For most in this predicament, it has nothing to do with being bad with money. It has everything to do with their income being 80% of their essential bills.
Reading stuff like this makes me feel old. The - new generation? - who seem to always publicly remind themselves that they're good enough after all and just like everyone else and normal and it's hard for us ... and now don't get me wrong: these things can be true. But I grew up not standing on a soapbox and exclaiming these things, and not thinking or writing in that way.
It's kind of a race to the bottom if everything is treated like you're an object and not a subject, as in, blowing around in the wind by objective forces that are external. There really is a mix of external and subjective forces at play, but we're reminded of the external with this style.
I would have said, "I fucked up. I used to be bad with money. Now I do this: __ __ __. "Bad with money" implies an immovable predicament and "I'm not alone" implies systemic forces at play. Again, the focus on the absolute and removal of the subject.
Yes, I'm extrapolating quite a bit from so little, it's just that this style of writing seems ubiquitous now.
Also, as someone on the younger side, this mentality is comforting. It's the comfort of existing within a school of fish. Despite unpredictable currents that act on you like an object, it's comforting to know that there are many of you. A few individuals disappear here and there, but chances are the school will survive. You're normal, you belong, things are hard, but you'll probably be fine.
More like the GP, however, I've gotten there not through identification with others but instead through the cultivation of a spiritual life philosophy.
Like GP, I also grow tired of hearing these voices too often. I have a little sister, who is 13 now, and she feels submitted to her fate. More often than not she feels like a candle in the wind (queue Elton John) instead of a captain at the helm.
But you're right, it is something to pay attention to. These little instances all add up to be statistically relevant and a source of knowledge for collective social truth-finding.
One thing I must insist on, philosophically, however, is that we are not often served by identifying with sub-par things. Personal identification is very useful for aspiring and evolving, but personal identification with the present or the past can unnecessarily keep you anchored to bad habits.
But even if she wasn't doing that and was indeed looking to normalize financial illiteracy by saying it's common and she's not the only one, I think that's a pretty healthy perspective. Yes she fucked up, which she acknowledges. But it can be healthy to not seek fault in you as a person or your character, but rather to seek fault in your behaviour, your lack of education on a topic, your views which may have been too biased for the short-term. After all, those things can be changed, it gives the individual agency and a feeling of control. I think the entire article acknowledged that the solution lied with her changing her views, her habits, her financial literacy, her financial management. I found it to the contrary of removal of the subject.
> I fucked up.
Was she not saying exactly those things? For example she says "I saw my folly" or "How was I ever going to afford a kid’s college fund? It wasn’t just that I’d only ever lived for my youth; maybe I’d only ever lived for myself. No wonder I was alone." It's quite clear she felt she fucked up and saw the issue with herself.
> I used to be bad with money. Now I do this: __ __ __.
Again, I felt she touched on this throughout the article, e.g. by saying things like "I’d started reading personal-finance books, analyzing my spending, and making budgets. I also started wearing sunscreen."
Pretty good description of toxic femininity.
I was raised on welfare myself and started out my early twenties with minimum wage jobs including factory work. Yet I always had savings, the idea that I couldn't cover a $1000 emergency would be insane to me, especially structurally.
Did that mean I had to live with my parents longer than I'd have liked to? Yes. I also didn't have a car and took the bus. I had a cheap Android phone. Wore secondhand clothes. I rarely ate out, and in my first 25 years of my life I never, ever, just went somewhere to get a coffee.
But I did have a home, transport, clothes, a smartphone, food and coffee, and also savings.
I don't want to victim-blame, there's certainly many who're trapped in a predicament. And it certainly helped being young, healthy, flexible, without kids, there's an immeasurable privilege to that situation versus the contrary (old, sick, with dependents). But I also saw plenty who weren't trapped and spent a ton on a way too expensive lease car they didn't need. Or who always had the latest iphone, and also had a minimum wage job. Or who rented a place downtown, instead of 20 minutes commute for a 30% discount. Those are lifestyle choices, which is completely fine to make, but not unconditionally. Once you have an emergency fund and you prioritize the short term over the long-term, it's simple a personal preference. But if you have no emergency fund, or if you have long-term goals you want to meet, you need to manage it. I have lots of friends who don't even spend the 1 hour a week to make and monitor a very basic budget for example.
I mean let's be frank, median household income is $64k in the US. It's about the richest in the world, especially if you exclude the tiny rich states that have a few million people like Luxembourg there's nothing to really rival it. The idea that <1 week of median household income is an emergency for 4 out of 5 households is statistically not in line with 'for most it's just their predicament, not related to lifestyle or financial planning or management'.
Lack of financial literacy is another problem that, I think, exacerbates the above.
I suspect this becomes increasingly likely as one progresses.
I have become much better at important things. However, anxiety has increased - largely because I have shifted from blind confidence to educated awareness.
This is a near meaningless way to compare things. I am not sure we even have an appropriate, widely used and widely computed/measured metric for this.
What matters is not the size of the median household income, but the ratio of this income to likely household expense.
If you need to put far more of your income into your self-managed retirement account(s), or to pay for healthcare that isn't covered by a national insurance scheme, or to pay for membership at a recreational facility that might otherwise have been free after local taxes, or to cover current, future or past educational costs that would be an order or magnitude or more less in another locale, or to cover day care that might have been provided by your government, your effective income is not well measured by its absolute magnitude.
How so? I don't see the link between not moving out as soon as expected, meaning my parents must've not been financially dependent on me in any way.
Would you for example suppose that parents who're in need of financial support would have their kids move out earlier than expected? I don't really follow your point.
So the parents got an X m2 apartment for N EUR (below market rate). When the children move out, they now have to pay N+M EUR because with 2 people they would only have been alotted an X-Y m2 apartment. Maybe an edge case, I know.
Because my dad was dependent on the state (disability) he received a supplemental income to get his living standard to the absolute legal minimum (set at 70% of minimum wage) that all Dutch citizens have a right to regardless of circumstance.
However, the government assumes that if there's say 4 people living in one home, that they're a household that can share certain costs, e.g. rent, heating, furniture etc. This means the minimum living standard can be attained with less money, so they cut your benefits. The more adults there are, the higher the discount. As I aged from a kid to a young adult, living at home meant his income was cut.
Second, any income that the household makes (e.g. from my job), would be cut from his benefits, as we shared a household. e.g. if I earned 500 euros, he'd get 500 euros less.
This meant that to live at home, a large portion of my minimum wage earnings (parttime, next to my studies) would go simply to make up for the cuts to my dad's benefits. Minimum wage is about 1500 here, so working a 33% job would net me 0 euros as the entire 500 went to my dad who got cut from 900 to 400 due to my job.
It's a weird system that definitely is grounded in some sound logic, but also creates edge cases that aren't creating useful outcomes. It pushed me out of the house, into an expensive housing market, left my dad (who wasn't very healthy) alone in a house, that also happened to be a social home that now has empty bedrooms. It also could've pushed me to quit my job as there was no real incentive in the short-term to work, but I knew long-term it wasn't viable.
I've found it pretty easy to save money almost on accident with a six figure income, even without keeping too close an eye on expenditures. Helps if you skip buying the luxury auto, don't pick the most expensive living quarters you can, keep eating out under $10-15/day, and if you can be lucky+conscientious enough not to have catastrophic healthcare expenses, but you don't even have to do all of that and you can save 20% and pay your taxes.
It's certainly possible closer to the median, but the belt has to be tighter.
Bottom third? Pinching pennies. Pick marginal housing. $25/week groceries. Turn down social invitations when your gas/transport budget's up. And saving for that $1000 emergency will still be slow.
There's something in a part of some people's psychology that wants to imagine that if you're just disciplined enough you can make it all happen no matter what the constraints are. Discipline can make a difference, but not the same scale of difference that greater resource inflows do.
And worse, when you inevitably need to tap it, it will be equally slow to refill.
Don't get me wrong, of course there are genuinely poor people. But not far over half of the population.
I don't think this is someone who can't cover essential bills with their salary. This is the trap kids fall into (my early 20's self included) when they first start making real money and it feels endless.
It's not endless. It's very easy to fritter away.
To this day, I still don't feel the urge to buy things on impulse, or because peers have them or do trendy things.
Yeah it was a little intoxicating and I def overdid it. No regrets tho.
Moving to America (sfba) quickly fixed that. Now I’m back to being pretty frugal (but not too much) and investing in asset building. Turns out that’s more rewarding.
But your early to mid 20’s are a great time to go a little crazy if you can. It will never again feel the same. You have little responsibility and lots of time to catch up later.
I’m not stingy. I’m sane. They’re the ones going bankrupt ;)
20 years later: They’re married with kids and I’m single. Perhaps I really looked stingy ;)
Moral of the story: People in average are de facto pushed to consume all their margin.
I wish to retire in a few years and they in a few decades.
What can you possibly be eating for $5
I think some people can treat eating as more utilitarian, while having a great meal or even a halfway decent meal is a true pleasure and an experience worth having as often as possible for myself. The small pleasure is what makes the grind feel worthwhile.
I fully expect to walk out $25-$30 lighter after a basic entree/lunch, a drink and a tip, even if eating alone on a lunch break. A date with my wife ( on the low end) $70, bring out the whole family ($100)
Do we have significantly different average prices. Maybe a pre-made gas station sandwich or single fast food sandwich could cost $5
A $5 meal sounds like a chore, an amazing roadside Shack find! or absolute trash ingredients not worth eating.
How do you do it?
It’s like a “pursue your passion” dilemma. If your passion is whitewater rafting, employment in that field will pay differently than, say, many kinds of employment facilitated by a computer science degree.
Same dilemma goes for clergy, who often have marketable and lucrative skills they leave behind to pursue their calling.
There is some truth to that, but there is also a fair amount of truth to the fact that a lot of people list things as "essential" that really aren't.
For many it's a trade off of being poor or looking poor, and they would much rather be poor than look poor.
Money isn't that different than dieting. It's a pretty simple equation.
Money in >= money out => Broke.
Money in < money out => Not broke.
With dieting, yes exercise more, but for the love of God, stop eating so damn much.
With money, yes get a better paying job, but for the love of God stop buying so much stupid shit.
The same goes for budgeting. Saying "spend less and get a better paying job" doesn't really help compared to detailed instructions on how to open a savings account and automatically deposit 5% of your pay into it, reviewing your monthly expenditure, changing habits like ordering delivery food every weekend, long term investments like buying your own washing machine, or pursuing a qualification that will help you earn more.
I guess the point I was trying to make is more that doing these things is not impossible. It is just a matter of being properly informed (which is in itself a difficult task).
I'd disagree, it's money management at that point.
I'm more concerned about those who are unprofitable every paycheck and growing debt, no way to cut expenses further. Probably due to high COL and lack of education, but I can't blame someone for living where they have family .
(Or, to go even more hard-line, if you consider "choosing to not go into trades, medical specialties, or other high-career-wage-growth-per-input-hour-of-education career paths, when you have no reason to believe you're uniquely suited to/talented at the high-barrier-to-entry career path you've chosen instead, and thereby not especially likely to end up making money at it" to be "being bad at money.")
Who knows, maybe publishing it in Outside will reach someone?