4 ms·

Yup. Don't forget the whole "frequently choose not to have a kid" part, and it becomes extremely one sided. Dual income families aren't new, but 2 high earners

by shados 5y ago

Yup. Don't forget the whole "frequently choose not to have a kid" part, and it becomes extremely one sided. Dual income families aren't new, but 2 high earners professionals with no kids aren't just the occasional doctor/dentist/lawyer couples anymore. I'm a software engineer myself in one of the high paying tech hubs, and married the same. When we went to look for a home and toured open houses, all you saw were pairs of young couples wearing Google, Microsoft and Facebook swags. Sure, I didn't personally ask every single one of them where they worked, but I'd venture that a non-zero amount of these couples were "Tech DINKs", like us. The average person simply can't compete with that. Add that in the urban areas these folks are less likely to want a big car, some may be happier playing Final Fantasy 14 during vacations than traveling across the world (I know plenty of travelers, but there's certainly a lot of "low cost" vacationers in the industry), and some level of financial literacy (common for people who get compensated with RSUs), and it's absolutely one sided. With that said, median home prices have only increased a little faster than inflation. When you account for interest rates tanking + inflation, a median home in 2021 is the same price and sometimes cheaper than it was in 2005 (data for the last few months is harder to find, and there's been a unusual spike, so it may not be quite true right now, but it was just a few months ago). The bigger problem is that everyone wants to live in the same place (usually in urban centers, where the jobs are, and where you don't have to drive an hour and a half to work). So prices where people want to be have increased higher than median. I'd expect people are more ok with paying a larger portion of their income to live where they want to be. Even as extremely high earner DINKs, housing will eat up a good chunk of our cash flow if we feel like blowing it all to live in Manhattan in a condo that doesn't suck.

wyclif 5y ago
What do you think are the best books to recommend to people who don't have enough financial literacy? This is a common theme in this kind of HN thread but I haven't seen many recommendations or lists of books that can help people level up in their financial wisdom. The bigger problem is that everyone wants to live in the same place (usually in urban centers, where the jobs are, and where you don't have to drive an hour and a half to work). I'm hoping WFH greatly disrupts this, opening up rural areas to tech workers. It won't work for everybody, but it does work for SWEs and many kinds of technology employees and contractors.
- kjkjadksj 5y ago
  There are a lot more reasons to live somewhere than commuting convenience alone. The reports of the death of the city have been greatly exaggerated. It turns out city dwellers need a lot more infrastructure than just a local brewery. Namely a functional school district and a population that isn’t 97% white and strongly skewed conservative.
  - wyclif 5y ago
    Some people want a community that skews conservative, and don't want to live in a shithole hellscape like San Francisco or Portland, with overpriced housing, tent cities under every bridge, drug dealers on every corner, and human feces on the sidewalks. Especially people who have families with children.
- shados 5y ago
  WFH only changes things in a small number of professions (hard to wait tables remotely, and sometimes doctors need to see patients in person). A large amount of people in those professions don't want to WFH (thus why a lot of big tech companies are INCREASING their real estate footprint rather than reducing it right now. Google, HubSpot, Spotify. Some of these are very open to WFH, but a lot of folks don't want to). It will make a difference, but it will be small. During that time, the rest of folks will still flok to cities. As to financial literacy, books tend to make things much more complicated than they are, and will be too focused. For a beginner, there's a few things that matter. First, the "flowchart". You can find a bunch of these online, but I like this one: https://u.cubeupload.com/demonlesondledon/FIREFlowChart.png https://u.cubeupload.com/demonlesondledon/FIREFlowChart.png This is so you don't fall in the trap of, let say, having a 5% investment while sitting on a 15% debt, or not use your employer 401k matching and invest the money somewhere worse. Then there's basic investment strategies to get started. Bogglehead gets you pretty far there: https://www.bogleheads.org/wiki/Three-fund_portfolio https://www.bogleheads.org/wiki/Three-fund_portfolio The next is understanding how the US market works. It averages 10% a year even if you include the great depression/recession and every other downturn. One day it could do like Japan and never recover/stay flat, but it has never happened in the US so far: https://advisor.visualcapitalist.com/historical-stock-market-returns/ https://advisor.visualcapitalist.com/historical-stock-market... Even for the great depression, while you'll hear that it took 25 years to recover, but that's based on the Nasdaq, which is a very small sample of stocks. The market in aggregate recovered much faster. Finally, you want to understand all the variables when comparing cost/return of home ownership vs renting. It's a LOT more complex than people make it sound. The NYT has a calculator that shows it, alongside a paywalled article: https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html https://www.nytimes.com/interactive/2014/upshot/buy-rent-cal... Bonus: a lot of it just comes down to internalizing the average market return and its risk, and comparing it against all the gains and leverage you can make in other ways. For example, with current interest rates, you probably want to pay your mortgage -as slowly as possible-, which is counterintuitive to most people.

by shados 5y ago

wyclif 5y ago

What do you think are the best books to recommend to people who don't have enough financial literacy? This is a common theme in this kind of HN thread but I haven't seen many recommendations or lists of books that can help people level up in their financial wisdom. The bigger problem is that everyone wants to live in the same place (usually in urban centers, where the jobs are, and where you don't have to drive an hour and a half to work). I'm hoping WFH greatly disrupts this, opening up rural areas to tech workers. It won't work for everybody, but it does work for SWEs and many kinds of technology employees and contractors.

kjkjadksj 5y ago
There are a lot more reasons to live somewhere than commuting convenience alone. The reports of the death of the city have been greatly exaggerated. It turns out city dwellers need a lot more infrastructure than just a local brewery. Namely a functional school district and a population that isn’t 97% white and strongly skewed conservative.
- wyclif 5y ago
  Some people want a community that skews conservative, and don't want to live in a shithole hellscape like San Francisco or Portland, with overpriced housing, tent cities under every bridge, drug dealers on every corner, and human feces on the sidewalks. Especially people who have families with children.
shados 5y ago
WFH only changes things in a small number of professions (hard to wait tables remotely, and sometimes doctors need to see patients in person). A large amount of people in those professions don't want to WFH (thus why a lot of big tech companies are INCREASING their real estate footprint rather than reducing it right now. Google, HubSpot, Spotify. Some of these are very open to WFH, but a lot of folks don't want to). It will make a difference, but it will be small. During that time, the rest of folks will still flok to cities. As to financial literacy, books tend to make things much more complicated than they are, and will be too focused. For a beginner, there's a few things that matter. First, the "flowchart". You can find a bunch of these online, but I like this one: https://u.cubeupload.com/demonlesondledon/FIREFlowChart.png https://u.cubeupload.com/demonlesondledon/FIREFlowChart.png This is so you don't fall in the trap of, let say, having a 5% investment while sitting on a 15% debt, or not use your employer 401k matching and invest the money somewhere worse. Then there's basic investment strategies to get started. Bogglehead gets you pretty far there: https://www.bogleheads.org/wiki/Three-fund_portfolio https://www.bogleheads.org/wiki/Three-fund_portfolio The next is understanding how the US market works. It averages 10% a year even if you include the great depression/recession and every other downturn. One day it could do like Japan and never recover/stay flat, but it has never happened in the US so far: https://advisor.visualcapitalist.com/historical-stock-market-returns/ https://advisor.visualcapitalist.com/historical-stock-market... Even for the great depression, while you'll hear that it took 25 years to recover, but that's based on the Nasdaq, which is a very small sample of stocks. The market in aggregate recovered much faster. Finally, you want to understand all the variables when comparing cost/return of home ownership vs renting. It's a LOT more complex than people make it sound. The NYT has a calculator that shows it, alongside a paywalled article: https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html https://www.nytimes.com/interactive/2014/upshot/buy-rent-cal... Bonus: a lot of it just comes down to internalizing the average market return and its risk, and comparing it against all the gains and leverage you can make in other ways. For example, with current interest rates, you probably want to pay your mortgage -as slowly as possible-, which is counterintuitive to most people.