I can relate to a lot of this, I was pretty stinking poor growing up. Now I make good money. (I still buy used tires from shady lots tho).
But even now that I'm making good money, it boggles my mind how richer everyone else still seems. Like, how do so many young people have a favorite island in Hawaii? How is everyone out there affording new cars? People actually picked a college major without thinking about cost?
One thing I have to constantly wrap my head around is that being broke doesn't correlate to income. I have a family and a mortgage and savings and nothing left over for luxuries at the end of the month. But someone working as a bartender can afford a new Jeep and go to Vegas 4x a year because they have a good roommate situation and they are due to inherit their parent's second house one day.
> Like, how do so many young people have a favorite island in Hawaii? How is everyone out there affording new cars?
The reality is that oftentimes they simply can't, at least according to a responsible definition of "afford".
All we see from the outside is the brand new Jeep, we don't see the fact that they're underwater on a 72 month loan with 6% interest. The average car loan term in 2019 was 69 months, that's insane. Something like 30% of trade ins have negative equity.
Even ignoring debt, I've spoken to a surprising number of people who make great money and live lavishly but have effectively no retirement savings. The level of financial literacy in the US is abysmal.
I couldn't help but do the same thing when I was reading the article, in the opposite direction: "wait - you had a wife and you were poor?" When I was young and my income was low or nonexistent, it seemed like women could smell the poverty on me and I couldn't even get close to them. It was like trying to sneak up on a grazing gazelle - they'd hear me coming and just sprint to a safe distance. The more money I made, the closer I could get until I finally made enough money that they stayed close enough to talk to.
Even now, married 20 years, the author talks about the burden on his wife and kids if he went back to being poor - I'm sure my wife would just leave if I was genuinely stuck in a poverty cycle with no way of getting out, and I wouldn't really blame her.
All platitudes aside, comparison really is the thief of joy.
Lots of people have very different situations from what they project (witting or unwittingly), they might be running up debt to pay for their lifestyle or maybe they have profitable small side businesses, and bartend for the bills and social aspect.
Focus on your journey, and where you are on the path, don't get distracted with people "passing" you on shorter, longer, or completely different paths.
I struggled with this as well and then I started asking people about it, I grew up lower middle class and there were some very rough stretches of time during my childhood.
What I've observed:
1) They're not saving for retirement. $0.
2) They spend a lot using credit. New vehicles with 2k down and high monthly payments. High monthly credit card bills.
3) They have a lot of stuff but are essentially living pay cheque to pay cheque. One thing that surprised me was working at a company that got acquired and payroll got moved to the parent company which had a pay schedule that was 1 week later, so they told us we would get paid one week later than we had historically. Inconvenient, but no problem for me. Out of an office of about 40 people 15 said they wouldn't be able to pay their bills. These were all people who made over 6 figures.
Another thing I've noticed is that many people don't look at absolute price but instead look at monthly payment, I think raising interest rates are going to hurt a lot of people that from the outside seem to have a dream life.
> One thing I have to constantly wrap my head around is that being broke doesn't correlate to income. I have a family and a mortgage and savings and nothing left over for luxuries at the end of the month. But someone working as a bartender can afford a new Jeep and go to Vegas 4x a year because they have a good roommate situation and they are due to inherit their parent's second house one day.
I feel like we don't count our own responsible expenses but double count other people's luxury expenses.
A new jeep is maybe 6k/yr. A trip to Vegas is maybe 1k. That's maybe a total 12k/yr
If you're mortgage is 3k a month and he's paying 500 a month in rent, you throw in two kids @ $1,000 a month and maybe 500/month in savings and you're looking at 66k in expenses which dwarfs the 12k.
I am sorta in the same boat, because I grew up relatively poor I'm paranoid so I save/invest a lot and drive a Honda while my coworkers complain of dealer markups on their new Porsche :)
It would be a real bummer if civilization collapses and it would all be for nothing, but otherwise I hope to FIRE in a few years...
This is something I really struggle with.
I'm now middle class, but the horror of growing up poor still sticks with me.
I have severe nightmares about being poor again, I just can't go back.
I tend to overwork, and hoard thing at times.
The most difficult thing these days, is my kids. I'm extremely happy that they don't know how bad things can be, but I get extremely worried by that too.
I get worried, that they don't try hard enough because they don't understand how bad things in life can get. I get worried that they are far too trusting because times are so good and plentiful.
this shows how big a difference a good social net makes.
i grew up poor, with a single parent, on social welfare (because the parent could not work since they had to stay home to take care of us kids until we were older)
in germany.
social welfare paid our rent and gave us enough money that we could afford everything we needed. (we didn't need a car, and we didn't have a tv, but that was by choice. they would probably have paid the tv, had we wanted one). i never felt any struggle. when i moved out from home, i never needed money from my parents either. always paid my own way. i was never rich. i just learned to live frugal. and i am not at all scared of being poor again, because i know that there is a social net that i have access to if i need it.
There is no middle class anymore. That has been eliminated by deliberate policy.
At best you are mid-upper lower class. If you have any worry about being able to get along if you lost your job and had a major life-threatening illness, you are still lower class like the rest of us.
All I can say is to treat them well and set them up for success.
I've noticed folks sometimes fall into the trap of trying to give their kids nothing to teach them lessons. Early help in life has compounding effects.
I have been poor in a poor country and now I’m not. I make mid-high six figures and just bought a house. I have five years of expenses saved up and could extend it to ten with the right moves. Still, sleeping at night is hard, imagining that everything could collapse at any moment - I don’t know how I would explain to my kid that “we don’t have money anymore”. This feeling permeates every interaction I have at work - will I fuck up this email to the VP, then get fired, then become poor again? Makes for a very unhealthy relationship with work. Sometimes I wish I won the lottery - not to buy boats and cars and houses, but simply to stop being worried every damn minute of my life.
> but simply to stop being worried every damn minute of my life.
You would be worried nonetheless, because your brain will latch on to the next anxiety. Just like you thought that having 5 years of expenses would alleviate your anxiety. What you need is a good therapist to work on your anxiety issues.
As you likely know, you are at the point where more money won't change these feelings.
Therapy or meditation, likely both may help induce a shift. As the grip loosens you will find many things begin to change.
"Sleeping well at night", is likely the single most important thing you can focus on. If you choose to focus on that, it likely will permeate many aspects of your life..
You may find a deeper and more authentic experience and through that you may find that you actually have won the lottery. You are safe. You have 5 years of expenses - I guarantee you that you could figure out solutions to just about anything that comes your way in 5 years.
You're no longer trying to survive. It's now time to learn how to live.
It's funny how your brain is able to convince you that the immediate consequence of "get fired" is "become poor," even though you have a five year buffer in which to regroup.
I'm afraid there's simply no amount of money that can possibly remove the feeling that everything could collapse at any moment. If your sense of security is predicated on continuing to possess money, you will always be vulnerable to the fear of losing it, no matter how much you accrue.
If you won the lottery tomorrow, what makes you think you wouldn't worry about losing that money too?
I thought about that recently when I went to the grocery store - when I was fresh out of college, making ~$30k/year, I remember always going to the grocery store and keeping a running total in my head of how much I was spending so I didn't go over $70, since I knew my debit card would be declined if I did. Now I don't even pay attention to how much individual items cost - I just grab what I need.
I dunno. Even when I was making minimum wage, groceries never seemed like a significant part of my budget. I never understood people trying to save 10c to get, like, the cheapest mustard possible. Compared to the big expenses (rent) food was really a small percentage of a budget, especially if you avoid stocking up on meat or alcohol.
I remember being much more frustrated by friends trying to drag me out to eat at restaurants or throwing away food. Like, one sit down meal was worth three days of groceries!
Typically, this is how I measured my success as well: when I stopped looking at the prices of things and just shopped or ordered what I wanted without too much concern. (Within reason of course, because as a former cook when I want splurge it can easily hit 4 digits.)
Everything else never felt as a re-assuring,; I've bought lots of cars and motorcycles, signed leases, traveled etc... over the years, but nothing made me more comfortable than knowing that the food bill wasn't going to ruin my finances for the month(s) as it used to before.
I used to live on $100/month for food during university, it's partly why I decided to work in kitchens and I know I can stretch out a meal quite a lot and not lose on quality. And if it's just me, I tend to like simple meals that I can iterate upon: a ragu can turn into about 5 different dishes and all uses cheap(er) cuts of meat.
But I still remember having to wait to buy things from grocery stores like yogurts or juice or pasta only when they were on special (loss leaders) and it's actually how I got a pretty good at understanding the market dynamics of a food supply's value chain, which helped when I ran kitchens and when I got into supply chain.
It ultimately culminates in focusing my cuisine on farm to tables because eating in-season not only tastes the best, is more environmental, but when you're in charge of food costs in menu development you can achieve ROIs and ARRs to justify larger expenses by buying and sourcing from farms who you can count on for price breaks for other items/prioritization for other items by buying their entire harvest ahead of planting.
As both a former farmer and chef, this was a huge relief and allows you to utilize capital where it's needed most without taking as many loans for repairs, labour, training, expansion etc...
I grew up upper middle class and earn a mid-low six figure salary. I used to be quite frugal. Now I'm just apathetic to it. I don't care at all about money. I have no particular financial goals. I save a lot without trying. But savings scale linearly in non risky comp scenarios. And that's kind of boring because there's nothing that I could imagine wanting that doesn't require orders of magnitude more money than I have now. Aside from the vague "retire early" thing.
Not a complaint.
> There’s something that people with money say that doesn’t make sense: that regardless of how much money you have, you run out of it just as soon.
This is just a weird thing to me. I didn't feel this was true on a five digit salary much less what I have now.
> When you get a good job, someone will ask you how much money you want to dump into your 401k. You will probably say “none” because you are conditioned to believe that trouble is just around the corner
This was relatable. While never having to support a family of 4 on 35k, I did have a period of my life where I was very broke on my own. When I finally started to climb out of my situation, I remember thinking people were idiots for putting money in a 401k. You can’t get it out if you need it. It took 5 years of stable employment before I actually started putting money into a 401k.
The freaking idea that money makes problems go away is so powerful.
That's basically what I noticed as I get less poor.
Automobile problems...pay for it. Medical problems...pay for it. Did you get a parking ticket? Pay it. Now you don't have to worry about being towed.
America really crushes the poor in many respects.
If the poor had other options, like Job corps, or a sharecropper type situation where they can stay rent free and learn skills.... that would be one thing. But there's nothing available to poor people other than to just fucking be poor or get lucky...and getting lucky seems like a rediculous way to build a society.
Then you combine that with massive offshoring and automation..... It makes you realize capitalism is kind of bullshit if there's 7 billion people in the world willing to do the job.
In America, it can be all over the place. On one hand, the first time I had a corporate job I certainly felt very naked being the one guy with a ratty car in the parking lot.
On the other hand, you might have a CEO proudly drinks cheap beer and wears Kirkland Signature workboots to the office.
> We are slightly terrified at all times of losing these things.
This is something that folks that came from The Other Side of the Tracks have. I came from there. People my age have grandparents (or, in some cases, parents) that lived through The Great Depression, and they have this, writ large.
I still basically live pretty low on the hog, even though it is not necessary. This recession is an annoyance; not a disaster. I lost more money, earlier this year, than many folks make all year. It sucks, and I'm not wealthy enough to "shrug it off," but I am not existentially terrified. I know that things will be OK in a couple of years, and I'm not in danger of burning my principal before things start recovering.
I loved his previous article, and I'm glad he's doing better.
I was suddenly middle-class-ish for a brief period last year. I have been mostly on the poor side for almost 14 years. To give you an example, I earned around $7,000 in all of 2014 and my average monthly income from 2016 through 2018 was $1800.
I did what was necessary - learned to cook, worked odd jobs, moved around frequently to find cheap accommodation, slept on all sorts of beddings and, sometimes, on the street, abstained from luxuries and travel etc - during this time.
Then, last year, I found a sweet gig and my income suddenly rose way beyond my expectations (around $6,000 per month). That was also the time I moved to a new apartment. I spent some of the new money on furnishings and living a comfortable life - not thinking twice about splurging on a meal or clothing. I invested in the stock market and opened an IRA account.
At the back of my mind, however, there was a nagging feeling that it wouldn't last. Sure enough, I lost the gig in February this year and am surviving on IRA money and credit cards. I forgot to cash out of the stock market near the top and suffered losses of almost $3,000. I am loathe to move out of my current place though I have a feeling I will have to, eventually. I am back to cooking all my meals and thinking twice before making purchases.
I am not sure if it is a cycle but poverty is definitely a mindset. I've been on the other side where I was making decent money that allowed me to live comfortably (not ostentatiously). I was in a better mental state. Lately, I have been pretty depressed (although things are not as bad as they were in 2014) and exhausted all the time.
I can't say my experience mirrors this. Yes, I spend more on things like food, but not so much that it makes a dent. I can still save far more than I ever could back then.
Getting decent pay is just so much more efficient at making you economically safe than any kind of clever frugality is. Maybe if you could figure out a way to live without paying rent or mortgage interest, it'd be worth it, but otherwise it's the income side that matters more than the expenses side.
And this is why Sweden has a more creative economy than the US. The state takes a bit more from the rich so that those at the bottom have at least, decent housing, health care, nutrition and education.
In a capitalist system the top 10% will always be richer and the bottom 10% will always struggle. And this would still be true even if a magic genie came a long and made everyone ten times smarter.
This isn't a knock on capitalism. Capitalism scales where many other systems don't. (I'm looking at you communism.)
Ask any Swede. Sweden is a capitalist country. They have social programs. They used to have a Socialist economy for a few decades but famously abandoned it in the early 90s after finding that their GDP had remained completely flat and their citizens went through crazy lengths to avoid tax (e.g. ABBA and their wardrobes)
Comparing Sweden as an opposing choice to Capitalism doesn't make any sense.
20 years ago I was living in a $100 car with 3 immovable doors that I had to push start and repair every day. I was working 80 hour weeks doing day labor in the mornings and telemarketing in the evenings. I also sometimes did truck deliveries, street magic, random tech gigs from craigslist, PC repair. If there was a craigslist ad with a problem I would learn enough to solve it well enough to get paid and get referrals.
Any free day I was trying to get better at programming on college library computers I was able to use by copying other peoples student IDs off sign in sheets.
I made maybe $1500 a month which barely covered food, gas, and helping out people even poorer than me while trying to slowly save for a vehicle that could make a cross country trip to somewhere with other work options.
I eventually got a $1000 vehicle that only needed weekly repair, used it to relocate to a more populated area, upgraded to an abandoned trailer with borrowed electricity and no septic, and got a retail job.
Now I had more time to build tech skills. Eventually got the confidence to take on contract coding jobs, and then the confidence to do that full time.
Eventually I knew enough to pass interviews and get a salaried software engineering role. Then another. Turns out there was plenty of demand for some of the skills developed along the way doing random coding and infosec gigs, managing cheap DIY servers for thousands of users of random open source side projects of mine, and building custom Linux kernels for whatever random old hardware I could find.
Worked my from software engineering roles into running security departments for a series of well known companies by finding major security bugs at every employer. Turns out security is one of those things everyone seems to think is someone else's job, so I always made it mine.
Now I own a home and have a family in Silicon Valley. I own a security consulting company where my team and I have several audit projects and retainer contracts at any given time helping major companies spot security flaws, and build defenses.
Going from homeless to the comfort I currently enjoy was a long road. I never fully shake the fear I could lose it all and be back on the streets at any time. That is only amplified now that others depend on me. I never took 401ks because I expect life or the institutions will fail me before I ever see it back. Never 100% trust banks because I worry funds will be stolen via identity theft or go negative into overdraft hell I can never pay back, no matter how high the balance. I always have the need to have multiple income sources so no single one of them drying up can sink me. The need to learn new skills constantly so I always deliver results most others cannot so people keep paying me. The need to prep for every worst case scenario I can think of always for myself and those that pay me.
In the end, I think this pressure of always feeling a bit chased has served me well and still does. I also do not know that I would recommend this path to anyone, but I am generally pretty happy these days so I will take it.
> Middle-class-or-better people don’t like to talk about money... You realize you are talking to people who have a problem you can’t solve for them.
This extends to not wanting to discuss salary with coworkers, by the way. The common conception is the bosses want to hold us down so they tell us not to talk about it. But I’ve been in multiple situations where I didn’t want to.
I knew I was making more, and it wasn’t because i was the best- in some cases I was lucky, sometimes I just negotiated better. But in either case there’s really no upside to disclosing.
In general, there would be more upward pressure on wages if information asymmetry went away. It's especially insidious for folks in the lower class, since they don't realize the extent to which they are being underpaid.
>But in either case there’s really no upside to disclosing.
There certainly is upside to discussing for anyone earning less than median. But as you write, as long as everyone thinks they are earning more than the median, individually they have no upside.
Obviously, everyone cannot be earning more than median, but more importantly, price transparency shows the movement of supply and demand curves, across industries and even across businesses in the same industry.
The hell of it is, he still isn't middle class. The US doesn't even have a middle class anymore. He is just no longer at the very bottom of the underclass. He is now mid-lower lower class.
It is impossibly hard for most people not in the upper class in the US to conceive of just how impossibly far they are from that upper class. $100k/yr? Lower class. $200k/yr? Still lower class: you still can't afford to send your kids through college, and still make your house and car payments, replacing your car every year or two. Yes, that was what middle-class people used to do.
What happened to the middle class? It was eliminated, by explicit political policy. The US income curve is now strongly bi-modal. One hump for upper class, another for lower. Very few people are near the middle, where the middle class once was. Those few are either tacking to get to the upper class, probably futilely, or are well on their way out of it, and won't be back.
The Republican Party discovered that they could get lower-class people to vote against their own interests, and for the interests of the upper class, by convincing them they were not lower class. Now half the country votes mainly to try to keep the desperately poor from taking what they have managed to scrabble together, and in the process ensure the extremely rich get extremely richer and don't have to pay for anything, and especially not let any of it go to those same voters.
Up until around 1970, Americans' income was on a relentless rise. That had stopped by 1980, and has been more or less level, since. The income didn't go away, at all. The total amount has skyrocketed, since, going up at the same rate as before. Just, rich people get all of the difference, everything from that line down to the flat line describing what they have left for the rest of us. All this is policy, and the program to get there was spelled out in the Powell Memorandum, which you can read online.
During COVID lockdown and supply-chain upsets, they got insanely more money, somehow, again at the rest of our expense.
> you still can't afford to send your kids through college, and still make your house and car payments, replacing your car every year or two. Yes, that was what middle-class people used to do.
Where is this halcyon universe where the median (or even the 75th percentile) American:
* Paid for their children to go to college
* Bought a new car every other year
'Cause that doesn't resemble any point in the past century of the universe we currently inhabit.
> The US income curve is now strongly bi-modal. One hump for upper class, another for lower. Very few people are near the middle, where the middle class once was.
Evidence? Because I don't think the US income distribution looks like this at all.
[Edit: Oh, you've got your own definition of "middle", which is completely different from what everyone else in this conversation is using. With your definition of "middle", I could see there not being many people there. I still don't think the distribution is bi-modal, though.]
> Still lower class: you still can't afford to send your kids through college, and still make your house and car payments, replacing your car every year or two. Yes, that was what middle-class people used to do.
This is a complete delusion designed to justify affluent people asserting they’re “middle class.” Americans never lived like that. Back in the 1960s and 1970s, most people didn’t even go to college. They lived in a house with half the square footage, but more people in the household. If they got cancer, they just died.
The problem isn’t republicans, or not just republicans. The problem is that Democrats also refuse to raise taxes on the top 25% above the current Reagan-era lows. Every other developed economy functions by heavily taxing the top 25%. Even in the US, that group earns the plurality of income. What makes the American tax structure unusual isn’t the absence of wealth taxes or low capital gains or corporate tax rates. It’s incredibly low tax rates on upper middle class people. What makes America unusual is that affluent professionals identify as beleaguered members of the “bottom 99%” instead of acknowledging that they are the people that must be taxed to pay for the social services they claim to want.
You know why many Americans are on the edge of medical bankruptcy? It’s not because we don’t have wealth taxes on billionaires. Sweden doesn’t have that either. Neither does Germany or France or Spain or Italy. The reason is because of the incredibly low taxes paid by Facebook engineers, doctors, lawyers, and other white collar professionals. My au pair paid about the same tax rate in Germany, with an entry level desk job (40%) as my double private practice lawyer household in Maryland. That’s because the second to highest tax rate (42% versus the top 45%) kicks in at the equivalent of $70,000/year. In Sweden, the top tax rate kicks in at 1.5x the median income (under $100,000 in the US).
This is an utterly deluded perspective that maybe only applies in hyper-regulated, to borrow from one below comment, "hellscapes" like NYC an SF. And maybe not even then. A median house is $400k (and yes, it's located near a job, probably a median job). A payment on that is <$2k after recent rate increases. Changing cars every 2 years is dumb and maybe made sense when cars were much lower quality, but still, median new car is what, $30-40k?
How much is median, decent college, e.g. an in-state university?
In most of the country, $200k is not middle class indeed - it's "rich".
To counter other left-wing delusions implied in this post,
housing-to-income ratio is long-term almost flat, until the recent inflation: https://www.longtermtrends.net/home-price-median-annual-inco...
I am not sure if they adjust by size, as median house size has also increased by a lot over this time; if they don't it understates the modestly of the housing price increases.
Like most capitalist societies historically, the US still has a middle class (petit bourgeoisie.)
Like most capitalist societies, this class is fairly small (not as small as the upper class, the haut bourgeoisie, though), generally high-income group, defined by relying on a mix of labor and capital income, both being important (or applying their own labor, rather than overwhelmingly rented labor, to their own capital.)
The idea of a middle-income “middle class“ was always a lie to divide the working class and protect both upper classes against them.
[+] [-] legitster|3 years ago|reply
But even now that I'm making good money, it boggles my mind how richer everyone else still seems. Like, how do so many young people have a favorite island in Hawaii? How is everyone out there affording new cars? People actually picked a college major without thinking about cost?
One thing I have to constantly wrap my head around is that being broke doesn't correlate to income. I have a family and a mortgage and savings and nothing left over for luxuries at the end of the month. But someone working as a bartender can afford a new Jeep and go to Vegas 4x a year because they have a good roommate situation and they are due to inherit their parent's second house one day.
[+] [-] hnaccount141|3 years ago|reply
The reality is that oftentimes they simply can't, at least according to a responsible definition of "afford".
All we see from the outside is the brand new Jeep, we don't see the fact that they're underwater on a 72 month loan with 6% interest. The average car loan term in 2019 was 69 months, that's insane. Something like 30% of trade ins have negative equity.
Even ignoring debt, I've spoken to a surprising number of people who make great money and live lavishly but have effectively no retirement savings. The level of financial literacy in the US is abysmal.
[+] [-] commandlinefan|3 years ago|reply
Even now, married 20 years, the author talks about the burden on his wife and kids if he went back to being poor - I'm sure my wife would just leave if I was genuinely stuck in a poverty cycle with no way of getting out, and I wouldn't really blame her.
[+] [-] h4waii|3 years ago|reply
Lots of people have very different situations from what they project (witting or unwittingly), they might be running up debt to pay for their lifestyle or maybe they have profitable small side businesses, and bartend for the bills and social aspect.
Focus on your journey, and where you are on the path, don't get distracted with people "passing" you on shorter, longer, or completely different paths.
[+] [-] ishjoh|3 years ago|reply
What I've observed:
1) They're not saving for retirement. $0.
2) They spend a lot using credit. New vehicles with 2k down and high monthly payments. High monthly credit card bills.
3) They have a lot of stuff but are essentially living pay cheque to pay cheque. One thing that surprised me was working at a company that got acquired and payroll got moved to the parent company which had a pay schedule that was 1 week later, so they told us we would get paid one week later than we had historically. Inconvenient, but no problem for me. Out of an office of about 40 people 15 said they wouldn't be able to pay their bills. These were all people who made over 6 figures.
Another thing I've noticed is that many people don't look at absolute price but instead look at monthly payment, I think raising interest rates are going to hurt a lot of people that from the outside seem to have a dream life.
[+] [-] davemp|3 years ago|reply
Comparing finances to others without actually having all the information isn’t worthwhile.
[+] [-] JamesBarney|3 years ago|reply
I feel like we don't count our own responsible expenses but double count other people's luxury expenses.
A new jeep is maybe 6k/yr. A trip to Vegas is maybe 1k. That's maybe a total 12k/yr
If you're mortgage is 3k a month and he's paying 500 a month in rent, you throw in two kids @ $1,000 a month and maybe 500/month in savings and you're looking at 66k in expenses which dwarfs the 12k.
[+] [-] sershe|3 years ago|reply
It would be a real bummer if civilization collapses and it would all be for nothing, but otherwise I hope to FIRE in a few years...
[+] [-] rufus_foreman|3 years ago|reply
[+] [-] stuckinhell|3 years ago|reply
The most difficult thing these days, is my kids. I'm extremely happy that they don't know how bad things can be, but I get extremely worried by that too. I get worried, that they don't try hard enough because they don't understand how bad things in life can get. I get worried that they are far too trusting because times are so good and plentiful.
Life can change good or bad in an instant.
[+] [-] em-bee|3 years ago|reply
i grew up poor, with a single parent, on social welfare (because the parent could not work since they had to stay home to take care of us kids until we were older)
in germany.
social welfare paid our rent and gave us enough money that we could afford everything we needed. (we didn't need a car, and we didn't have a tv, but that was by choice. they would probably have paid the tv, had we wanted one). i never felt any struggle. when i moved out from home, i never needed money from my parents either. always paid my own way. i was never rich. i just learned to live frugal. and i am not at all scared of being poor again, because i know that there is a social net that i have access to if i need it.
[+] [-] ncmncm|3 years ago|reply
At best you are mid-upper lower class. If you have any worry about being able to get along if you lost your job and had a major life-threatening illness, you are still lower class like the rest of us.
[+] [-] diob|3 years ago|reply
I've noticed folks sometimes fall into the trap of trying to give their kids nothing to teach them lessons. Early help in life has compounding effects.
[+] [-] danrocks|3 years ago|reply
[+] [-] thatfrenchguy|3 years ago|reply
You would be worried nonetheless, because your brain will latch on to the next anxiety. Just like you thought that having 5 years of expenses would alleviate your anxiety. What you need is a good therapist to work on your anxiety issues.
[+] [-] mikodin|3 years ago|reply
Therapy or meditation, likely both may help induce a shift. As the grip loosens you will find many things begin to change.
"Sleeping well at night", is likely the single most important thing you can focus on. If you choose to focus on that, it likely will permeate many aspects of your life..
You may find a deeper and more authentic experience and through that you may find that you actually have won the lottery. You are safe. You have 5 years of expenses - I guarantee you that you could figure out solutions to just about anything that comes your way in 5 years.
You're no longer trying to survive. It's now time to learn how to live.
[+] [-] yusefnapora|3 years ago|reply
I'm afraid there's simply no amount of money that can possibly remove the feeling that everything could collapse at any moment. If your sense of security is predicated on continuing to possess money, you will always be vulnerable to the fear of losing it, no matter how much you accrue.
If you won the lottery tomorrow, what makes you think you wouldn't worry about losing that money too?
[+] [-] badrabbit|3 years ago|reply
[+] [-] commandlinefan|3 years ago|reply
I thought about that recently when I went to the grocery store - when I was fresh out of college, making ~$30k/year, I remember always going to the grocery store and keeping a running total in my head of how much I was spending so I didn't go over $70, since I knew my debit card would be declined if I did. Now I don't even pay attention to how much individual items cost - I just grab what I need.
[+] [-] legitster|3 years ago|reply
I remember being much more frustrated by friends trying to drag me out to eat at restaurants or throwing away food. Like, one sit down meal was worth three days of groceries!
[+] [-] Melting_Harps|3 years ago|reply
Typically, this is how I measured my success as well: when I stopped looking at the prices of things and just shopped or ordered what I wanted without too much concern. (Within reason of course, because as a former cook when I want splurge it can easily hit 4 digits.)
Everything else never felt as a re-assuring,; I've bought lots of cars and motorcycles, signed leases, traveled etc... over the years, but nothing made me more comfortable than knowing that the food bill wasn't going to ruin my finances for the month(s) as it used to before.
I used to live on $100/month for food during university, it's partly why I decided to work in kitchens and I know I can stretch out a meal quite a lot and not lose on quality. And if it's just me, I tend to like simple meals that I can iterate upon: a ragu can turn into about 5 different dishes and all uses cheap(er) cuts of meat.
But I still remember having to wait to buy things from grocery stores like yogurts or juice or pasta only when they were on special (loss leaders) and it's actually how I got a pretty good at understanding the market dynamics of a food supply's value chain, which helped when I ran kitchens and when I got into supply chain.
It ultimately culminates in focusing my cuisine on farm to tables because eating in-season not only tastes the best, is more environmental, but when you're in charge of food costs in menu development you can achieve ROIs and ARRs to justify larger expenses by buying and sourcing from farms who you can count on for price breaks for other items/prioritization for other items by buying their entire harvest ahead of planting.
As both a former farmer and chef, this was a huge relief and allows you to utilize capital where it's needed most without taking as many loans for repairs, labour, training, expansion etc...
[+] [-] spywaregorilla|3 years ago|reply
Not a complaint.
> There’s something that people with money say that doesn’t make sense: that regardless of how much money you have, you run out of it just as soon.
This is just a weird thing to me. I didn't feel this was true on a five digit salary much less what I have now.
[+] [-] lampshades|3 years ago|reply
This was relatable. While never having to support a family of 4 on 35k, I did have a period of my life where I was very broke on my own. When I finally started to climb out of my situation, I remember thinking people were idiots for putting money in a 401k. You can’t get it out if you need it. It took 5 years of stable employment before I actually started putting money into a 401k.
[+] [-] edmcnulty101|3 years ago|reply
The freaking idea that money makes problems go away is so powerful.
That's basically what I noticed as I get less poor.
Automobile problems...pay for it. Medical problems...pay for it. Did you get a parking ticket? Pay it. Now you don't have to worry about being towed.
America really crushes the poor in many respects.
If the poor had other options, like Job corps, or a sharecropper type situation where they can stay rent free and learn skills.... that would be one thing. But there's nothing available to poor people other than to just fucking be poor or get lucky...and getting lucky seems like a rediculous way to build a society.
Then you combine that with massive offshoring and automation..... It makes you realize capitalism is kind of bullshit if there's 7 billion people in the world willing to do the job.
It's a total clown world.
[+] [-] woweoe|3 years ago|reply
[+] [-] legitster|3 years ago|reply
On the other hand, you might have a CEO proudly drinks cheap beer and wears Kirkland Signature workboots to the office.
[+] [-] ChrisMarshallNY|3 years ago|reply
This is something that folks that came from The Other Side of the Tracks have. I came from there. People my age have grandparents (or, in some cases, parents) that lived through The Great Depression, and they have this, writ large.
I still basically live pretty low on the hog, even though it is not necessary. This recession is an annoyance; not a disaster. I lost more money, earlier this year, than many folks make all year. It sucks, and I'm not wealthy enough to "shrug it off," but I am not existentially terrified. I know that things will be OK in a couple of years, and I'm not in danger of burning my principal before things start recovering.
I loved his previous article, and I'm glad he's doing better.
[+] [-] rakeshsharmak|3 years ago|reply
I did what was necessary - learned to cook, worked odd jobs, moved around frequently to find cheap accommodation, slept on all sorts of beddings and, sometimes, on the street, abstained from luxuries and travel etc - during this time.
Then, last year, I found a sweet gig and my income suddenly rose way beyond my expectations (around $6,000 per month). That was also the time I moved to a new apartment. I spent some of the new money on furnishings and living a comfortable life - not thinking twice about splurging on a meal or clothing. I invested in the stock market and opened an IRA account.
At the back of my mind, however, there was a nagging feeling that it wouldn't last. Sure enough, I lost the gig in February this year and am surviving on IRA money and credit cards. I forgot to cash out of the stock market near the top and suffered losses of almost $3,000. I am loathe to move out of my current place though I have a feeling I will have to, eventually. I am back to cooking all my meals and thinking twice before making purchases.
I am not sure if it is a cycle but poverty is definitely a mindset. I've been on the other side where I was making decent money that allowed me to live comfortably (not ostentatiously). I was in a better mental state. Lately, I have been pretty depressed (although things are not as bad as they were in 2014) and exhausted all the time.
[+] [-] jelliclesfarm|3 years ago|reply
When you are middle class, it’s lower middle class, middle class and upper middle class. Only the UMC has being rich aspirations/possibilities.
[+] [-] vintermann|3 years ago|reply
Getting decent pay is just so much more efficient at making you economically safe than any kind of clever frugality is. Maybe if you could figure out a way to live without paying rent or mortgage interest, it'd be worth it, but otherwise it's the income side that matters more than the expenses side.
[+] [-] joemazerino|3 years ago|reply
Importantly: you can always make it back.
[+] [-] jccodez|3 years ago|reply
[+] [-] entropicgravity|3 years ago|reply
In a capitalist system the top 10% will always be richer and the bottom 10% will always struggle. And this would still be true even if a magic genie came a long and made everyone ten times smarter.
This isn't a knock on capitalism. Capitalism scales where many other systems don't. (I'm looking at you communism.)
[+] [-] thehappypm|3 years ago|reply
[+] [-] ffggvv|3 years ago|reply
[+] [-] busterarm|3 years ago|reply
Comparing Sweden as an opposing choice to Capitalism doesn't make any sense.
[+] [-] lrvick|3 years ago|reply
Any free day I was trying to get better at programming on college library computers I was able to use by copying other peoples student IDs off sign in sheets.
I made maybe $1500 a month which barely covered food, gas, and helping out people even poorer than me while trying to slowly save for a vehicle that could make a cross country trip to somewhere with other work options.
I eventually got a $1000 vehicle that only needed weekly repair, used it to relocate to a more populated area, upgraded to an abandoned trailer with borrowed electricity and no septic, and got a retail job.
Now I had more time to build tech skills. Eventually got the confidence to take on contract coding jobs, and then the confidence to do that full time.
Eventually I knew enough to pass interviews and get a salaried software engineering role. Then another. Turns out there was plenty of demand for some of the skills developed along the way doing random coding and infosec gigs, managing cheap DIY servers for thousands of users of random open source side projects of mine, and building custom Linux kernels for whatever random old hardware I could find.
Worked my from software engineering roles into running security departments for a series of well known companies by finding major security bugs at every employer. Turns out security is one of those things everyone seems to think is someone else's job, so I always made it mine.
Now I own a home and have a family in Silicon Valley. I own a security consulting company where my team and I have several audit projects and retainer contracts at any given time helping major companies spot security flaws, and build defenses.
Going from homeless to the comfort I currently enjoy was a long road. I never fully shake the fear I could lose it all and be back on the streets at any time. That is only amplified now that others depend on me. I never took 401ks because I expect life or the institutions will fail me before I ever see it back. Never 100% trust banks because I worry funds will be stolen via identity theft or go negative into overdraft hell I can never pay back, no matter how high the balance. I always have the need to have multiple income sources so no single one of them drying up can sink me. The need to learn new skills constantly so I always deliver results most others cannot so people keep paying me. The need to prep for every worst case scenario I can think of always for myself and those that pay me.
In the end, I think this pressure of always feeling a bit chased has served me well and still does. I also do not know that I would recommend this path to anyone, but I am generally pretty happy these days so I will take it.
[+] [-] putsjoe|3 years ago|reply
[+] [-] 50|3 years ago|reply
"A king is but a foolish labourer / Who wastes his blood to be another’s dream" (Yeats)
"As a capitalist, he is only capital personified. His soul is the soul of capital." (Marx)
[+] [-] draw_down|3 years ago|reply
This extends to not wanting to discuss salary with coworkers, by the way. The common conception is the bosses want to hold us down so they tell us not to talk about it. But I’ve been in multiple situations where I didn’t want to.
I knew I was making more, and it wasn’t because i was the best- in some cases I was lucky, sometimes I just negotiated better. But in either case there’s really no upside to disclosing.
[+] [-] diob|3 years ago|reply
In general, there would be more upward pressure on wages if information asymmetry went away. It's especially insidious for folks in the lower class, since they don't realize the extent to which they are being underpaid.
[+] [-] lotsofpulp|3 years ago|reply
>But in either case there’s really no upside to disclosing.
There certainly is upside to discussing for anyone earning less than median. But as you write, as long as everyone thinks they are earning more than the median, individually they have no upside.
Obviously, everyone cannot be earning more than median, but more importantly, price transparency shows the movement of supply and demand curves, across industries and even across businesses in the same industry.
[+] [-] drpgq|3 years ago|reply
[+] [-] ncmncm|3 years ago|reply
It is impossibly hard for most people not in the upper class in the US to conceive of just how impossibly far they are from that upper class. $100k/yr? Lower class. $200k/yr? Still lower class: you still can't afford to send your kids through college, and still make your house and car payments, replacing your car every year or two. Yes, that was what middle-class people used to do.
What happened to the middle class? It was eliminated, by explicit political policy. The US income curve is now strongly bi-modal. One hump for upper class, another for lower. Very few people are near the middle, where the middle class once was. Those few are either tacking to get to the upper class, probably futilely, or are well on their way out of it, and won't be back.
The Republican Party discovered that they could get lower-class people to vote against their own interests, and for the interests of the upper class, by convincing them they were not lower class. Now half the country votes mainly to try to keep the desperately poor from taking what they have managed to scrabble together, and in the process ensure the extremely rich get extremely richer and don't have to pay for anything, and especially not let any of it go to those same voters.
Up until around 1970, Americans' income was on a relentless rise. That had stopped by 1980, and has been more or less level, since. The income didn't go away, at all. The total amount has skyrocketed, since, going up at the same rate as before. Just, rich people get all of the difference, everything from that line down to the flat line describing what they have left for the rest of us. All this is policy, and the program to get there was spelled out in the Powell Memorandum, which you can read online.
During COVID lockdown and supply-chain upsets, they got insanely more money, somehow, again at the rest of our expense.
[+] [-] akavi|3 years ago|reply
Where is this halcyon universe where the median (or even the 75th percentile) American:
* Paid for their children to go to college
* Bought a new car every other year
'Cause that doesn't resemble any point in the past century of the universe we currently inhabit.
[+] [-] AnimalMuppet|3 years ago|reply
Evidence? Because I don't think the US income distribution looks like this at all.
[Edit: Oh, you've got your own definition of "middle", which is completely different from what everyone else in this conversation is using. With your definition of "middle", I could see there not being many people there. I still don't think the distribution is bi-modal, though.]
[+] [-] refurb|3 years ago|reply
An individual income of $200k put your firmly in the top 10% of income earners in the US.
But the claim is they are lower class?
This seems really disconnected with reality. I’m not sure you understand what life is like for the average American.
[+] [-] rayiner|3 years ago|reply
This is a complete delusion designed to justify affluent people asserting they’re “middle class.” Americans never lived like that. Back in the 1960s and 1970s, most people didn’t even go to college. They lived in a house with half the square footage, but more people in the household. If they got cancer, they just died.
The problem isn’t republicans, or not just republicans. The problem is that Democrats also refuse to raise taxes on the top 25% above the current Reagan-era lows. Every other developed economy functions by heavily taxing the top 25%. Even in the US, that group earns the plurality of income. What makes the American tax structure unusual isn’t the absence of wealth taxes or low capital gains or corporate tax rates. It’s incredibly low tax rates on upper middle class people. What makes America unusual is that affluent professionals identify as beleaguered members of the “bottom 99%” instead of acknowledging that they are the people that must be taxed to pay for the social services they claim to want.
You know why many Americans are on the edge of medical bankruptcy? It’s not because we don’t have wealth taxes on billionaires. Sweden doesn’t have that either. Neither does Germany or France or Spain or Italy. The reason is because of the incredibly low taxes paid by Facebook engineers, doctors, lawyers, and other white collar professionals. My au pair paid about the same tax rate in Germany, with an entry level desk job (40%) as my double private practice lawyer household in Maryland. That’s because the second to highest tax rate (42% versus the top 45%) kicks in at the equivalent of $70,000/year. In Sweden, the top tax rate kicks in at 1.5x the median income (under $100,000 in the US).
[+] [-] sershe|3 years ago|reply
In most of the country, $200k is not middle class indeed - it's "rich".
Real /median/ household income is still on "relentless rise": https://fred.stlouisfed.org/series/MEHOINUSA672N
Middle class "shrinking": https://www.aei.org/wp-content/uploads/2018/01/middleclass1....
To counter other left-wing delusions implied in this post, housing-to-income ratio is long-term almost flat, until the recent inflation: https://www.longtermtrends.net/home-price-median-annual-inco... I am not sure if they adjust by size, as median house size has also increased by a lot over this time; if they don't it understates the modestly of the housing price increases.
Government spending as %% of GDP is constantly growing, or at most flat in good times: https://fred.stlouisfed.org/series/FYONGDA188S
And social services as %% of that are growing, too: https://www.pewresearch.org/fact-tank/2017/04/04/what-does-t...
[+] [-] dragonwriter|3 years ago|reply
Like most capitalist societies historically, the US still has a middle class (petit bourgeoisie.)
Like most capitalist societies, this class is fairly small (not as small as the upper class, the haut bourgeoisie, though), generally high-income group, defined by relying on a mix of labor and capital income, both being important (or applying their own labor, rather than overwhelmingly rented labor, to their own capital.)
The idea of a middle-income “middle class“ was always a lie to divide the working class and protect both upper classes against them.