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All the petty spending is so small in comparison to your rent. Cut out the vape and save $16 a week all you want, thats not making or breaking anything. This is

All the petty spending is so small in comparison to your rent. Cut out the vape and save $16 a week all you want, thats not making or breaking anything. This is the classic “5 dollar latte” fallacy: that older generations think the youth is foolish for spending $5 on coffee, while not knowing thats an absolute drop in the bucket relative to lifes big costs today, and also probably returning more than $5 in not feeling totally depressed and miserly.

anthonypasq 3y ago
I think the issue is actually bigger than this. The economy seems to continue to be white-hot despite everyone claiming its doing terrible and everything costs too much etc. people are eating out more than ever before, getting delivery more than ever before, and vacations are also booming. consumption is up no matter how you slice it. i think a lot of the younger generation have completely given up on the idea that they are ever going to own a house and instead of saving for that are just blowing it on food, booze, vacations etc.
- deleted 3y ago
  [deleted]
dazc 3y ago
I'm in the UK and just before the banking crisis you could get a decent house for £50k with a 120% self-certified mortgage. These are the same people who often resort to the coffee/netflix argument. £50k is now a deposit.
the_snooze 3y ago
I think that's too defeatist of a view. The boring reality is that small things done consistently over time seriously add up. It's true for health and exercise. It's true for relationships. It's true for finances. A $5 pick-me-up every now and then isn't a bad thing by itself. But if it becomes a daily habit, then you're missing out on other choices with better long-run returns. The immediate costs are small, but the eventual opportunity costs are huge. Younger people have a resource older people don't: time. That's time for habits to compound. May as well choose good ones to compound, because you're never getting that time back again.
- acuozzo 3y ago
  > if it becomes a daily habit, then you're missing out on other choices with better long-run returns If you quit that habit, it might make you miserable enough to make even worse financial choices. These petty expenditures are a tax on misery. Anecdote: My father's criminal history (racketeering) more-or-less forced him into a career in backbreaking construction in order to support his family when he got out of prison. He would come home after work with burns from creosote and often looked as if he had gone balls-to-the-wall in the gym all day. Back then, I wouldn't dare think to try to separate him from his cigarettes and lottery tickets. It would have been cruel.
- Sebb767 3y ago
  > because you're never getting that time back again. Which can also as easily be used as an argument to actually spend that money and enjoy it. In the end, it's important that the money is well spent: If you enjoy that 10$ coffee or 25$ takeout, it's awesome. If it's a daily habit that you're used to and doesn't give you much joy anymore, it's wasted money.
  - ryandrake 3y ago
    It's not the $5 latte or $10 avacado toast that's keeping young people broke. I think we can all agree that that number is a drop in the bucket compared to huge expenses they are struggling with. The problem is the mindset of "I should be able to have a luxury because it makes me feel better" which, if you accept it, starts to pervade all of your spending. It justifies the Netflix subscription. Then it justifies the weekly beer bill and food delivery. Then it justifies a few video game DLCs or virtual items. Then it justifies blowing $500 on a banger birthday party or a nice vacation somewhere. Before you know it, you're buying a new wardrobe and a pickup truck you don't need. All because "You only live once and I deserve those little luxuries that bring me joy."
- DonsDiscountGas 3y ago
  It's not a point of view, it's just math. $5 every day is $150/month, $1800 per year, save that for 30 years and maybe you can have a down payment on a house (assuming the interest on your savings has kept pace with the increase in housing prices, which is likely but not certain). There's no one weird trick to get rich from no income.
vel0city 3y ago
Each piece is pretty small, but added up it can be pretty significant. I'll take your $16/wk for vaping costs, I don't have any hard data but I think that's probably a bit low. $5 for coffee 5 times a week, that's $25/wk. Looking around me, its hard to get a meal delivered with a food delivery service for less than $18. Making a meal at home, even a frozen pre-cooked dinner, is usually like $5 or less, so we'll say an additional $13 meal 4x a week so $52/wk. 52 + 25 + 16 * 4 weeks in a month is $372/mo. Over $4,400/yr, on just eating out/delivery, one coffee 5 times a week, and vaping. And somehow I doubt its really just 5 coffees a week, its probably not just $13 additional cost per meal only 4 times a week, I doubt a vaping habit is really only $16/wk. Is an extra $4,400/yr in their budget a big deal to the people in question?
- kjkjadksj 3y ago
  Minimum wage is netting you nearly $45k a year in some parts of this country. Is a 10% bump in minimum wage going to appreciably change your situation? Hell no. Buy some moments of happiness today, you might get hit by a bus tomorrow.
- Sebb767 3y ago
  > Is an extra $4,400/yr in their budget a big deal to the people in question? Well, since you saved it by excluding a lot of pleasurable spending, you can't really count it as "fun" money and therefore it's not that great, really. With the current market, it's also not nearly enough to get you anywhere near buying a house or an apartment. It can be used for a car, but then again, is a car a better investment than nice coffee and food? While I do see the value in saving and I get why spending this money looks wasteful, I can also see the other side of not bothering pass on convenience for a bit of extra money. Of course, it all depends on how well you're set up generally (i.e. if you don't have an emergency fund, those 4k$ are a lot more important).
  - vel0city 3y ago
    > excluding a lot of pleasurable spending We're talking about kicking a vaping habit, not eating out or doing food delivery four times less a week and making your coffee at home. Its not like they're now no longer doing anything fun in their lives. Saving only that for 3 years and you've got over $13,000. While not a ton of money, $13k is more than enough to qualify for a down payment on a small house or condo in many housing markets in the US. Sure, probably not NYC or LA or SF, but doable in DFW, KC, San Antonio, Houston, Oklahoma City, Cleaveland, Rochester, Syracuse, Utica, Philly, Wilmington, Tallahassee, Corpus Christie, Albuquerque, and more.
stetrain 3y ago
Yes. Managing your budget is important. But it's difficult to manage your budget in a way that "fixes" a huge increase in housing costs even relative to baseline inflation.

anthonypasq 3y ago

I think the issue is actually bigger than this. The economy seems to continue to be white-hot despite everyone claiming its doing terrible and everything costs too much etc. people are eating out more than ever before, getting delivery more than ever before, and vacations are also booming. consumption is up no matter how you slice it. i think a lot of the younger generation have completely given up on the idea that they are ever going to own a house and instead of saving for that are just blowing it on food, booze, vacations etc.

deleted 3y ago
[deleted]

dazc 3y ago

I'm in the UK and just before the banking crisis you could get a decent house for £50k with a 120% self-certified mortgage. These are the same people who often resort to the coffee/netflix argument. £50k is now a deposit.

the_snooze 3y ago

I think that's too defeatist of a view. The boring reality is that small things done consistently over time seriously add up. It's true for health and exercise. It's true for relationships. It's true for finances. A $5 pick-me-up every now and then isn't a bad thing by itself. But if it becomes a daily habit, then you're missing out on other choices with better long-run returns. The immediate costs are small, but the eventual opportunity costs are huge. Younger people have a resource older people don't: time. That's time for habits to compound. May as well choose good ones to compound, because you're never getting that time back again.

acuozzo 3y ago
> if it becomes a daily habit, then you're missing out on other choices with better long-run returns If you quit that habit, it might make you miserable enough to make even worse financial choices. These petty expenditures are a tax on misery. Anecdote: My father's criminal history (racketeering) more-or-less forced him into a career in backbreaking construction in order to support his family when he got out of prison. He would come home after work with burns from creosote and often looked as if he had gone balls-to-the-wall in the gym all day. Back then, I wouldn't dare think to try to separate him from his cigarettes and lottery tickets. It would have been cruel.
Sebb767 3y ago
> because you're never getting that time back again. Which can also as easily be used as an argument to actually spend that money and enjoy it. In the end, it's important that the money is well spent: If you enjoy that 10$ coffee or 25$ takeout, it's awesome. If it's a daily habit that you're used to and doesn't give you much joy anymore, it's wasted money.
- ryandrake 3y ago
  It's not the $5 latte or $10 avacado toast that's keeping young people broke. I think we can all agree that that number is a drop in the bucket compared to huge expenses they are struggling with. The problem is the mindset of "I should be able to have a luxury because it makes me feel better" which, if you accept it, starts to pervade all of your spending. It justifies the Netflix subscription. Then it justifies the weekly beer bill and food delivery. Then it justifies a few video game DLCs or virtual items. Then it justifies blowing $500 on a banger birthday party or a nice vacation somewhere. Before you know it, you're buying a new wardrobe and a pickup truck you don't need. All because "You only live once and I deserve those little luxuries that bring me joy."
DonsDiscountGas 3y ago
It's not a point of view, it's just math. $5 every day is $150/month, $1800 per year, save that for 30 years and maybe you can have a down payment on a house (assuming the interest on your savings has kept pace with the increase in housing prices, which is likely but not certain). There's no one weird trick to get rich from no income.

vel0city 3y ago

Each piece is pretty small, but added up it can be pretty significant. I'll take your $16/wk for vaping costs, I don't have any hard data but I think that's probably a bit low. $5 for coffee 5 times a week, that's $25/wk. Looking around me, its hard to get a meal delivered with a food delivery service for less than $18. Making a meal at home, even a frozen pre-cooked dinner, is usually like $5 or less, so we'll say an additional $13 meal 4x a week so $52/wk. 52 + 25 + 16 * 4 weeks in a month is $372/mo. Over $4,400/yr, on just eating out/delivery, one coffee 5 times a week, and vaping. And somehow I doubt its really just 5 coffees a week, its probably not just $13 additional cost per meal only 4 times a week, I doubt a vaping habit is really only $16/wk. Is an extra $4,400/yr in their budget a big deal to the people in question?

kjkjadksj 3y ago
Minimum wage is netting you nearly $45k a year in some parts of this country. Is a 10% bump in minimum wage going to appreciably change your situation? Hell no. Buy some moments of happiness today, you might get hit by a bus tomorrow.
Sebb767 3y ago
> Is an extra $4,400/yr in their budget a big deal to the people in question? Well, since you saved it by excluding a lot of pleasurable spending, you can't really count it as "fun" money and therefore it's not that great, really. With the current market, it's also not nearly enough to get you anywhere near buying a house or an apartment. It can be used for a car, but then again, is a car a better investment than nice coffee and food? While I do see the value in saving and I get why spending this money looks wasteful, I can also see the other side of not bothering pass on convenience for a bit of extra money. Of course, it all depends on how well you're set up generally (i.e. if you don't have an emergency fund, those 4k$ are a lot more important).
- vel0city 3y ago
  > excluding a lot of pleasurable spending We're talking about kicking a vaping habit, not eating out or doing food delivery four times less a week and making your coffee at home. Its not like they're now no longer doing anything fun in their lives. Saving only that for 3 years and you've got over $13,000. While not a ton of money, $13k is more than enough to qualify for a down payment on a small house or condo in many housing markets in the US. Sure, probably not NYC or LA or SF, but doable in DFW, KC, San Antonio, Houston, Oklahoma City, Cleaveland, Rochester, Syracuse, Utica, Philly, Wilmington, Tallahassee, Corpus Christie, Albuquerque, and more.

stetrain 3y ago

Yes. Managing your budget is important. But it's difficult to manage your budget in a way that "fixes" a huge increase in housing costs even relative to baseline inflation.