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Being poor in general, during your childhood, scars you for life. It makes you penny wise and pound foolish, adverse to taking risks in your career and investm

• ClumsyPilot 4y ago
  I frequently encounter people and family with obvious issues arising from childhood, and 95% of the time their parents were poor as kids and thats where it all comes from. On one hand these people are a pain to deal with, but in most cases its not their fault either.
  • jjj123 4y ago
    What makes them a pain to deal with? I work with ultra-privileged people who by all accounts are “well adjusted” and I find them harder to deal with than people I grew up with from home. Many of them have no history of and don’t understand trauma, and as a result they’re unempathetic to what the literal majority of people experience. Edited for clarity
    • wolverine876 4y ago
      > I work with ultra-privileged people who by all accounts are “well adjusted” and I find them harder to deal with than people I grew up with from home. Many of them have no history of and don’t understand trauma, and as a result they’re unempathetic to what the literal majority of people experience. Financial issues aren't the only trauma in life, by a long shot. Plenty of people in that group have trauma. What makes people unempathetic is often that they don't come to grips with their own trauma; they deny it and thus deny it for others - if it's too painful to admit to yourself, think how dangerous other people's trauma could be!
      • jjj123 4y ago
        I think you’re underestimating how much trauma correlates with wealth in America. It’s not just the trauma of being poor, it’s trauma of growing up in a dangerous area, or of your parents getting divorced, or of getting sexually assaulted, or of young friends or family members dying. All of which get far more likely the poorer you are. Obviously I’m not saying that there aren’t wealthy, Ivy League educated people with trauma. But if we’re looking at the stats it’s not even close.
        • wolverine876 4y ago
          It's not a competition for who has more trauma, but I generally agree. If you look at my other posts in this thread, I am generally trying to explain what you said well here.
• doix 4y ago
  > It makes you penny wise and pound foolish while always having to look over your shoulder monetarily speaking. Could you explain what you mean? I grew up pretty poor, single income PhD student/post-doc salary family with two kids. Eventually my father got a proper position at a university, but until then we were pretty poor. My parents used to sleep on the floor, we had almost no furniture(I remember playing football in our living room with my dad since it was entirely empty) with most of our stuff coming from charities. I wonder if I exhibit the behavior you talk about or not.
  • junofan 4y ago
    You grew up in the modern day priest class, not poor.
    • doix 4y ago
      That's fair. My parents left the collapsing USSR with nothing and ended up in Australia. Materially poor with no support network or generational wealth, but well educated and with a clear path to the middle class. I still think I/we were very fortunate and didn't mean to offend anyone by saying we were poor. I am well aware there are/were many people less fortunate than us.
      • ponow 4y ago
        It's not fair.
    • ponow 4y ago
      No, poor is poor. Please don't move or re-label goal posts.
    • Mezzie 4y ago
      This is one problem with socio-economic class: When somebody's 'socio' doesn't match their 'economic', things get weird. I'm a first generation college student who has 3 great-grandparents with college degrees. It makes it easier to dig yourself out, but depending on the circumstances it can also cause its own issues. For example, my mother ran away from an abusive but well-off home, so I was regaled with tales of upper-middle and well-off hypocrisy and all their problems, which makes it really hard to want to fit in/keep my mouth shut in spaces that I share with those people.
• tootie 4y ago
  So much of economics seems so obvious when you read about it but it runs very strongly against our lizard brain instincts.
• throwaway98797 4y ago
  Had this problem Easy solution take a few hundred from the bank and physical set it on fire keep doing it until you don’t care it’s illegal but it works
  • ChuckNorris89 4y ago
    >take a few hundred from the bank and physical set it on fire keep doing it until you don’t care That sounds bad. Why not give it to a homeless guy or to charity or something? >it’s illegal Honestly, the central banks can go to hell. They can print way more money than you can ever burn, which they do, even far too much of it, bringing us to where we are today.
    • olddustytrail 4y ago
      You are simultaneously saying that destroying money is a bad thing and that creating money is a bad thing. There is no "natural" amount of money.
    • throwaway98797 4y ago
      it needs to be a total loss there can’t be any value
  • blackoil 4y ago
    Better approach that I am trying is try to buy luxury version whenever I need something. Broke a plate, buy one from boutique ceramic shop. Need some glasses sure a high end crystal. Though on counter side, be really sure that you are rich before trying to act like one.
    • phil21 4y ago
      This is very similar to how I tried (am trying?) to evolve my spending, usually having the impulse to buy something now before it become scarce or buy the cheapest possible thing to get the task done in the moment. These days I realize I have nearly everything I need, so if I'm buying something I figure I can't really afford it unless I'm getting the "best" out there. Best for me means researching the best performing/quality/etc. item in the category. If I'm replacing a broken item I also take the opportunity to upgrade. For example I needed a carpet shampoo cleaner recently. Instead of heading to Walmart to buy whatever consumer gear was slapped on the shelf, I spent a few weeks deeply researching the ecosystem and ended up with something about 4-5x the expense - but with performance to match. The difference in quality makes it almost a pleasure to clean my carpets these days. It's easy to spend money simply on fancy and not get much out of it. But I feel pretty satisfied when I make an absurdly expensive purchase like the above but still feel great about it a year later due to the value/increased quality of life it bought me. In the moment if feels ridiculous paying many multiples more than I would have in the past, but over time these little incremental improvements add up. It's the spending that I do like a "poor person" that bothers me the most - just buying crap on impulse, or "collector" behavior. I find I need to actively mitigate both impulses or I'd end up on a hoarding TV show.
• snarfy 4y ago
  I'll never have another credit card. Frequent flyer miles, what are those? The whole industry can go fuck themselves.
  • sokoloff 4y ago
    If you're able to live without the credit aspects of the credit card, why not take the 1-2% discount on nearly everything consumable that you buy? If you pay it off every month, credit cards have a negative cost (to you) and a fair amount of convenience (for renting cars, hotels, booking flights, etc).
    • duncan_idaho 4y ago
      That 1-2% is what they pay you for all your data. Credit cards are a key component of data brokers.
      • throwaway193948 4y ago
        compared to all the other data collected about me with no benefit to myself that seems like an ok deal
      • bombcar 4y ago
        The 1-2% is what they pay you for helping strong-arm the merchant into giving them 3%.
      • astrange 4y ago
        It's a refund on the interchange fee from not doing chargebacks and paying your bills on time. Your data is not interesting or valuable, that's your ego talking.
        • kube-system 4y ago
          Data brokering is a 200 billion dollar industry. Some individual data brokers say they have data on half of all transactions in the US, so it's safe to say that your transactions are more likely to be sold than not. Nobody cares about your data (unless you're high profile), but -- for example -- hedge funds and the like will spend big bucks to get aggregate sales data before this quarter's financial reports are written.
• hansword 4y ago
  It's being poor, that scars you. As with everything, during childhood impressions are stronger and effect your life more, but being really poor in your 20s has quite a similar effect.
  • ricardobayes 4y ago
    That's true, I grew up during the 2008 recession so I constantly have that at the back of my mind. Massive layoffs, housing crash, breaking news everyday, everyone in just constant worry for an extended period of time. Now in 2022 I find myself reliving these memories a little, and I have observed my behavior to be extremely risk-averse these days.
    • nomel 4y ago
      For me, the current projection of the economy are justifying all of me, most likely unhealthy, behavior.
• almost_usual 4y ago
  > Being poor in general, during your childhood, scars you for life. You can learn to cope with the anxiety better if you talk to a therapist but it will never fully go away.
  • wolverine876 4y ago
    Who can afford a therapist?
    • nomel 4y ago
      Especially if you have anxiety around spending money.
      • wolverine876 4y ago
        Great point.
• Markoff 4y ago
  Not necessarily, I grew up pretty poor, my mother stealing food from kitchen she worked to save money (and I had to lug it every day when I was older), father having mediocre salary (later divorced without father's income), yet now belonging to like top 3% earners in country I live, I have like 150K EUR in stocks and don't really give a F about losing currently 10-20%, it's long term investment. It probably also helps I bought apartment without mortgage in 4th most touristy city in Europe. So yeah, I dislike the idea of being mortgage slave, but if I didn't optimize my income I wouldn't mind taking one to buy investment apartment, so I had to invest money in stock. But the funny thing is I will refuse to buy something I consider overpriced even when total sum makes absolutely no difference at my income, I just don't like the idea of wasting my money on something which can be bought cheaper, so some people may think I am poor or cheap although I don't mind spending money on something I consider worth the money. For instance almost nobody here in Czechia has AC, but I am one of those few people who have one, because I value my comfort at home more than having newest smartphones and other crap.
• twoquestions 4y ago
  True facts, this. My spouse never had to wonder where the electric or gas money was coming from, even though their family is really frugal despite making really good money, and I'm still surprised at their decisions that I irrationally describe as extravagant even though they're better decisions all told. Even though I have a great job now and have for years, I still find myself shying away from good things that I really can afford, or buying cheap shoes when dropping a Benjamin is better even in the immediate term.
  • scottLobster 4y ago
    Coming from the more well-off side, it makes friendships with people on the other side harder as well. By chance a good chunk of my social circle in college was less well off than me, and while we liked playing games together I got weird looks for buying shirts new at Macy's or Michelin tires. It just seemed to rub them the wrong way, like they thought I was trying to show off or rub something in their face even though I'm just upper-middle-class and buying what I saw as the best product for what I needed. It's not like I was showing up in a new Lexus or something. Some of them also expected me to drive them everywhere even though they had working cars of their own, and that got rather toxic after a while.
    • mettamage 4y ago
      Can confirm this. Middle class here. Have a relationship with someone well-off. I view it as cultural differences that we need to overcome. In our case we did. The only "downside" is that it takes a very consistent form of energy. I'm constantly thinking "if I'd be as rich as she is, how would I deal with the situation?" I can imagine it to some extent due to how I play poker and seeing parallels with my stack size versus my financial situation. Long story short: when I feel I don't have enough, I get very tight on my spending. When I feel I have enough, I get loose and lax. As one might imagine, I wasn't a very good poker player because of that ;-)
      • dkn775 4y ago
        I’ve been with my fiancée 10 years, she was solid middle class with a single mother teacher, I am pretty solid upper middle class growing up. I just want to say that if allowed to happen you can really be a force together, a moderation force coming from your side and your SO. She buys higher quality trash bags and tires (lol) now and I don’t splurge on stuff all the time now, and don’t waste as much money. I really appreciate the perspective being with her has given me.
• throwaway0a5e 4y ago
  Everyone's character, behaviors, preferences, etc, etc, are formed in very large part by their life experience. If I had a nickle for every time someone said something about the poors being scarred or broken and then in short order started spewing nonsense about how the poors have minimal agency, need guidance or protecting from themselves, are doing it wrong, etc, etc. I would be a very wealthy man. And a hell of a lot of HN would be poorer in $.05 increments. Did you (in general, not personally) ever think that maybe it's all the upper middle class types who are doing it wrong and the only reason we get away with it is because we have money to sustain the lifestyle? People who act like cheapskates, buying $500 cars, $20 Walmart jeans, while their peers sneer about the $2k Camry, and $50 Levis being a "better value", seem to do well at all levels of the economic ladders and even frequently improve their lot in life.
• spaetzleesser 4y ago
  It doesn’t have to even be in your youth. I lost a lot of money with a real estate deal in the 90s plus a lot more when the .COM bubble crashed. Since then I have no confidence in investing or jobs. I always look over my shoulder and wait for things to go bad. Especially since 2008 it made sense to blindly invest into housing and stocks even while knowing they would crash eventually. Being gunshy from previous experience made you lose out on a lot of gains.
  • wing-_-nuts 4y ago
    Yeah, it's not just in childhood, it also hits early adulthood as well, when people are just starting out. I scraped by on ~ $600 / mo in disability until I graduated college in my mid 20s in 2008. My spending habits, my hobbies, everything was ingrained around that age. Today I make 25x as much, and barely spend 2x. It's hard to change early habits.
• kosyblysk2 4y ago
  you can make the same argument (in reverse) about being rich. it is like saying: ohhh my mommy was so bad to me and now i have issues, ohhh my mommy was so good to me and now i have issues. victim mentality
  • tidbits 4y ago
    Or extremes are bad?
  • Fezzik 4y ago
    Not all consequences are the same, even if the initial conditions are of the same-type; not all people who acknowledge negative consequences think of themselves as victims. Saying one is aware that certain conditions and circumstances in childhood tend to cause certain negative behaviors in adulthood is helpful information. Dismissing it as having a victim mentality is unhelpful.
  • wing-_-nuts 4y ago
    I think you should try and understand the definition of 'victim mentality' a little better. There's great power in understanding where you came from, and how that affects your behavior today.
  • bobkazamakis 4y ago
• DrBazza 4y ago
  Another way of stating that article is that most people in their 20s and 30s have only ever known low-inflation and stability. Those in their mid-40s onwards are possibly young enough to remember how what their parents dealt with in the 70s.
  • w-j-w 4y ago
    Low inflation, yes, but not stability. Many people in their 20s now watched a parent lose their job during the 2008 housing crisis. Just because they didn't see the 70s don't mean they haven't seen macroeconomic calamity affect their parents microeconomic reality.
  • itronitron 4y ago
    I remember sitting in the car with my mom outside an Amtrak train station in the late `70's asking her why she was cutting the tops off of several cereal boxes that we had just bought from the grocery store. Apparently they were for a discount on train tickets.
    • thebigspacefuck 4y ago
      Some coupons are just worth it. A guy in the 90s figured out he could get millions of frequent flyer miles from a few thousand dollars of pudding.
      • DrBazza 4y ago
        Or a military jet? https://en.wikipedia.org/wiki/Leonard_v._Pepsico,_Inc https://en.wikipedia.org/wiki/Leonard_v._Pepsico,_Inc.
  • thebigspacefuck 4y ago
    What about the Great Recession?
  • laputan_machine 4y ago
    I'm in my 30s, I remember 2008 not being a fun time, didn't feel stable watching friends and family lose their jobs and then their houses!
• ciconia 4y ago
  > scars you for life. You could also say being poor in childhood teaches you how to be frugal. I regard this as a healthy habit and better discipline I wish I had with money (coming from a middle-class family). Another way to look at frugality is just an aversion to spending money on whatever it is that society or mass media tell you you have to buy, an important and healthy attitude one can have, IMO.
  • deleted 4y ago
    [deleted]
  • option 4y ago
    It’s not just frugality. Being “penny wise and pound foolish” and being risk averse is a huge drag on one’s financial opportunities.
  • short_sells_poo 4y ago
    I think you are both correct. It is true that people who grow up poor simply have much fewer chances to learn how to grow wealth. They may be frugal and manage the little they have with care, but that kind of mindset is not enough in general. They don't get any chance to learn how to invest money properly, because they don't have any to invest. If they do put something aside, they are encouraged (by the circumstances) to keep it as safe as possible (ie cash), which is generally a bad investment decision. You are also right in that there are plenty of people who are high earners, but never get to actually build wealth because they spend it all. This can often be the curse of living in a high cost of living area. You see all the wealthy people driving in nice cars and living in luxury homes, and this makes it difficult to consciously deny yourself these things and live (relatively) modestly but build long term wealth instead.
    • wolverine876 4y ago
      That overlooks the basic point, that poverty causes trauma. Budgeting is just one symptom. It causes negative life-long outcomes; there's plenty of research on this.
  • stu2b50 4y ago
• mabbo 4y ago
  My wife grew up very close to the poverty line, with her parents always just about to lose the house. And she has this anxiety. (Edit: to be clear, she's a successful civil engineer, considered one of the best in her field locally and makes great money- she has nothing to worry about.) In order to help with it, we have a bank account that our bills come out of that has a little more than 6 months worth of all our bills (mortgage payment included) just sitting there, collecting zero interest. Every time a bill is paid, we top it up to the target amount. If we stop making money today, we don't have to do anything differently for 6 months. It's not logical or financially wise, but it means that she doesn't worry about money as much. I consider the opportunity cost on the interest we might collect on that money as a bill that I'm happy to pay.
  • collinvandyck76 4y ago
    with the market being as it is, actually very wise to have a lot of cash on hand :) we also operate this way. i could become unemployed today and we buffer enough so that it's not an emergency at all.
    • Melatonic 4y ago
      I prefer a layered approach - some investments take longer than others to cash out. And some are in between but still provide some return. A ton of cash on hand is probably a bad idea
      • moffkalast 4y ago
        https://www.reddit.com/r/dataisbeautiful/comments/tou7v2/oc_warren_buffetts_2022_portfolio_update_at/ https://www.reddit.com/r/dataisbeautiful/comments/tou7v2/oc_... Even Warren Buffet always keeps at least something like a fifth of his investments in cash. Otherwise how the hell are you going to buy low?
        • Melatonic 4y ago
          I would imagine though that he is also very often selling / buying so that hes not just sitting on a pile of cash for months at a time?
• Melatonic 4y ago
  I have seen it also go other ways though - I think it really depends on the family and how they deal with being poor. Families who are poor in currency but very rich in love and social connections seem to still produce great adults who might have some of the scars you are talking about but also are able to overcome them.
• wolverine876 4y ago
  > Habits that even after you remove poverty from your live, you still feel the the anxiety and triggers in your head. In high school, I went to a friend's house for lunch. Their father served a mountain of food. My friend said, a bit exasperated, 'Dad - why do you always serve so much food?!' Dad said, caringly but directly: 'Remember that I grew up in a refugee camp in Palestine. It is very important to me that nobody ever runs out of food to eat in my home.' An eye-opening moment for a teenager.
• 01100011 4y ago
  I feel like the results of risky behavior in the real world are somewhat similar to risky behavior in investing. When there is a bull market and overall growth trajectory, risky behavior is more likely to pay off. When a nation is in its growth phase, risky behavior is also more likely to pay off. If a nation starts to enter a phase of decline, perhaps more conservative behavior is a better gamble? Certainly you have to take risk to make outsized gains, I'm just thinking the likelihood of a payoff changes depending on the overall environment.
• jmcgough 4y ago
  It's pretty well studied that people who grew up poor have a harder time saving and are actually more reckless about spending, because they a) didn't have modeling or financial education from their parents and b) had to spend money when they got it before some random fee or cost gobbled it up
• sbf501 4y ago
  > penny wise and pound foolish I've seen this in action: e.g., clipping coupons but not paying down debt faster than the schedule.
• refurb 4y ago
  "Scars you for life"? I mean, the generation who went through the Great Depression did pretty damn well in terms of savings, investment and a lack of waste.
• LoveGracePeace 4y ago
  Came here to say this, completely agree.