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Houses that could once be bought decades ago on a single-income family salary for $25,000 may now, in 2015, cost as much as $750,000+, in certain residential areas.
Places in the U.S. where this has happened are usually much more populated, or have much greater access to high-paying career opportunities and other amenities than they used to have many decades ago. So, those areas have fundamentally changed from how they used to be in the past.
You are quite likely living on either the east or west coast.
"Live within your means" as a phrase and as a popular figure of speech, would seem to be self-evident and obvious, at least on the surface. Simply put, it might represent not spending what you don't have. However -- and this is a big "but" -- it can also get incredibly frustrating to have people automatically parroting this phrase, for several reasons. First, the "means" with which one lives has gone down, not up, over the past 30+ years, with wages not being fairly-adjusted to inflation. What this means on a practical level, is that with the varying levels of inflation and deflation of the dollar over the past few decades, people's standards of living have gone down, not up. It was much easier to "live within one's means" in 1950, 1960, and 1970, than it was was say from 1980 - present. Houses that could once be bought decades ago on a single-income family salary for $25,000 may now, in 2015, cost as much as $750,000+, in certain residential areas. This is an extreme example where it is obvious that the financial industry has "moved the goal posts" of what living within one's means represents today in 2015, vs. what it used to mean.
While observing some degree of "living within one's means" would actually seem prudent and even wise, it almost sounds like some people may take it to drastic extremes, where it is used as a justification for endorsing the gradual (and involuntary) reduction of people's living standards, over time. While also serving as an apologist of sorts to the well-off, well-to-do, and the wealthy. Keeping in mind that it is much, much easier to live within one's means, so to speak, if one is already well-off in the first place.
you may think that is a good point but it demonstrates a desire to whine and complain rather than accept reality. to someone with an income, who cares whether or not standards and means have gone down? it doesnt matter. the reality is that today you have x amount of income coming in and "living within your means" means that you need to spend less than that income.
Also keep in mind that it's much, much easier to become well off if you live within your means.
I would go one step further and say the only way to become well off is to live within your means. No one on earth can become well off if they live beyond what they can pay for. Some people figure it out early and start socking away money. Some people never figure it out. It takes time to accumulate wealth. Having a bunch of stuff that isn't paid for is not doing well. It is simply being poor with alot of stuff.
It helps if you have good examples in your family, showing you how to delay gratification, save up for things, forgo some things entirely, work for what you get, value things like good relationships instead of material things, emphasize education and getting a good job, entrepreneur skills, investing for the future etc. Some people have no roll models in these areas and I think that is where you get folks who can't figure out how to get ahead.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Quote:
Originally Posted by StarPaladin
"Live within your means" as a phrase and as a popular figure of speech, would seem to be self-evident and obvious, at least on the surface. Simply put, it might represent not spending what you don't have. However -- and this is a big "but" -- it can also get incredibly frustrating to have people automatically parroting this phrase, for several reasons. First, the "means" with which one lives has gone down, not up, over the past 30+ years, with wages not being fairly-adjusted to inflation. What this means on a practical level, is that with the varying levels of inflation and deflation of the dollar over the past few decades, people's standards of living have gone down, not up. It was much easier to "live within one's means" in 1950, 1960, and 1970, than it was was say from 1980 - present. Houses that could once be bought decades ago on a single-income family salary for $25,000 may now, in 2015, cost as much as $750,000+, in certain residential areas. This is an extreme example where it is obvious that the financial industry has "moved the goal posts" of what living within one's means represents today in 2015, vs. what it used to mean.
While observing some degree of "living within one's means" would actually seem prudent and even wise, it almost sounds like some people may take it to drastic extremes, where it is used as a justification for endorsing the gradual (and involuntary) reduction of people's living standards, over time. While also serving as an apologist of sorts to the well-off, well-to-do, and the wealthy. Keeping in mind that it is much, much easier to live within one's means, so to speak, if one is already well-off in the first place.
Like most arguments, it may be true for some and not for others. We needed both incomes to buy our first house for $50,000 in 1978. That house is now worth $700k, but having moved up to bigger/newer homes since then as our income grew along with the equity in the previous homes, we are now far better off financially than back then. Our combined income today is about 5 times more than when we bought the first house, and our mortgage interest rate today is about 1/3 of what it was on that first loan. Not that we could afford to buy our current house now, based on what it would sell for, about 3-1/2 time what we paid for it.
"Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."
Charles Dickens, David Copperfield
I think there are a lot of valid reasons why it can be harder to live within your means now, as well as some less valid ones like just wanting all the newest gadgets, etc. But the reality is that I think that a lot of people need to work harder at not spending more than they have even if that's not as much fun. Sometimes, it's not discretionary but there are a lot of people spending money they don't have on things that are luxuries, not necessities.
As for the original question, yes of course the entire concept is biased in favor of people of greater means, meaning they can afford a more extravagant lifestyle and still be within their means. But there are plenty of people with very high incomes who still get into debt because they spend more than they have. If anything, they have more access to credit and the ability to overspend more than less well off people.
I would go one step further and say the only way to become well off is to live within your means. No one on earth can become well off if they live beyond what they can pay for.
What about medical school? Technically most doctors got there only by "living beyond their means" for a time. It is virtually impossible to work your way through it.
"Live within your means" as a phrase and as a popular figure of speech, would seem to be self-evident and obvious, at least on the surface. Simply put, it might represent not spending what you don't have. However -- and this is a big "but" -- it can also get incredibly frustrating to have people automatically parroting this phrase, for several reasons. First, the "means" with which one lives has gone down, not up, over the past 30+ years, with wages not being fairly-adjusted to inflation. What this means on a practical level, is that with the varying levels of inflation and deflation of the dollar over the past few decades, people's standards of living have gone down, not up. It was much easier to "live within one's means" in 1950, 1960, and 1970, than it was was say from 1980 - present. Houses that could once be bought decades ago on a single-income family salary for $25,000 may now, in 2015, cost as much as $750,000+, in certain residential areas. This is an extreme example where it is obvious that the financial industry has "moved the goal posts" of what living within one's means represents today in 2015, vs. what it used to mean.
While observing some degree of "living within one's means" would actually seem prudent and even wise, it almost sounds like some people may take it to drastic extremes, where it is used as a justification for endorsing the gradual (and involuntary) reduction of people's living standards, over time. While also serving as an apologist of sorts to the well-off, well-to-do, and the wealthy. Keeping in mind that it is much, much easier to live within one's means, so to speak, if one is already well-off in the first place.
Here's the huge problem with this post: when you get down to cases, virtually everyone who was working thirty years ago and now is making far more money now than they were then. At 25 a person is just starting out. At 55 that person is typically at peak earnings years. $10,000 then is not anything like $100,000 today, accounting for inflation, but there are plenty of people making $100k today who were making only $10k thirty years ago.
umm, second thing, YOU are the only one in charge of your living standard, not me, not society at large. You want more, you better figure out how to become more valuable to the rest of us--then you'll get more. Until then, live within your means, whether those means are paltry or plush.
What about medical school? Technically most doctors got there only by "living beyond their means" for a time. It is virtually impossible to work your way through it.
Yep. Another cliche comes to mind here - You have to spend money to make money. You could say that's pretty much true for the higher education system in the US nowadays.
I'm one the original boomers (early1946) so I saw the 60's, 70's and 80's when a bunch off you say were so great. There were still homeless people. There were still poor people and people that didn't give a damn.
If the government gave everyone over 18 $40K a year, there would still be people that can't handle money or save and would be poor by June or in some instances January. There would still be those that choose to be homeless.
Taxing the rich to the max would still not provide the utopia that so many want.
Living within ones means isn't the righteous path some people make it out to be. At least in today's credit dependent society, probably the largest single group practicing it religiously are homeless, vagrants and drifters living hand to mouth.
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