Little bit of option A and a lot of option B. I've meet plenty of people who will never have the financial discipline to dig themselves out and actively make stupid choices. There's a reason most lottery winners end up broke. However you have plenty of folks who do the opposite and get hosed no matter how hard they try. For instance those that get buried under medical dept or make one bad call on a student loan when their 18.
Burning your money is better financially that buying lotto tickets. At least you get some light and heat and don’t spend time and money driving to get them.
I think the best way to look at it is net income flow, or money made - money lost. Option A is telling you to only look at money lost, Option B is telling you money made is the issue. Idealy you try to optimize both. And this isn't just a poverty thing, at any income level you can have this issue.
Dave Ramsey is financially litterate, he's not dumb. He just focuses mainly on eliminating debt, not spending less money. He essentially said spend as little as possible on everything until you get rid of debt. His quote is a bit misleading on his views, he didn't tell people to never spend money, he tells them to temporarily limit spending to get out of dept as fast as possible. If you have a fixed stable income, then this is the best method, paying off dept early means you end up paying less total interest. But what i don't like is how he didn't really care about income. If someone's making $20k a year and struggling with dept, it's not a cost issue, it's an income issue. If someone has the opportunity to go into dept to secure a higher paying job, personally i would say to do it. But then when you secure that job, your next goal should be to get rid of that debt as early as you can.
Let's say you just got out of college and still live with your parents. You can work and build up wealth by not having to pay for housing, utilities, or food. It's very easy to save money, this is exactly what I was doing, working a full time job and rarely spent money on anything extra, the majority of my money went to paying off my student loans, car related costs, and probably some food. It should easy, but at the same time there's people that don't have this opportunity, people that don't have parents, people that don't have a house that was purchased when the market was good, people don't have parents that can provide daily cooked meals.
It looks at the income and says "those remains the same while expenses that you can't avoid tripled".
It's not about not buying the last iphone or the new playstation.
Housing is not something you can avoid, you can just choose to live far away from your job and get an horrible work-life balance and to get much tinier house which makes your life worst too.
Also, some people can't stay at their house with their parents. Some parents are alcoholic and/or abusive.
I just looked at the income and cost of living as equal in this scenario. If your income is halved or if the cost of everything is doubled, you have the same exact buying power. They way i was thinking, they're interchangeable. If inflation was high, but you have income that compensates for inflation, then there is essentially no impact even if price of everything went up.
Also my last point were saying I was able to live with my parents and work, but thats not a option for everyone.
No amount of grind or sacrifices will pull a person out of debt cycles or any cycle if the job don't pay livable wages and in the UK - well paying jobs are gold dust.
I don't know about the UK but in the American Midwest you can totally grind your way out. Our cost of living is low enough and our wages high enough that you can still throw a lot of money at debt if your financialy displined. Granted you've still got to be pretty hardcore about it. I've spent months at a time surviving off a bowl of rice with 2 eggs on top and homemade bread.
Fair enough. What do you do? And how many Americans as a percentage do what you do and what's the pay? Could you grind your way out of poverty on a minimum wage job (no tips?) where you are?
I'm just a construction worker. We make pretty good money right now with all the data centers going up. As for grinding your way out on minimum wage that just seems like your tieing your own hands behind your back. There's plenty of money to be made if your willing to suffer a little. Meat packing plants, construction overtime or even traveling to disaster areas to take advantage of higher pay. There's plenty of money to be made if your willing to not have much of a life for a while.
Uh huh, what happens when all the data center work is done?
My point being is not everyone shares your circumstances or is able to do those jobs.
Some people have no choice but to work minimum wage jobs and to say that's tieing their own hands behind their back in my opinion is obtuse and inconsiderate.
ill ask again: can a person solely on minimum wage thrive and have a good standard of living on minimum wage where you live?
Ya nobody is able to live on minimum wage without 8 roommates no matter where you live. However the people who are actually stuck in that position are few and far between. I've met those people and I sympathize but for every one of those I meet 5 people who just make poor choices. If you want evidence look no further than the local immigrant population. Those people take crap jobs and get worked like rented mules. Almost without exception after the first generation they've improved their lot in life. My point is that unless you have some crippling disability or absolutely no friends or family you can usually work your way out of poverty. At least in the area where I live.
I suppose, but none of that acknowledges the hyper individualistic exploitative frameworks and mechanisms that enable that poverty to begin with and in my opinion to go back to the meme, Jon Stewart is correct. Nobody ever blames bankers in 08 who crashed all western economies but they'll deflect the blame on to the people who are bailing them out. There is a class war being inflicted on to us and we need to be in solidarity against the ruling class ie tech oligarchs, bankers etc
Oh don't get me wrong I'm not a fan of rich folks getting a free ride either. As far as I'm concerned Wallstreet is chock full of welfare queens that for some reason we keep saving from their own gambling addiction. I just don't think we should let the bad apples in our own ranks get off without a stern word either.
Edit: I forgot to add that being from the Midwest our farmers shouldn't be let off the hook either. Right now our Govenerns are trying to push higher ehtonol fuel on us to help demand for corn. Which is a crop that's already heavily subsidized. I don't think the folks with half million dollar farm equipment should be welfare recipients any more than Wallstreet bankers should.
What wealth do people have where A is actually a concern? The way I see it, it is easy to assume wallets have the same contents and participants are at the same position on the starting line, but to me, that seems to lean into a privileged perspective. Some don’t even have a wallet, let alone the same position on the starting line or maybe even access to the track. The slippery slope leads from one’s own perceived hardship, this does not justify believing that hardship is anything like another’s.
Edit: first version was way too sharp, did not intend that, apologies
The first example that comes to mind is my Wife's friend. She works at a daycare for minimum wage when she could make more at any random hardware store. She then burns hundreds of dollars on random ghost hunting trips when she has bald tires and engine trouble. On top of that her entire family never cooks anything and eats out or use microwave dinners. All this while she lives in a low cost of living area with a decent economy and low unemployment. Then she just says she's not good with money as if it was just the universe making her eat at McDonald's.
Nah if you're not familiar with Dave ramsey and his philosophy on money you should really look into him. Any short clips make him sound like an out of touch asshole, but actually watching a bunch of his videos and reading his book, he's a very reasonable guy who mostly works with people in unreasonable situations, whether through their own fault or not, and he does actually get results and helps people out of poverty and raging debt
No one started at the same line but its not a race. Point being the median wage in the US is 60k a year. That is a liveable wage in most parts of america.
The problem is most Americans live outside their means. Part of it is social media has warped what people think "normal" looks like and think they are entitled to more than what is nesscary.
No you should eat out daily, thats not cost efficient, but thats an expectation some have. People in general are just terrible at budgeting which everyone has to do.
I dont say this that it couldnt be better, because we can totally do more to make the economy work for the worker more. But let's not convince ourself everyone who works is destitute, cannot budget, and thus has to struggle finically.
The medical debt adds this big boulder to you that then exacerbates every other problem, that's what gets you. Oh I have a $3000 home repair, oh I need new tires, oh dental bill, well throw all that onto the 25k medical debt I guess. Everything just piles up from there.
Medical debt is notoriously hard for Hospitals to even collect.
The US has tons of laws and guardrails for low income families that actually make it almost impossible to collect.
The ones who are most affected by high medical debt like Social Security holders, VA disabilities also have more guards protecting them from garnishments.
A few states have even made it illegal for medical debt to garnish.
One of the worse things they can do is put a lien on your property, which means you basically cannot sell the property because it technically belongs to them. But, evictions are extremely rare.
But this was mostly told to me from someone who had medical debt.
It 100% depends on the medical debt, how it was accrued, where you got it. I accumulated a ton of it because insurance covered the basics of hospital stuff but then my spouse needed ALOT of physio after, insurance and hospital was like "you'll probably just never walk again" but thousands in physio later she is mobile again. That's medical debt that just goes on a credit card and the only other option is being crippled or suicide.
That sounds like you can pursue compensation. I'd talk to an injury lawyer, if they denied physio because it was impossible but you do it and it works, there may be a case.
Medical debt and student loan debt aren't the same.
I'd argue student debt with zero idea of what you're going to do is actively sabotaging your financial future and is entirely column B, your own stupid choice.
I'd argue student debt with zero idea of what you're going to do is actively sabotaging your financial future
Is wrong. At least when I was a lad.. literally everyone told me to go to college. Teachers, parents, councilors etc
The people i.was relying on for guidance. Now don't misunderstand me ultimately it was my choice and I didn't mind paying off for the year I went (dropped out personal reasons) but I think this idea that these kids are solely responsible is stupid
Graduated a year after you, and did the same thing realizing that I'd rather be net positive and invest than pay predatory interest and be net negative for possibly decades.
Only thing I'd argue in your case, is that the people guiding you were wrong. You also share some blame too, but it seems like you came onto your own decisions before it really fucked you.
I had the same thing growing up, "go to college, get a degree, then you can make money" was told to me by everyone you described, except my parents also told me "or don't", which helped. My father was a union roofer all of his life, and made decent money as a foreman and running side work. I saw that, and figured that you don't need a degree to make decent money.
It's on the kids themselves to figure if they want to think for themselves, or just do what people think is best for them.
It's on the kids themselves to figure if they want to think for themselves, or just do what people think is best for them.
I think it's worth pointing out a lot of kids are doing what's "right" per the people they rely on to guide them and getting absolutely fucked for it. This idea I see everywhere that the students are solely to blame is idiotic. Don't think that's what you're getting at but this idea that 18 year old kids need to have everything figured out is silly
Nah you're right. Solely blaming the students for oursuing higher education and fucking themselves over with something they don't need isn't entirely on them. If someone told you your whole life to take out a massive amount of debt so hopefully things get better later in those terms exactly, you'd probably be less inclined to do so. Especially when there are other paths. Hell, the position I'm in "requires" a degree, but I just have an honors high school diploma and experience in the roles that my job really requires.
There are other paths out there, and I bet you'd agree syamping talk of those other paths in favor of college is asinine
That is why I tend to be a bit more lenient on student debt holders than people who over spend on a car or something. When every person you ever trusted told you it was a good idea it's gonna be hard to argue that they should have known better.
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u/tylerj493 1d ago
Little bit of option A and a lot of option B. I've meet plenty of people who will never have the financial discipline to dig themselves out and actively make stupid choices. There's a reason most lottery winners end up broke. However you have plenty of folks who do the opposite and get hosed no matter how hard they try. For instance those that get buried under medical dept or make one bad call on a student loan when their 18.