My dad would say stuff like "if they wouldn't get smartphones and flat screen TVs, they'd be doing better!"
No, Dad. You know that house that you bought in 1983 for $90k? It's now worth $425k. It is STILL a starter house built in the 1960s, but instead of an $18k downpayment (cost of two average cars in the 80s), a buyer now needs $85k (cost of three or four average cars today). No amount of asceticism on phones or TVs is going to close that gap. Certainly not TVs. I don't get how people fail to understand how cheap TVs are now.
Boomers wasted money on different stuff while their prime expenses (housing, education, health care) were less. That is all.
You can buy that $425K house with $9K - 21K down. Some places less. Some places have cheaper housing too. And lower property taxes. I just looked - seems Portland is about $1.60/$100 just for property taxes.
Boomers wasted money on different stuff while their prime expenses (housing, education, health care) were less. That is all.
now, education does indeed cost too much. The cost of my state university degree was $6K a year now, equating to $14K/yr now. But it's going to cost me $20K for my oldest starting this year.
So, a rising HS junior thinking about college better figure out how they'll "make up" that $24K difference. Even more importantly, that COLLEGE junior better figure out what major will allow him to quickly repay the $24K.
I don't think that it's the $1,000 phones, t.v.s, lattes (insert luxury of choice/blame), but spending on such things when a person barely has the proverbial pot to **** in is often indicative of overall poor spending and lifestyle habits. Not always, of course, but often.
The following statement that I'm about to make is anecdotal, but I grew up around people who spent on whatever was "thing(s)" of the moment to their own detriment; I've lived and worked with and around them. I've dated them (but never for long as that sort of spendthrifted-ness puts me off).
I have former coworkers who, after being laid off due to COVID, were spending up to the hilt on non-necessities when the federally padded unemployment benefits were still in effect. Some of these same folks are now stressing about how they're going to get by this month now that the extra cash is no longer being doled out. In these instances, I find it rather hard to muster up much sympathy for the grasshoppers among us. For those who were already doing the best that they could under challenging circumstances made all the more difficult by recent events, I do my best to help them out as I can because the meager rainy day funds that they were able to scape together ran out due to the unexpected deluge that is COVID. Life happened in an epic way that no one could have foreseen.
That flat screen (to use the above example) might have been relatively cheap when compared to t.v.s of not so very long ago, but unfettered spending when you're already living hand to mouth (or close to it) makes it an unaffordable luxury item. The lack of financial self-discipline in the average American of all classes and incomes is appalling, but changing deeply ingrained financial habits is just as difficult as changing eating habits. People as a whole really didn't learn much from the fallout of 2008; I saw that long before the events of these past several months. They want what they want when they want it and damn the consequences.
Where I do truly feel for the younger generation is when it comes to the unprecedented levels of student loan debt that so many of them carry for jobs/careers that, for many of them, up until relatively recently did not require the level of education (or even a degree) that they now do.
That debt really does throttle their economic growth. I think that those of us who are in the Gen-X cohort were the last to have affordable higher education readily available to us.
dammit, this is the post I meant to quote.
I strongly believe that the millenials have become trapped in the "right now" rather that evil "white-centric" idea of delayed gratification.
"This $5 Starbucks doesn't make a bit of difference in a $20K downpayment" .... financially it doesn't; habitually it does.
Use housing as an example: when I got out of college, I had roommates, even though I had a fairly top-line white collar job with my economics degree. 3 years later, when my employer moved to a different area, I went to a garage apartment that was barely above uninhabitable. I could deal with the living conditions for a year, cause I didn't think I'd be in that city more than 1.5 years. After a year when it became obvious I'd be there longer, I went upscale to a 30 year old apartment complex with a laundry 100 yards from my place.
I learned to cook, and I ate a lot of Tony's $2 pizza and Lean Cuisines. For 5 years, 5 days/week I never ate dinner out beyond an occasional Wendy's. And I saved money.
And at the age of 30, when it was time to get married and get a house - we never rented together and my fiancee had 3 roommates! - we had a 10% downpayment.
So, I stayed in less-expensive housing for 8 years in order to someday be able to afford to buy.
So, a rising HS junior thinking about college better figure out how they'll "make up" that $24K difference.
Even more importantly, that COLLEGE junior better figure out what major will allow him to quickly repay the $24K.
Tying both examples together the teens should have OTHER useful job skills, earning decent money.
And be well begun before they leave high school even if those who have family money to rely on.
To guide their subsequent career decisions, to always be there in reserve for them like an emergency fund,
and to have provided the seed cash for tuition needed to get started down the path to begin with.
Too few teens have even tried this sort of approach in the last 30 or more years.
I strongly believe that the millenials have become trapped in the "right now" rather that evil "white-centric" idea of delayed gratification.
"This $5 Starbucks doesn't make a bit of difference in a $20K downpayment" .... financially it doesn't; habitually it does.
Use housing as an example: when I got out of college, I had roommates, even though I had a fairly top-line white collar job with my economics degree. 3 years later, when my employer moved to a different area, I went to a garage apartment that was barely above uninhabitable. I could deal with the living conditions for a year, cause I didn't think I'd be in that city more than 1.5 years. After a year when it became obvious I'd be there longer, I went upscale to a 30 year old apartment complex with a laundry 100 yards from my place.
I learned to cook, and I ate a lot of Tony's $2 pizza and Lean Cuisines. For 5 years, 5 days/week I never ate dinner out beyond an occasional Wendy's. And I saved money.
And at the age of 30, when it was time to get married and get a house - we never rented together and my fiancee had 3 roommates! - we had a 10% downpayment.
So, I stayed in less-expensive housing for 8 years in order to someday be able to afford to buy.
If only were it just millennials, but I do agree with you although a lot of them learned their poor spending habits at their parents" (and some cases, grandparents') knees. Too many of them were not taught about money, budgeting, and how to delay self-gratificaion before they left the nest (or didn't). It's like a financial version of that infamous anti-drug commercial from back in the day, "Who did you learn this from?!?....I learned it from you!" Overall, children learn what they live and money/household management isn't any different.
For example,the notion of a "dream school" just didn't exist for most of us in my generation unless there was a certain reason with a specific end goal to attend a certain university. Flash forward a decade or so, and I would hear juniors and seniors extolling the virtues of their "dream" college--with few of the virtues having anything to do with an actual education or training. The lack of guidance or ability to say no to these kids who were about to saddle themselves with a ton of unnecessary debt boggled my mind. At eighteen, few know what they're getting into by taking on mass quantities of debt.
I have a renter who's a millennial. Very nice person and a hard worker, but the things that he doesn't know about basic household management and finances surprise me. He's learning, though, and in the long run, I think that he'll be okay. Sometimes, it just takes longer for people to learn crucial life lessons.
I drink 2 cups of coffee every day. The bag I get at Costco runs $14 and lasts me and the wife (3 cups) about 3 weeks. So, $19/mo. the savings "pays" for my Netflix and Disney+ subscription. I had my last TV for 14 years. I upgraded 3 months ago for 2 reasons: the bulb costs $200 to replace; the streaming software far exceeded the TV's ability.
Mine's a neat story, but that's all it is. Yours too.
Actually I pulled my info from surveys of what people spend on caffeine. As someone who has a lot of money (for me anyway) in SBUX stock I make it my business to keep up with consumer trends in that sector.
The typical guest at a typical Starbucks store spends $6 per visit, and makes 2 or 3 visits per week. They spend between $40 and $65 a month. There are, of course, "heavy users" that spend more - these tended to be office workers in well-paid sectors, but also people in the hospitality and leisure sector. Because of Covid, Starbucks's sales have dropped about 60% since both commercial offices and hospitality are trashed. (but somehow the stock is stable)
Actually I pulled my info from surveys of what people spend on caffeine. As someone who has a lot of money (for me anyway) in SBUX stock I make it my business to keep up with consumer trends in that sector.
The typical guest at a typical Starbucks store spends $6 per visit, and makes 2 or 3 visits per week. They spend between $40 and $65 a month.
Wow. That adds up quickly and is more than a few of my individual monthly utility bills.
You can buy that $425K house with $9K - 21K down. Some places less. Some places have cheaper housing too. And lower property taxes. I just looked - seems Portland is about $1.60/$100 just for property taxes.
Cheaper housing almost always equates to fewer jobs. Where good jobs are - from my experience (and I have applied to jobs and scanned their housing costs in over 40 states over the years) - "good" houses (3/2 sfh with >1500 sq. ft.) in most places are in the 300k range at least. Starters in the low-mid 200s. The starters are mostly old homes of course, since developers don't build basic housing anymore, only build luxury units. If they build lower end housing, they're apartments or townhomes. E.g.: my first house was built in 1950.
It doesn't matter the state - the closer you get to the metro jobs centers, the more likely you are to have housing costs getting higher than 300-400k. In the hot metros, it's higher still. Even in the "value" states like Texas or Tennessee (it's metros are surprisingly more expensive than you'd think), you still pay that much but at least you get more square footage. Yes it's cheaper in the smaller towns, but getting jobs there is harder because there are simply fewer to apply to.
Anywhere a "good" 3/2 single family house is cheaper than <150k means one of several things, often simultaneous: a) volume of jobs available have long since fled the area, b) it's a poor area with high crime, or c) the house is in major need of repair. The exception might be the upper midwest, e.g.: Ohio, but I don't know those cities well enough so their cheaper houses might be in bad neighborhoods. But in any case these are generally states in population decline. I might find a career-type job in eastern OH or western PA, but again, they are not creating large volume of them. The "hot" places right now are in the sun belt.
Furthermore, "just move" is not a solution for everyone. Again, as someone who has moved around the country a lot for jobs - there is cost to that goes beyond dollars and cents that some people can't pay. It's somewhat of a luxury to be free to move wherever you want. It's hard on the family. Some people are responsible for their families, especially elderly, who are place-bound and can't just pick up and move wherever the best income:cost of living ratio can be found.
Last edited by redguard57; 08-04-2020 at 01:39 PM..
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