Work/College/Finance

[Y2HH]

I wasn't really sure where else to put this, but a bunch of separate but related threads on Reddit (and other similar service) got me wondering about the modern family dynamic and how everyone appears to believe how much things have changed for the worse...

 

For example, you'll often hear thing like, "Before Reagan, a family could be raised on a single income...today, it takes two college degrees to do the same, not to mention the mountain of debt accumulated from those educations...", etc...of course, many of these are pointless claims riddled with political rhetoric. That aside, I wonder what there may be too this, and if it's the people, not necessarily the time...

 

It's obvious it costs more to raise a family than it did back in the day, but much of this is through choice. I remember growing up and my family had no cell phone bills, no cable bill, one television etc...so many of these added expenses are through modern choice versus actual necessity.

 

The reason I'm wondering is because I know a LOT of couples that both have degrees, and often make more than I do because of their dual incomes, but seem unable to do what I do on a single income...raise a family, pay the mortgage, pay my bills, etc...

 

Sometimes I wonder if it's the person/people versus what they ACTUALLY have, but think they don't have...because they often spend their money so trivially, they don't even realize they're doing it. I do realize that some people accumulated a mountain of student loan debt to get degrees that would take forever to pay off that debt...but didn't they know BEFORE they graduated the average of what such a degree would pay them and think about that?

[Steve9347]

I do realize that some people accumulated a mountain of student loan debt to get degrees that would take forever to pay off that debt...but didn't they know BEFORE they graduated the average of what such a degree would pay them and think about that?

Yeah, but the alternative is being a telemarketer or flipping cheeseburgers or bartending. You can't even get a sales position these days without a degree. Also, at 18, you are thinking more about the fun you'll have in the coming years in college than about the repercussions of borrowing for a degree.

 

These days, in most cases you just have to go to college if you want a rewarding position. It's not a choice.

[EvilMonkey]

Yeah, but the alternative is being a telemarketer or flipping cheeseburgers or bartending. You can't even get a sales position these days without a degree. Also, at 18, you are thinking more about the fun you'll have in the coming years in college than about the repercussions of borrowing for a degree.

 

These days, in most cases you just have to go to college if you want a rewarding position. It's not a choice.

Flip burgers for a few years, learn the biz and you can get promoted to manager in a few years and be making upper $20's low $30's 3 years after you graduate high school. Work for a corporate owned store and there is potential to go into those ranks as well. College today is almost a joke, depending on what you are going for. A History major is just a fancy name for the next barrista at Starbucks. I have a senior in college right now working for me as an intern and she is dumb as a box of rocks. Zero common sense and no clue how the world works. She is a marketing major and can spout off all the marketing buzzwords you want, but it isn't helping her. I have had 3 salespeople in the last 3 years and the best one only finished high school.

 

 

[bigruss]

I grew up in a single income family, though my dad was making good money by the time they had kids (parents waited til they were 30yrs old to start having kids). That said, they were frugal were they needed to be, so that they could afford things they wanted.

 

For example, we rarely went on lavish vacations, instead we would wait until my dad accumulate enough points to buy airline tickets for my mom, myself, and my brother, while he would plan work visits around the vacation time to take advantage of whichever company he was working for to pay for his ticket and the rental car (for part of the trip). We were fortunate that my grandma lived in California near where my dad would need to visit, so we could work this out easily, but considering we only really had to pay for food for the trip these were quite cheap.

 

We used those savings in vacations to buy a fixer-up cottage on Lake Michigan, which was a spot we would go on summer vacations as we rented cheaply from a family friend but my parents wanted their own place after going there for over 40 years.

 

So, although we now own a family cottage, we saved up for it for years by not going on cruises, etc.

 

The biggest thing I've seen is people just flat out over-extend themselves. One of my old girlfriends had a mom who had less in savings than I did in High School, and that was just from what I saved up from summer jobs. She made decent money, but was terrible in managing it, she would go out for dinners all the time, go to summer festivals and eat there instead of packing food, etc. People don't realize how much that adds up, and suddenly when their kid is going off to college they have nothing to offer them in terms of assistance besides a box of dorm food.

[bigruss]

Flip burgers for a few years, learn the biz and you can get promoted to manager in a few years and be making upper $20's low $30's 3 years after you graduate high school. Work for a corporate owned store and there is potential to go into those ranks as well. College today is almost a joke, depending on what you are going for. A History major is just a fancy name for the next barrista at Starbucks. I have a senior in college right now working for me as an intern and she is dumb as a box of rocks. Zero common sense and no clue how the world works. She is a marketing major and can spout off all the marketing buzzwords you want, but it isn't helping her. I have had 3 salespeople in the last 3 years and the best one only finished high school.

A degree doesn't make someone smart, but it can show people that you managed to learn how to learn while maybe picking up some industry specific knowledge.

[EvilMonkey]

I wasn't really sure where else to put this, but a bunch of separate but related threads on Reddit (and other similar service) got me wondering about the modern family dynamic and how everyone appears to believe how much things have changed for the worse...

 

For example, you'll often hear thing like, "Before Reagan, a family could be raised on a single income...today, it takes two college degrees to do the same, not to mention the mountain of debt accumulated from those educations...", etc...of course, many of these are pointless claims riddled with political rhetoric. That aside, I wonder what there may be too this, and if it's the people, not necessarily the time...

 

It's obvious it costs more to raise a family than it did back in the day, but much of this is through choice. I remember growing up and my family had no cell phone bills, no cable bill, one television etc...so many of these added expenses are through modern choice versus actual necessity.

 

The reason I'm wondering is because I know a LOT of couples that both have degrees, and often make more than I do because of their dual incomes, but seem unable to do what I do on a single income...raise a family, pay the mortgage, pay my bills, etc...

 

Sometimes I wonder if it's the person/people versus what they ACTUALLY have, but think they don't have...because they often spend their money so trivially, they don't even realize they're doing it. I do realize that some people accumulated a mountain of student loan debt to get degrees that would take forever to pay off that debt...but didn't they know BEFORE they graduated the average of what such a degree would pay them and think about that?

It's all about choices. Eating out and stopping off for that coffee or doughnut eat thru your money faster than people realize. My 18 year old son is finding that oout the hard way. He only has a part time job at the moment, and for the first month after every job shift he would stop off at Taco Bell or 7-11 for something. Then 3 weeks later he didn't have enough money for gas to get to work and had to come to me. I showed him his checking account online and pointed at all the $5 and $7 debit card charges and just left him there looking at the screen for a few minutes. He still hasn't learned.

[Balta1701]

It's obvious it costs more to raise a family than it did back in the day, but much of this is through choice. I remember growing up and my family had no cell phone bills, no cable bill, one television etc...so many of these added expenses are through modern choice versus actual necessity.

I know it's chic to say things like this but I haven't seen anything more than anecdotes to back it up and frankly I don't believe it. I just think some forms of entertainment have gotten cheaper and replaced other forms of entertainment.

 

If you look at inflation-adjusted expenditures on entertainment, they were the same in 2009 as they were in 1989. For some reason this data is really hard to find before 1984 but the BLS gave me an easy 1984 comparison here. If you look at the columns that have really changed...we spend somewhat less on food, significantly less on clothing, and generally less on transportation. That is balanced by an increase in spending on housing, and substantial increases in spending on healthcare, insurance, and retirement/pensions (the things that have been stripped out of the government safety net since the 1980s).

 

[bigruss]

And a college degree is not a joke, it's all about how you use it, how you prepare yourself for the real world.

 

I work in IT, and there is a HUGE difference between those that went to a 4 yr school and those who went and got certificates or went to a trade school. That difference isn't in smarts, because I've seen people on both sides struggle or dominate the technology, but in terms of how they interact with others, their ability to communicate, present, and lead is a BIG difference. I'm not saying everyone from a 4 year school has all these skills, but they should be in a much better position in terms of these skills than those who didn't go. There will always be outliers, but the way college is set up gives those students a great chance to learn how to work with others, learn how to lead peers, and as I mentioned before, learn how to learn.

[Y2HH]

I know it's chic to say things like this but I haven't seen anything more than anecdotes to back it up and frankly I don't believe it. I just think some forms of entertainment have gotten cheaper and replaced other forms of entertainment.

 

If you look at inflation-adjusted expenditures on entertainment, they were the same in 2009 as they were in 1989. For some reason this data is really hard to find before 1984 but the BLS gave me an easy 1984 comparison here. If you look at the columns that have really changed...we spend somewhat less on food, significantly less on clothing, and generally less on transportation. That is balanced by an increase in spending on housing, and substantial increases in spending on healthcare, insurance, and retirement/pensions (the things that have been stripped out of the government safety net since the 1980s).

 

 

How is it "chic" or ancedotal for me to say entertainment spending is through choice and not necessity? Also note, that some "entertainment spending" isn't considered entertainment spending. For example, having an iPhone is NOT necessary. A 20$ per month feature phone can make phone calls and text...but the 100$ a month iPhone is more fun...and 80% of that bill SHOULD be in entertainment spending, but it's not because it's a phone bill.

 

It's NOT necessary to have a 200+$ cable bill every month. It's simply not. That's not an anecdote...it's real. People who complain about bills most often have a 200$ cable bill, and that's not even mentioning the movies they go see every weekend, or rent.

 

Also, a good television costs a lot of money...I see a LOT of people with MULTIPLE 50+ inch TV's in the same boat...

Edited June 12, 2012 by Y2HH

[bigruss]

It's all about choices. Eating out and stopping off for that coffee or doughnut eat thru your money faster than people realize. My 18 year old son is finding that oout the hard way. He only has a part time job at the moment, and for the first month after every job shift he would stop off at Taco Bell or 7-11 for something. Then 3 weeks later he didn't have enough money for gas to get to work and had to come to me. I showed him his checking account online and pointed at all the $5 and $7 debit card charges and just left him there looking at the screen for a few minutes. He still hasn't learned.

It's amazing how people don't think the little expenses add up. I had a coworker complain at work that he is risking losing his house as his wife takes more time off to watch the kids, and then he goes out for lunch every day.

 

If you bring your lunch it'll cost probably about $20/wk or so depending on how much you eat. Going out for lunch probably costs closer to an average of $45/wk. That's close to $100 a month that can go towards a mortgage payment.

[Balta1701]

How is it "chic" or ancedotal for me to say entertainment spending is through choice and not necessity? Also note, that some "entertainment spending" isn't considered entertainment spending. For example, having an iPhone is NOT necessary. A 20$ per month feature phone can make phone calls and text...but the 100$ a month iPhone is more fun...and 80% of that bill SHOULD be in entertainment spending, but it's not because it's a phone bill.

 

It's NOT necessary to have a 200+$ cable bill every month. It's simply not. That's not an anecdote...it's real. People who complain about bills most often have a 200$ cable bill, and that's not even mentioning the movies they go see every weekend, or rent.

 

Also, a good television costs a lot of money...I see a LOT of people with MULTIPLE 50+ inch TV's in the same boat...

And every generation feels the need to lecture everyone else about how they're doing it wrong. The reality is, looking back 25+ years, the share of income spent on those purchases hasn't appreciably changed. And similarly, there hasn't been a change in "Other expenditures" either, so however you count it, that lecture can be applied in whatever glory day period you want to highlight. The data doesn't lie.

 

What really has changed, what really has made it harder for people to get by over that time period, is the increase in housing costs (bubble), the increase in healthcare costs, and the increase in the cost of a retirement/insurance plan as pension plans have been replaced by more expensive investment plans.

[RockRaines]

You need that piece of paper to get a good job and to have room for advancement. The flipping burgers for 20-30k had to be a joke right? You cant live in a city off that wage, maybe with your parents or way out in the boonies somewhere. Its proven college degrees earn you upwards of a million more than a person without that piece of paper over your working lifetime.

 

My only advice towards people (and I eat out and go out a lot) is that cash is king so save what you can but please leave a little bit extra for yourself out of that. You cant take it with you and you never know when you are going to kick the bucket. If you are pouring every dollar you have into that house you think will appreciate, dont dont it. And sign a prenup.

[southsider2k5]

And every generation feels the need to lecture everyone else about how they're doing it wrong. The reality is, looking back 25+ years, the share of income spent on those purchases hasn't appreciably changed. And similarly, there hasn't been a change in "Other expenditures" either, so however you count it, that lecture can be applied in whatever glory day period you want to highlight. The data doesn't lie.

 

What really has changed, what really has made it harder for people to get by over that time period, is the increase in housing costs (bubble), the increase in healthcare costs, and the increase in the cost of a retirement/insurance plan as pension plans have been replaced by more expensive investment plans.

 

Of course they are more expensive... They are funded and paid for.

[Balta1701]

Of course they are more expensive... They are funded and paid for.

And the fees associated with the plans are vastly higher.

[bigruss]

And the fees associated with the plans are vastly higher.

Depends on which firm. My company does PST and you have to use Vanguard for the accounts, the rates on those accounts are practically nothing.

[southsider2k5]

And the fees associated with the plans are vastly higher.

 

Unless you include the fees such as taxing agencies and the employees of the pension agencies, not to mention the pension fraud costs, which we are all paying for.

[EvilMonkey]

You need that piece of paper to get a good job and to have room for advancement. The flipping burgers for 20-30k had to be a joke right? You cant live in a city off that wage, maybe with your parents or way out in the boonies somewhere. Its proven college degrees earn you upwards of a million more than a person without that piece of paper over your working lifetime.

 

My only advice towards people (and I eat out and go out a lot) is that cash is king so save what you can but please leave a little bit extra for yourself out of that. You cant take it with you and you never know when you are going to kick the bucket. If you are pouring every dollar you have into that house you think will appreciate, dont dont it. And sign a prenup.

The Wendy's 1 mile from my current work is looking for a dayshift manager and paying $29k a year. I didn't say you could make $30k flipping the burgers, I said do it for the experience and try to move up, you could be making $30k in 2 years, all while gaining experience AND making money. Instead of spending $25k a year for school and making no money. Some fields yes, you need that piece of paper. Even back in my college days, I had some computer classes I had to take at night where I was the only 'kid' in the class. Everyone else was from Bell Labs and knew this stuff easy, but they had to have that paper to prove it.

[RockRaines]

The Wendy's 1 mile from my current work is looking for a dayshift manager and paying $29k a year. I didn't say you could make $30k flipping the burgers, I said do it for the experience and try to move up, you could be making $30k in 2 years, all while gaining experience AND making money. Instead of spending $25k a year for school and making no money. Some fields yes, you need that piece of paper. Even back in my college days, I had some computer classes I had to take at night where I was the only 'kid' in the class. Everyone else was from Bell Labs and knew this stuff easy, but they had to have that paper to prove it.

My point wasnt you were lying, it was that 20-30k a year is VERY hard to live on and would be downright impossible to raise a family on. Even in that industry there is a glass ceiling how far you can advance without at least some sort of degree. Its better to go out and get the paper as soon as possible even if accumulating debt IMO.

[Jenksismyhero]

 

http://boingboing.net/2011/09/22/cost-of-r...8Boing+Boing%29

 

 

Child care costs are out of control. Taxes, especially property taxes, have gotten out of control.

 

I'm sort of in half agreement with Y2HH here. My wife and I are a good case study for why this society is so f***ed up. We both have graduate degrees (she has a masters in literature, i have a juris doctor). That's about 150k in student loan debt. That's about 1200-1300 a month simply in student loans. Add to that a mortgage and a car payment, and even though we're both making good money, raising this new child of ours will be difficult. We don't go on vacation, we don't spend "lavishly." Yes, we have smart phones and cable bills, but frankly that's a drop in the bucket compared to other major costs of life.

 

The fact is the poor don't pay their share (taking more than they give), the rich escape paying their share, so the gov't continues to suck the teet of middle class America, which is why this economy is stagnant and people are as depressed as they are about the future.

Edited June 12, 2012 by Jenksismybitch

[Steve9347]

Flip burgers for a few years, learn the biz and you can get promoted to manager in a few years and be making upper $20's low $30's 3 years after you graduate high school. Work for a corporate owned store and there is potential to go into those ranks as well. College today is almost a joke, depending on what you are going for. A History major is just a fancy name for the next barrista at Starbucks. I have a senior in college right now working for me as an intern and she is dumb as a box of rocks. Zero common sense and no clue how the world works. She is a marketing major and can spout off all the marketing buzzwords you want, but it isn't helping her. I have had 3 salespeople in the last 3 years and the best one only finished high school.

Well, there's always dumb people regardless of degree, but the degree certainly helps.

[Y2HH]

Well, there's always dumb people regardless of degree, but the degree certainly helps.

 

You know what helps more than a degree?

 

A degree that's actually worth something to the world.

[Steve9347]

You know what helps more than a degree?

 

A degree that's actually worth something to the world.

True. I begged my then 18 and now 19 year old cousin to not get a history degree. That little idiot.

[Soxbadger]

Its not the degree that makes the person, its the person who makes the degree.

 

As for money, like Rock said, you cant take it with you. I dont really care that much about it, I make enough to live what I consider is a fun life, and that is all that really matters.

 

 

[Y2HH]

Its not the degree that makes the person, its the person who makes the degree.

 

As for money, like Rock said, you cant take it with you. I dont really care that much about it, I make enough to live what I consider is a fun life, and that is all that really matters.

 

No point in being the richest guy/gal in the graveyard...

 

That said, it's also not fun not having money for emergency situations/emergency costs/repairs on cars/houses...I save a little...I keep myself in the black, but I also spend money and have fun.

[RockRaines]

No point in being the richest guy/gal in the graveyard...

 

That said, it's also not fun not having money for emergency situations/emergency costs/repairs on cars/houses...I save a little...I keep myself in the black, but I also spend money and have fun.

Cash is king, save what you can and portion the rest for fun. Self-budgeting is very underutilized these days. Its so easy and now there are free online applications that can help you do it.