Coronavirus reveals financial irresponsibility of Americans

Discussion in 'Coronavirus Pandemic Discussions' started by gorfias, Mar 23, 2020.

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  1. gorfias

    gorfias Well-Known Member

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    Some 80% of Americans are living pay check to pay check.

    https://thehill.com/opinion/finance...veals-financial-irresponsibility-of-americans

    Old rule of thumb was that you have enough savings to get by for 3 months.

    No easy answers to this one. A reasonable question is, if the Government is just going to penalize savers to transfer money to those that did not, why the heck should anyone save money.

    And yet, with no relief people really will become homeless and even starve. We will see a race to the bottom. Or will we?

    In the mid 19th century, it was not uncommon for large families to form communities together. As long as some where OK, the community survived. I do not know if that sort of thing will ever be possible again.
     
    Last edited: Mar 23, 2020
  2. wgabrie

    wgabrie Well-Known Member Donor

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    Yeah, it's called Mom's basement. :)
     
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  3. Spim

    Spim Well-Known Member Past Donor

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    I agree that irresponsible people are being exposed.

    im solid middle class but I probably have a 12 month cushion, no car payments, no phone payments, no cc balances.

    It's a safe bet that more than half of those 80% have nicer cars than I do, newer phones, cc balances, and probably more expensive homes.

    i dont feel a lot of sympathy for those peeps, i do feel bad for those that were legitimately scraping by.

    I had a customer tell me that hes been out of work for 4 days and hes unable to pay his april mortgage, he hasn't even collected his last check yet, made more than I do, and hes already crying poor.

    perhaps the 26' open bow fishing boat and the 2019 Tundra or his wifes Audi was a bad idea? ya, it was....
     
    Last edited: Mar 23, 2020
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  4. gorfias

    gorfias Well-Known Member

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    Wishing my boy would stay put till this blows over but he's chomping at the bit to get out on his own. In the middle of all this. I said to a pal, if he's making a mistake, he's young and will bounce back.

    Yeah, I've got people who were born with a silver spoon and then cry poor to me, a guy that has been scrambling my whole life, one recently asking if she could move in and retire with me and my family. I'm not looking for a roommate and I'm sure having this person, even if family, move in with us? I'd be divorced before sundown.
     
  5. nopartisanbull

    nopartisanbull Well-Known Member

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    Question: Why are we forced to pay info Social Security?

    Answer; Because after the longest economic expansion, after the largest tax cuts in history, after the best booming years in history, a great majority are still living pay cheque to pay cheque.
     
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  6. EMTdaniel86

    EMTdaniel86 Banned

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    You saw this with the government shutdown and then and Nancy came out and said people need money to pay their bills. Why didn't people put money away to cover their bills...... People do need to put money away for emergencies. I always get a kick out of reading stories of people who spend money on things that they don't need(need vs want) or speeding before covering themselves for emergencies like this. Roof over your head or food vs Netflix or the newsiest Iphone.......
     
    Last edited: Mar 23, 2020
  7. modernpaladin

    modernpaladin Well-Known Member Past Donor

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    I'm prolly good for 4 months if I lose all income. Thats just paying water, power and mortgage. I have food for at least that long. But I have a lot of unemployment built up. So unless that system goes under, Im good for a year or more. But I also happen to be a critical asset for my employer. They'd have to shut down their US branch if they stopped paying me.
     
  8. Spim

    Spim Well-Known Member Past Donor

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    yip. fortunately most of my friends are well cushioned, which is probably why they are friends, they share the same values.

    I do have a kid on sabbatical at age 26, (preplanned before this event) So I might see my household grow before this is over, but not until the moderate cushion dwindles there, right now shes living dirt cheap out hiking and camping but I'm afraid that we might see national parks address that in the near future, I dunno.
     
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  9. gorfias

    gorfias Well-Known Member

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    Me, wife and kids boomeranged twice. Total of 3 years living with family to save a nest egg to buy a house. (And we are good room mates: my brother in law said he didn't care if we ever moved out. My mother in law graciously called the house we saved for and were moving into when leaving her house, "that g.d. house.") My wife's twin? Did the same with her husband and kids. Now, twin has 2 kids: one with significant other living with her getting a nest egg together, the other with her S.O. in the boy friend's parent's house. I will not be surprised nor mind if my kids boomerang to me for such reasons. They have a plan. That other family member? She just wants to retire in my house!!! My wife would flay me alive and roll me in rock salt.
     
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  10. Spim

    Spim Well-Known Member Past Donor

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    I'm my own boss and wont see a measurable reduction in income for 12 months minimum, 24 max depending on how deep a recession goes. but my wife isnt so lucky, so my cushion factors in a 75% cut for her in the short term, it's quite likely she will see hours or wages cut, but we're fairly well prepared for that.

    sometimes is pays off being a cheap bastard. I have one prepper buddy, mid 60's that's probably giddy over this situation as far as food stash, but is about to lose 10-12,000 a month on his biz with -0- salary. hes well prepared financially but that's a tough pill to swallow even if you've got a massive cushion, within 3 months your making huge withdrawals and setting your retirement plans back big time because it's a double swing: you are losing income, withdrawing from savings, and not contributing to retirement in a time where contributions are probably the best idea.

    He admitted to me yesterday that he can shake off 75k without really noticing long term but then it really starts to hurt.

    personally, even if things go really disastrously south for an extended period, I'm probably only going to fall 1k short a month, which is very manageable with my savings.
     
    Last edited: Mar 23, 2020
  11. squidward

    squidward Well-Known Member

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    The boom was created via debt based consumerism. Always a recipe for disaster
     
  12. jay runner

    jay runner Banned

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    Right now is probably the worst time ever to RV or camp or nomad:

    https://www.campendium.com/camping/...il&utm_term=0_d42c2750af-769dae5405-112820665

    If you have a trip planned with reserved spots all the way through, some of those campgrounds are going to close before you get there.

    If you're on foot, bicycle, or a dual sport motorcycle there's nothing can stop you, as always, because you can use cover.
     
    Last edited: Mar 23, 2020
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  13. Spim

    Spim Well-Known Member Past Donor

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    thanks for sharing, I passed that along, very helpful. we were discussing this as recently as Saturday but I never thought to google it myself.

    that's quite a laundry list of closings, a couple of them I was just viewing travel pics from last week.
     
    Last edited: Mar 23, 2020
  14. jay runner

    jay runner Banned

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    My wife was nagging me to saddle up, but I had a suspicious feeling about it.

    Big Bend was still open yesterday, and closed today. She wanted to go back for the spring flowers and cactus blooms. We won't be rafting through St. Elena Canyon this year.
     
    Last edited: Mar 23, 2020
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  15. 61falcon

    61falcon Well-Known Member

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    I thought the federal government had already closed all national parks and recreation areas they control???
     
  16. 61falcon

    61falcon Well-Known Member

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    The majority of Americas workers do not make enough to save large amounts of cash so that they could sustain themselves for a long period of time and continue to pay their bills.
     
  17. Spim

    Spim Well-Known Member Past Donor

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    out in the desert away from 99.999% of the population is likely the safest spot, yet, there are rules and regs that always complicate things, sigh.
     
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  18. jay runner

    jay runner Banned

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    All Florida state parks are closed, as are most states' parks already. The Grand Canyon West campground (privately owned) closed before the East. Bad time to be on the road.

    The risk is at the shower houses and restrooms and park stores where people congregate or have to stand in line. Usually a line, maybe long, for restrooms at Yellowstone.
     
  19. Collateral Damage

    Collateral Damage Well-Known Member

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    Majority? Could you be a little more specific, please, because I tend to believe that it's not how much they make, it's how much they spend actually being the problem.
    https://www.nbc-2.com/story/39956151/living-paycheck-to-paycheck
     
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  20. 61falcon

    61falcon Well-Known Member

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    Of course how much one makes determines how one lives,supposedly we tightened lending standards so that it would be difficult for Americans to get into the debt morass that occurred in 2008.The GOP had done a lot of relaxing the tight lending standards set by Dodd Franks and other legislation passed after the 2008 crisis.
     
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  21. jay runner

    jay runner Banned

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    A lot of people at church buy all their clothes at Goodwill, Salvation Army, and other thrift stores. You MUST make ends meet no matter how little you earn.

    Even if you earn 75k but spend 85k you got one hellova a spending problem.
     
  22. Quantum Nerd

    Quantum Nerd Well-Known Member

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    Hey, if 80% live paycheck to paycheck, there must be a lot of Trump voters among them. Isn't the narrative that those are the ones with personal responsibility?

    My opinion: The reason why 80% live paycheck to paycheck isn't because they are bad people, it is because the system has been stacked against them since the advent of Reagonomics. Since then, basically all economic gain went to the top few %, whereas the regular gut needed to go to two incomes to even stay afloat.
     
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  23. jay runner

    jay runner Banned

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    Every individual chooses the poison of debt, or the elixir of freedom, and less stuff that incurs less debt is more freedom.
     
    Last edited: Mar 23, 2020
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  24. Quantum Nerd

    Quantum Nerd Well-Known Member

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    And less stuff that incurs less debt slows economic growth. Pick your poison.
     
  25. jay runner

    jay runner Banned

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    No mortgage, bought a distressed small home on large acreage from the bank and I fixed it up with some labor from my wife. No credit card debt. One car loan to keep the credit rating up.

    We've never had a bill collector call us. We are scared as hell of debt.

    A five dollar bill is one hell of a lot of money and we are in awe of it and must spend it wisely to get the most possible from it. People who went through the Great Depression taught me personal finance.

    But it's a free country, and if people prefer being in debt to get nice, new stuff, that's their business. But they should know how deep deep is so they don't drown.
     
    Last edited: Mar 23, 2020

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