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> A week ago, he said he had “a good middle-class job” which paid him $35.50 an hour plus health care and retirement benefits. Now he is struggling to figure ou

by csomar 7y ago

> A week ago, he said he had “a good middle-class job” which paid him $35.50 an hour plus health care and retirement benefits. Now he is struggling to figure out how he’ll pay a $300 electric bill and $1,000 in rent for his townhouse. He also lost his health insurance. You make $35.5/hour in (I suppose?) a stable job but if the work stops for a week, you struggle with a $300 bill? I know some people are living paycheck to paycheck but starting from a certain income you should build a safety net. What about your IRA? What about your credit score? What about small investments? Looks like some people are living $ to $ without leaving any money aside. This might be what is going to make this even harder for the economy.

big_chungus 7y ago
This is exactly right. The economy has grown to unsustainable levels based on the economic habits of the average American who can't be bothered to save, hence the crash we're seeing now. At sixty hours a week, that guy should be making six figures, pre-tax. There is zero excuse for not saving. Everyone should save at least six months of salary for emergencies; though a few people legitimately can't, most Americans simply don't bother because they'd rather spend that money on the new i phone. Edit: Williamdclt, I'll answer your question here due to rate-limiting. Yes, lots of us do; I've been working that way since internships in high school. Same with many others I know. Usually, though, it's close to 12 hours a day and none on Saturday, or maybe 11 a day and a little on the weekend. Not an issue so long as you plan about an hour a day for something fun and mindless, and leave weekends free to do chores/relax. Edit: Consz, responding here due to rate-limiting. Not all of us live in the same world. I'm glad to hear you and your friends are doing well, but that's not representative of everyone. I do because I'm currently hourly, and that's true of many of the people I mentioned. When every additional hour worked has more money associated with it, most people will work more; that's not silly. The downside is, of course, there's a distinct opportunity cost to taking time off, so I don't do so much of that.
- minikites 7y ago
  Wages have stagnated since the 1970s: https://i.stack.imgur.com/m7EXP.jpg https://i.stack.imgur.com/m7EXP.jpg
- williamdclt 7y ago
  Americans work sixty hours a week? Ten hour a day, rest on Sunday?
  - saiya-jin 7y ago
    Welcome to the job of doctor for example. But its true that those are outliers, I would expect average to be closer to 45
  - GordonS 7y ago
    I'm British, but used to work with a lot of Americans, all white-collar workers in the oil and gas industry, across a few different companies. It seemed to me that the US has a toxic overtime culture, where your perceived value to the company was based in large part by how much time you were at your desk. And of course, you didn't get paid for that overtime. I don't think I met a single person who worked less than 50+ hours a week, every week. I did ask about this, and was always told it was "normal". Also, and I might be remembering this wrongly, I think employees only got ten days annual leave. This was all in a single industry, in a single state, so I don't know how well the observation extrapolates, but it was my perception at the time.
  - big_chungus 7y ago
    Not all, no, but a good few do (I'm sure this varies by industry, region, etc.) Ambitious people tend to do so more than others; there are only so many promotions/pay raises/etc. to go around and I'd rather I get it than one of my co-workers, so it becomes a bit of a positional arms race.
- consz 7y ago
  This is silly. My professional cohort doesn't have anyone working sixty hour weeks, and these are people making mid-6 to mid-7 figures. Lot more to life than working, buddy.
wmeredith 7y ago
60% of Millennials (basically people in their 30's) don't have enough saved for a $1000 emergency: https://www.cnbc.com/2018/12/19/60-percent-of-millennials-cant-cover-a-1000-dollar-emergency.html https://www.cnbc.com/2018/12/19/60-percent-of-millennials-ca...
- mrguyorama 7y ago
  I'm pretty sure those millennials aren't making $35 an hour
ithinkinstereo 7y ago
I went to my local 7-11 a couple of weeks ago to get some cash at the ATM. Next to it was a garbage bin for throwing away your receipt. Out of curiosity, I went through about a dozen and not a single one had a balance above $1,000. Most were below $500. There is little financial literacy in this country. Basic lessons about opening a bank account, the difference between checkings and savings, etc. is not something that is taught in K-12 nor in College. Let alone more "advanced" topics like 401Ks and IRAs and investing in the stock market.
- commandlinefan 7y ago
  > Most were below $500. > There is little financial literacy in this country. Well, technically if you're drawing cash, you should be drawing it from your checking account and if you're saving it should be in a savings account, so your checking account balance should be relatively low.
- tharne 7y ago
  That's a pretty biased sample. Most people with financial literacy aren't withdrawing cash at a 7/11. They're doing it at their own bank branch to avoid paying any fees. The reasoning here is circular. At the ATM in 7/11 that would only be used by people who aren't financially literate enough to absorb excessive fees, we find evidence of poor finances and poor financial literacy.
  - sodafountan 7y ago
    Uhm, what? Or maybe they're just doing it out of convenience? Have you never payed a fee for convenience? Have you tipped in a restaurant? Have you taken the highway instead of the back roads and payed a toll? Have you ever had food delivered to you? Congrats you're doing the same thing people who pull money out of an ATM are doing you financially illiterate rube.
    - dwaltrip 7y ago
      FYI, I liked the points you made. However, personal insults ruin discussion and lower the quality of the forum, so I downvoted this comment. I can certainly relate to getting fired up at foolish comments on the internet! It's tough sometimes... heh. Cheers, I hope you have a good day.
sodafountan 7y ago
Well here's the thing about that, people were actively incentivized not to save cash with low interest rates and a booming stock market. I know for myself personally I'm heavily invested in the markets just because that's what worked best for almost a decade. Nobody saw this coming. Now you have to debate selling your stock at such low prices and realizes huge loses or paying your bills - I think most people are going to try to hold out for unemployment/use credit before they do that.
- dojitza1 7y ago
  Your emergency fund isn't supposed to accrue interest, it is supposed to be a safety net against these kind of situations.
bagacrap 7y ago
yeah, not great, but the same thing has happened to many businesses. When they stop making money they can't meet their obligations (e.g. wages) and need a bailout a week later.

by csomar 7y ago

big_chungus 7y ago

This is exactly right. The economy has grown to unsustainable levels based on the economic habits of the average American who can't be bothered to save, hence the crash we're seeing now. At sixty hours a week, that guy should be making six figures, pre-tax. There is zero excuse for not saving. Everyone should save at least six months of salary for emergencies; though a few people legitimately can't, most Americans simply don't bother because they'd rather spend that money on the new i phone. Edit: Williamdclt, I'll answer your question here due to rate-limiting. Yes, lots of us do; I've been working that way since internships in high school. Same with many others I know. Usually, though, it's close to 12 hours a day and none on Saturday, or maybe 11 a day and a little on the weekend. Not an issue so long as you plan about an hour a day for something fun and mindless, and leave weekends free to do chores/relax. Edit: Consz, responding here due to rate-limiting. Not all of us live in the same world. I'm glad to hear you and your friends are doing well, but that's not representative of everyone. I do because I'm currently hourly, and that's true of many of the people I mentioned. When every additional hour worked has more money associated with it, most people will work more; that's not silly. The downside is, of course, there's a distinct opportunity cost to taking time off, so I don't do so much of that.

minikites 7y ago
Wages have stagnated since the 1970s: https://i.stack.imgur.com/m7EXP.jpg https://i.stack.imgur.com/m7EXP.jpg
williamdclt 7y ago
Americans work sixty hours a week? Ten hour a day, rest on Sunday?
- saiya-jin 7y ago
  Welcome to the job of doctor for example. But its true that those are outliers, I would expect average to be closer to 45
- GordonS 7y ago
  I'm British, but used to work with a lot of Americans, all white-collar workers in the oil and gas industry, across a few different companies. It seemed to me that the US has a toxic overtime culture, where your perceived value to the company was based in large part by how much time you were at your desk. And of course, you didn't get paid for that overtime. I don't think I met a single person who worked less than 50+ hours a week, every week. I did ask about this, and was always told it was "normal". Also, and I might be remembering this wrongly, I think employees only got ten days annual leave. This was all in a single industry, in a single state, so I don't know how well the observation extrapolates, but it was my perception at the time.
- big_chungus 7y ago
  Not all, no, but a good few do (I'm sure this varies by industry, region, etc.) Ambitious people tend to do so more than others; there are only so many promotions/pay raises/etc. to go around and I'd rather I get it than one of my co-workers, so it becomes a bit of a positional arms race.
consz 7y ago
This is silly. My professional cohort doesn't have anyone working sixty hour weeks, and these are people making mid-6 to mid-7 figures. Lot more to life than working, buddy.

wmeredith 7y ago

60% of Millennials (basically people in their 30's) don't have enough saved for a $1000 emergency: https://www.cnbc.com/2018/12/19/60-percent-of-millennials-cant-cover-a-1000-dollar-emergency.html https://www.cnbc.com/2018/12/19/60-percent-of-millennials-ca...

mrguyorama 7y ago
I'm pretty sure those millennials aren't making $35 an hour

ithinkinstereo 7y ago

I went to my local 7-11 a couple of weeks ago to get some cash at the ATM. Next to it was a garbage bin for throwing away your receipt. Out of curiosity, I went through about a dozen and not a single one had a balance above $1,000. Most were below $500. There is little financial literacy in this country. Basic lessons about opening a bank account, the difference between checkings and savings, etc. is not something that is taught in K-12 nor in College. Let alone more "advanced" topics like 401Ks and IRAs and investing in the stock market.

commandlinefan 7y ago
> Most were below $500. > There is little financial literacy in this country. Well, technically if you're drawing cash, you should be drawing it from your checking account and if you're saving it should be in a savings account, so your checking account balance should be relatively low.
tharne 7y ago
That's a pretty biased sample. Most people with financial literacy aren't withdrawing cash at a 7/11. They're doing it at their own bank branch to avoid paying any fees. The reasoning here is circular. At the ATM in 7/11 that would only be used by people who aren't financially literate enough to absorb excessive fees, we find evidence of poor finances and poor financial literacy.
- sodafountan 7y ago
  Uhm, what? Or maybe they're just doing it out of convenience? Have you never payed a fee for convenience? Have you tipped in a restaurant? Have you taken the highway instead of the back roads and payed a toll? Have you ever had food delivered to you? Congrats you're doing the same thing people who pull money out of an ATM are doing you financially illiterate rube.
  - dwaltrip 7y ago
    FYI, I liked the points you made. However, personal insults ruin discussion and lower the quality of the forum, so I downvoted this comment. I can certainly relate to getting fired up at foolish comments on the internet! It's tough sometimes... heh. Cheers, I hope you have a good day.

sodafountan 7y ago

Well here's the thing about that, people were actively incentivized not to save cash with low interest rates and a booming stock market. I know for myself personally I'm heavily invested in the markets just because that's what worked best for almost a decade. Nobody saw this coming. Now you have to debate selling your stock at such low prices and realizes huge loses or paying your bills - I think most people are going to try to hold out for unemployment/use credit before they do that.

dojitza1 7y ago
Your emergency fund isn't supposed to accrue interest, it is supposed to be a safety net against these kind of situations.

bagacrap 7y ago

yeah, not great, but the same thing has happened to many businesses. When they stop making money they can't meet their obligations (e.g. wages) and need a bailout a week later.