Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
These articles come out about once a month. I definitely agree people live beyond their means and don't save enough. If I'm not mistaken they often ask these questions in regards to whats in your savings account. This doesn't account for investments, cryptocurrency, potentially even a checking account so the data in a sense is sort of misleading.
Right...it TENDS to work out that way. That means it is less than a 100% correlation. Which means there are a good number of people out there who worked JUST as hard (maybe harder) as you and were JUST as smart as you but didn't wind up in your position. Why? Because there are random factors (some call it "luck") that come into play and "indifferently" boost some up and lay some low. That's not because of anything they did.
Similarly, some people do really well but don't work hard or work smart...but they "lucked out". For some odd reason the world thinks just as well about those folks as they do YOU...and all the failures are judged harshly, despite the specific factors that were involved.
We conveniently remember what we did...but not the things that "just worked out" to help us get where we are.
Right...it TENDS to work out that way. That means it is less than a 100% correlation. Which means there are a good number of people out there who worked JUST as hard (maybe harder) as you and were JUST as smart as you but didn't wind up in your position. Why? Because there are random factors (some call it "luck") that come into play and "indifferently" boost some up and lay some low. That's not because of anything they did.
Similarly, some people do really well but don't work hard or work smart...but they "lucked out". For some odd reason the world thinks just as well about those folks as they do YOU...and all the failures are judged harshly, despite the specific factors that were involved.
We conveniently remember what we did...but not the things that "just worked out" to help us get where we are.
Nothing is a 100% correlation. But it certainly increases your odds by a very high degree. I mean, if a treatment for a chronic disease proved to be 90% effective, does that mean it should be ignored? Of course not.
What's more, once again, the entire point of this conversation is about people salting away money in savings. You simply cannot tell me with a straight face that the average person working an average job can't put away a couple of hundred dollars a month. It's far more likely that being strapped for cash is about the decisions people make every single day.
Do I bring leftovers from home or do I pick up a sandwich on my lunch break? Do I REALLY need the extended cable package? Do I really need a new car or can I can make this bucket of bolts last another year? Likewise, do I need a new car or can I get a decent used one? Most of these decisions seem trivial. But, as I spelled out earlier in this thread, it's the death of a thousand cuts.
Let's start with the fundamentals. Spend $7.50 a day on your lunch at work, and that's not $150 a month, but really $300 monthly in pre-tax income. Buy a pack of smokes a day, and...well, you get the picture. So if you just did nothing else but bring your lunch to work and stick the money instead in a 401(k), you are conservatively putting back somewhere close to $2000 a year.
That sounds like a trivial amount, right? Nope. Now, I didn't start investing until I was 30. I mean, seriously, I just blew my money in my 20s. But if I had just put that selfsame $2000 in an S&P Index fund in 1985 when I turned 23 and put another $2000 in every year after that, that modest savings and investment would be worth more than $100,000 today, even with market downturns, recessions, and everything else factored in.
I mean hell, most employers of any size have 401(k) plans for their employees right now. Some even match your contribution. Throw in the tax savings and it's like free money given to you with every single paycheck. But I know people who would rather spend that money on a trip to Mexico or a new car.
That's not luck. That is nothing more than simple discipline.
Right...it TENDS to work out that way. That means it is less than a 100% correlation. Which means there are a good number of people out there who worked JUST as hard (maybe harder) as you and were JUST as smart as you but didn't wind up in your position. Why? Because there are random factors (some call it "luck") that come into play and "indifferently" boost some up and lay some low. That's not because of anything they did.
Similarly, some people do really well but don't work hard or work smart...but they "lucked out". For some odd reason the world thinks just as well about those folks as they do YOU...and all the failures are judged harshly, despite the specific factors that were involved.
We conveniently remember what we did...but not the things that "just worked out" to help us get where we are.
Quote:
Originally Posted by MinivanDriver
Nothing is a 100% correlation. But it certainly increases your odds by a very high degree. I mean, if a treatment for a chronic disease proved to be 90% effective, does that mean it should be ignored? Of course not.
Absolutely right! And you seem to be able to admit that for about 5 seconds....but I'd wager that 15 seconds from now you'll still forget about it when you're talking about those stupid lazy people who aren't saving - because you're assuming they MUST be lazy, otherwise they would be saving. Your emotions just won't let reality enter into your life view.
Absolutely right! And you seem to be able to admit that for about 5 seconds....but I'd wager that 15 seconds from now you'll still forget about it when you're talking about those stupid lazy people who aren't saving - because you're assuming they MUST be lazy, otherwise they would be saving. Your emotions just won't let reality enter into your life view.
I don't assume they're lazy. I know they're lazy. You don't get to complain about not having any money while you simultaneously blow your money on a daily basis with dumb decisions.
It doesn't take more than ten minutes to clip coupons before your weekly grocery shopping. Likewise, it doesn't take ten minutes to work up your weekly meal plan so you're avoiding unnecessary purchase. It doesn't take more than three minutes to put your lunch in a tupperware and tote it to work. It doesn't take more than five minutes to look at your cable bill and say, "Hey, how can I make this lower?" It doesn't, for example, take more than ten minutes to call your electric utility to ask for level billings so you can budget. It doesn't take ten minutes to go online to look at your bank account and balance it.
It takes a few hours to get your mortgage refinanced at a lower rate, but the savings are huge. Even after eight years of interest rates at historic lows, I'm was shocked to learn at dinner one night that a couple of acquaintances just never bothered to go to the bank to get a better rate, potentially saving themselves hundreds of dollars monthly. Or switch from a 30-year mortgage to a 15-year mortgage so they could pay off the house faster. These friends were still paying 6.5% on their mortgage. Just couldn't be bothered with it.
I mean, it's not as if I'm gifted with supernatural intelligence here. None of these steps are exactly arcane. These are all pedestrian, common-sense things that anybody who bothers to pay attention could do. I mean, hell, just using coupons saves us about $75-$100 a month on our grocery bill. Shopping at a lower priced grocery store a couple of miles further away saves us another $150 or so a month. I'll drive an extra mile to get gas because the price difference is ten cents a gallon. Yeah, I'll drive two minutes to save a buck twenty-five.
I've sat behind the one-way mirror a lot of times during consumer research focus groups run by social scientists. The process is about the least scientific thing I've ever seen which explains why, so often, they are spectacularly wrong.
Of course they are. I am not aware of any significant consumer research that is not:
1) Funded by the consumer-products industry, directly or indirectly.
2) Driven to find answers that benefit corporate-level marketing and consumer goods sales.
3) Based on the body of research already developed via the above means to the defined ends.
Or that is:
4) Looking at any aspect of consumer behavior or marketplace above the trivial level that is within 20 years of the present state of the art of corporate-level, proprietary research.
There is no independent, third-party, neutral, outside, contrarian or investigative consumer research above the level of judging which peanut butter is the better buy... which is just more of the same thing at a clickbait level.
I mean, it's not as if I'm gifted with supernatural intelligence here. None of these steps are exactly arcane. These are all pedestrian, common-sense things that anybody who bothers to pay attention could do. I mean, hell, just using coupons saves us about $75-$100 a month on our grocery bill. Shopping at a lower priced grocery store a couple of miles further away saves us another $150 or so a month. I'll drive an extra mile to get gas because the price difference is ten cents a gallon. Yeah, I'll drive two minutes to save a buck twenty-five.
I think it's hard to take things in a vacuum. for example you will drive a couple of miles further for a lower price? I totally admit I am the exact opposite. I spend 2 hours or more in my car so I will pay triple the price for convenience. One of the big reasons why I rarely step into a walmart? It's out of my way. I don't care how low they make their prices, convenience and my time are worth so much more.
When my kids were little, this was before on line became big, I was not packing 3 kids up in a car, driving around to get the best deals yada yada yada just to save 50 bucks?
so it's not that people don't pay attention to them it's a "worth" thing.
Now I don't know but my mortgage refi was a pain in the bazooka. so once again for me it was a cost vs. effort thing. Now my mortgage is currently 4.0% so it was already pretty low.
but I do, I measure everything by is it worth me taking away precious time to do it.
I think it's hard to take things in a vacuum. for example you will drive a couple of miles further for a lower price? I totally admit I am the exact opposite. I spend 2 hours or more in my car so I will pay triple the price for convenience. One of the big reasons why I rarely step into a walmart? It's out of my way. I don't care how low they make their prices, convenience and my time are worth so much more.
When my kids were little, this was before on line became big, I was not packing 3 kids up in a car, driving around to get the best deals yada yada yada just to save 50 bucks?
so it's not that people don't pay attention to them it's a "worth" thing.
Now I don't know but my mortgage refi was a pain in the bazooka. so once again for me it was a cost vs. effort thing. Now my mortgage is currently 4.0% so it was already pretty low.
but I do, I measure everything by is it worth me taking away precious time to do it.
Absolutely. You subscribe to the cost vs. time mentality. But, as you yourself have stated at some point in this forum, you aren't hurting for money.
However the subject here is people who are, the ones who have no savings. They have no margin of error in their lives. If the transmission in their car falls out, it's a disaster. So that $50 savings a week at Wal-Mart isn't much money to you. But if your household income is the US average of $73K before taxes, those resulting savings of $2,600 a year is huge. For those people, measures that are seeming inconveniences to you become lifesavers to them.
We keep a years' worth of living expenses in savings, separate from our investments. It took us twenty years to reach that point. Yet when we took a financial hit ten years ago, we didn't dip into that money. We did all our grocery shopping at Wal-Mart, no matter how little we enjoyed it. Out went the HBO, the extended cable package, and the dinners out. Refinancing our house in 2009 saved us the equivalent of $500 a month. That's $6000 a year. Somewhere around $12,000 a year in pre-tax income. So by refinancing and tightening our belts, we managed to pick up an average of $1200-$1400, all without touching our savings. So we got through a very tough year actually putting a considerable sum in the bank. When you start looking at it in a big picture way, suddenly it all becomes worth it.
Last edited by MinivanDriver; 02-12-2018 at 11:42 AM..
Screw that. I paid every damned dime of my college tuition by working a full-time job. When I got out of college, I moonlighted. I stuck money back. I started putting money into a 401K. I brought leftovers to work rather than run out to McDonalds for lunch. I went to association meetings of the industry I wanted to be in, even though I didn't know a soul. I called people up. And when I got my foot in the door, I put everything I had into it. Three years later, I was running a department with people ten years older than me doing what I asked.
I chose my wife not just because she was hotter than flowing lava, but also because she had a great head on her shoulders. We scrimped and saved. When times were tough we put our shoulders to the wheel and made it work. And today, at 55, we're seeing everything come to fruition.
And now somebody like you wants to mewl about how unfair the world is. And how you think you deserve a piece of what I earned with the sweat of my brow, by pulling all-nighters, and by taking the considerable risk of starting my own business.
Quote:
Originally Posted by MinivanDriver
But my post wasn't intended to elevate myself. It was to point out that one's ultimate station in life is largely dependent on the decisions one makes in life. I'm simply pointing out that life threw some serious obstacles in my path and I overcame them.
1. My parents' announcing, one week before my entering college, that they couldn't afford to send me. Fortunately, I had saved several thousand dollars working paper routes and mowing lawns. I wrote the first semester's tuition check, canceled my dorm room, and lived a home. I got a full-time job from 3-Midnight. So I would go to class, then work until midnight. Made the dean's list and walked off stage with my diploma without a dime in student loans. When someone talks about how much fun college was, I just give them a blank look, because it was not four years I'd like to repeat.
2. My father dropped dead three months after I graduated, leaving my mother with enough insurance money to cover his funeral. With my brothers and sister living out of state, I shelved graduate school and worked a second job to support her until she could get on her feet two years later. I wound up having to choose an entirely new career from scratch. By the way, this probably explains why I detest it when people claim they can't save money. My father was an architect who spent every dime he had on suits and dining out. Never gave a thought to tomorrow.
3. Started a business with a partner. We were barely on our feet with the firm when he had a stroke, the result of a melanoma that unbeknownst to everyone, had spread like wildfire to his brain. He died two weeks later on Christmas Day. I spent the next year keeping our few clients in place, acquiring new clients, and growing the company. Working until 1 or 2 a.m. was routine and the wolf was always at the door.
4. After several years of growth, a new biz partner had worked out. Until, due to a side business of which I had no knowledge, he one day declared bankruptcy and up and left town. My credit was locked up due to his bankruptcy, so I had to scramble like a madman for the next two years shoring up clients and reestablishing credit.
5. 2008. I watched 70% of my business vanish almost overnight when the banking system nearly collapsed. I once again scrambled, simplified my business model and worked like a dog to keep the doors open.
None of this is a pat on my back. I only bring them up because you asked. Ask most self-employed people, and you will likely get similar stories, the kind that people who take their paychecks for granted never have to experience. Maybe that's why being so tight with a penny has been inculcated in how we work. In fact, the past ten years have been good. But I had some major curve balls thrown my way. Had my wife and I not been conservative, adroit financial managers, we would have been in even bigger jams.
Last edited by MinivanDriver; 02-12-2018 at 03:31 PM..
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
