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Around the Internet => Antimustachian Wall of Shame and Comedy => Topic started by: Poorman on January 16, 2014, 11:48:57 AM

Title: 4 people who earn six figures and still feel broke
Post by: Poorman on January 16, 2014, 11:48:57 AM
There are some gems here and also some hope that out of control situations can be turned around.

http://finance.yahoo.com/blogs/daily-ticker/i-earn-six-figures-and-still-feel-broke-215546862.html;_ylt=AwrSyCTxKNhSpUwACq.TmYlQ
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 16, 2014, 02:00:54 PM
I work with lots of people who make six figures and still feel broke. I have zero sympathy for them.
Title: Re: 4 people who earn six figures and still feel broke
Post by: odput on January 16, 2014, 02:18:07 PM
It does kind of blow me away how these articles are always written so that we're supposed to feel sorry for the people profiled...

"Having lots of money is stressful and comes with a certain lifestyle WAAH WAAAAAH!"

STFU already
Title: Re: 4 people who earn six figures and still feel broke
Post by: Cheddar Stacker on January 16, 2014, 02:37:27 PM
Quote -  “I contribute only 1% to my 401(k) right now and as for emergency savings, I have none. None. All of our disposable income is going toward the cost of our wedding at this point.”

This is the kind of shit that makes it hard to feel sorry for them. Why do we feel the need to go into debt (or defer retirement savings) for a wedding? I had a relatively modest wedding (compared to typical Americans, not Mustachians) that still cost $12-20K depending on what you include. I would have been happy eloping to Vegas or a beach somewhere, but DW and families weren't on board. At least no one went into debt for it, but it still bothers me that this has become the norm in our society.

At least the last guy's woes are from starting a business that sounds like it has potential.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Angelfishtitan on January 16, 2014, 02:42:06 PM
Quote from: Article
But earning more doesn’t necessarily confer superior financial management skills, and even high-earners find that it’s shockingly easy to fall into one particularly nefarious debt trap — living beyond one’s means.

Is the debt just lying in wait for an unsuspecting upper middle class citizen to leap out on?
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlanStache on January 16, 2014, 03:08:57 PM
I did not feel there were to many facepunches deserved by those in the article, mostly it seemed like people had made some mistakes or had gone to school and have now realized they are now not in a great position and at least thinking about ways to better there situation.  Are they all level 15 mustachian-no, but they could now be on the right path.  Also it is a yahoo article for christs sake.
Title: Re: 4 people who earn six figures and still feel broke
Post by: sulaco on January 16, 2014, 03:10:59 PM
Our household income is above six figures, we save a significant portion of it each year, have a budget that makes MMMs look even more luxurious than it already is, and still feel broke ;)

For me it's the distance between our current stache and FI that makes me feel that way. With mortgages (primary and investment) on top of that, I still have anxiety over our finances (mostly around not being able to put up with my high paying but stressful job long enough to reach it).
Title: Re: 4 people who earn six figures and still feel broke
Post by: Cheddar Stacker on January 16, 2014, 03:34:50 PM
Our household income is above six figures, we save a significant portion of it each year, have a budget that makes MMMs look even more luxurious than it already is, and still feel broke ;)

For me it's the distance between our current stache and FI that makes me feel that way. With mortgages (primary and investment) on top of that, I still have anxiety over our finances (mostly around not being able to put up with my high paying but stressful job long enough to reach it).

+1 but it's a different kind of broke. It's sort of a mentally broke feeling, not a financially broke feeling, at least for me.

I agree completely with this statement. FIRE is still at least 5 years away, but more likely 10 for me/us. I have the same anxieties, but the six figures I earn make it hard to do anything about it, like quit now. I just don't have the confidence to go the self-employed route now when I can go the unemployed route in a limited amount of years.

I start to feel mentally broke when I read others on this website and can't help but feel envious. I'm sure others would be envious of my six figure salary.

However, what I've learned most from this website is to look at everything through a different set of lenses. This is my journey, and I'm enjoying it for what it is. I hesitate now at every moment i feel envious, defeated, angry, etc. and do my best to think WWMMMD (what would MMM do)?

Example - When I first started posting on the forum I was waiting for some sort of validation from others, like an attaboy or something. Then I realized it's not about that, it's about me contributing what I can and hopefully helping someone else. I get some satisfaction out of that, even if I don't get the attaboy or a single reply to my post.
Title: Re: 4 people who earn six figures and still feel broke
Post by: dragoncar on January 16, 2014, 03:49:47 PM
Our household income is above six figures, we save a significant portion of it each year, have a budget that makes MMMs look even more luxurious than it already is, and still feel broke ;)

For me it's the distance between our current stache and FI that makes me feel that way. With mortgages (primary and investment) on top of that, I still have anxiety over our finances (mostly around not being able to put up with my high paying but stressful job long enough to reach it).

+1 but it's a different kind of broke. It's sort of a mentally broke feeling, not a financially broke feeling, at least for me.

I agree completely with this statement. FIRE is still at least 5 years away, but more likely 10 for me/us. I have the same anxieties, but the six figures I earn make it hard to do anything about it, like quit now. I just don't have the confidence to go the self-employed route now when I can go the unemployed route in a limited amount of years.

I start to feel mentally broke when I read others on this website and can't help but feel envious. I'm sure others would be envious of my six figure salary.

However, what I've learned most from this website is to look at everything through a different set of lenses. This is my journey, and I'm enjoying it for what it is. I hesitate now at every moment i feel envious, defeated, angry, etc. and do my best to think WWMMMD (what would MMM do)?

Example - When I first started posting on the forum I was waiting for some sort of validation from others, like an attaboy or something. Then I realized it's not about that, it's about me contributing what I can and hopefully helping someone else. I get some satisfaction out of that, even if I don't get the attaboy or a single reply to my post.

Attaboy
Title: Re: 4 people who earn six figures and still feel broke
Post by: Cheddar Stacker on January 16, 2014, 04:07:28 PM
There it is! Thanks dragoncar.

Seriously not what I wash fishing for, but thanks.

One other point to @sulaco - I recently paid off a few small debts and optimized a few other things. Setup more autopay on bills and have some automatic transfers for investments. A few days ago I found myself with that "what's next" feeling I've heard others post about. I know the answer to the question for me, but it reminded me of the MMM post about what it feels like to become rich.

Our net worth does not put us in the "rich" category by this websites standards, but things have reached a certain level where they're sort of on autopilot. My "what's next" is to just plug along and FI is just going to happen by itself. Control our spending a bit, but otherwise just autopilot. It's boring, but that's how it should feel.

If sulaco and others earn six figures and have MMM level spending, you are by no means financially broke, and you will be rich before you know it. Good luck.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Roland of Gilead on January 16, 2014, 04:11:42 PM
My wife was talking to a coworker who just bought a million dollar home, has three kids, and was struggling to make ends meet on their $240,000 a year income (they did put down $300,000 on the home though).

Sigh.
Title: Re: 4 people who earn six figures and still feel broke
Post by: gillstone on January 16, 2014, 04:33:14 PM
Quote from: Article
But earning more doesn’t necessarily confer superior financial management skills, and even high-earners find that it’s shockingly easy to fall into one particularly nefarious debt trap — living beyond one’s means.

Is the debt just lying in wait for an unsuspecting upper middle class citizen to leap out on?

http://www.smbc-comics.com/?id=3238#comic (http://www.smbc-comics.com/?id=3238#comic)
Title: Re: 4 people who earn six figures and still feel broke
Post by: greaper007 on January 16, 2014, 04:37:50 PM
My wife and I have just crossed the 6 figure mark, but it took a good 8-10 years to get there, and I'm finally starting to attack debt now.   We each had 2 student loans to pay off.   She has a PhD in psychology and I was an airline pilot, I had a career change to a stay at home dad, and we started a business.   

I have to say at this point I don't regret any of our decisions, and we never really lived very poshly.   But we each had points in our careers where we couldn't make ends meet with what we made, so we had to use credit cards to make up the rest.   And that wasn't because we bought expensive things, we literally made at or below minimum wage.

6 figures looks nice, but you don't always see the debt incurred to get there.   I'd venture that most professionals have $100-$250,000 in student loans and credit cards.   What's the alternative, finishing medical school in your 50s while you pay your way?
Title: Re: 4 people who earn six figures and still feel broke
Post by: Poorman on January 16, 2014, 05:23:15 PM
Quote from: Article
But earning more doesn’t necessarily confer superior financial management skills, and even high-earners find that it’s shockingly easy to fall into one particularly nefarious debt trap — living beyond one’s means.

Is the debt just lying in wait for an unsuspecting upper middle class citizen to leap out on?

http://www.smbc-comics.com/?id=3238#comic (http://www.smbc-comics.com/?id=3238#comic)

That comic reminds me of my college days when the credit card companies were allowed to set up tables on campus and practically chase students down to sign them up.  It was right on the main walkway that 80% of freshman had to walk past to get to their lower division classes.  So many signed up for cards based on cheap gimmicks like a free T-shirt or whatever.  Pretty sad.
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 16, 2014, 06:57:54 PM
While I still stand by my statement about having no sympathy for people with sizable incomes who are constantly broke, I think there is an underlying problem about how we, as a society, manage our money.  Where are we going wrong and what is the solution?
Title: Re: 4 people who earn six figures and still feel broke
Post by: fat bruce lee on January 16, 2014, 07:15:59 PM
I like these articles mostly because they keep me sane.  Is that sick?

I'm fortunate enough to make what I do and am thankful i stumbled on MMM's site early last year.  I can see that I could have been heading in the direction of being written about on Yahoo.  But also seeing my parents go through some rough situations like these folks, but mostly with a housing market that turned out to be a nightmare for many.

What gets me is that many mindlessly move forward in this bad direction.  I've always felt that a personal finance class was needed in high school.  It would have done me more good than home ec. 

The ability to change is something I embraced.  Hopefully these folks will too.
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 16, 2014, 09:05:10 PM
The ability to change is something I embraced.  Hopefully these folks will too.

I hope so too for their sake. I'm always surprised at the resistance to change even when things are going to shit. I guess I've embraced change enough that I forgot what it's like to be afraid of it.
Title: Re: 4 people who earn six figures and still feel broke
Post by: SwordGuy on January 16, 2014, 10:39:12 PM
While I still stand by my statement about having no sympathy for people with sizable incomes who are constantly broke, I think there is an underlying problem about how we, as a society, manage our money.  Where are we going wrong and what is the solution?

Agreed in full.

$100,000 is GOD'S PLENTY of money to live on.   If someone can't make ends meet on $100,000 a year they are doing a piss-poor job of managing their money.

And I'm SO VERY FED UP with articles whining about folks graduating with a HUGE $29,000 student loan debt.  That's pure horseshit.    The average car is selling for over $31,000 and people manage to pay that off in 5 to 7 years yet somehow a $29,000 student loan is an unbearable, never-ending burden?   That's an example of pure financial incompetence, not student loan slavery.  They should be buying  $5000 to $10000 low mileage, good gas mileage used car instead.  That, and kicking the Starbucks habit would let them easily pay off that student loan.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Insanity on January 16, 2014, 10:42:19 PM
While I still stand by my statement about having no sympathy for people with sizable incomes who are constantly broke, I think there is an underlying problem about how we, as a society, manage our money.  Where are we going wrong and what is the solution?

Agreed in full.

$100,000 is GOD'S PLENTY of money to live on.   If someone can't make ends meet on $100,000 a year they are doing a piss-poor job of managing their money.

And I'm SO VERY FED UP with articles whining about folks graduating with a HUGE $29,000 student loan debt.  That's pure horseshit.    The average car is selling for over $31,000 and people manage to pay that off in 5 to 7 years yet somehow a $29,000 student loan is an unbearable, never-ending burden?   That's an example of pure financial incompetence, not student loan slavery.  They should be buying  $5000 to $10000 low mileage, good gas mileage used car instead.  That, and kicking the Starbucks habit would let them easily pay off that student loan.

but.. but.. if we don't have consumerism then people will lose their jobs or incomes will go down and it will be cyclical… spending is what makes the world go around!!!! you know it…

</sarcasm>
(it has been one of those days)
Title: Re: 4 people who earn six figures and still feel broke
Post by: Cinder on January 17, 2014, 03:39:56 AM

That comic reminds me of my college days when the credit card companies were allowed to set up tables on campus and practically chase students down to sign them up.  It was right on the main walkway that 80% of freshman had to walk past to get to their lower division classes.  So many signed up for cards based on cheap gimmicks like a free T-shirt or whatever.  Pretty sad.

Hey, I got a university branded lawn chair!  That was back in 2003 and it still works, hasn't broken or torn yet!

I also only spent what I had, and never thought of a credit card as free money...
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 17, 2014, 09:13:40 AM
While I don't feel sorry for these people I'm somewhat in that situation too. I figure depending on my part-time job we could creap above six figures in gross income this year. But between retirement savings (~10% right now, slowly increasing) and aggressive student loan payoff we don't have a lot of fluff in the budget and I still feel like we're not making nearly as much progress as we should be

And you still manage to not whine about it like the world owes you something.

When you're paying off debt and trying to build your 'stache it never seems like enough. You can always envision where you would stick those extra dollars. That is totally normal. Being a whiny bitch about it and blaming other people is not normal or ok and makes everyone around you think you are a huge douche. I think that is the main point in a nutshell.
Title: Re: 4 people who earn six figures and still feel broke
Post by: rockstache on January 17, 2014, 10:26:53 AM
While I don't feel sorry for these people I'm somewhat in that situation too. I figure depending on my part-time job we could creap above six figures in gross income this year. But between retirement savings (~10% right now, slowly increasing) and aggressive student loan payoff we don't have a lot of fluff in the budget and I still feel like we're not making nearly as much progress as we should be

+1

We're DINKS and I think we're going to just cross 6 figures gross this year too. However, we're 30 and REALLY need to catch up on our retirement savings (our 20s were almost entirely a wash for that), and our situation is sort of limited in what things we can do to change our spending. We have to stay in the current house (long story, reasons not relevant to this conversation), which has no insulation, and therefore high heat cost, and also a high COLA, and we both have to commute. I can't do anything about that stuff right now, but I can get rid of cable, lower my auto insurance, and try to tighten the reigns about food spending. You just have to do what you can, and 6 figures doesn't mean it's easy street and throwing discipline to the wind.
Title: Re: 4 people who earn six figures and still feel broke
Post by: MsSindy on January 17, 2014, 11:04:28 AM
........
6 figures looks nice, but you don't always see the debt incurred to get there.   I'd venture that most professionals have $100-$250,000 in student loans and credit cards.   What's the alternative, finishing medical school in your 50s while you pay your way?

If you venture that, then you'd be wrong...or at least it doesn't have to be that way.  But the conditioning lately claims that is the only way to get there.  Yes, if you're talking med school, then maybe.  But there are plenty of jobs that make over $100k - my hubby and I both have them.

Me: - went to junior college, night school, tele-school all while working - company picked up a small portion of the fees.  Transferred to a 4 year State school with a little cash we had saved and went full time.  While my DH worked a full time job and we built cabinets and other wood-working jobs out of our 1-car garage.  Those were tough years, but we were so proud of what we did.  Got a job and I worked my way up the ladder and became a Project Manager, making over $100k.  I had a little bit of luck and a little bit of "can-do" attitude to get me there.  I don't consider myself especially talented, but I'm a strong worker.

Him: Got a 4 year apprenticeship in Industrial Maintenance....meaning he worked while he learned.  He's worked his way up through the years and is now in an Engineering position, even though he never got a degree.  He has smarts, the "I can fix anything smarts", not "book smarts".  And yes, he has been shut out of jobs because he doesn't have a degree, but he never complains, works hard, and thankfully is very talented!

My point is, there is more than one way to get there, and it doesn't have to be with a lot of debt along the way.  Sure, I didn't graduate at 22, but I had real world experience before I even graduated, which made me more marketable than my peers.  And my DH earned while he learned.
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 17, 2014, 11:24:12 AM
I finished college with 10k in student loans which I paid off in under 2 years. I did it by working during school (graduated with honors and 165 semester hours in 4 years) applying for scholarships and joining the Coast Guard Reserve (the military has lots of education benefits.) lots of debt is not necessary to make $100k/ year. In my mind, it is mostly a result of people just not caring enough to find better ways to go about it.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Albert on January 17, 2014, 11:39:53 AM
100k might sound like a lot of money, but it depends where you live, whether you have any debt and most importantly how many people are supported on that. In my area it's above average but nothing special for a single salary let alone for a family income.

Having said that living decently on 100k should be possible practically everywhere so I'm not crying for those folks either.
Title: Re: 4 people who earn six figures and still feel broke
Post by: odput on January 17, 2014, 11:45:02 AM
I finished college with 10k in student loans which I paid off in under 2 years. I did it by working during school

+1

I can't quite figure out why everyone forgets that you are allowed to have a job while taking college courses
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 17, 2014, 11:51:00 AM
I finished college with 10k in student loans which I paid off in under 2 years. I did it by working during school

+1

I can't quite figure out why everyone forgets that you are allowed to have a job while taking college courses

If I had really tried I could have graduated with no loans. I did have some fun while I was in school :)
Title: Re: 4 people who earn six figures and still feel broke
Post by: sherr on January 17, 2014, 11:56:23 AM
That comic reminds me of my college days when the credit card companies were allowed to set up tables on campus and practically chase students down to sign them up.  It was right on the main walkway that 80% of freshman had to walk past to get to their lower division classes.  So many signed up for cards based on cheap gimmicks like a free T-shirt or whatever.  Pretty sad.

I was one of those students. I was clueless enough to not really know how to cancel a credit card, but clued-in enough to make sure there weren't any annual or other fees. Signed up, got the T-shirt, and promptly cut up and forgot about the card when it came. Four years later I look at my credit report and discover that I have 4 years of perfect credit history and therefore excellent credit for someone my age. So yay?

The only real downside is that they spelled my name wrong on the card so now I have an "alias" that is going to be on my credit report for the rest of my life, which is mildly annoying.
Title: Re: 4 people who earn six figures and still feel broke
Post by: dragoncar on January 17, 2014, 12:07:37 PM
100k might sound like a lot of money, but it depends where you live, whether you have any debt and most importantly how many people are supported on that. In my area it's above average but nothing special for a single salary let alone for a family income.

Desire to facepunch... rising...

Quote
Having said that living decently on 100k should be possible practically everywhere so I'm not crying for those folks either.

Desire to facepunch... subsiding...
Title: Re: 4 people who earn six figures and still feel broke
Post by: SwordGuy on January 17, 2014, 12:10:26 PM
100k might sound like a lot of money, but it depends where you live, whether you have any debt and most importantly how many people are supported on that. In my area it's above average but nothing special for a single salary let alone for a family income.

Having said that living decently on 100k should be possible practically everywhere so I'm not crying for those folks either.

$100,000 a year sounds like a lot of money because it IS a lot of money!

I didn't say that someone making $100,000 a year had no difficulting doing everything they wanted to do, RIGHT NOW, RIGHT AWAY, plus was rolling in so much dough that they could max out their retirement savings, plus pay off their student loans.

I said that if they couldn't make ends meet on $100,000, they were financial morons.

If the reason they can't make ends meet is because they have a huge debt, then (barring catastrophic illness or lengthy bouts of unemployment) they were almost certainly financial morons to end up with that much debt. 

Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 17, 2014, 12:13:49 PM
$100k is enough to live on unless you make stupid financial choices. It may not be enough if I decide I want a beach house in Malibu. But that goes back to the choices thing. If you make $100k you should be fine if you make reasonable choices. If you don't I won't feel sorry for you; its almost certainly your fault.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Albert on January 17, 2014, 12:19:05 PM
100k might sound like a lot of money, but it depends where you live, whether you have any debt and most importantly how many people are supported on that. In my area it's above average but nothing special for a single salary let alone for a family income.

Having said that living decently on 100k should be possible practically everywhere so I'm not crying for those folks either.

$100,000 a year sounds like a lot of money because it IS a lot of money!

I didn't say that someone making $100,000 a year had no difficulting doing everything they wanted to do, RIGHT NOW, RIGHT AWAY, plus was rolling in so much dough that they could max out their retirement savings, plus pay off their student loans.

I said that if they couldn't make ends meet on $100,000, they were financial morons.

If the reason they can't make ends meet is because they have a huge debt, then (barring catastrophic illness or lengthy bouts of unemployment) they were almost certainly financial morons to end up with that much debt.

I do not actually disagree. I just pointed out that 100k could really feel like it's a lot of money and it could also feel like it's merely adequate depending on factors I listed. I think it would be difficult to argue about that.

Dragoncar: :):):)
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 17, 2014, 12:33:23 PM
I don't consider myself especially talented, but I'm a strong worker.

This.

Somehow I missed this earlier but really this is all you need. If you are not afraid of a little work you can do pretty much anything.
Title: Re: 4 people who earn six figures and still feel broke
Post by: mlipps on January 17, 2014, 02:45:50 PM
I read a quote a while ago that I think of a lot when I start to get the creeping feeling of not being able to meet all of our priorities at once (Ok, those are pretty responsible priorities, not "I want a designer purse" priorities, but still).

Anyone can afford anything but no one can afford everything.

That pretty much sums it up for me as far as this article goes.
Title: Re: 4 people who earn six figures and still feel broke
Post by: AlmostIndependent on January 17, 2014, 02:50:35 PM
Anyone can afford anything but no one can afford everything.

That is great. Kind of along the same lines as "You're never too rich to be broke."
Title: Re: 4 people who earn six figures and still feel broke
Post by: greaper007 on January 18, 2014, 09:46:45 AM
........
6 figures looks nice, but you don't always see the debt incurred to get there.   I'd venture that most professionals have $100-$250,000 in student loans and credit cards.   What's the alternative, finishing medical school in your 50s while you pay your way?

If you venture that, then you'd be wrong...or at least it doesn't have to be that way.  But the conditioning lately claims that is the only way to get there.  Yes, if you're talking med school, then maybe.  But there are plenty of jobs that make over $100k - my hubby and I both have them.

Me: - went to junior college, night school, tele-school all while working - company picked up a small portion of the fees.  Transferred to a 4 year State school with a little cash we had saved and went full time.  While my DH worked a full time job and we built cabinets and other wood-working jobs out of our 1-car garage.  Those were tough years, but we were so proud of what we did.  Got a job and I worked my way up the ladder and became a Project Manager, making over $100k.  I had a little bit of luck and a little bit of "can-do" attitude to get me there.  I don't consider myself especially talented, but I'm a strong worker.

Him: Got a 4 year apprenticeship in Industrial Maintenance....meaning he worked while he learned.  He's worked his way up through the years and is now in an Engineering position, even though he never got a degree.  He has smarts, the "I can fix anything smarts", not "book smarts".  And yes, he has been shut out of jobs because he doesn't have a degree, but he never complains, works hard, and thankfully is very talented!

My point is, there is more than one way to get there, and it doesn't have to be with a lot of debt along the way.  Sure, I didn't graduate at 22, but I had real world experience before I even graduated, which made me more marketable than my peers.  And my DH earned while he learned.

It depends on the opportunities available to you, and what you want to do.   I'm sure that if I got a degree in chemical engineering, and my wife decided to be a medical doctor instead of a psychologist, we'd have a lot more money now.    However, that's not where our interests and talents lie.    I know from personal experience that following degrees or careers for the cash never works out.   You end up a depressed alcoholic, or you end up quitting.

There are lots of examples of people that misuse student loan debt.   They take out as much as they can to buy nice cars and sports equipment.   They go to ridiculously expensive liberal arts colleges when they could hit a perfectly decent public university.    However, the larger issue is that college expenses have risen dramatically faster than inflation and it's extremely difficult, if not impossible to work your way through college and not take on any debt in the process.   It's great if you have a degree that will pay you $20 an hour for a side job while you're working on your degree, but not every degree is like that.   And what would the world be without people that promote literature, art, history and philosophy?   A pretty boring place.

Instead of lambasting individual people, we should be questioning the structure.    We know that the only way our society will continue to advance is through education.   Yet we've allowed educational costs to skyrocket in this country.   Instead of having a defense budget that's 26 times larger than our nearest competitor, and focusing more on college football and basketball teams than noble laureates, we should start funding meat and potatoes university education for every citizen.   I dare say we'd get more out of the process.
Title: Re: 4 people who earn six figures and still feel broke
Post by: zinethstache on January 18, 2014, 12:20:38 PM
My DH and I both feel that finances should be taught all through k-12 education. I took an accounting class in 11th grade. It was a blast, It was a big envelope with an actual ledger, checkbook and invoices/bills that you cut up and put in smaller envelopes for each month. It was an optional class, and probably would have been intimidating for some. But had we all taken some financial courses starting at a younger age it would have been good for all students to take. Today there would need to be investing courses as well. I also recoll in 8th grade Social Studies playing Pit. That was a fun excercise in supply and demand.

We are now single income, mid way through our full transition to FI. DH retired from his horrible career in 2011. I make over 6 figures and DH is now finally making rental income so things are less stressful. Never had any student loan debt because my employers over the years paid for mine 100%. DH was blue collar and those skills now serve him well with our rental properties. He just renewed his Commercial Electricians license through 2016 just in case he ever needs it. He is definitely the fix-it man for most anything and really serves him well now with his new endeavor.

My big fear right now is my physical health. I am a very hard worker. I sit for 12+ hours at my day job and then go ride/compete with horses and pack around very heavy equipment for side gigs we do in our spare time. My back has had issues for over 20 years, I have a variety of diagnoses per the doctors and what I do physically is c not the best for it. Well last summer L5-S1 ruptured out of the blue and I needed emergency surgery to remove the massive material in my spinal canal (had been great for 10 years before this) and I have struggled with it ever since. I have accumulated 18 years of sick leave and have FMLA and short term disability to use thank goodness. I've taken a couple of medical leaves and right now I am still only cleared for 32 hours work since in my field of work once cleared for 40, it will quickly ramp up to 50. These are the unexpected things in life you cant really prepare for and really impact FI plans. For instance if I need to negotiate a max 32 hour /week schedule, my income will drop which in turn delays our plans.

This eye opening experience has altered my FI plans. I need to get back to good health, give up all heavy lifting side gig work. I am formulating how I can operate my side gigs differently, and the help I provide with the rentals will be throttled back to book work until I am in much better physical health, I can see myself getting back to being able to paint and such. It will accept the lesser "side" income I enjoy to save my back. I have plans to continue this side work pose FI to keep me busy and provide that fun money we can use.

Most students I talk with who intern for me or at my company  have the mentality that they can accumulate a lot of student debt to use for their current living expenses and they will pay it off later. I cringe when I hear this. They have been sold on a concept that they don't even understand and haven't planned out the impact of what $20-$100K negative net worth is going to do to them when they graduate. They will figure it out later. These interns are IT interns so I suspect they will be ok but still when I was earning my IT degree it was not all about living off of student loans.

If my health does finally return (its been over a year now, I am working out of this dark hole, albeit slowly) I will burn my oil at a much slower pace and likely will NOT be duped into working well past FI because just a little more saved will make me feel so much safer. I WILL be quitting the day job the second I am able. I want to be healthy enough to enjoy life while I am young!
Title: Re: 4 people who earn six figures and still feel broke
Post by: yahui168 on January 18, 2014, 05:40:03 PM
It took me a couple of days to realize I know Ruben! My wife went to school with him and his wife and we've had dinner a couple of times in the last 15 years. I'm glad he's turning things around.
Title: Re: 4 people who earn six figures and still feel broke
Post by: mm1970 on January 19, 2014, 08:18:17 PM
........
6 figures looks nice, but you don't always see the debt incurred to get there.   I'd venture that most professionals have $100-$250,000 in student loans and credit cards.   What's the alternative, finishing medical school in your 50s while you pay your way?

If you venture that, then you'd be wrong...or at least it doesn't have to be that way.  But the conditioning lately claims that is the only way to get there.  Yes, if you're talking med school, then maybe.  But there are plenty of jobs that make over $100k - my hubby and I both have them.

Me: - went to junior college, night school, tele-school all while working - company picked up a small portion of the fees.  Transferred to a 4 year State school with a little cash we had saved and went full time.  While my DH worked a full time job and we built cabinets and other wood-working jobs out of our 1-car garage.  Those were tough years, but we were so proud of what we did.  Got a job and I worked my way up the ladder and became a Project Manager, making over $100k.  I had a little bit of luck and a little bit of "can-do" attitude to get me there.  I don't consider myself especially talented, but I'm a strong worker.

Him: Got a 4 year apprenticeship in Industrial Maintenance....meaning he worked while he learned.  He's worked his way up through the years and is now in an Engineering position, even though he never got a degree.  He has smarts, the "I can fix anything smarts", not "book smarts".  And yes, he has been shut out of jobs because he doesn't have a degree, but he never complains, works hard, and thankfully is very talented!

My point is, there is more than one way to get there, and it doesn't have to be with a lot of debt along the way.  Sure, I didn't graduate at 22, but I had real world experience before I even graduated, which made me more marketable than my peers.  And my DH earned while he learned.
Some of the best engineers I've ever worked with have the "I can fix anything" smarts.  Some of the worst were really good at book learning...
Title: Re: 4 people who earn six figures and still feel broke
Post by: dragoncar on January 19, 2014, 08:39:34 PM
........
6 figures looks nice, but you don't always see the debt incurred to get there.   I'd venture that most professionals have $100-$250,000 in student loans and credit cards.   What's the alternative, finishing medical school in your 50s while you pay your way?

If you venture that, then you'd be wrong...or at least it doesn't have to be that way.  But the conditioning lately claims that is the only way to get there.  Yes, if you're talking med school, then maybe.  But there are plenty of jobs that make over $100k - my hubby and I both have them.

Me: - went to junior college, night school, tele-school all while working - company picked up a small portion of the fees.  Transferred to a 4 year State school with a little cash we had saved and went full time.  While my DH worked a full time job and we built cabinets and other wood-working jobs out of our 1-car garage.  Those were tough years, but we were so proud of what we did.  Got a job and I worked my way up the ladder and became a Project Manager, making over $100k.  I had a little bit of luck and a little bit of "can-do" attitude to get me there.  I don't consider myself especially talented, but I'm a strong worker.

Him: Got a 4 year apprenticeship in Industrial Maintenance....meaning he worked while he learned.  He's worked his way up through the years and is now in an Engineering position, even though he never got a degree.  He has smarts, the "I can fix anything smarts", not "book smarts".  And yes, he has been shut out of jobs because he doesn't have a degree, but he never complains, works hard, and thankfully is very talented!

My point is, there is more than one way to get there, and it doesn't have to be with a lot of debt along the way.  Sure, I didn't graduate at 22, but I had real world experience before I even graduated, which made me more marketable than my peers.  And my DH earned while he learned.
Some of the best engineers I've ever worked with have the "I can fix anything" smarts.  Some of the worst were really good at book learning...

Worst case: I can fix anything = book learning + confidence.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Freckles on January 19, 2014, 09:03:40 PM
"One of the toughest changes they made was consolidating their three checking accounts so they could keep better track of their money flow."

Huh?  A little bit of hassle maybe, but one of the toughest changes?  I've closed checking accounts.  It's not hard.  Keeping track of three sounds harder to me.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Insanity on January 19, 2014, 09:33:25 PM
"One of the toughest changes they made was consolidating their three checking accounts so they could keep better track of their money flow."

Huh?  A little bit of hassle maybe, but one of the toughest changes?  I've closed checking accounts.  It's not hard.  Keeping track of three sounds harder to me.

That could have been more emotional (note: did not read the article) based on their own personal preferences than it was of the actual process.  They might have wanted to kept money separate.
Title: Re: 4 people who earn six figures and still feel broke
Post by: infogoon on January 20, 2014, 12:56:28 PM
And I'm SO VERY FED UP with articles whining about folks graduating with a HUGE $29,000 student loan debt.  That's pure horseshit.    The average car is selling for over $31,000 and people manage to pay that off in 5 to 7 years yet somehow a $29,000 student loan is an unbearable, never-ending burden?   That's an example of pure financial incompetence, not student loan slavery. 

Agreed. The chance to vastly, vastly improve your lifetime earnings and only incur as much debt as you would to buy a moderately optioned Subaru is a fantastic deal. Stop complaining, pick a solid major, and hit the books.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Ms Betterhome on January 23, 2014, 02:28:05 PM
A couple of years ago there was a proposal to means-test a previously untested government payment. The proposed rate at which the payment would cut out was a combined household income of $150k. This set of a chorus of squeals from middle class parents who swore they were 'struggling' on that income. It boggled my mind, especially as that happens to be my household incom, I definitely don't feel I'm in need of any government subsidy!
Title: Re: 4 people who earn six figures and still feel broke
Post by: greaper007 on January 23, 2014, 03:44:45 PM
A couple of years ago there was a proposal to means-test a previously untested government payment. The proposed rate at which the payment would cut out was a combined household income of $150k. This set of a chorus of squeals from middle class parents who swore they were 'struggling' on that income. It boggled my mind, especially as that happens to be my household incom, I definitely don't feel I'm in need of any government subsidy!

In most areas of the country I agree with you.    But...I lived in CT after I got my first job and my wife and I were definitly struggling at a combined $100,000 salary.    The cost of living in this area is redicuously high and we had about $80,000 of combined student debt, and this was in New Haven and Hartford.    I don't know how anyone lives in NYC with a family income under $200,000.
Title: Re: 4 people who earn six figures and still feel broke
Post by: TreeTired on January 23, 2014, 04:09:07 PM
Quote
I don't know how anyone lives in NYC with a family income under $200,000.

I don't either... but have you read "Bonfire of the Vanities"? Poor old Sherman McCoy couldn't make it in NYC on a mere $765,000.    Private school for the kiddos,  servants,  it's really tough to make it on less than $2mm.   

I love the irony of Keith Urban, megamultimillionaire that he is singing:

Oh, I know
That I don't need a whole lot of anything
I just want a little bit of everything


I couldn't finish the article.  My son just graduated and has his first job, living comfortably on his $40k salary in a very expensive city.  I loaned him money to buy a condo.  I needed the income, he can use the deduction,  his payment is cheaper than rent.

We lived in a very wealthy town in NJ.  I frequently cautioned my wife when she observed neighbors buying new cars, or vacation homes, or embarking on extensive home renovations (the town's favorite sport).  I told her we had no way of knowing if a particular neighbor was stretching their budget to the max or was accustomed to annual $10mm bonuses and were living well within their means.  There was some of both in town.




Title: Re: 4 people who earn six figures and still feel broke
Post by: dragoncar on January 23, 2014, 05:35:24 PM
Quote
I don't know how anyone lives in NYC with a family income under $200,000.

I don't either...

I maintain contact with several gentlemen from my preparatory academy, who easily live in NYC while drawing less than $200k (per annum) from their trust.  It is not a conspicuous event.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Guizmo on January 23, 2014, 07:05:50 PM
I worked with many people who had families making a combined $70k per annum that lived in NYC. It is all about priorities.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Ms Betterhome on January 24, 2014, 12:18:06 AM
Well. I live in Sydney, which is not quite expensive as New York, but it's pretty close, according to these figures: http://images.smh.com.au/file/2014/01/05/5054744/costofliving.jpg?rand=1388923914725

We have no debt other than our mortgage, which I think makes a BIG difference. We also don't live in a sexy 'expat' area as described in the article...
Title: Re: 4 people who earn six figures and still feel broke
Post by: greaper007 on January 24, 2014, 11:49:34 AM
I worked with many people who had families making a combined $70k per annum that lived in NYC. It is all about priorities.

What's rent in Brooklyn (let alone Manhattan) these days?   I think the average is north of $3000 a month, food costs are much higher than the nation on average, and you get hit with all sorts of taxes that most people don't have to pay.    The first time I got hit with a $300 tax bill for my old car (that's a local annual tax in addition to state registration fees) I said it's time to get out of the northeast.   That and $5000 a year for property taxes on a beat up bungalow on the highway so our town could have granite curbs.   

I agree that one could easily get by on a smaller salary in NYC or Boston, but it's going to be a long time before you hit FI on anything less than a combined $200k.   But  I grew up in Cleveland where mansions are $400,000 so I probably have a different perspective on costs.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Albert on January 24, 2014, 11:58:56 AM
I'm sure plenty of people live comfortably in NYC on much less than 200k. There are also some advantages in living there, no need for a car for example.
Title: Re: 4 people who earn six figures and still feel broke
Post by: Angelfishtitan on January 27, 2014, 11:57:45 AM
But...I lived in CT after I got my first job and my wife and I were definitly struggling at a combined $100,000 salary.    The cost of living in this area is redicuously high and we had about $80,000 of combined student debt, and this was in New Haven and Hartford.    I don't know how anyone lives in NYC with a family income under $200,000.

Hahahaha....wait are you serious?

You can easily live on a third of that in CT without even being a really hardcore mustachian, just got to be smart.
Title: Re: 4 people who earn six figures and still feel broke
Post by: 2lazy2retire on January 29, 2014, 08:37:02 AM
It does kind of blow me away how these articles are always written so that we're supposed to feel sorry for the people profiled...

"Having lots of money is stressful and comes with a certain lifestyle WAAH WAAAAAH!"

STFU already

I am convinced that these articles are written in the knowledge that it will piss off a lot of people and generate a lot of hits and comments ( almost 6k in this case). Lets face it an article about a family of 4 struggling to get by on 40k is not going to arouse any sentiment ( ie traffic )
Whats does amaze me is that if I were one of the case studies here I would not want to advertise the fact that I am a complete moron.
Title: Re: 4 people who earn six figures and still feel broke
Post by: MsSindy on January 29, 2014, 11:12:01 AM
........
Whats does amaze me is that if I were one of the case studies here I would not want to advertise the fact that I am a complete moron.

I know, right??  Do you think they got paid?  Or did they just want their 15 minutes of fame?

Title: Re: 4 people who earn six figures and still feel broke
Post by: LDoon on January 29, 2014, 12:12:39 PM
Quote
I know, right??  Do you think they got paid?  Or did they just want their 15 minutes of fame?

I assume they get paid or perhaps receive a years worth of financial planning.
Title: Re: 4 people who earn six figures and still feel broke
Post by: DukeGanote on September 13, 2014, 10:56:28 AM
Why do we feel the need to go into debt (or defer retirement savings) for a wedding?

So we can be debt slaves like guy: "Zar Muhammad’s troubles began 30 years ago when he took a loan from a kiln owner to marry. (The elaborate marriage and funeral ceremonies expected by Afghans frequently cost several years’ worth of wages, forcing many people to take out loans that they must work off.)"
http://www.nytimes.com/2011/03/16/world/asia/16kiln.html?pagewanted=all

Of course, over there "his children would inherit his debt."
Title: Re: 4 people who earn six figures and still feel broke
Post by: DukeGanote on September 13, 2014, 11:00:02 AM
Apparently it's not impossible on less than $200K. Not saying that I'm willing to try though.

"Sylvia Flores...declared bankruptcy in 2005 and subsequently managed to run up $300,000 in debt despite earning more than $200,000 a year. Over the past three years, Ms. Flores has sharply lowered her spending and paid down most of her debt."
http://blogs.wsj.com/totalreturn/2014/09/08/six-figure-incomes-and-going-broke-readers-offer-advice/?google_editors_picks=true
Title: Re: 4 people who earn six figures and still feel broke
Post by: Davids on September 14, 2014, 08:42:48 AM
We currently gross $100,000 per year. Used to gross about $150,000/year before DH early retired at age 44.

Here's how most of our income is applied towards our net worth:

$18,000 towards the principal on our almost-paid-off-home
$17,400 into 403b
$11,000 Roth IRA contributions
$  4,800 pension contribution
$  8,000 into 529 and custodial DRiPs

Additional health insurance and flex spending contributions put our AGI into the 15% tax bracket. The amount left over after taxes is plenty for a family of five in the midwest. A family that refuses to compete with the debt-ridden Joneses, drives 10 year old cars, bikes around town, cooks at home and shops at thrift stores. I live 8 miles from work. Our investment portfolio is set up to pay quarterly dividends, and sometimes we take capital gains when it keeps us under the 15% tax bracket. And there is still room for improvement - lots and lots of ways I could be doing more.

For now, looking forward to paying my mortgage off by the end of next year. That'll be $18K/year I can put towards the kids' college...
That is excellent fartface. This is a great example that unfortunately if you try to sell to many Americans they will look at you like you are crazy.
Title: Re: 4 people who earn six figures and still feel broke
Post by: zataks on September 14, 2014, 09:01:54 AM
I am convinced that these articles are written in the knowledge that it will piss off a lot of people and generate a lot of hits and comments ( almost 6k in this case). Lets face it an article about a family of 4 struggling to get by on 40k is not going to arouse any sentiment ( ie traffic )
Whats does amaze me is that if I were one of the case studies here I would not want to advertise the fact that I am a complete moron.

I think you're absolutely right.  It's hard to inspire people (read: get them to tell others about the article for positive reasons) if it's about a family identical to their own making it without trouble because they choose to live within their means.

But what people need to hear about are the folks struggling, just barely, and totally making it on 40k/year.  Was talking to my grandmother a couple weeks ago and she was saying how it's so sad that "there are so many middle-class Americans that can't afford to live."
I responded that, "well, yea, if all the kids have their own bedrooms, the family has two cars, and flat screen TVs, it's hard to get by on average salaries." 
Gma, "But, zataks, they can't even afford food!"
Me "that may be, but I think a lot is lifestyle choice."

Please note, we were talking about the media's described "middle class" not legitimately poor folks. 

Full disclosure: Am now half of a DINK household well into 6figs.  Making ends me?  Totally.  Living pretty fucking luxuriously?  Definitely.  Living mustachian and saving my balls off?  Not yet but getting there.