POLITICS SCHMALITICS

[Screwball]

You don't need a financial advisor to keep a budget. Maybe I'm too old, but you don't buy "splurge" items when you don't have the money to pay for them.  I saw this with my kids, and I hear it from other parents.  This is the "I want it now" mentality we see in TV commercials.

The younger people just don't seem to be very good with money/credit.  Or maybe numbers in general, as I see in my classes.  Many of these younger people can't make change, balance a checkbook, and some struggle with basic math.

Their parents and educational system has failed them IMO.  And of course easy and cheap (not so much anymore) credit is also a culprit.  This is not a good picture going forward for many I suspect.

 

[1984Echoes]

22 minutes ago, gehringer_2 said:

Not completely the case. Our credit union offers all kinds of seminars on saving, investing, retirement that are free, aimed at people without a lot of assets and as far as I have seem, offer pretty sound advice. It's true a small investor is not going to get any reputable professional advisor to spend one-on-one time with them for what they can afford to pay for it, but there are resources out there. 

Maybe the bigger problem is that too many people don't have enough initial knowledge to bootstrap themselves into being able to recognize good advice from bad on their first attempt to learn something when they are most likely to be preyed upon.

Yeah... I didn't mean to make that sound so restrictive... because you're correct, a person CAN look around and find good advise, even for free.

I think I was answering in a restrictive way based on the financial advisors = sharks vein...

As for the bigger problem... I still think that it's too many people living paycheck-to-paycheck where they're not even able to get to that first attempt. I think that's what SB's charts are showing.. that people just don't even have money to make the initial effort to start up savings. Just my opinion.

But yeah, once a person has some money to start investing, they have to get past the sharks... and starting with free seminars as you've described them by banks & credit unions are probably their best and most risk-free path to follow.

[1984Echoes]

21 minutes ago, Screwball said:

... You don't need a financial advisor to keep a budget. Maybe I'm too old, but you don't buy "splurge" items when you don't have the money to pay for them.  I saw this with my kids, and I hear it from other parents.  This is the "I want it now" mentality we see in TV commercials.

The younger people just don't seem to be very good with money/credit.  Or maybe numbers in general, as I see in my classes.  Many of these younger people can't make change, balance a checkbook, and some struggle with basic math.

Their parents and educational system has failed them IMO.  And of course easy and cheap (not so much anymore) credit is also a culprit.  This is not a good picture going forward for many I suspect.

 

And living paycheck-to-paycheck is exactly what SB has outlined here.

An inability to budget, to "live within ones' means", to avoid "splurge" shopping, to rely on credit cards or relatives to help one "maintain a lifestyle"... all lead to the same problem:

No budgeting/ restraint = living paycheck-to-paycheck = no money = no savings.

[gehringer_2]

30 minutes ago, Screwball said:

Their parents and educational system has failed them IMO. 

I imagine any curriculum around money in public schools is probably like a third rail for the average school administrator. Probably no matter what you do you are going to get hammered from some consitiuency that thinks you are being too socialist, or too capitalist or to moneyist, or anti-banker, or pro-business, or your're discriminating against the poor kids or 'triggering' the rich kids, and maybe all of them at once. I mean I can just imagine a bottomless pit of complaint  -- way easier to do nothing. 

So yeah - FAIL.

Edited January 2, 2023 by gehringer_2

[Screwball]

4 minutes ago, 1984Echoes said:

 

And living paycheck-to-paycheck is exactly what SB has outlined here.

An inability to budget, to "live within ones' means", to avoid "splurge" shopping, to rely on credit cards or relatives to help one "maintain a lifestyle"... all lead to the same problem:

No budgeting/ restraint = living paycheck-to-paycheck = no money = no savings.

Spending cash/credit has been embedded in our culture due to advertising and cheap/easy credit.  I remember people bouncing checks.  They would come in to pay for the check - and the $30 dollar fee along with it - and not bat an eye.  It was worth the extra 30 to have fun for one night knowing the check was going to bounce.

Nuts!

It's all about consumption - the more the better.  We are a shopping mall with a flag.

[1984Echoes]

I don't know if I mind the consumerism - per se - as that is what drives our economy to #1. IIRC, our economy is roughly 70% consumerism?

But the problems that come along with that... consumer debt, lack of restraint/ budgeting/ savings/ ... I don't know how to solve those and, wish we could figure that part out.

[Screwball]

3 minutes ago, gehringer_2 said:

I imagine any curriculim around money in public schools is probably like a third rail for the average school administrator. Probably no matter what you do you are going to get hammered from some consitiuency that thinks you are being too socialist, or too capitalist or to moneyist, or anti-banker, or pro-business, or your're discriminating against the poor kids or triggering the rich kids......I mean I can just imagine a bottomless pit of complaint  -- way easier to do nothing. 

So yeah - FAIL.

I can't speak for everywhere, but the educational system around here is a complete mess.  I don't know what my college does for financial stuff, but the high school kids I had for 3 years were clueless, and I'll go on record the lock downs and zoom meetings during COVID didn't help one bit.

I had some down time one day waiting on a kid to come back from a trip to the office.  I asked the kids if they knew how to make change - not a clue (this was a STEM class with a room full of so-called wannabe machinists).  They didn't have much of a clue for a lot of other things either.  Now I think I am seeing these same things with the frosh in college.  Last semester was one of the worse ones I've had.

I gave up the high school stuff because I was tired of playing Sister Mary Elephant.

[mtutiger]

46 minutes ago, Screwball said:

You don't need a financial advisor to keep a budget. Maybe I'm too old, but you don't buy "splurge" items when you don't have the money to pay for them.  I saw this with my kids, and I hear it from other parents.  This is the "I want it now" mentality we see in TV commercials.

The younger people just don't seem to be very good with money/credit.  Or maybe numbers in general, as I see in my classes.  Many of these younger people can't make change, balance a checkbook, and some struggle with basic math.

I think this is part of the case. But I really do think that the structural issues faced during the Great Recession is also a factor as well.

There's a tendency to try to boil everything down to just one factor, and I'm not sure it all comes down to spending habits imo. Again, just speaking from experience as someone from the cohort who does have a savings and feels they have made educated decisions on finances, long term income prospects were undoubtedly hindered by when I entered the workforce.

Sure, we can talk about spending to live within your own means, but even if one does, if their income over the long run started at a low base, that will still impact how much one can save or put away versus starting at a higher base. Just think that has to be discussed with the portion of millennials that entered the workforce during the Great Recession and in its aftermath. Versus today when higher bases and even signing bonuses are the norm.

Edited January 2, 2023 by mtutiger

[gehringer_2]

5 minutes ago, Screwball said:

and I'll go on record the lock downs and zoom meetings during COVID didn't help one bit.

that is the consensus at here as well. A lot of students unprepared to even show up when they have to be somewhere in person.

Edited January 2, 2023 by gehringer_2

[mtutiger]

1 minute ago, gehringer_2 said:

that is the consensus at here as well. A lot of students unprepared to even show up when they have to be somewhere in person.

Speaking from experience, it was a huge negative for those newly hiring on from out of school and into a job as well. Training, developing rapport, etc. 

[Screwball]

18 minutes ago, mtutiger said:

I think this is part of the case. But I really do think that the structural issues faced during the Great Recession is also a factor as well.

There's a tendency to try to boil everything down to just one factor, and I'm not sure it all comes down to spending habits imo. Again, just speaking from experience as someone from the cohort who does have a savings and feels they have made educated decisions on finances, long term income prospects were undoubtedly hindered by when I entered the workforce.

Sure, we can talk about spending to live within your own means, but even if one does, if their income over the long run started at a low base, that will still impact how much one can save or put away versus starting at a higher base. Just think that has to be discussed with the portion of millennials that entered the workforce during the Great Recession and in its aftermath. Versus today when higher bases and even signing bonuses are the norm.

I'm not trying to boil it down to one thing - as I don't think it is a one thing problem - nor exclusive to age groups.  I know plenty of people my age (late 60s) who are also terrible at money/budgets/spending/etc.

I also understand it is getting harder and harder to make ends meet.  I have argued that for years - and it's not getting any easier.

But these are the cards we are dealt - so we must play the had we have.  Or eventually you starve.

[Screwball]

28 minutes ago, gehringer_2 said:

that is the consensus at here as well. A lot of students unprepared to even show up when they have to be somewhere in person.

My attendance records this last semester were as bad as I've had. I tell them the very first day "if you want to pass this class, you have to do this" which includes showing up for class.  I flunked about 1/5 of the students, and all were because they didn't show up, which got them behind, and they couldn't catch up (even with tutoring). 

Why would you sign up for a class, 2 times a week for 2 hours, then show up for half of them - then wonder why you fail.  Because you deserve to, and how about that $XXXX you just pissed away?

And taking notes isn't against the law either - especially in my class - but they show up with a phone. No paper, no pencil, no nothing.  Amazing!  And they are not very good at following directions either.

Many of these kids not only flunked my class, they are going to flunk life.

Edited January 2, 2023 by Screwball

[mtutiger]

20 minutes ago, Screwball said:

I'm not trying to boil it down to one thing - as I don't think it is a one thing problem - nor exclusive to age groups.  I know plenty of people my age (late 60s) who are also terrible at money/budgets/spending/etc.

I also understand it is getting harder and harder to make ends meet.  I have argued that for years - and it's not getting any easier.

But these are the cards we are dealt - so we must play the had we have.  Or eventually you starve.

Maybe I missed it being discussed here, but without seeing the data, housing costs seem to be a huge factor as well. Even in the 10 or so years I have lived in my area, here I live, the cost of the average home increased from around $150,000 in 2011 to around $390,000 in 2022. Rents are even more out of control, with 1 bedroom units frequently being in the high thousands, low 2s per month.

We are a bit of an outlier because DFW has experienced rapid growth for a while, but costs have risen everywhere. As it pertains to younger people, its a double hit because (a) home ownership has historically been a huge factor in growing wealth and it is increasingly a lot harder to get into and (b) renting, which isn't an investment in anything except a roof for a month, increasingly costs more than a monthly mortgage payment these days.

We were very luck to have been able to buy during the last decade, but know quite a few people who cannot or have gotten into homes at a higher debt/income than we have. That has a massive impact in the long run one would think and is a part of the income insecurity as well that impacts both millennials and Gen-Z, given how home equity provides a number of paths (ie. Home equity loans, HELOCs, etc.) to those who own homes (which generally skews toward older generations) that don't exist for those who don't (skews younger)

Edited January 2, 2023 by mtutiger

[CMRivdogs]

2 hours ago, Screwball said:

This part kind of stuck out to me;

 

Some have zero emergency savings, but know more about managing their finances than an advisor, and look to social media for advice.

Maybe that isn't such a good idea?

We've used a financial advisor when my spouse came into a fairly substantial chunk of change in a "retirement buyout" several years ago. We found him helpful and have remained mostly in the black with their efforts. They also came in handy navigating the whole Medicare morass especially when it came to prescription drugs not covered under the basic plans.

 

[CMRivdogs]

8 minutes ago, mtutiger said:

Maybe I missed it being discussed here, but without seeing the data, housing costs seem to be a huge factor as well. Even in the 10 or so years I have lived in my area, here I live, the cost of a home increased from around $150,000 in 2011 to around $390,000 in 2022. Rents are even more out of control, with 1 bedroom units frequently being in the high thousands, low 2s per month.

We are a bit of an outlier because DFW has experienced rapid growth for a while, but costs have risen everywhere. As it pertains to younger people, its a double hit because (a) home ownership has historically been a huge factor in growing wealth and it is increasingly a lot harder to get into and (b) renting, which isn't an investment in anything except a roof for a month, increasingly costs more than a monthly mortgage payment these days.

We were very luck to have been able to buy during the last decade, but know quite a few people who cannot or have gotten into homes at a higher debt/income than we have. That has a massive impact in the long run one would think and is a part of the income insecurity as well that impacts both millennials and Gen-Z, given how home equity provides a number of paths (ie. Home equity loans, HELOCs, etc.) to those who own homes (which generally skews toward older generations) that don't exist for those who don't (skews younger)

Rents may be the biggest problem in finding affordable housing. When we made the decision to downsize in 2017 we found a fairly new build ranch style complex. Rent was about half the mortgage payments we were making. When we moved out in Sept 2020 the rate would have been at least 50% more that what the original rent without any changes in amenities. Supply and demand, I guess (This was in Commerce Twp)

Home sale prices in that area have skyrocketed as well. Lots of new builds, but even trying to buy an older home would take a lot of capital. Especially the ones I've seen on Zillow and Reality once you factor in the cost to do needed upgrades.

 

[Screwball]

23 minutes ago, mtutiger said:

Maybe I missed it being discussed here, but without seeing the data, housing costs seem to be a huge factor as well. Even in the 10 or so years I have lived in my area, here I live, the cost of the average home increased from around $150,000 in 2011 to around $390,000 in 2022. Rents are even more out of control, with 1 bedroom units frequently being in the high thousands, low 2s per month.

We are a bit of an outlier because DFW has experienced rapid growth for a while, but costs have risen everywhere. As it pertains to younger people, its a double hit because (a) home ownership has historically been a huge factor in growing wealth and it is increasingly a lot harder to get into and (b) renting, which isn't an investment in anything except a roof for a month, increasingly costs more than a monthly mortgage payment these days.

We were very luck to have been able to buy during the last decade, but know quite a few people who cannot or have gotten into homes at a higher debt/income than we have. That has a massive impact in the long run one would think and is a part of the income insecurity as well that impacts both millennials and Gen-Z, given how home equity provides a number of paths (ie. Home equity loans, HELOCs, etc.) to those who own homes (which generally skews toward older generations) that don't exist for those who don't (skews younger)

Totally agree on the costs of a home.  Once people couldn't buy homes, they jacked the shit out of rent so you can't afford to rent either.  And how many can/do save enough to come up with a down payment on a house?  At least one that helps them afford it.  When you have no savings, that loan isn't happening.  The age of NINJA is over (thank goodness).

If you follow the markets this topic (due to interest rates) is usually a hot and widely discussed topic - so I am not unaware of the problems.

But I'm still bewildered to have watched people go out and buy an overpriced house with interest rates at all time lows and think they got some kind of a deal .  People that bought a house in the last 2-3 years (maybe longer) are now underwater (adding on edit; unless they put enough down) with the current interest rates.  Maybe that won't matter if they want to live there for years, but they are going to get hosed if they sell now, if they can sell at all.

Edited January 2, 2023 by Screwball

[CMRivdogs]

The housing market seems to still be in decent shape here, though not as strong as say a year ago. Part of it I think is the season. Not many want to move in December.  The other factors going for sales here is it's a military area and still attracts a fair amount of retirees.

Edited January 2, 2023 by CMRivdogs

[mtutiger]

50 minutes ago, Screwball said:

But I'm still bewildered to have watched people go out and buy an overpriced house with interest rates at all time lows and think they got some kind of a deal .  People that bought a house in the last 2-3 years (maybe longer) are now underwater (adding on edit; unless they put enough down) with the current interest rates.  Maybe that won't matter if they want to live there for years, but they are going to get hosed if they sell now, if they can sell at all.

Yeah, we've been wanting something else for a little whole and have held off partially for that reason....

But really it's just hard to consider buying a house when the value of these homes are close to double what one paid back in 2016. Having issues with space or having additional maintenance costs, at least at this point, are worth it versus an even larger mortgage and tax bill.

[Deleterious]

Most of these kids do not have anyone to show them the financial ropes.  I was lucky and both my grandpa and father were into investing and I learned a lot from both of them.  Not just markets, but saving, not using credit cards, keeping a good credit score, etc.  

Most of you seem financially literate.  If you know a young person I would encourage you to take a few minutes and talk to them a bit about finances.  Tell them how having bad credit costs you a lot of money in the long run.  Don't use payday loans, don't buy cars from "We finance anyone" lots, don't finance phones or even buy a new phone ever 18 months.  Get that six month emergency fund.  If your employer matches 401k contributions, its free money risk free.  If they don't have a 401k then tell them about IRA's.  

We started to offer a 401K in the last year.  I found a 401K calculator online and entered some very conservative numbers.  Starting at age 30 with $0 and retiring at 65, making $45,000 a year contributing 10% with 3% match and 6% return on average you will have over $900,000 when you retire.  I put it into Excel and printed off 400 copies and passed them out to each employee.  They were blown away at the amount of money they would have.  When I go into work now I get more questions about finances than I do actual work.

These kids are not dumb and they are definitely not lazy.  Not everyone had a grandpa and/or dad to teach them these things.  They want to learn and are willing to learn.  Their elders (us) have just failed them miserably.  

[Tiger337]

I wish I knew more about 401k's when I was young.  I was good at saving and not going into any kind of debt, but was late at getting into investing.  

Young people are not stupid, but they need instruction.  Some things they need to learn for themselves, but I don't think finances and investing are among those things.   

Edited January 2, 2023 by Tiger337

[Screwball]

2 hours ago, Deleterious said:

Most of these kids do not have anyone to show them the financial ropes.  I was lucky and both my grandpa and father were into investing and I learned a lot from both of them.  Not just markets, but saving, not using credit cards, keeping a good credit score, etc.  

Most of you seem financially literate.  If you know a young person I would encourage you to take a few minutes and talk to them a bit about finances.  Tell them how having bad credit costs you a lot of money in the long run.  Don't use payday loans, don't buy cars from "We finance anyone" lots, don't finance phones or even buy a new phone ever 18 months.  Get that six month emergency fund.  If your employer matches 401k contributions, its free money risk free.  If they don't have a 401k then tell them about IRA's.  

We started to offer a 401K in the last year.  I found a 401K calculator online and entered some very conservative numbers.  Starting at age 30 with $0 and retiring at 65, making $45,000 a year contributing 10% with 3% match and 6% return on average you will have over $900,000 when you retire.  I put it into Excel and printed off 400 copies and passed them out to each employee.  They were blown away at the amount of money they would have.  When I go into work now I get more questions about finances than I do actual work.

These kids are not dumb and they are definitely not lazy.  Not everyone had a grandpa and/or dad to teach them these things.  They want to learn and are willing to learn.  Their elders (us) have just failed them miserably.  

I must respond to this - good stuff and well said.

I'm not good with words - they are not my bag - numbers are. But I'm going to give it a shot...

What Del said above is spot on, and much of what I think is missing today and have for quite some time.

Let me put it this way; I'm old (66) so I grew up in an entirely different era - my parents grew up through the Great Depression so they knew the economical pain - and they were frugal.  Very frugal - and I was brought up the same way. I was taught - like so many my age - if you don't have the money to buy something - don't buy it.  You did what you had to do in order to accumulate enough money to buy what you wanted (bike, car, house, etc.).  It doesn't work that way anymore, and I get that, for better or worse...

This is about our kids - or you might say - our youth (no matter how these survey's break them down).  Our youth truly are our worlds raw materials when it comes to our (their) future.  I've always believed that, and taught my kids with that belief (among other things) in mind. 

To take it further, in my experience, as a retired engineer by trade, now teaching our youth in a college and high school setting - I am the one who is getting the education.  I admit, I am a fish out of water, not trained nor have experience in teaching young people.  I did do a lot of training to fellow co-workers in the shit show known as Corporate America - the cesspool of bullshit that it is. So the only thing I have going for me is I know the material - which is a good start IMO. I've already watched the alternative where we have teachers who know jack shit about how the "real world" works - but teach school and author books.

I came to the conclusion after teaching school for fun money after retirement - our educational system is a complete mess - ran by the same clueless greedy pricks who run our corporations.  Huge and stupid money spent on (in the trade school setting along with the college) administration bullshit while the kids still slave away with 10 year old computer equipment, robots, CNC machines, and welding equipment . IT staffs at a bare minimum, clueless as well (they hate me), and the administration should get an Oscar for Marketing Bullshit. They treat it like an invitation to Harvard - watch for your acceptance letter - then let them play games on their phone all year. The high school kids figuring out what they want to do next year say hey, let's go here so we can fuck off all day.  Truly Sister Mary Elephant - I could write a book on the daily mayhem.

College will get there - I can already see it. Bad. I don't know how much longer I can last. I am not a babysitter, and will not be, even if it makes me some beer money.  It's about the teaching.

Our companies cannot hire good people (or enough of them) - I know because I was part of it. It's not getting any better. I don't like what I see but it is what it is.  What do we do? At some point the entire shithouse is going to blow up. We don't have enough people to do what needs to be done so all of us eat. We now have HR departments so inept, they couldn't hire an ant to play in sand.  But there is nobody to hire even if they knew what they were looking for, so there's that...

Let's start with the kids - it is their future after all.  Del's right - they are not lazy (some really are though - that can be fixed) and and they want someone to teach them.  I can't stress that enough. So many of these kids are begging for attention, guidance, and love. The system (along with their parents - it all starts at home) is failing them - and they know it - but they don't know how to fix it. I don't either, but maybe I can help them.

I love my classes and my kids, no matter how old they are. I really do this because I think I might be able to make a difference, and we sure as hell need that. Invest in our young.

I had a kid last semester who came into class the first day when it was 95 degrees outside with a hoodie so you could only see his eyes, nose, and mouth. OK, let's see where this goes - you never know.  A few weeks later he wore a hoodie with a baseball thing on the front. I asked him if he was a baseball fan. Yep. The rest is history.  We eventually had a baseball in class so I could show him a curveball that would make him a 20 game winner.  He did, I did, and the class got a big kick out of it. We even made a drawing of a flattened baseball cover. Turns out he was from the Bahamas. As the semester went on his hoodie ended up on the back of his head, he was asking questions, and having a ball.  Really came out of his shell. Great kid, and we became buds.

This is why I took great interest in this survey. People need to get into people. Fuck all this other bullshit.

Edited January 3, 2023 by Screwball

[Tiger337]

5 minutes ago, Screwball said:

Let's start with the kids - it is their future after all.  Del's right - they are not lazy (some really are though) and and they want someone to teach them.  I can't stress that enough. So many of these kids are begging for attention, guidance, and love. The system (along with their parents - it all starts at home) is failing them - and they know it - but they don't know how to fix it. I don't either, but maybe I can help them.

 

I think this is true at every level of education all the way up to graduate school.  I think the most important quality of a teacher is to genuinely care about students.  If they know that you care about them, they will most likely respond a lot better and learn more.  It's important to know your stuff and to come prepared with good material and present it well, but if you don't care, they won't either.   

[oblong]

My son is 22 and has a serious girlfriend. While we are not pleased with an apparent lack of direction we do see some qualities. She comes from an immigrant family. Their native language is not English.  She works multiple jobs. The biggest thing I liked was their aversion to credit cards. She said their family thinks they are evil.  Everything is cash. He calls it “the immigrant hustle”  She totaled her car on Christmas. She handled everything. All my son had to do is pick her up. Stuff like that goes a long way for me.  You don’t need to be rich to have “a lot” of money.  
 

I wish I had the “money” Gene. I don’t get worked up over a few bucks here or there. I’m fortunate to afford it I guess. But I don’t stress about it.  I do the full match at work. 25% of my income goes into a fund.  It increases 1% a year and another next year when I turn 50.  It’s a target fund.  I figure they do the hard work. Set it and forget it.

[mtutiger]

11 hours ago, mtutiger said:

I dont think millennials or Gen-Z love the Democratic Party... but when placed in a lineup next to the party that spends the bulk of their time vice signaling on culture war issues and either ignoring or denying outright the existance of actual problems versus proposing solutions (ie. climate change), among other things, it's not hard to see how they struggle with these groups.

An example of the vice-signaling, referencing Damar Hamlin collapsing in Cincinnati tonight. From one of the bigger conservative voices purportedly marketing themselves and the brand to younger voters.

No wonder the brand struggles with younger voters.

Edited January 3, 2023 by mtutiger

[chasfh]

On 1/1/2023 at 7:47 PM, Tiger337 said:

My question is: Is that a generational thing or an age thing?  We boomers weren't a particularly reponsible bunch when we were younger either ! 

😉