Do you have $400 in cash or in the bank you could use in an emergency?

[HSanders]

I feel for people who work their asses off and still struggle. Some of them make great decisions and make the most out of their situations.

I do as well. Those people are who social welfare programs are supposed to be for IMO.

But too many make excuses. They are unwilling to make sacrifices (ie. 2nd jobs, reduced spending on fun, etc.) to put money into things that matter. Then they end up living pay cheque to pay cheque because the majority of their disposable income pays for bloated car loans they didn't need, mortgages they can't afford, a brand new iPhone every year, vacations on credit cards, etc. Then they blame the government and economy. At least here.

If you are lower income here, it usually pays better here to work PT and get taxpayer assistance and to stay unmarried and get double assistance though your combined incomes are sufficient. Being less self sufficient is encouraged. If you can be on social programs and have a similar lifestyle to what you would have if you were working, the lazy will prefer that.

And this is not a political commentary, it is an actual fact of human nature born out by results I have observed first hand.

A lot of lower income people are that way due to their own decisions. If that were not the case, why would the lower income lottery winners so often become broke very quickly?

We have the savings to handle some large emergencies, and I am conservative in managing our finances and most spending but we aren't the best example because we don't have kids which ups your disposable income in a major, major, major way. So those who have kids and manage to save a good bit, kudos to you. Also kudos to those who are teaching their children those skills.

 

[HSanders]

Meant to read Next Door but never got to it. One of the first ones I read that helped me understand it all was Millionaire Teacher. Same basic lessons and ideas, and these types of books should be required reading in high school.

The fact that personal finance isn't hammered home in school (high school or university) is nuts.

I believe that both colleges and high schools should require class(es) of that nature. It would sure be better than some of the garbage they do require.

 

[O.Z.O.]

I bought a used 2012 Audi Wagon with 40K on it in early 2014. It now has 125K on it (hockey dance and lax) and runs like new. I plan to have it for 200K+.

back in 2013 we caught a really sweet deal on a 2011 CRV that had been a garage queen and had 8900 miles on it. 3 years later it has 58,000 miles on it which is considered nothing for a 5 year old car. O.Z.O. Jr. is driving a 2005 Ford Escape Limited (loaded, great car) that we drove off the lot new. Last year we bought Mrs. O.Z.O. a 2016 CX5 Grand Touring. Our typical MO is to buy cars new and drive them until they die (my current vehicle being the exception). Mrs. O.Z.O. and I could afford to drive luxury cars if we wanted to...but like Lisa said...it's a car. If you can get a reliable one for 30K that's comfortable and well within your budget, why would you spend 60K+ and need to take out a loan for an oil change?

 

[aloyouis]

back in 2013 we caught a really sweet deal on a 2011 CRV that had been a garage queen and had 8900 miles on it. 3 years later it has 58,000 miles on it which is considered nothing for a 5 year old car. O.Z.O. Jr. is driving a 2005 Ford Escape Limited (loaded, great car) that we drove off the lot new. Last year we bought Mrs. O.Z.O. a 2016 CX5 Grand Touring. Our typical MO is to buy cars new and drive them until they die (my current vehicle being the exception). Mrs. O.Z.O. and I could afford to drive luxury cars if we wanted to...but like Lisa said...it's a car. If you can get a reliable one for 30K that's comfortable and well within your budget, why would you spend 60K+ and need to take out a loan for an oil change?

Agreed, no need to spend $60K. I paid $23k for the wagon. It was a lease with all service records from the dealer. It had 1 glaring issue that made it a steal: It was owned by a heavy smoker. I watched it age on their lot and updated my rejected offer downward every two weeks via email while it sat.

They finally called me and asked for $1000 higher than my lowest offer. We met in the middle. Another dad from my son's HS who owns a body shop was able to get the smell out as a favor. I have NO IDEA why the dealer didn't get the smell out except that the dealer used car manager was a smoker himself and maybe didn't see realize the issue.

We have driven that car full of stinky hockey gear all over the midwest and twice to Mass for tournaments. Sorry if that is TMI and I put you to

 

[BostonTim]

back in 2013 we caught a really sweet deal on a 2011 CRV that had been a garage queen and had 8900 miles on it. 3 years later it has 58,000 miles on it which is considered nothing for a 5 year old car. O.Z.O. Jr. is driving a 2005 Ford Escape Limited (loaded, great car) that we drove off the lot new. Last year we bought Mrs. O.Z.O. a 2016 CX5 Grand Touring. Our typical MO is to buy cars new and drive them until they die (my current vehicle being the exception). Mrs. O.Z.O. and I could afford to drive luxury cars if we wanted to...but like Lisa said...it's a car. If you can get a reliable one for 30K that's comfortable and well within your budget, why would you spend 60K+ and need to take out a loan for an oil change?

This. For 20-25 years, while in full blown practice, It was BMW's, at least every four years. I justified on the old Appearance of Success basis. And I think that's a valid thought. Loved the cars, but was never comfortable with the cost (maintenance was unbelievable) because, I didn't need it and there were more important things to be done with all that money.

Those days are long gone.

I'm fine in my CRV and will probably bury it as well.


Cheers, BostonTim

 

[deec77]

:shrug_n:

http://www.usatoday.com/story/money/personalfinance/2016/10/09/savings-study/91083712/

Nearly 7 in 10 Americans have less than $1,000 in savings


Sean Williams, The Motley Fool 10 a.m. EDT October 9, 2016
America's spend-first mentality is a genuine concern.


The U.S. is often referred to as the land of economic opportunity. Apparently, it's also the land of consumption and "spend everything you've got."

We don't have to look far for confirmation that Americans are generally poor savers. Every month the St. Louis Federal Reserve releases data on personal household savings rates. In July 2016, the personal savings rate was just 5.7%. Comparatively, personal savings rates in the U.S. 50 years ago were double where they are today, and nearly all developed countries have a higher personal savings rate than the United States. In other words, Americans are saving less of their income than they should be — the recommendation is to save between 10% and 15% of your annual income — and they're being forced to do more with less in terms of investing.

~Dee~

 

[mooseontheloose]

Assuming a person gets a job at 25 starting at the Canadian national average, saving 10% income would give them enough money to be financially independent around the time they are mid-60s. That includes inflation factored into the investment growth, but assumes a high starting wage and no increase in wage/annual savings.

Still, that shows how insane it is for people to be saying less than 6% of their income.

And the higher your annual spending, the more money you need to retire. People are generally woefully unprepared these days.

 

[Big/Sky/Fly]

Assuming a person gets a job at 25 starting at the Canadian national average, saving 10% income would give them enough money to be financially independent around the time they are mid-60s. That includes inflation factored into the investment growth, but assumes a high starting wage and no increase in wage/annual savings.

Still, that shows how insane it is for people to be saying less than 6% of their income.

And the higher your annual spending, the more money you need to retire. People are generally woefully unprepared these days.

I know millionaires that are broke...there's a term for that, but, I'm not saying it here.

NFL players (pro sports in general) are notorious for blowing their wad...

 

[HSanders]

I think having the forced "savings" by the govt of SS, plus a lot who take SS never paid in (ones who didn't work for it, older people who paid little in because it started in 1945 or so and wasn't the large chunk itis now)and retirement age raising etc etc.) population aging, and even those who did pay in may be getting more out than they paid in allows people here to think "it's taken care of" I bet people saved more & spent less when they alone were 100% responsible for their own retirement.

 

[aloyouis]

I know millionaires that are broke...there's a term for that, but, I'm not saying it here.

NFL players (pro sports in general) are notorious for blowing their wad...

I do as well. We have friends with 6000 sq.ft houses and 3 new cars yet they could not miss a single paycheck without also missing all the car payments and the mortgage payment. Yikes!

I think having the forced "savings" by the govt of SS, plus a lot who take SS never paid in (ones who didn't work for it, older people who paid little in because it started in 1945 or so and wasn't the large chunk itis now)and retirement age raising etc etc.) population aging, and even those who did pay in may be getting more out than they paid in allows people here to think "it's taken care of" I bet people saved more & spent less when they alone were 100% responsible for their own retirement.

Social Security bugs the shit out of me. When I was younger and just starting to make a good living I often complained about paying into SS. I said then (and would still do if I could go back) that I would gladly opt out of SS 100% if I could just avoid paying into it. Obviously, that was not allowed.

So here I find myself having paid $233,705 (as of earlier this year) is SS taxes so far in my life plus another $105,779 in Medicare taxes and I now have built SS into my retirement plan. I have no choice. Even though we have saved and based on where we are to plan today, could retire on our own in a few years, the load I have been taxed screams at me for a proper and fair return.

And it bugs me to no end that I was forced to pay for something I may never get......

 

[HSanders]

Plus the dollars we have paid in are "given" back to us at a lesser value. $1,000 30 years ago when it was taken from your check would have bought you more stock, etc. than it would now.

We'll never get back what we paid in especially as the government does not credit towards personal SS paid that of business owners for the business share they paid in.

Now that the ACA has done away with preexisting conditions, maybe older people could simply receive medicare credits or HSAs they could use towards purchasing their own insurance/ paying for their expenses instead. That would help them spend/budget it more wisely and tailor it more towards their actual needs.

 

[aloyouis]

Plus the dollars we have paid in are "given" back to us at a lesser value. $1,000 30 years ago when it was taken from your check would have bought you more stock, etc. than it would now.

We'll never get back what we paid in especially as the government does not credit towards personal SS paid that of business owners for the business share they paid in.

Now that the ACA has done away with preexisting conditions, maybe older people could simply receive medicare credits or HSAs they could use towards purchasing their own insurance/ paying for their expenses instead. That would help them spend/budget it more wisely and tailor it more towards their actual needs.

Excellent points.