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I find this issue as a failure of our public education system to teach consumer/personal finance, marketing schemes to promote consumerism, credit/deficit spending, and the individual's failure in continuing to educate themselves later in life.
There's a lot of people/businesses that make a lot of money off the fact that people have nothing saved. Such individuals are financially inefficient and often pay 8X more in interest rates, are not invested in the stock market, and don't have the access that others enjoy. The dirty secret is that the wealthy I've become, the less money I spend. I'm offered all sorts of discounts that aren't available to most people, I have access to boats, horses, and even a private plane…none of which are my own, but they belong to friends of mine. It's such a backwards system and something needs to be done about it.
I find this issue as a failure of our public education system to teach consumer/personal finance, marketing schemes to promote consumerism, credit/deficit spending, and the individual's failure in continuing to educate themselves later in life.
I find it to be a complete failure by parents first
After all expenses my wife and I are left over with $4,000 a month and I still panic about the future and having enough. I'm only 30 and have an emergency fund and a home with about $55k worth of equity in it. I have no idea how people sleep at night living paycheck to paycheck and nothing in savings to fall back on. We can pay all our bills on either my wife's or my salary. With one of us unemployed we'd actually be banking $2000 every month, with our emergency fund we could probably float for over a year after the unemployment ran out. We wouldn't be saving for retirement during that time, or going on vacations. But we'd still be able to eat out once a month.
We've become extremely frugal. I'm looking to sell my used car so I don't have a car payment. Our home is only like 2.6x our annual income and still like $150k below what we were approved for by the bank and I still look at it sometimes and wonder if I spent too much. (got it well under the market, seller paid closing costs, and we got instant extra equity)
Even with all that I still panic and lose sleep at night thinking I could lose everything in the blink of an eye. Oh and I have a 4 year Nursing degree I can always fall back on... still panic
If I had no savings and lived paycheck to paycheck I'd seriously have to live in one of those tiny houses or a cabin in the middle of nowhere for like $400 a month till I built up a solid 12 month nest egg or something.
I get financial security, I don't get the obsession with retirement.
My great grand father worked until he died, so did my grandfather, and I hope the same happens with my dad decades from now.
We spend decades building the skills we need to work, and then our work defines us for decades more. Retirement isn't for everyone, some of us enjoy the challenges of work, the feeling of production in excess of consumption, of being part of something greater.
Unfortunately, business in the U.S. thinks negatively about older people now and it will only get worse decades from now. I, too, would like to work into retirement age but I doubt that happens. You'd need to own your business to call the shots.
I know of people that is in their 60's and have no savings and will have too work the rest of their life.
Short on savings? You're not alone.
Twenty-eight percent of Americans have nothing in their savings accounts and another 21 percent don't even have a savings account, according to a new survey from GOBankingRates. 49% of Americans Have Nothing Saved
It specifically asked about savings accounts. Not exactly a great proxy for "saving".
What if you have $500 in savings and 15k in checking?
Quote:
“How much money do you have saved in your savings account?”
Was the question that was asked.
I'd fall in the 5% that said between 5-9.9k, but I have another couple grand in checking, have a lot in HSA accounts, have 35-40k in contributions to a Roth IRA, have much more than that in brokerage accounts.
I find it to be a complete failure by parents first
I agree with this. I hold the parents responsible for all facets of child development of which education is one.
Schools are just a tool to assist in education. The responsibility lies with the parents. Carrying this a step further, I think of all children as home-schooled, some send their children to schools during the day but the parents are the ones that ensure they obtain the overall education that is needed.
It specifically asked about savings accounts. Not exactly a great proxy for "saving".
What if you have $500 in savings and 15k in checking?
Was the question that was asked.
I'd fall in the 5% that said between 5-9.9k, but I have another couple grand in checking, have a lot in HSA accounts, have 35-40k in contributions to a Roth IRA, have much more than that in brokerage accounts.
I agree that the question is not a great one the way it is worded. We haven't had a savings account in years. If we need more cash then what is in our checking accounts, we just transfer some from one of our brokerage accounts.
But in answering the question, we would appear to be among the people who have no cash reserves.
Low interest rates put squat in the pockets of the 35% who rent.
I looked all OVER my bank statement, but can't find where my bank gives me more interest on my money because I own instead of rent.
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