Paycheck to Paycheck

[Akivah]

I haven't mentioned there being a 'parent's home' available.
What if you can't save much money considering you are paying the rent ?

It will take longer. The time can be shortened by cutting expenses or by increasing income.

Also given that rents increase, but mortgage payments on fixed interest loans don't*, it will be in the person's best interest to purchase a residence at some point in their lifetime. Each mortgage payment increases equity, while each rental payment is just gone.

*except for increased taxes and insurance.

 

[Akivah]

Brackets don't work that way.

Brackets do work that way. If one's total income is $10 below the top amount of the bracket, then $30 of interest would be taxed at $10 in the lower bracket and $20 in the higher bracket. You'd still come out with more money, after tax, with more interest earned.

But adjusting for inflation, one loses ground because tomorrow's dollars are worth less than today's. Whatever one earns on interest income after taxes, it's always been less than inflation (on average), thus one loses buying power.

One loses even more buying power by not earning income at all.
Unless you've got nothing. The zero dollars I have now is worth just as much as the zero dollars I'll have in the future.

 

[Terrywoodenpic]

Fifteen years ago £25,000 was an average industrial wage in the UK.
Today you would need £50,000 to live at the same level. This percentage difference is true at any income, and needs to be planned for.
Forward planning and pensions rarely keep pace with inflation, but at every level you tend to need to spend less on big ticket items. I tend to live well with in my income at my age. So still save in real terms.
However I have never made a personal budget in my life. Though I do keep a spread sheet so that I know where I am.

 

[Revoltingest]

Brackets do work that way. If one's total income is $10 below the top amount of the bracket, then $30 of interest would be taxed at $10 in the lower bracket and $20 in the higher bracket.

Good!
I thought you were arguing against that view.

You'd still come out with more money, after tax, with more interest earned.

Well, of course.
But the loss of value of the money deposited would exceed the interest income.
And even though the taxpayers saw this economic loss, they see further loss
by paying income tax on the interest. Thus, money put in the bank loses ground.

This shows the advantage of low inflation, less ground is lost cuz taxes approach zero.

One loses even more buying power by not earning income at all.

Well of course.
You didn't think I was advocating earning nothing on cash, did you?
I only point out the loss in purchasing power with inflation.

Unless you've got nothing. The zero dollars I have now is worth just as much as the zero dollars I'll have in the future.

That's my goal....to have relatively nothing in cash.
Unfortunately, even after capital improvements here & there,
I currently have some hefty deposits earning little at my bank.
But this is to address an unpredictable real estate development
situation which might need cash to cure.

 

[Terrywoodenpic]

Perhaps gold is the answer for ready cash...it never depreciates and keeps pace with inflation. The fluctuations of the bullion market are always within reason.... it is so instantly convertable that it might as well be cash.
However it never works for you. But holds its own in the worst market conditions.
If you must hold a sizeable pot instant money to hand, it would seem to be an excellent way of doing it.

 

[Shadow Wolf]

According to Dave Ramsey, anyone can get out of debt. It just takes willpower, planning, and sacrifice.
Do This First If You Want to Get Out of Debt
He has frequent callers of people from all walks of life that started out poor, but are now millionaires through these methods.

I've read one of his books, and it was basically him saying to put making money above everything else, including your family. If it costs money, don't do it. Sure, it may help you get out of debt, and maybe get a savings up, but it's a recipe for a miserably life and a family life that you aren't going to have much of a part in, especially if you follow his example of working part time to deliver pizzas even if you already have full time employment.

And it takes luck. You can have all the will power, planning and sacrifice but one bad illness or disaster in the house or car and you are back to in debt.

I use to be in the paycheck-to-paycheck group. The main reason was low-wage jobs. But, even with the second highest paying job I had, I could work to build up a savings, but any sort of car repair, medical surgery, or any unexpected expense with a hefty price tag would drain it.

 

[Terrywoodenpic]

The most expensive way to live is with debt and on credit.
Those that use credit to live, pay for everything twice once to the seller and once to the lender.
If you are in that position. It it worth any sacrifice to get your affairs sorted and in the black.
the aim should be to have sufficient balances to pay cash for everything.

 

[PureX]

There's really no point in continuing our discussion. You're set on your ways. So am I. Keep in mind, that i never stated that government should have no involvement. My position is balanced, in that both the government and the individual has reasonable amounts of responsibility for the success of that individual. The government should help with the root of the issues but at some point, the individual has to be able to lead their own life with no further contributions from outsiders.

If you feel the individual has absolutely no responsibility in their own success, then so be it...

If you feel that it's all on the government, then so be it.

Personally, I stopped relying on the government a long time ago and I feel that mindset has helped me to be independent and self-sufficient. But that's just me.

What the government is responsible for is ensuring EQUAL OPPORTUNITY FOR ALL it's citizens. And that the opportunities being made available are sufficient for them to live a reasonably secure life. That means that everyone gets the opportunity for a basic, and then higher education. Everyone gets a day's living wage for a day's work. Everyone gets equal protection from everyone else, under the law. Everyone gets equal access to health care and human services. Then, if people don't avail themselves of these opportunities, we need to address the reasons why. Are they mentally or physically ill? (This includes addiction.) Then we should find and offer ways to help them recover or at least contribute to the extent that they are able and willing. And if they are not able or willing, we should respect their humanity (and our own) by providing for them, anyway.

If we would ensure equal opportunity in this country, very few people would refuse to take advantage of those opportunities in whatever way they feel inclined. Not everyone wants to be a brain surgeon. Some people WANT to drive buses, and build houses, and fix cars. And we need people to do these things just as much as we need brain surgeons. So we should pay them a respectable wage for their services allowing them to live a reasonably secure life.

But this is not the system we have. The system we have is all about rewarding greed. It rewards money with more money. And it gives those who have more money than they need to live total control over commercial enterprise, which enables them to amass even more money that they don't need. Which they will then inevitably use to further rig and play the system to even greater advantage. And as a result, they get ALL the opportunities, ALL the justice, ALL the advantages, while everyone else is systematically being denied. And they are exactly the people who least deserve all this advantage, because they have proven their lack of social concern and responsibility. And this is insanely unhealthy for any society, because it is ultimately stifling, self-destructive, and unsustainable.

I don't give a crap about who's fault ignorance and poverty is until the opportunity to overcome them is real, and is available to everyone. And right now it is anything but.

 

[suncowiam]

What the government is responsible for is ensuring EQUAL OPPORTUNITY FOR ALL it's citizens. And that the opportunities being made available are sufficient for them to live a reasonably secure life. That means that everyone gets the opportunity for a basic, and then higher education. Everyone gets a day's living wage for a day's work. Everyone gets equal protection from everyone else, under the law. Everyone gets equal access to health care and human services. Then, if people don't avail themselves of these opportunities, we need to address the reasons why. Are they mentally or physically ill? (This includes addiction.) Then we should find and offer ways to help them recover or at least contribute to the extent that they are able and willing. And if they are not able or willing, we should respect their humanity (and our own) by providing for them, anyway.

If we would ensure equal opportunity in this country, very few people would refuse to take advantage of those opportunities in whatever way they feel inclined. Not everyone wants to be a brain surgeon. Some people WANT to drive buses, and build houses, and fix cars. And we need people to do these things just as much as we need brain surgeons. So we should pay them a respectable wage for their services allowing them to live a reasonably secure life.

But this is not the system we have. The system we have is all about rewarding greed. It rewards money with more money. And it gives those who have more money than they need to live total control over commercial enterprise, which enables them to amass even more money that they don't need. Which they will then inevitably use to further rig and play the system to even greater advantage. And as a result, they get ALL the opportunities, ALL the justice, ALL the advantages, while everyone else is systematically being denied. And they are exactly the people who least deserve all this advantage, because they have proven their lack of social concern and responsibility. And this is insanely unhealthy for any society, because it is ultimately stifling, self-destructive, and unsustainable.

I don't give a crap about who's fault ignorance and poverty is until the opportunity to overcome them is real, and is available to everyone. And right now it is anything but.

I would say you're very passionate about this, as we all should.

I would agree with your opinion if I felt it was slightly realistic. History has suggested that such extreme forms of socialism will fail. Capitalism has been a constant of success.

I would also agree with you when technology reaches a certain point to automate our most basic processes and is able to supply our most common necessities.

For now, I'll refer to fiction like Star Trek for such utopian ideals. Well, not Star Trek Discovery. More like Star Trek The Next Generation minus the wars with Romulans... And Borg.

 

[suncowiam]

The most expensive way to live is with debt and on credit.
Those that use credit to live, pay for everything twice once to the seller and once to the lender.
If you are in that position. It it worth any sacrifice to get your affairs sorted and in the black.
the aim should be to have sufficient balances to pay cash for everything.

I actually pay mostly every thing with credit card but also pay no interest.

I get the perks of miles and convenience of not having to hold cash.

 

[metis]

Capitalism has been a constant of success.

Not the laissez-faire version.

Socialism was adopted to a varying extent by all current nations because of the ills of unbridled capitalism. Even though we may say countries like the U.S. are "capitalistic", the reality is that we have what economists call a "mixed economy", namely an economy that's a mixture of both capitalistic and socialistic programs.

 

[Terrywoodenpic]

I actually pay mostly every thing with credit card but also pay no interest.

I get the perks of miles and convenience not having to hold cash.

That is the best way to use a credit card. you are not paying for credit, but getting the benefit and convenience.
But it only works if you "could" pay cash.

 

[suncowiam]

Not the laissez-faire version.

Socialism was adopted to a varying extent by all current nations because of the ills of unbridled capitalism. Even though we may say countries like the U.S. are "capitalistic", the reality is that we have what economists call a "mixed economy", namely an economy that's a mixture of both capitalistic and socialistic programs.

I believe in some forms of socialism. I support welfare as I stated before.

But let's not fool ourselves that socialism can live on its own. It doesn't. Socialism is only successful on top of capitalism.

 

[oldbadger]

I have one of these, which I'm planning to keep cash in.....

It's a Corliss "cannonball" safe, which weighs abou t12,000#.
It has 2 time locks, & is extremely nitroglycerine resistant.

Ours is a bit smaller than those.

 

[Akivah]

I've read one of his books, and it was basically him saying to put making money above everything else, including your family. If it costs money, don't do it. Sure, it may help you get out of debt, and maybe get a savings up, but it's a recipe for a miserably life and a family life that you aren't going to have much of a part in, especially if you follow his example of working part time to deliver pizzas even if you already have full time employment.

He is addressing people that are badly in the hole. But he also says to "Live like no one else, so that later you can live and give like no one else". That means that to get out of your debt hole, you need to live on the bare minimum, and yes, work extra jobs. But once you've built up your wealth and attained economic stability, that you can spend as you will as you can afford it.

I agree that those first few years are painful, but I agree with him that the efforts will be worth it later on. Being debt-free is a wonderful feeling.

I use to be in the paycheck-to-paycheck group. The main reason was low-wage jobs. But, even with the second highest paying job I had, I could work to build up a savings, but any sort of car repair, medical surgery, or any unexpected expense with a hefty price tag would drain it.

Draining your savings is better than going deep into debt. That pain lasts far beyond the incurred expense.

 

[oldbadger]

Perhaps gold is the answer for ready cash...it never depreciates and keeps pace with inflation. The fluctuations of the bullion market are always within reason.... it is so instantly convertable that it might as well be cash.
However it never works for you. But holds its own in the worst market conditions.
If you must hold a sizeable pot instant money to hand, it would seem to be an excellent way of doing it.

Buying scrap gold works.

 

[Akivah]

I actually pay mostly every thing with credit card but also pay no interest.

I get the perks of miles and convenience not having to hold cash.

Me too. Just pay off the entire balance each month, and you'll score over the credit card companies!

 

[Akivah]

Not everyone wants to be a brain surgeon. Some people WANT to drive buses, and build houses, and fix cars. And we need people to do these things just as much as we need brain surgeons. So we should pay them a respectable wage for their services allowing them to live a reasonably secure life.

Just curious, have you ever taken a microeconomics course? Do you know about supply and demand?

 

[metis]

I believe in some forms of socialism. I support welfare as I stated before.

But let's not fool ourselves that socialism can live on its own. It doesn't. Socialism is only successful on top of capitalism.

I generally agree, especially since socialism is not monolithic.

 

[Revoltingest]

Ours is a bit smaller than those.

I'd make a comment about becoming a real man,
but I'm in a charitable mood for the next 5 minutes.