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This meme about people just not pulling themselves up by their bootstraps seems attractive based on anecdotes we all have had with slackers, but it lacks eviden

This meme about people just not pulling themselves up by their bootstraps seems attractive based on anecdotes we all have had with slackers, but it lacks evidence. Millennials are increasingly saving when they can[0], increasingly staying home[1] and _not_ going out every other night. Clearly the younger generation understands saving is important. Yet 78% of American households are living paycheck to paycheck [2]. For an example - Say you rent a one bedroom in Boston for 2k, nearly half the average[3], and you share this one bedroom with a roommate making rent 1k/month. Minimum wage in MA is 12.75/hour - if you work part time, 30 hour weeks 50 weeks out of the year, you take home 1530 a month, leaving 530 a month for food, transportation, and student loans, while they continue your studies or interview for jobs. If they managed to spend just 430 on all those costs, and saved $100/month, it would take them 10 months to cover rent alone for just one month, forget about 3-6 months. Should this person be priced out of Boston schools and interviewing in the job market because they can’t save for a global pandemic shutting down all service jobs? [0] https://www.usatoday.com/story/money/2020/02/07/millennials-savings-habits-might-shock-you-in-a-good-way/41142261/ https://www.usatoday.com/story/money/2020/02/07/millennials-... [1] https://www.cell.com/joule/fulltext/S2542-4351(18)30003-5 https://www.cell.com/joule/fulltext/S2542-4351(18)30003-5 [2] https://www.cnbc.com/2019/01/09/shutdown-highlights-that-4-in-5-us-workers-live-paycheck-to-paycheck.html https://www.cnbc.com/2019/01/09/shutdown-highlights-that-4-i... [3] https://www.rentcafe.com/average-rent-market-trends/us/ma/boston/ https://www.rentcafe.com/average-rent-market-trends/us/ma/bo... Edit: fixed numbers, minimum wage in MA is actually 12.75, not 12

JamesBarney 7y ago
So I totally agree that a 3-6 months emergency fund saved up as a waiter in case we have a once in a century pandemic is not realistic. But spending two-thirds of your take-home pay on an apartment is also absolutely crazy.
- bluGill 7y ago
  It isn't in case of pandemic. It is in case of whatever. Most people face something sometime in their life. Generally a small thing, but an expensive car repair is still reason to have an emergency fund
  - JamesBarney 7y ago
    An expensive car repair is not 6 months of living expenses. It's completely unrealistic to expect a 22-year-old waiter to have saved $10,000. And any model of the world where that is an assumption is going to be terribly flawed.
    - bluGill 7y ago
      Most 22 year old waiters have other options. If you can move back in with your parents that greatly reduces how much you need to have saved to cover 6 months of living expenses. There are lots of reasons someone won't have 6 months of expenses. Most are rare situations (most people are not just getting started in life). If everybody makes saving 6 months expenses a goal they work to before most people will achieve it. When it is only a minority that can't take care of themselves it is a lot easier on the rest of us.
- mattnewton 7y ago
  Then I hope you would agree that we help that waiter the same way we help people who's home has been washed away in a hurricane, with some meager public assistance from disaster relief. I agree it's insane to be spending that much on rent as well - but short of raising the minimum wage and using pricing controls to stop rent increases, what can be done about it? Cities hold the good schools and the good jobs, and people aren't being irrational by moving there and trying to compete. This is the modern financial tightrope we ask people entering the workforce to walk. Say they spend an additional $200/month on a used car they own outright, just between the price of gas, insurance, and parking, to get to work, and this lets them instead pay $500/month in rent living further out in a townhouse with more roomates. The new $400/month savings rate this allows them, if fully utilized, still takes nearly 7 months to save up 3 months of sitting in your apartment doing nothing but paying $500/month rent + the $430 we said you needed for food and all other expenses monthly. This isn't just hypothetical for me. I had the great fortune to work during college at significantly above minimum wage in a very cheap area, and saving for me was still next to impossible. I have a sister who hustled waiting tables for almost two years after her degree in NYC before building up enough connections to start her professional career filming tv shows. She is now paying down the debt she accrued with a much, much higher paying job, contributing much more to the economy than she would have had staying in our sleepy state. These kinds of success stories take not only the kind of panache and grit people like to prescribe to the working poor, they also take the ability to take large risks and the luck that they pan out. My sister and I were fortunate to know that if we failed, we had loving parents who could catch us with a place to stay until we got back on our feet. It's true we worked hard, but without that safety net, and much other luck, I don't think either of us would have walked to the end of the financial tight rope of rent in major cities. I think people who walked across the rope without fearing the fall often just don't get it.
  - JamesBarney 7y ago
    So I totally agree that people who work for companies affected by the quarantine should get some type of unemployment benefits to help them through this rough time. But if you are spending two-thirds of your take-home on rent and don't have parents who can either support you or let you with them then you should probably make some life changes. When I graduated I didn't have a backup plan. I grew up with my grandmother and by the time I'd graduated she'd moved into an assisted living facility and sold her house. And I never would have dreamed of living in a place that would put me at that much risk like San Francisco or New York. I was happy to move to Houston where even my waiter and bartender friends live very comfortable middle-class lives, and spend close to 25% of their income on rent.

JamesBarney 7y ago

So I totally agree that a 3-6 months emergency fund saved up as a waiter in case we have a once in a century pandemic is not realistic. But spending two-thirds of your take-home pay on an apartment is also absolutely crazy.

bluGill 7y ago
It isn't in case of pandemic. It is in case of whatever. Most people face something sometime in their life. Generally a small thing, but an expensive car repair is still reason to have an emergency fund
- JamesBarney 7y ago
  An expensive car repair is not 6 months of living expenses. It's completely unrealistic to expect a 22-year-old waiter to have saved $10,000. And any model of the world where that is an assumption is going to be terribly flawed.
  - bluGill 7y ago
    Most 22 year old waiters have other options. If you can move back in with your parents that greatly reduces how much you need to have saved to cover 6 months of living expenses. There are lots of reasons someone won't have 6 months of expenses. Most are rare situations (most people are not just getting started in life). If everybody makes saving 6 months expenses a goal they work to before most people will achieve it. When it is only a minority that can't take care of themselves it is a lot easier on the rest of us.
mattnewton 7y ago
Then I hope you would agree that we help that waiter the same way we help people who's home has been washed away in a hurricane, with some meager public assistance from disaster relief. I agree it's insane to be spending that much on rent as well - but short of raising the minimum wage and using pricing controls to stop rent increases, what can be done about it? Cities hold the good schools and the good jobs, and people aren't being irrational by moving there and trying to compete. This is the modern financial tightrope we ask people entering the workforce to walk. Say they spend an additional $200/month on a used car they own outright, just between the price of gas, insurance, and parking, to get to work, and this lets them instead pay $500/month in rent living further out in a townhouse with more roomates. The new $400/month savings rate this allows them, if fully utilized, still takes nearly 7 months to save up 3 months of sitting in your apartment doing nothing but paying $500/month rent + the $430 we said you needed for food and all other expenses monthly. This isn't just hypothetical for me. I had the great fortune to work during college at significantly above minimum wage in a very cheap area, and saving for me was still next to impossible. I have a sister who hustled waiting tables for almost two years after her degree in NYC before building up enough connections to start her professional career filming tv shows. She is now paying down the debt she accrued with a much, much higher paying job, contributing much more to the economy than she would have had staying in our sleepy state. These kinds of success stories take not only the kind of panache and grit people like to prescribe to the working poor, they also take the ability to take large risks and the luck that they pan out. My sister and I were fortunate to know that if we failed, we had loving parents who could catch us with a place to stay until we got back on our feet. It's true we worked hard, but without that safety net, and much other luck, I don't think either of us would have walked to the end of the financial tight rope of rent in major cities. I think people who walked across the rope without fearing the fall often just don't get it.
- JamesBarney 7y ago
  So I totally agree that people who work for companies affected by the quarantine should get some type of unemployment benefits to help them through this rough time. But if you are spending two-thirds of your take-home on rent and don't have parents who can either support you or let you with them then you should probably make some life changes. When I graduated I didn't have a backup plan. I grew up with my grandmother and by the time I'd graduated she'd moved into an assisted living facility and sold her house. And I never would have dreamed of living in a place that would put me at that much risk like San Francisco or New York. I was happy to move to Houston where even my waiter and bartender friends live very comfortable middle-class lives, and spend close to 25% of their income on rent.