6 ms·

TIL I live beyond my means. Welcome to America. Having 10-15% cushion to save is a luxury for a lot of people. Probably not most people on HN but still.

YuriNiyazov 11y ago
You do. Either that, or (if you are in tech) you are massively underpaid at your job.
- johnward 11y ago
  It's both. I've worked on fixing the latter. However, living beyond your means isn't always that easy to correct. I can't just stop paying student loans for example. It's not like I'm dropping $300 a month on starbucks. It's student loans, mortgage, utilities, and other debt that takes up my entire paycheck.
  - YuriNiyazov 11y ago
    I completely agree with you that correcting "living beyond your means" is a very hard thing to do.
  - hunterloftis 11y ago
    Definitely. Some types of living beyond means (buying expensive toys, regularly flying to expensive vacations, eating out a majority of the time) are easy to correct. Loans and depreciating assets will be much more difficult.
- caseysoftware 11y ago
  @johnward More likely you have a lot of optional things that you can trim away. Do you have cable? How often do you eat out? Do you smoke? Do you have a budget that you stick to? It's all about priorities. If you don't prioritize it, it won't happen. It's not easy and emergencies and unexpected bills come up but the freedom is amazing. Check out the Ramsey Plan. We wiped out most of our debt in about 2 years while saving for a house. And that's while renting, 3 kids, and living just outside DC.
  - johnward 11y ago
    I appreciate the suggestions and trust me I'm working on it. I wasn't trying to turn this into a thread about my money issues. It's just that HN tends to have a lot of very young and very very well paid people who tend to think everyone else is in that same situation. I'm not sure they realize how fortunate they really are.
    - caseysoftware 11y ago
      Agreed but even many of them squander it all and live paycheck to paycheck. Unrelated: I know a bunch of the Watson team here in Austin. Good group, cool tech. :)
      - johnward 11y ago
        I'm working in San Antonio each week right now. Haven't made it to Austin yet.
  - GFischer 11y ago
    You got me interested, but step 1 is already too steep, I guess I should convert it to local currency. And what's that thing about "mortgage"... Looks like it's too naïve, but it's good advice for people living in the U.S. and that have mortgages.
    - caseysoftware 11y ago
      Yes, convert it to your local currency and skip over the steps that don't apply to you. The point is that - like with most things - if you don't have a plan and you haven't defined success, you can't get there. A plan doesn't make it easier but it makes you think about the details, gives you something to work against, and lets you track progress.
purplelobster 11y ago
If you work in tech you should be able to save at least 30%. I save 60%, and I also live in the highest marginal tax rate country in the world. If you can't it probably means you live beyond your means.
- deleted 11y ago
  [deleted]
- purplelobster 11y ago
  @johnward Well you don't have to do 60% (I'm trying to become financially independent). But stop buying stuff you don't need. Live in a smaller apartment, preferably close to work. Avoid debt and cars like the plague, cook your meals at home. You won't miss all that stuff and it'll make it possible to save a significant portion of your take home pay. @hoorayimhelping SF also have ridiculous salaries compared to the rest of the world. Everybody seems to be making at least $120k starting out, and many up to $300k. I make way less than that, but also live in a pretty expensive city. I just bypass that by not buying a lot of stuff. It's only possible because I reject the average consumerist middle-class lifestyle. I won't buy a house, I'll never buy a car again, I bike to work, I don't have expensive hobbies. You can't have the cake and eat it too. However most people should be able to save more than they do.
- deleted 11y ago
  [deleted]
- hoorayimhelping 11y ago
  This is bit of a silly blanket statement given America's main tech center (and a significant portion of HN's population) is in San Francisco, where rents are the highest in the country. It's really hard not to live beyond your means just by living there.
- gregd 11y ago
  Your numbers mean literally nothing to me. What do your expenses cost per month? Children? Food? Housing? Student loans? Car payment? What is your income tax rate? Sales tax rate? Insurance? Phone? Internet?
NDizzle 11y ago
Wow, 10 to 15 percent is a luxury? I left the bay area because I wasn't happy with a 20% savings rate! I'm currently at a 60% savings rate and I'm 3 hours away from SF. I'm mid 30s with 3 kids. Should I just blow it all on something ridiculous? Like what? Every single month?!
- johnward 11y ago
  Maybe it's easy to save 60% if you make 200k per year?
  - alexcp_ 11y ago
    Of course it's easier to save money when you make so much, however I think the lifestyle is more important than the actual salary. It's easy to waste money on small things. Some people buy expensive coffee and eat out everyday for example. It adds up really fast.

YuriNiyazov 11y ago

You do. Either that, or (if you are in tech) you are massively underpaid at your job.

johnward 11y ago
It's both. I've worked on fixing the latter. However, living beyond your means isn't always that easy to correct. I can't just stop paying student loans for example. It's not like I'm dropping $300 a month on starbucks. It's student loans, mortgage, utilities, and other debt that takes up my entire paycheck.
- YuriNiyazov 11y ago
  I completely agree with you that correcting "living beyond your means" is a very hard thing to do.
- hunterloftis 11y ago
  Definitely. Some types of living beyond means (buying expensive toys, regularly flying to expensive vacations, eating out a majority of the time) are easy to correct. Loans and depreciating assets will be much more difficult.
caseysoftware 11y ago
@johnward More likely you have a lot of optional things that you can trim away. Do you have cable? How often do you eat out? Do you smoke? Do you have a budget that you stick to? It's all about priorities. If you don't prioritize it, it won't happen. It's not easy and emergencies and unexpected bills come up but the freedom is amazing. Check out the Ramsey Plan. We wiped out most of our debt in about 2 years while saving for a house. And that's while renting, 3 kids, and living just outside DC.
- johnward 11y ago
  I appreciate the suggestions and trust me I'm working on it. I wasn't trying to turn this into a thread about my money issues. It's just that HN tends to have a lot of very young and very very well paid people who tend to think everyone else is in that same situation. I'm not sure they realize how fortunate they really are.
  - caseysoftware 11y ago
    Agreed but even many of them squander it all and live paycheck to paycheck. Unrelated: I know a bunch of the Watson team here in Austin. Good group, cool tech. :)
    - johnward 11y ago
      I'm working in San Antonio each week right now. Haven't made it to Austin yet.
- GFischer 11y ago
  You got me interested, but step 1 is already too steep, I guess I should convert it to local currency. And what's that thing about "mortgage"... Looks like it's too naïve, but it's good advice for people living in the U.S. and that have mortgages.
  - caseysoftware 11y ago
    Yes, convert it to your local currency and skip over the steps that don't apply to you. The point is that - like with most things - if you don't have a plan and you haven't defined success, you can't get there. A plan doesn't make it easier but it makes you think about the details, gives you something to work against, and lets you track progress.

purplelobster 11y ago

If you work in tech you should be able to save at least 30%. I save 60%, and I also live in the highest marginal tax rate country in the world. If you can't it probably means you live beyond your means.

deleted 11y ago
[deleted]
purplelobster 11y ago
@johnward Well you don't have to do 60% (I'm trying to become financially independent). But stop buying stuff you don't need. Live in a smaller apartment, preferably close to work. Avoid debt and cars like the plague, cook your meals at home. You won't miss all that stuff and it'll make it possible to save a significant portion of your take home pay. @hoorayimhelping SF also have ridiculous salaries compared to the rest of the world. Everybody seems to be making at least $120k starting out, and many up to $300k. I make way less than that, but also live in a pretty expensive city. I just bypass that by not buying a lot of stuff. It's only possible because I reject the average consumerist middle-class lifestyle. I won't buy a house, I'll never buy a car again, I bike to work, I don't have expensive hobbies. You can't have the cake and eat it too. However most people should be able to save more than they do.
deleted 11y ago
[deleted]
hoorayimhelping 11y ago
This is bit of a silly blanket statement given America's main tech center (and a significant portion of HN's population) is in San Francisco, where rents are the highest in the country. It's really hard not to live beyond your means just by living there.
gregd 11y ago
Your numbers mean literally nothing to me. What do your expenses cost per month? Children? Food? Housing? Student loans? Car payment? What is your income tax rate? Sales tax rate? Insurance? Phone? Internet?

NDizzle 11y ago

Wow, 10 to 15 percent is a luxury? I left the bay area because I wasn't happy with a 20% savings rate! I'm currently at a 60% savings rate and I'm 3 hours away from SF. I'm mid 30s with 3 kids. Should I just blow it all on something ridiculous? Like what? Every single month?!

johnward 11y ago
Maybe it's easy to save 60% if you make 200k per year?
- alexcp_ 11y ago
  Of course it's easier to save money when you make so much, however I think the lifestyle is more important than the actual salary. It's easy to waste money on small things. Some people buy expensive coffee and eat out everyday for example. It adds up really fast.