Housing is easily one of the worst problems right now. $15 minimum wage and budgeting skills means nothing when 1BDR apartments are climbing over $2000/m.
Why focus on individuals on personal finance but not the government's inaction of the student loan debt, healthcare crisis, stagnant wages coupled with higher costs of living, etc., which are much bigger issues?
Elites are comfortable building their fortunes on sand because they know they'll be insulated from the consequences when another consumer collapse eventually happens.
Elites are comfortable building their fortunes on sand because they know they'll be insulated from the consequences when another consumer collapse eventually happens.
Again, this isn't a multiple choice test. It's not one answer at the expense of all others. It's something small and actionable that has zero downside. It's not going to change the course of the economy on its own. Other problems exist without question. But I've never once thought of education as a bad thing.
Having a higher salary doesn't necessarily mean money woes are behind you, with nearly one in 10 workers making $100,000 or more (9 percent) saying they usually or always live paycheck-to-paycheck and 59 percent in that income bracket in debt. Twenty-eight percent of workers making $50,000-$99,999 usually or always live paycheck to paycheck, 70 percent are in debt; and 51 percent of those making less than $50,000 usually or always live paycheck to paycheck to make ends meet, 73 percent are in debt.
I have very little confidence in the survey methodology or results (see above). How was "living paycheck to paycheck" defined? There are plenty of people with six figure salaries who consider themselves as living paycheck to paycheck on the basis of having minimal liquid assets (despite sizable retirement/limited-use/property investments).
I do this for a living. I've done this for a living for the last 16 years now. I've sat in planning meetings and watched senior executives gloat about how much of their balance sheet is buoyed by fee income. Oh I have plenty of displeasures-- just not directed where you think it is. It's why I left the corporate banking world for a credit union and haven't looked back.
Everyday I come into the office hoping to make a difference for my members. I would also love nothing more than to be able to see those members tackle much larger conquests. To reach those higher goals. My issue is we're habitually starting from behind and even treading water is a challenge because we did collectively such a piss poor job of even teaching the fundamentals in addition to the deck already being stacked.
What I'm not willing to do is throw my hands up in the air and say "Well, this doesn't solve everything on its own so fuck it, what's the point?" I'm just not that guy. Is financial literacy a conversation for another topic? Possibly. But it came up here so I attempted to shed a little insight here.
Having been through the process twice now, I felt the need to back up just how true this is. When I purchased my first home, I was making ~40K and they approved me for $350K. The realtor pushed very hard on the notion that we should be looking for $275-300K houses when we had indicated we were more interested in $125-135K homes. We ended up in a $130K starter home with an easily manageable mortgage payment.
It's really, really easy to be seduced by all the pressure to buy way more house than you need or can afford.
Disaster sirens should be going off in every seat of government in the US, but they act like everything is fine. The financial instability of people in the US keeps me up at night and makes me fearful for what is to come.
I do this for a living. I've done this for a living for the last 16 years now. I've sat in planning meetings and watched senior executives gloat about how much of their balance sheet is buoyed by fee income. Oh I have plenty of displeasures-- just not directed where you think it is. It's why I left the corporate banking world for a credit union and haven't looked back.
Everyday I come into the office hoping to make a difference for my members. I would also love nothing more than to be able to see those members tackle much larger conquests. To reach those higher goals. My issue is we're habitually starting from behind and even treading water is a challenge because we did collectively such a piss poor job of even teaching the fundamentals in addition to the deck already being stacked.
What I'm not willing to do is throw my hands up in the air and say "Well, this doesn't solve everything on its own so fuck it, what's the point?" I'm just not that guy. Is financial literacy a conversation for another topic? Possibly. But it came up here so I attempted to shed a little insight here.
it's not really insight though, because the things you're talking about are not significant root causes. so when you come into a thread about something that's clearly a systemic issue and start talking about individual financial responsibility it just looks like you're trying to blame workers for problems with american capitalism.
Having been through the process twice now, I felt the need to back up just how true this is. When I purchased my first home, I was making ~40K and they approved me for $350K. The realtor pushed very hard on the notion that we should be looking for $275-300K houses when we had indicated we were more interested in $125-135K homes. We ended up in a $130K starter home with an easily manageable mortgage payment.
It's really, really easy to be seduced by all the pressure to buy way more house than you need or can afford.
I was working paycheck to paycheck for 4 or more years 2011-2015.
Cheap non-smartphone, prepaid credit, pasta with sauce 5 nights a week, no subscriptions to anything, no trips abroad even for friends' weddings... everything was budgeted, everything was calculated. I did what I had to do and I got through it. It really frustrates me when people who are in that situation don't do that.
That said that's not the real problem here, obviously. The real problem is the entrenchment of wealth in the hands of the 1%, in the distribution of wealth to investors rather than labour, and to cost of living outstripping wage growth.
Still, I do get frustrated when I meet my broke cousin who has had the electricity turned off on him looking for loans from family and he's rocking a Samsung s7 - a phone I still wouldn't consider I could afford despite having almost a years' worth of wages saved up for emergencies and a home deposit.
Seeing my co-workers, friends, and family all spend way over their means makes me somewhat disagree. Just means everyone is conditioned to spend which is true. Ask those 78% of American workers who live paycheck to paycheck if they do monthly budgets or actually look at their spending.
They are in places with jobs and money. These people with stagnant wages are basically left to rot or they go urban where you need to make 2x-3x as much to stay afloat.
Having been through the process twice now, I felt the need to back up just how true this is. When I purchased my first home, I was making ~40K and they approved me for $350K. The realtor pushed very hard on the notion that we should be looking for $275-300K houses when we had indicated we were more interested in $125-135K homes. We ended up in a $130K starter home with an easily manageable mortgage payment.
It's really, really easy to be seduced by all the pressure to buy way more house than you need or can afford.
This is crazy to me and good on you. We'll be looking to purchase our first home next year. I'll be 34 and my fiance, then wife will be 26 and our combined income will likely be around 110-120K. We both want to get something in the 175-200K range max that we could comfortably enough afford on one income.. I may become a stay at home dad so we don't end up spending a ton on childcare. 2000sq ft with 3 or 4 bedrooms should be enough for us with a couple of dogs and couple of kids in the future. The last thing we want is to have too much house.
Something is weird with these numbers. 78% are living paycheck to paycheck, however the highest percentage listed in the income breakdown is ~50% for those under 50k?
And the lower numbers by income group specifically stated those were usually or always living paycheck-to-paycheck (at least among the sub 100K groups).
Either I'm having a brain fart or something is wrong with the math. If no income bracket has more than 51% of its workers living P2P, how can more than 51% (78%) of the total worker population be living P2P?
Perhaps 78% of the total worker population has lived paycheck to paycheck at some point in their lives (or for a few weeks in the last year)?
Having been through the process twice now, I felt the need to back up just how true this is. When I purchased my first home, I was making ~40K and they approved me for $350K. The realtor pushed very hard on the notion that we should be looking for $275-300K houses when we had indicated we were more interested in $125-135K homes. We ended up in a $130K starter home with an easily manageable mortgage payment.
It's really, really easy to be seduced by all the pressure to buy way more house than you need or can afford.
Same story as us for our first home, got approved for 440k, bought a house for 175k. Wife went back to school a couple years after we bought that house and we managed just fine with her not working anymore
They are in places with jobs and money. These people with stagnant wages are basically left to rot or they go urban where you need to make 2x-3x as much to stay afloat.
I'm only 24, but this was me a couple of months ago before I started a new job. Now I'm paid enough where I can save the majority of my pay and it's made life so much better. I'd be hard to go back.
Either I'm having a brain fart or something is wrong with the math. If no income bracket has more than 51% of its workers living P2P, how can more than 51% (78%) of the total worker population be living P2P?
38% Sometimes
17% Usually
23% Always
-----------------
78%
The 51% you see at sub 50K are in the usually or always groups. Basically, it's a slightly different statistic being displayed and it's a shame the article doesn't have some consistency, or at least report the 40% overall usual-or-always percentage to put the others into proper perspective once those are mentioned.
If I budgeted my discretionary spending better I could save a little bit month to month, but it wouldn't be that much. It's hard right now, specifically for the discretionary spending. Food is killing me. My wife is pregnant and we both get home late in traffic. As a result we've been eating out a ton more for convenience. It's added easy $300-$400 a month for food costs. I'm also working on a bathroom remodel, so what little I have managed to save over the last year was just blown. lol
Beyond me living a little loosely right now, by far my biggest drain is housing costs. California home prices are insanity. You add a student loan payment and a car payment to that and shit gets wild lol. Between my house, car and student loan, $3460 a month goes out. You add food, gas, retirement, healthcare & utilities and it's pretty easy to see how living month to month can get.
Same story as us for our first home, got approved for 440k, bought a house for 175k. Wife went back to school a couple years after we bought that house and we managed just fine with her not working anymore
38% Sometimes
17% Usually
23% Always
-----------------
78%
The 51% you see at sub 50K are in the usually or always groups. Basically, it's a slightly different statistic being displayed and it's a shame the article doesn't have some consistency, or at least report the 40% overall usual-or-always percentage to put the others into proper perspective once those are mentioned.
The Federal Reserve idea makes so much sense it's painful to think about because you know it won't happen. Those stupid fucks wonder all the damn time why inflation is so low, expecting it to come back at anytime. When all they and the Treasury Department have to do to make inflation rise is to relieve student loan debt.
Couple that with serious reform for how post secondary education is funded and the economy will take off. Do that AND actually regulate the cost of healthcare? Say hello to 5%+ economic growth.
it's not really insight though, because the things you're talking about are not significant root causes. so when you come into a thread about something that's clearly a systemic issue and start talking about individual financial responsibility it just looks like you're trying to blame workers for problems with american capitalism.
So professionally, I'm an avid believer in focusing efforts on whats within my line of sight. To that effect, I have roughly 3500 (overwhelmingly low-to-moderate income) households associated with my office. That's 3500 families that I make it my sole business to bust my ass to improve their livelihoods. There's plenty of common themes across all 3500 of those households, but financial literacy is one that's directly within my line of sight so that's the one that's going to draw my attention.
Notice the only place I'm assigning blame is the failure of teaching the basics. I volunteered in the past with a non-profit that did classes on budgeting to high school kids. But it was an hour. Where's the reinforcement there?
Again, I understand the cynicism. But the fact of the matter is I can't directly attack those other significant root causes, but when I look inward and ask "what else can I do?", fighting for education is going to be at the top of that list. I already vote in every primary. I already get involved locally. I already support causes that are important to me. Still, I stand by the fundamental concept of never throwing my hands up in the air and saying "I can't solve it completely so fuck it, why try". If it's a band-aid on a gunshot wound, so be it. My band-aid is at least more than "Hey look at this gunshot wound! Sure is bad isn't it!"
Imagine how much the corporate overlords would lose if everyone in the US stopped working for a week in protest. It's a shame there's no global network where people can organize and plan...
Americans are brainwashed from birth to hate anything that would be Pro Workers Rights, such as and especially Unions. The power of the 1% is seen in the control they have over the minds of the less wealthy.
All Americans believe they are temporarily embarrassed millionaires. This is why nothing ever gets done to help the 99%.
Millions of Americans living month to month while the richest corporations are hoarding over $2 trillion in cash reserves and adding billions and billions to their war chests each and every month.
Down payment and closing costs were paid out of my own and my gf's savings split 50/50. We only put 5% down as PMI is minimal (approx $80-90 a month..would have to go back and look at the paperwork). This allowed us to leave ample funds in our bank accounts and in less than a year that money spent was already recovered back into savings.
I still don't understand the question or the point you are trying to make.
This is very much a regional (or even local) thing, but there are plenty of programs available to first-time homebuyers, those in LMI areas, etc etc.
Also, while I would stop well short of recommending it as a one-size-fits-all solution, borrowing against a 401k/403b/TSP/etc for such a purpose can make sense. Very much YMMV.
Of course, if we did a better job at making those resources known...
Having been through the process twice now, I felt the need to back up just how true this is. When I purchased my first home, I was making ~40K and they approved me for $350K. The realtor pushed very hard on the notion that we should be looking for $275-300K houses when we had indicated we were more interested in $125-135K homes. We ended up in a $130K starter home with an easily manageable mortgage payment.
It's really, really easy to be seduced by all the pressure to buy way more house than you need or can afford.
Damn, what year was that? I'm making nearly twice that, have excellent credit, and got approved for about the same. Regional, I suppose? That isn't even including my wife.
I agree, though, never go for what you're approved for when it comes to buying a house. Lenders don't account for your spending habits, so that can be a quick way of living paycheck to paycheck.
Damn, what year was that? I'm making nearly twice that, have excellent credit, and got approved for about the same. Regional, I suppose? That isn't even including my wife.
I agree, though, never go for what you're approved for when it comes to buying a house. Lenders don't account for your spending habits, so that can be a quick way of living paycheck to paycheck.
I'd be willing to wager early '00s. In the days where ARMs were common and stated income was the norm, his numbers sound about right for the time.
In your case, there's much more stringent underwriting criteria (as a result of all those terrible mortgages above) so it's likely based on a 30 yr fixed at current rates and verified income.
110% agree with the second part. We bought at a number that would be doable for us, which was a significant amount less than what we were approved for. We also pushed our timeline up a bit last year to lock in while rates were where they were.
I do think a conversation should be had about how corporations and politics are working together to systematically make the working poor continue to be a reality, but the definition of "paycheck to paycheck" is fairly broad. Does it mean if you don't get paid on the 30th you're on the street? Or is it that you're just working to live?
If it's the second option then that's probably a reality for most people since there aren't too many ways to freely not work and still have financial independence. Most people I'd think are part of that category but wouldn't be on the street if they missed a paycheck.
