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Comment by shados | Hacker News Reader

That is scary, but not surprising.

Even if you gave someone without savings 600 bucks right now, chances are they'd turn around and buy a new iphone with it instead of saving it. And then you have all the people who are in a situation where they can't save if they wanted to, be it because of poor decisions or bad circumstances out of their control.

And honestly, even if you CAN save...I'm very lucky and quite privileged, and was looking at my 401k recently. It's doing quite well (yay!), but if I extrapolate to retirement, I'm not even close to what I'll need to have a comfy retirement. The majority of people are just flat out screwed.

How to solve this...who knows. Its a hard problem.

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How did you arrive at the conclusion that most poor people would waste $600 on things they don't really need?

Rush Limbaugh would be my guess

It's not just poor people. If it really is the case that 70% of Americans have no significant savings, then we're talking about a whole lot of people above the median income, not all of whom have unusual situations requiring them to spend everything they earn.

If more than the top 30% of people have iphones (or equally expensive phones), then some percentage of people did exactly that.

There is going to be a huge intersection of people with less than 1000$ in savings, but have an iPhone.

Perhaps that's WHY they have so little savings? I knew a family who filed for bankruptcy while having 3 macbooks they used for MS Word and Facebook. Bad spending habits and the need to keep up with the Jones are both issues.

Not all people are poor because they "waste" money, but when you consider that a lot of luxuries are considered "necessities", you have to question things.

> ... but when you consider that a lot of luxuries are considered "necessities", you have to question things.

Sometimes "luxuries" are necessities, in less obvious ways. For example, it may be very difficult to get certain types of jobs unless you display the right status symbols[1].

[1] https://tressiemc.com/2013/10/29/the-logic-of-stupid-poor-pe...

That's a nice site... The author has some really good points about for-profit colleges too.

  The $20 Principle
  
  I have written before about how $20 can change a 
  student’s life.

  The $20 is slightly euphemistic but not entirely so.

  We talk a lot about big money in higher education but I 
  know for a fact that it’s small money that can derail 
  one’s educational ambitions.

  I was a student in a doctoral preparation program. I was 
  an older “non-traditional” student. I was independent. I 
  didn’t have children but neither was I still someone’s 
  child. To take advantage of this highly competitive 
  program, I had to submit a $100 reservation fee.

  I didn’t have it.

  I was $24 short.

- https://tressiemc.com/2016/08/30/the-20-principle/

I don't disagree with that. But that makes it at best a "semi-necessity".

But that just makes the whole "if you give someone in need 600$, they will spend it on an iphone" MORE valid. If you need status symbols just for the symbol, you might wind up skimping on physical necessities (car repairs, rent, food, etc). Whether or not that is their fault could be up for debate, but it makes the statement itself all the more true.

I only have anecdotal evidence, but people who are poor because they have bad decision making skills would drop 600$ on some "status symbol" trifle without a second thought. People who are poor because of bad luck/circumstances will try their best to save it, or spend it on bills, food, etc.

I never said most.

Beyond that actually good arguments people have already given you, that's just been my life experience. I was born and raised poor. Not "I'm living paycheck to paycheck in a studio apartment poor", but rather "Wondering when this week I'll have enough money to eat" poor.

And so, the people I grew up with were the same. And while iphones did not exist at the time, you can bet your ass the moment someone had just enough money to buy bread, the rest went on their new electric guitar. And the day they got their foodstamps, they would trade a portion of them so they could get a shiny new TV.

That's just human nature.

"chances are they'd turn around and buy a new iphone"

Most in that situation would spend the money, but on needs like food or medication. The "blow it on a new iPhone" meme comes from an entitled right wing culture (that also made up the concept of a "Welfare Queen ")

> but on needs like food or medication

Or debt. (Real debt -- the ones where they break your legs if you don't repay.)

> The "blow it on a new iPhone" meme comes from an entitled right wing culture

I would have kept "right wing" out of it. Entitlement stereotypes are on both sides of the aisle, no need to make this partisan.

> [...] entitled right wing culture (that also made up the concept of a "Welfare Queen ")

The first use of the term that I can find is from Jet Magazine in 1974. They're hardly "right-wing".

https://books.google.com/books?id=DVsDAAAAMBAJ&lpg=PA1&pg=PA...

That's not quite the same usage as Reagan though.

If you don't have enough saved for retirement maybe you should stop wasting $600 on a new iPhone. Doesn't being judged suck?

You're getting downvoted but I agree with you, the parent is jumping to a ridiculous conclusion and lacks perspective. I expect he has not had many difficult times.

It's just math: nearly 70% of people have nearly no savings, but market penetration for a lot of luxury devices when put together is a heck of a lot more than 30%. So there's an intersection. How large is it? Who knows.

And while I was never homeless, I spent most of my life having to pick between rent and food and surrounded by people who were in the same boat. That's where I've seen that situation happen times and times again.

If Americans are truly NOT saving (as opposed to just not using savings accounts):

Yes, being judgmental without knowing the whole story isn't a good thing, but that misses the point: people are choosing to spend instead of save-and many times it's on luxuries. He's not just talking about the poor.

It is a fact that an iPhone is a luxury. There are plenty of much cheaper phones that function exactly the same as an iPhone. But through excessive marketing and a digitized world, people are convinced they NEED an iPhone. They're convinced they NEED a $1500 Macbook Pro for school in liberal arts.

It's not good to make judgments on the poor, but this is 69% of Americans, not just the poor (impoverished are closer to 15%), and that's the scary part. Most but the top 30% are spending above their means, and getting credit to do it, in an economy that's probably not going to grow like it did in the 20th century.

Well no, that was exactly my point. People who are privileged and don't have anything stopping them from saving, still don't and screw themselves over.

If that's true, then people for whom it's difficult/impossible to save are completely screwed, and we need to chance something, because the odds really ARE stacked against them.

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