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I'll grant you the loan repayment, but the other things aren't expenses. "Lost income" is a psychological artefact, not anything concrete. It's a result of comp

I'll grant you the loan repayment, but the other things aren't expenses. "Lost income" is a psychological artefact, not anything concrete. It's a result of comparing against some hypothetical ideal financial situation. The same for "catching up" on retirement savings. The concrete part is that people with that level of income (large, but not so large as to make all problems disappear) know that to be comfortable in the future they need to save a big chunk of their income. The people living with much lower incomes just don't have that luxury at all. Which is kind of the point - it's totally different worlds.

lotsofpulp 5y ago
When currency is being devalued year after year, lost income (up to a certain amount) most certainly is an expense. The longer you sit out of the asset inflation game, the more you fall behind. So whatever the cause for you falling behind has to make up for it. Maybe I’m wrong, but that model has served me well.
- azornathogron 5y ago
  I agree that currency devaluation and so on means that saving money earlier in life has a larger impact on your lifetime comfort than saving money later. I don't really follow how it's classed as an expense though. And I don't know how you determine how much income you have "lost". I think we probably agree on the situation but disagree on what terms make sense to describe it.
  - lotsofpulp 5y ago
    Assuming you need $x by some age due to being unable to earn more money (illness, old age, not wanting to work), then not earning income in your possible working years pushes up the amount of income needed in other working years to reach the same $x. For example, if you get your bachelors in 3 years instead of 4 and spend $30k on tuition and earn $90k by working, then that would result in an extra $120k in compared to spending 4 years in college. I class it as an expense, because everything has an opportunity cost, which is defined as your 2nd best option. It is not always useful, for example thinking about spending time with your kids rather earning $15 driving for uber or something. But it could be, if you need that $15 to feed your kids.
cyberlurker 5y ago
Yes, the problems of those with lower income are more immediate and I think it is grossly unfair to blame their predicament on their character or inherent talents. I disagree that lost income is purely psychological. There are biological realities to deal with, especially in the US without the social safety net of other countries, that make lost income important. The first two that come to mind are the significant cost of raising children and retirement. Those are ticking clock issues to many people. I agree they are two different worlds for low and middle income people. But we could play this game with even lower income people elsewhere in the world and reduce the issues of the developed countries poor.

lotsofpulp 5y ago

When currency is being devalued year after year, lost income (up to a certain amount) most certainly is an expense. The longer you sit out of the asset inflation game, the more you fall behind. So whatever the cause for you falling behind has to make up for it. Maybe I’m wrong, but that model has served me well.

azornathogron 5y ago
I agree that currency devaluation and so on means that saving money earlier in life has a larger impact on your lifetime comfort than saving money later. I don't really follow how it's classed as an expense though. And I don't know how you determine how much income you have "lost". I think we probably agree on the situation but disagree on what terms make sense to describe it.
- lotsofpulp 5y ago
  Assuming you need $x by some age due to being unable to earn more money (illness, old age, not wanting to work), then not earning income in your possible working years pushes up the amount of income needed in other working years to reach the same $x. For example, if you get your bachelors in 3 years instead of 4 and spend $30k on tuition and earn $90k by working, then that would result in an extra $120k in compared to spending 4 years in college. I class it as an expense, because everything has an opportunity cost, which is defined as your 2nd best option. It is not always useful, for example thinking about spending time with your kids rather earning $15 driving for uber or something. But it could be, if you need that $15 to feed your kids.

cyberlurker 5y ago

Yes, the problems of those with lower income are more immediate and I think it is grossly unfair to blame their predicament on their character or inherent talents. I disagree that lost income is purely psychological. There are biological realities to deal with, especially in the US without the social safety net of other countries, that make lost income important. The first two that come to mind are the significant cost of raising children and retirement. Those are ticking clock issues to many people. I agree they are two different worlds for low and middle income people. But we could play this game with even lower income people elsewhere in the world and reduce the issues of the developed countries poor.