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Realistically: yes. It's uncomfortable and nobody ever wants to hear it, and it's quick to get shouted down (especially in forums like HN where everyone is eit

Realistically: yes. It's uncomfortable and nobody ever wants to hear it, and it's quick to get shouted down (especially in forums like HN where everyone is either wealthy or only "temporarily" poor), but if you can't afford to put $5500 into an IRA each year while also keeping your emergency fund topped up for 12 months' expenses while also still having enough extra for at least one little vacation that year -- then you're poor. Not middle class, but poor. And, statistically speaking, if you're poor now, then you're likely to be poor for the rest of your life. America continues to run on the idea that that's not true, but that's a clever bit of marketing intended to keep people from realizing just how truly screwed they are. This isn't to say that you're destitute or that it's impossible to live well at more modest means. Many people do.

taurath 9y ago
Lol, by that measure 80%+ of the US is poor. The reality is much of that 80% of people are doing okay, and can survive a hiccup or two either by having enough money to expense themselves through it, unemployment or disability. If you’re in a high COL area I’d say that’s where you need to have a lot more money stashed. 12 months expenses isn’t reasonable for most people under 40.
- thaumaturgy 9y ago
  > Lol, by that measure 80%+ of the US is poor. Yep. Not really a laughing matter. > Only 39% of Americans have enough savings to cover a $1,000 emergency https://www.cnbc.com/2018/01/18/few-americans-have-enough-savings-to-cover-a-1000-emergency.html https://www.cnbc.com/2018/01/18/few-americans-have-enough-sa... Relying on unemployment, disability, or having enough money (or, in most cases, credit) to "expense a hiccup or two" is not middle class. And people under 40 should have an easier time developing an emergency fund, because their expenses should be lower. People over 40 should have an easier time maintaining the emergency fund because it should be an investment account that they started before they were 30. Your reply is a pretty good example of the amazing impact that political marketing has had on popular views towards wealth and poverty in this country. People have become entirely convinced that they aren't poor so long as they "can survive", that poverty is something that happens to the other people they hear about on the television. $5500 a year, plus one vacation, plus building or maintaining an emergency fund, should amount to saving about $10,000 a year. The second-to-bottom, 15% tax bracket tops out at $37,950 for single people, and IRA contributions are 100% tax deductible, so you can safely gross up to $43,450 in that bracket. (edit: math.) If it sounds difficult to squirrel away 25% gross annually in that bracket, that's because that's not the middle class bracket. It's the "poor" bracket.
  - deleted 9y ago
    [deleted]
  - taurath 9y ago
    That source is absolutely wrong though - it originated from a report from Bankrate which only counted money in people’s savings (not checking) accounts. With rates under 1% for the past decade many people haven’t been even using a savings account.
    - thaumaturgy 9y ago
      That's a fair criticism. The Bankrate report was marketing material, based on a survey, and someone's answer would depend on what they considered a "savings account" to be. I don't have a savings account with my bank because, as you say, it's not worth it. I do have a small amount of savings in an investment account. Whether I'd consider that when asked about a savings account or not, I dunno. However, the Fed has asked a different question intended to drill down into the same problem, and found that 47% of people responding would pay for a $400 emergency by borrowing money or selling something (https://www.theatlantic.com/magazine/archive/2016/05/my-secret-shame/476415/ https://www.theatlantic.com/magazine/archive/2016/05/my-secr..., also cites Bankrate though). I'm unaware though of any studies finding that the majority of Americans have a significant amount of money (let's say a thousand or more) in a liquid asset of some kind. If you know of any, that would be some welcomed good news.
  - ryanwaggoner 9y ago
    First, your tax ignores payroll tax, and IRA contributions are pre-income-tax but post-payroll-tax. Just FYI. So taxes take a bigger bite than you’re portraying. Second, where did you come up with this rationale that you’re poor unless X, Y, and Z? It seems just as arbitrary to say that you’re not poor if you can put $2000 into an IRA, have a three month emergency fund, and take a week vacation. Or let’s go the other way, why not: if you can’t put $30k per year into savings, have a three year emergency fund, and take eight weeks off per year, you’re not middle class, you’re poor. See, we can all pull random numbers and standards out our ass! In actuality, “poor” and “middle class” are actual defined terms with relatively well-defined meanings, none of which have anything to do with your bizarre markers of what constitutes different steps on the socioeconomic ladder.
- enraged_camel 9y ago
  >>Lol, by that measure 80%+ of the US is poor. No. It's not that most people can't save enough for retirement. It's just that they won't, due to a combination of bad habits and financial decisions.
  - rectang 9y ago
    It's a beautiful system where not only do the poor get to suffer, but their suffering allows the wealthy to luxuriate in perceived moral superiority.
    - pbhjpbhj 9y ago
      It's way better than that: at the extremes the deep poverty of the poorest earns more money through usurious credit for the rich too.
    - ericd 9y ago
      This is silly and infantilizing. You can walk down any street in any of the many non-depressed area of the US and see a parade of bad financial decisions driving by in the form of newish $30k+ cars, along with a number of $50k+ pickup trucks, doubtless financed with debt. No one here is talking about people who can't afford food, he's talking about a much larger percentage of the population that makes an objectively large amount of money and still doesn't save nearly any of it. People in the US are, on average, not nearly as frugal as they should be, and the sorry state of savings in this country is at least partly due to those habits. Even people with 6 figure take home salaries frequently are only a few months of savings away from financial ruin or tapping their retirement savings, if they lose their job. For them, it's a planning and discipline problem, not a problem of some evil system keeping them down.

taurath 9y ago

Lol, by that measure 80%+ of the US is poor. The reality is much of that 80% of people are doing okay, and can survive a hiccup or two either by having enough money to expense themselves through it, unemployment or disability. If you’re in a high COL area I’d say that’s where you need to have a lot more money stashed. 12 months expenses isn’t reasonable for most people under 40.

thaumaturgy 9y ago
> Lol, by that measure 80%+ of the US is poor. Yep. Not really a laughing matter. > Only 39% of Americans have enough savings to cover a $1,000 emergency https://www.cnbc.com/2018/01/18/few-americans-have-enough-savings-to-cover-a-1000-emergency.html https://www.cnbc.com/2018/01/18/few-americans-have-enough-sa... Relying on unemployment, disability, or having enough money (or, in most cases, credit) to "expense a hiccup or two" is not middle class. And people under 40 should have an easier time developing an emergency fund, because their expenses should be lower. People over 40 should have an easier time maintaining the emergency fund because it should be an investment account that they started before they were 30. Your reply is a pretty good example of the amazing impact that political marketing has had on popular views towards wealth and poverty in this country. People have become entirely convinced that they aren't poor so long as they "can survive", that poverty is something that happens to the other people they hear about on the television. $5500 a year, plus one vacation, plus building or maintaining an emergency fund, should amount to saving about $10,000 a year. The second-to-bottom, 15% tax bracket tops out at $37,950 for single people, and IRA contributions are 100% tax deductible, so you can safely gross up to $43,450 in that bracket. (edit: math.) If it sounds difficult to squirrel away 25% gross annually in that bracket, that's because that's not the middle class bracket. It's the "poor" bracket.
- deleted 9y ago
  [deleted]
- taurath 9y ago
  That source is absolutely wrong though - it originated from a report from Bankrate which only counted money in people’s savings (not checking) accounts. With rates under 1% for the past decade many people haven’t been even using a savings account.
  - thaumaturgy 9y ago
    That's a fair criticism. The Bankrate report was marketing material, based on a survey, and someone's answer would depend on what they considered a "savings account" to be. I don't have a savings account with my bank because, as you say, it's not worth it. I do have a small amount of savings in an investment account. Whether I'd consider that when asked about a savings account or not, I dunno. However, the Fed has asked a different question intended to drill down into the same problem, and found that 47% of people responding would pay for a $400 emergency by borrowing money or selling something (https://www.theatlantic.com/magazine/archive/2016/05/my-secret-shame/476415/ https://www.theatlantic.com/magazine/archive/2016/05/my-secr..., also cites Bankrate though). I'm unaware though of any studies finding that the majority of Americans have a significant amount of money (let's say a thousand or more) in a liquid asset of some kind. If you know of any, that would be some welcomed good news.
- ryanwaggoner 9y ago
  First, your tax ignores payroll tax, and IRA contributions are pre-income-tax but post-payroll-tax. Just FYI. So taxes take a bigger bite than you’re portraying. Second, where did you come up with this rationale that you’re poor unless X, Y, and Z? It seems just as arbitrary to say that you’re not poor if you can put $2000 into an IRA, have a three month emergency fund, and take a week vacation. Or let’s go the other way, why not: if you can’t put $30k per year into savings, have a three year emergency fund, and take eight weeks off per year, you’re not middle class, you’re poor. See, we can all pull random numbers and standards out our ass! In actuality, “poor” and “middle class” are actual defined terms with relatively well-defined meanings, none of which have anything to do with your bizarre markers of what constitutes different steps on the socioeconomic ladder.
enraged_camel 9y ago
>>Lol, by that measure 80%+ of the US is poor. No. It's not that most people can't save enough for retirement. It's just that they won't, due to a combination of bad habits and financial decisions.
- rectang 9y ago
  It's a beautiful system where not only do the poor get to suffer, but their suffering allows the wealthy to luxuriate in perceived moral superiority.
  - pbhjpbhj 9y ago
    It's way better than that: at the extremes the deep poverty of the poorest earns more money through usurious credit for the rich too.
  - ericd 9y ago
    This is silly and infantilizing. You can walk down any street in any of the many non-depressed area of the US and see a parade of bad financial decisions driving by in the form of newish $30k+ cars, along with a number of $50k+ pickup trucks, doubtless financed with debt. No one here is talking about people who can't afford food, he's talking about a much larger percentage of the population that makes an objectively large amount of money and still doesn't save nearly any of it. People in the US are, on average, not nearly as frugal as they should be, and the sorry state of savings in this country is at least partly due to those habits. Even people with 6 figure take home salaries frequently are only a few months of savings away from financial ruin or tapping their retirement savings, if they lose their job. For them, it's a planning and discipline problem, not a problem of some evil system keeping them down.