"It's not you. It's a failed Economy" or, why it's impossible to save

[BTDretire]

 This article will make you mad, it all about how everything in the economy is wrong and the fact that you can't, won't and don't save any money is not your fault.

https://eand.co/its-not-you-it-s-a-failed-economy-e610b98381fc

[js82]

Oh dear.  Talk about decent points being obscured by bad examples.

There are legitimate points in there.  The costs of education/housing/health care relative to income have skyrocketed over the past couple decades in a way that the CPI/traditional measures don't adequately capture.  We live in a culture that overvalues the MBA/CEO and undervalues the scientist and the teacher.

But there's a host of bad examples that detract from the good points in the article: Gates/Bezos/Zuckerberg are about the last the people you should be singling out - they're people who achieved something substantial - they built businesses that had a profound impact on the world - regardless of whether or not you like their business models.  Or claiming that for someone on twice the average income of $60k "it's a struggle" - unless you live in a tremendously expensive area, $120k is enough to live quite comfortably.

The author would be better served by singling out any of the host of mediocre CEO's who didn't found a company/build it from scratch and ended up with a golden parachute after achieving approximately nothing.  Or a certain real estate "mogul" who who "earned" his wealth by... starting with a bunch of family money/assets, and investing it with a degree of success that was merely average.

[Nate79]

I can only read so much stupidity before I lose patience and stop reading.

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[Linea_Norway]

"The average income is $60k. Nobody can afford a) healthcare b) elderly care c) childcare d) retirement e) education f) housing, food, and daily bills on that. Nobody. Period. "

This site proves the opposite. He is a complainypants. There are probably some valid points, but he makes so many wrong mistakes, that we can't take anything serious.

[Maenad]

There are legitimate points in there.  The costs of education/housing/health care relative to income have skyrocketed over the past couple decades in a way that the CPI/traditional measures don't adequately capture.  We live in a culture that overvalues the MBA/CEO and undervalues the scientist and the teacher.

That's what drives me nuts about these kinds of articles and the subsequent "discussions" online. I mean, congrats to them, they successfully click-baited, but in the argument of personal-choices-vs-societal-impact, the answer is pretty much always "some of each", and it really chaps my ass when people don't acknowledge that.

My life is a lot cushier than my brother's, though he works harder than I do, since I lucked out and got the "engineer brain". DH's life is cushier than his brother's because DH will actually work for a living and his brother, though also very intelligent, is a mooch who would rather be homeless than get a job.

I think we as a society do have a responsibility to give people as equal an opportunity as possible (which we're nowhere near, obvs), but everyone is born into different circumstances with different challenges, and there's nothing that says you can't both advocate for societal change as well as do the best you can with what you have.

[Bateaux]

At every level of income, starting below minimum wage as a minor, I was able to save.  No gimmicks, tricks or lottery wins.  Just time, patience and persistence.

[dignam]

I only made it about half way through that.  Mostly superlatives and use of anger porn which our society loves.  Plus, I hate complainers.

This site is chock full of counter examples to his griping.  My gf was making well under the "$60k average" and was doing just fine before we met.  She was even socking away money into her 401k, and had zero debt (still all true).

[Channel-Z]

I only make $54k and I still have $1,200-$1,400 to save most months. But I'm only paying for housing/bills/health care/retirement out of that list. It can be done, but at my income level, it requires plenty of sacrifice.

Also, I'm really close to the point where I will need to buy a new (used) car, so that will set me back one year of savings. But at least I will be able to do that instead of taking on a seven-year loan.

I will agree that predatory behavior is a problem.

[sabanist]

I never listen to these type articles.  I started with nothing, was in a much worse position than 90% of the public.  No hand outs, no parental bail outs.  I made the right decisions and now I am in a better financial position than 90% of the public.  It took working very hard, patience, and perseverance. 

Stop whining and use what resources are available to improve your situation. 

[StarBright]

Oh dear.  Talk about decent points being obscured by bad examples.

There are legitimate points in there.  The costs of education/housing/health care relative to income have skyrocketed over the past couple decades in a way that the CPI/traditional measures don't adequately capture.  We live in a culture that overvalues the MBA/CEO and undervalues the scientist and the teacher.

^ this.

But I actually 100% agree with the statement that "Nobody can afford a) healthcare b) elderly care c) childcare d) retirement e) education f) housing, food, and daily bills on" 60k. I also agree that all of those would be pushing it on 120k as well. Luckily most people aren't dealing with all of those items at the same time.

But as with most articles on personal finance there is no gray area and no long view. There are periods when you are flush and periods of famine, but that is just hard to convey in articles!

I think the bigger problem is that society seems to be shaping up in a way where you can't make a wrong step AND you can't have bad luck when it comes to health (or your kids or your parents) or you might never get ahead.

I do think some of the younger and childless folks on the forum underestimate the cost of children (when it comes to both childcare and healthcare). The cheapest individual insurance my company offers is $65 a paycheck with a deductible of $1,500. If you have a family the cheapest plan jumps to $290 a paycheck with a 6k deductible - for a family you will pay $13,500.00 in a year before your insurance ever kicks in and pays for anything. No small thing on a median income.

I know childcare varies all over the country but I know when we were in the full throws of the daycare years our biggest expenses were childcare, then health insurance, and then housing. We were lucky to have been able to pay off our student loans right before our youngest was born and also lucky that both sets of our parents are currently healthy and self sufficient.

I agree the original author gilds the lily with hyperbole, but his bigger point ain't entirely wrong.

 

[mathlete]

Hyperbole to illustrate a point.

[Boofinator]

But when the point is an outright lie, then hyperbole is self-destructive.

"The economy is doing just fine. It's probably you. Or more precisely, your profligate spending and your complete lack or work ethic."

(Or does hyperbole only work in one direction? :)

[mathlete]

But when the point is an outright lie, then hyperbole is self-destructive.

"The economy is doing just fine. It's probably you. Or more precisely, your profligate spending and your complete lack or work ethic."

(Or does hyperbole only work in one direction? :)

I detest dishonesty too. In fact, I get all crabby when I see it floating around the Personal Finance community. So I totally feel you.

I see this as a further progression of, "It's not your fault that you coal mining job vanished over night.", even though coal has been in the midst of a half-century decline. When doing political speech, people don't want to hear about bootstraps unless it's in reference to other people.

Jimmy Carter told people to put on sweaters instead of using heating oil so that we could push back against OPEC. People hated him for it. Working people do not like to be told to work harder. Especially not by political advocates. That's never going to change. We lost this battle, unfortunately.

[mathlete]

It's a Medium article, so I'm not inclined to get too worked up about it anyway, but I'm probably easier on this guy because I think he's pushing an idea that we're all going to have to cope with sooner or later. If you tether your self-worth to how much capitalism values your labor, you're in for a rude awakening. Maybe you're old enough for it not to matter, but your kids and grandkids are going to feel it. Whatever labor your perform, globalism or technology is coming for it. And it will do it better or more efficiently than you do. It's best that we all decide together that human life has inherent value.

But on the other hand, fuck this guy for implying that it's hard to live on $120,000.

[Boofinator]

Jimmy Carter told people to put on sweaters instead of using heating oil so that we could push back against OPEC. People hated him for it. Working people do not like to be told to work harder. Especially not by political advocates. That's never going to change. We lost this battle, unfortunately.

My mom still jokes about Carter and his sweaters. I never get the joke.

[mathlete]

My mom still jokes about Carter and his sweaters. I never get the joke.

Hehehe. Carter could have been a very successful FIRE blogger if he were born a few decades later.

[Just Joe]

Success can still be found in the USA. Doesn't matter whether a person lives in a HCOL place or a LCOL.

HCOL might soak up all a person's average income. LCOL might only offer dying career paths. Don't be too married to a place or type of employment.

This forum is full of success stories - some still in progress. Many articles seem to focus on short term thinking. Play the long game for happiness and profit.

[sabanist]

Oh dear.  Talk about decent points being obscured by bad examples.

There are legitimate points in there.  The costs of education/housing/health care relative to income have skyrocketed over the past couple decades in a way that the CPI/traditional measures don't adequately capture.  We live in a culture that overvalues the MBA/CEO and undervalues the scientist and the teacher.

^ this.

I actually 100% agree with the statement that "Nobody can afford a) healthcare b) elderly care c) childcare d) retirement e) education f) housing, food, and daily bills on" 60k. I also agree that all of those would be pushing it on 120k as well. Luckily most people aren't dealing with all of those items at the same time.

But as with most articles on personal finance there is no gray area and no long view. There are periods when you are flush and periods of famine, but that is just hard to convey in articles!

I think the bigger problem is that society seems to be shaping up in a way where you can't make a wrong step AND you can't have bad luck when it comes to health (or your kids or your parents) or you might never get ahead.

I do think some of the younger and childless folks on the forum underestimate the cost of children (when it comes to both childcare and healthcare). The cheapest individual insurance my company offers is $65 a paycheck with a deductible of $1,500. If you have a family that jumps to $290 a paycheck with a 6k deductible - for a family you will pay $13,500.00 in a year before your insurance ever kicks in and pays for anything. No small thing on a median income.

I know childcare varies all over the country but I know when we were in the full throws of the daycare years our biggest expenses were childcare, then health insurance, and then housing. We were lucky to have been able to pay off our student loans right before our youngest was born and also lucky that both sets of our parents are currently healthy and self sufficient.

I agree the original author gilds the lily with hyperbole, but his bigger point ain't entirely wrong.

I just switched to a HDHP with an HSA.  My premiums are going down significantly.  My max out of pocket is 6500 and my deductible is 3k.  This is for family coverage.  Its with Humana. 

My take on your post is a bit different.  I think of all the money I've been giving to the insurance company all these years and never using it.  We have never been to the doc outside of annual checkups.  So I've been in the job for 11 years.  Its like 140 difference in the monthly premiums.  (140x12)11 is like 18k in premium difference. 

Given that there are HSA's now that we and the company both contribute to, I think its worth the risk of having to pay that deductible. 

As far as staying healthy, that's cheap too.  Drink water, not soda.  Exercise is free. Etc etc. 

I think people's health can generally be cheap so long as they take care of themselves

[mathlete]

As far as staying healthy, that's cheap too.  Drink water, not soda.  Exercise is free. Etc etc. 

I think people's health can generally be cheap so long as they take care of themselves

Healthcare costs are pretty much an inevitability. If you're lucky enough to live a long time, you'll almost certainly incur large healthcare costs at some point. Quality of life is a better motivation to lead a healthy lifestyle than economics is.

[js82]

I think people's health can generally be cheap so long as they take care of themselves

This is exactly the kind of over-generalization that people are railing against on both sides of this debate.

I have seen coworkers in their 20's/30's fight off cancer.  I'm personally going to have pretty major foot surgery(plus tons of rehab) in the next year+.  For people that don't have a bunch of cash saved up these kinds of events aren't just physically/emotionally devastating, they wreak financial havoc as well.

Is eating healthily and staying physically active good advice in general?  Sure.  Is it any guarantee of low medical bills in a country that has, far and away, the highest medical prices in the world?  Absolutely not.

[BikeFanatic]

Some of the healthiest people that I know have medical issues.  They eat vegetarian, run, work out, but still if you have cancer or high blood pressure or auto immune disease, you can notveat and exercise your way to health.  There are no guarantees of health based on lifestyle for many  people.

[Metalcat]

As far as staying healthy, that's cheap too.  Drink water, not soda.  Exercise is free. Etc etc. 

I think people's health can generally be cheap so long as they take care of themselves

Healthcare costs are pretty much an inevitability. If you're lucky enough to live a long time, you'll almost certainly incur large healthcare costs at some point. Quality of life is a better motivation to lead a healthy lifestyle than economics is.

Yep.

The best way statistically to get cancer is to live a really healthy lifestyle.

[Car Jack]

Let's cue up that story.  Was it on Marketwatch?  Family rakes in $350k a year and can't save anything.  Let me go cry to that family's full time nanny about that perhaps on one of their multiple out of country vacations "to see their family".  Call the Waaaambulance.

[burninglights]

Imagine what the author will say when the longest bull market in American history is over.

[kite]

A person whose living depends on saying "the sky is falling" is going to tell you that the sky is falling.  Doesn't make it true. 

[Not There Yet]

Every time someone talks about not being able to afford a "decent" life I get out the salt shaker for several grains.  What many define as "decent" many members of this forum would define as wildly extravagant. 

   

[mozar]

I think that the author could have made a better connection between meritocracy myth making and our current societal predicament. Even though the article itself is a mess I agree with his main point. If childcare didn't cost 24k a year, if we had paid family leave, if there was an affordable public option for healthcare, etc, I wouldn't be a mustachian. I'm mustachian because living in a society without a strong safety net is terrifying.  I'm not saying I would go buy a 100k car but I would feel like I could take a job that doesn't pay a lot and still be happy.

[ApacheStache]

I, like others, didn't make it far into this article before I shook my head and decided to stop reading. I do however like this sensible mic-drop of a comment left by a reader

No, it probably is you. Your problem, see, is that you’ve grown up with an inflated sense of entitlement. You think that the world owes you a living. Alas, it does not. You owe yourself a living, yet here you are trying to outsource that responsibility. But at the end of the day no one’s going to do for you what you can’t be bothered to do for yourself. And though Mr. Umair Haque is quite willing to reinforce your sense of grievance with his interminable tirades, you should’ve hold your breath waiting for him to cut you a check.

[EscapeVelocity2020]

I didn't read very far either, but this interesting point was made early on -

Albert Einstein was smart. George Orwell was smart. Would you agree with that? They were both socialists, by the way, a fact they probably didn’t teach you at school —but I digress: neither one was a billionaire. Jonas Salk created the polio vaccine — and gave it away, for free, to the whole world.

But yeah, then the article goes off the rails.

[Boofinator]

Jonas Salk created the polio vaccine — and gave it away, for free, to the whole world.

There is a big difference between giving something away and being forced to give it away.

Additionally, Salk earned a living doing the research required to develop the vaccine. Furthermore, this article (https://slate.com/technology/2014/04/the-real-reasons-jonas-salk-didnt-patent-the-polio-vaccine.html) explains some of the other reasons why a patent wasn't procured for polio.

[ETwagon]

I can only read so much stupidity before I lose patience and stop reading.

I knew better and would have stopped reading at the lefts mantra of "pedigreed white men", but I forged on only to discover "Profound and radical social transformation — like the kind an Elizabeth Warren or a Bernie offers — is the answer".  Ugh.

[Buffaloski Boris]

Thanks for all the comments. It’s saved me from reading yet another Clickbait article. These Embrace Your Victimhood sort of articles used to irritate me. Now I find them motivating. Wallowing in self pity is a choice. Those who choose to do so are just handing opportunity over to me and mine.

[Bloop Bloop]

It's a Medium article, so I'm not inclined to get too worked up about it anyway, but I'm probably easier on this guy because I think he's pushing an idea that we're all going to have to cope with sooner or later. If you tether your self-worth to how much capitalism values your labor, you're in for a rude awakening. Maybe you're old enough for it not to matter, but your kids and grandkids are going to feel it. Whatever labor your perform, globalism or technology is coming for it. And it will do it better or more efficiently than you do. It's best that we all decide together that human life has inherent value.

But on the other hand, fuck this guy for implying that it's hard to live on $120,000.

I'm pretty sure there are those of us who are smart enough to keep ahead of the curve. Some sorts of intellectual or interpersonal labour will always be in demand. It is true that we can't predict what that will be, but people are endlessly adaptable and intelligent.

[GodlessCommie]

On a micro level, it is counter-productive to get into a mindset of "things are stacked against me, nothing I can do", regardless of things being stacked or not. And, while post-war working class prosperity is gone and is not coming back, America still offers plenty of opportunity - you only need to look at the flow of immigrants to recognize that.

On a macro level, it is important to recognize that opportunity is not equally distributed, that most of other developed countries have higher levels of upward mobility, and that too many Americans are growing up in environments where staying out of prison is an achievement in and of itself. So, while it is tempting to say "just do X and Y, and you'll be fine", it is not helpful (or fair), either.

[MoneyQuirk]

I think it's very easy (and very appealing to produce articles pandering to it) to complain.

Everything is bad and wrong if you look hard enough for it.

But guess what? Everything is absolutely amazing and filled with opportunity if you look for it.

The group that thinks everything is bad and wrong will find that... it is.

But the group that sees everything as filled with opportunity will find that... it is.

[BTDretire]

I just switched to a HDHP with an HSA.  My premiums are going down significantly.  My max out of pocket is 6500 and my deductible is 3k.  This is for family coverage.  Its with Humana. 

My take on your post is a bit different.  I think of all the money I've been giving to the insurance company all these years and never using it.  We have never been to the doc outside of annual checkups.  So I've been in the job for 11 years.  Its like 140 difference in the monthly premiums.  (140x12)11 is like 18k in premium difference. 

It's been tens years ago now, I got notice my health insurance premium for a family of 4 was going up to $9,900. I switched from a $2,500 deductible to a $10,000 deductible, my premium went down to $4,300, saving me $5,600 a year. I then maxed out my HSA and in less than two years had my $10k deductible. Although our health care costs are low so we never meet our deductible, and several years ago, I quit using the HSA and just let it grow.
  I was a happy camper until Obamacare, when got large increases 3 years in a row, 18.2% 19.4 and 24%. It slowed a little after that, but I still paid dearly for Obamacare and never covered by it.

Given that there are HSA's now that we and the company both contribute to, I think its worth the risk of having to pay that deductible. 

As far as staying healthy, that's cheap too.  Drink water, not soda.  Exercise is free. Etc etc. 

I think people's health can generally be cheap so long as they take care of themselves
[/quote]

[sabanist]

I just switched to a HDHP with an HSA.  My premiums are going down significantly.  My max out of pocket is 6500 and my deductible is 3k.  This is for family coverage.  Its with Humana. 

My take on your post is a bit different.  I think of all the money I've been giving to the insurance company all these years and never using it.  We have never been to the doc outside of annual checkups.  So I've been in the job for 11 years.  Its like 140 difference in the monthly premiums.  (140x12)11 is like 18k in premium difference. 

It's been tens years ago now, I got notice my health insurance premium for a family of 4 was going up to $9,900. I switched from a $2,500 deductible to a $10,000 deductible, my premium went down to $4,300, saving me $5,600 a year. I then maxed out my HSA and in less than two years had my $10k deductible. Although our health care costs are low so we never meet our deductible, and several years ago, I quit using the HSA and just let it grow.
  I was a happy camper until Obamacare, when got large increases 3 years in a row, 18.2% 19.4 and 24%. It slowed a little after that, but I still paid dearly for Obamacare and never covered by it.

Given that there are HSA's now that we and the company both contribute to, I think its worth the risk of having to pay that deductible. 

As far as staying healthy, that's cheap too.  Drink water, not soda.  Exercise is free. Etc etc. 

I think people's health can generally be cheap so long as they take care of themselves

[/quote]

9900/year is crazy.  I recall preobama care, I had a hdhp with bcbs.  It was a catastrophic plan that was only there in case one of us fell seriously ill.  Think i paid like 300/mo.  we were all young and healthy though so never used it.  Except once, i cut my thumb with a circular saw.  Can't remember what we paid but I don't think it was that bad, hell we didn't have much extra money back then so it couldn't have been. 

Times have changed