Being frugal is for the rich • Hacker News Board

Re: Being frugal is for the rich

#31

Post by neogodless » Mon, Mar 26, 2018, 7:54 PM UTC

notyourwork wrote: post #18

aschearer wrote: post #3

The title here seems very inflammatory. The article questions whether some actions (e.g. painting your own home instead of hiring someone to do it) are truly frugal. It goes on to say that the philosophy of frugality is a handmaiden for wealthy. Maybe so, but why would we discourage good spending habits? For example, choosing to eat one or more meals out each day versus bulk cooking is an option available to most peo…

People want what they can't have which I don't think will ever dissolve. Therefore, the idea that advertising has any bearing on this is flawed. Keeping up with the joneses is less about having the same thing and more about having the joneses quality of life. They aren't the same if you look at them. Having a fancy car for example is a status symbol, what is the status? The status is that this car has nicer features,…

There are so many things you cannot tell by looking at how other people appear to be living their lives. Or whether the car is valued for utility, features or perceived status.

First, you can't tell from looking at their car how well-suited their finances are to paying for it. They could have a 12.99% 72-month loan that doubles the actual cost (plus higher insurance premiums, premium fuel, etc). Or they bought it cash, self-insure, and have money invested that compounds over time and pays their insurance and gas bill for them.

Second, you probably don't know how they are using it. If you're a master salesman with an excellent income, selling 7-figure deals to executives, you might actually get utility out of perceived status! But if you're a coder who walks a quarter mile from parking and works in the basement of the building, the brand name on that car is worth nothing. And most of those comfort features can probably be found in a Mazda for $20K less. Or a ten-year old luxury car. (Personally I love the hatchback which combines all those features with utility and fuel economy! No need to buy the luxury sport sedan.)

Finally, wait, why do you think advertising isn't doing its job? People know what they can't have because of advertising. Then they want it.

Re: Being frugal is for the rich

#32

Post by vorpalhex » Mon, Mar 26, 2018, 7:55 PM UTC

qntty wrote: post #7

aschearer wrote: post #3

The title here seems very inflammatory. The article questions whether some actions (e.g. painting your own home instead of hiring someone to do it) are truly frugal. It goes on to say that the philosophy of frugality is a handmaiden for wealthy. Maybe so, but why would we discourage good spending habits? For example, choosing to eat one or more meals out each day versus bulk cooking is an option available to most peo…

I guess this is the real motive behind the article: But here’s the thing. Regardless of intent, these Millennials are telling an older generation of elite Americans — the very people whose policies and financial decisions kneecapped the economy — what they want to hear: that everything is more or less okay, and young people just need to be more thoughtful about their money. And that’s a shitty idea to perpetuate. Bec…

> continuing to build a world where they are more and more necessary

My grandmother can still, to this day, recount living in an apartment with no furniture except a mattress, with my grandfather who was employed as an engineer in New York. It took, by her estimate, about two years to have enough furniture before she was willing to invite over any sorts of company.

Today you can furnish an apartment reasonably with about a months worth of wages. I know this because I helped take a friend who makes a bit over minimum wage to IKEA to get all their furniture for an apartment they moved into.

The myth of decline is that - a myth. The economy is better then it has been in decades, violence is at an all time low, and jobs are widely available in many areas of the country.

I have friends who complain about the economy "being destroyed", who max out credit cards to buy brand new cars and buy expensive home theaters. I have one friend who despite making six figures a year, took a predatory payday loan because she had spent her wages on expensive unused tools.

That's not to blame "millennials" anymore than to blame any other generation. Bad financial choices have existed since the dawn of human history, but in many cases today they are choices, not pre-supposed economic outcomes. We can help correct that by teaching good finance skills (budgeting, doing things yourself instead of hiring people, focusing on cheaper hobbies, etc).

Re: Being frugal is for the rich

#33

Post by jogjayr » Mon, Mar 26, 2018, 7:56 PM UTC

duxup wrote: post #25

jogjayr wrote: post #17

Earlier quoted context omitted.

But tons of folks working high-paying jobs don't manage to establish a lifestyle like the Frugalwoods. There's a reason phrases like "keeping up with the Joneses" exist. It's how you end up with "out-of-touch" articles about how a $250k annual income is barely middle-class in NYC or the Bay Area. Can't we focus on the message instead of the messenger? Or stop assuming that the message is for Millennials alone?

I think there is a legit reason to include the messenger and the message if you think the messenger's advantages are what make the suggestions in the message possible....

There are many people who have the same advantages as the Frugalwoods (education, high-paying jobs) but not the same lifestyle outcomes. Are we going to criticize them for pointing this fact out by showing their own example?

Re: Being frugal is for the rich

#34

Post by bsder » Mon, Mar 26, 2018, 7:58 PM UTC

throwaway84742 wrote: post #16

qntty wrote: post #7

Earlier quoted context omitted.

I guess this is the real motive behind the article: But here’s the thing. Regardless of intent, these Millennials are telling an older generation of elite Americans — the very people whose policies and financial decisions kneecapped the economy — what they want to hear: that everything is more or less okay, and young people just need to be more thoughtful about their money. And that’s a shitty idea to perpetuate. Bec…

Most young people do need to be more thoughtful about their money, though. And the economy as a whole is, by multiple different metrics, the best it’s ever been. It’s just that this greatness needs to be spread a bit wider. In the capitalist system with a labor market as tight as we’ve ever seen it this is addressed by getting another job for more money. Now is a good time to do it. You are responsible for your own s…

> In the capitalist system with a labor market as tight as we’ve ever seen it this is addressed by getting another job for more money.

Is it tight?

I see very few occupations with rising wages. That's the REAL test for a tight labor market.

Let me be anecdotal for a moment ...

I was at a conference recently where the companies had a panel session complaining about getting more people into the business. Unlike most software disciplines, they really do have an infeed problem. In addition, they are also getting poached and losing their junior guys from the shop floor.

Okay, think I, I was a hiring manager in the DotCom Boom(tm), I understand getting poached in a narrow field.

So, do you know who their primary opponents are?

Amazon and Foxconn.

Two of the worst employers on the planet. You are losing employees from your manufacturing line to Amazon warehousing and Foxconn manufacturing.

Um, please go bankrupt and may your industry die in a fire if you treat people so badly as to lose them to Amazon and Foxconn.

Re: Being frugal is for the rich

#35

Post by xboxnolifes » Mon, Mar 26, 2018, 8:01 PM UTC

duxup wrote: post #22

xboxnolifes wrote: post #12

Earlier quoted context omitted.

The audience that these types of blog posts are targeting aren't those of who are stuck making minimum wage, but instead those who are fairly well off but think they aren't because they keep spending yearly costs on $1000 phones, 5+ subscription services, large housing costs, eating out multiple times per week, etc.

I don't know who the target audience is. I'm not sure your issues you address are anymore a path to financal independence than anyone else offers. It's really easy to pick our personal boogeymen that no doubt play a part in things, and make them more of the issue than they really are.

I'm just repeating issues that the blog authors from FrugalWoods, MMM, MadFientist, ERE, ERN, etc, all bring up as their main points for obtaining wealth (Or being financially independent as they call it). And they were merely examples of a large list of things that increase spending, hence the 'etc'.

Each of them typically does three things: They keep their household yearly spending under $35,000 (some even less than this), increase income as much as possible, and invest the savings, taking advantage of tax-deferred accounts whenever possible. Though, the three things are basically common sense when you think about it.

Re: Being frugal is for the rich

#36

Post by EnFinlay » Mon, Mar 26, 2018, 8:02 PM UTC

logfromblammo wrote: post #30

I would also make the economic argument that a rich person that is still frugal is actively exacerbating income inequality. If Warren Buffett is indeed still paying only $3 for breakfast every day, that's giving a big middle finger to the economy. Money is half of the circulatory system of the economy. When it pools too long in one spot, it clots, and then a thrombosed clot can cause damage somewhere else. He really…

I fundamentally and vehemently disagree with you.

Re: Being frugal is for the rich

#37

Post by jjeaff » Mon, Mar 26, 2018, 8:03 PM UTC

joefourier wrote: post #11

American salaries are difficult to make sense of from a European perspective. The referenced average salary of $36,000/year for millennials with only a high-school diploma would be a normal entry-level salary for a software engineer in most of Western Europe, and a very good salary for experienced engineers in Eastern Europe. Tax burden is higher here as well, and while the cost of housing is exorbitant many parts of…

You can't really compare a $36k salary from one region to the next in the US, much less the US to Europe. You would need figures adjusted for ppp.

As for triple the salary in eastern Europe, well, housing and other big expenses are presumably lower. But so is the standard of living.

You have to compare people to those around them.

Plenty of people in Africa would think a $10k annual salary is exorbitant and unnecessary.

Re: Being frugal is for the rich

#38

Post by crooked-v » Mon, Mar 26, 2018, 8:04 PM UTC

gowld wrote: post #26

tjpaudio wrote: post #19

Earlier quoted context omitted.

City-based salary adjustments are really something only educated professionals get, low-wage earners are screwed in big cities. I think also it will shock you how much every day items are compared to Europe. For one, public transportation is not available to most of America. So you have to have a car and car insurance, thats hundreds of dollars more per month right there. Cellphone service costs 3x as much as anywher…

> City-based salary adjustments are really something only educated professionals get, That's not entirely true. In many cities, minimum wage is substantially higher ($12-$15/hr) than the Federal minimum ($7.25/hr) > in big cities > So you have to have a car and car insurance Not in big cities.

Very few of the big cities in the US have public transit that's even sufficient for most people to get to work, let alone to sustain the rest of a reasonable lifestyle.

I'm saying this as someone who previously had a 1 hr 20 min commute via public transit just to go 16 miles, and that was with the relatively good public transit in the Portland metro area and me literally living a block away from main downtown transit hub.

Re: Being frugal is for the rich

#39

Post by bsder » Mon, Mar 26, 2018, 8:05 PM UTC

malvosenior wrote: post #14

qntty wrote: post #7

Earlier quoted context omitted.

I guess this is the real motive behind the article: But here’s the thing. Regardless of intent, these Millennials are telling an older generation of elite Americans — the very people whose policies and financial decisions kneecapped the economy — what they want to hear: that everything is more or less okay, and young people just need to be more thoughtful about their money. And that’s a shitty idea to perpetuate. Bec…

I think there’s real value in spreading the message of thrift. The 20th century saw a massive build up of the consumerist lifestyle. It’s going to take a lot of work to back that out, so we might as well start now. I’ve personally seen people with high five figure student debt go on regular international trips. These people more or less live paycheck to paycheck and save specifically for travel (or use credit cards —…

Why not? They're screwed by the economy, so might as well go all in.

We need to get to the idea that there are not enough good jobs for everybody. Once we get to that point, we can start to figure out what to do about it.

Re: Being frugal is for the rich

#40

Post by qntty » Mon, Mar 26, 2018, 8:05 PM UTC

malvosenior wrote: post #27

qntty wrote: post #20

Earlier quoted context omitted.

No doubt. Again: the tips are great and many people would do well to listen to them. However, the larger question of the place that these tips have in the story that we tell ourselves about society is still an open question. There are multiple ways to place these tips in a larger context while still following them and regarding them as worthwhile . It's important to understand that there is a choice to be made here a…

I don’t think there’s a way to place them in the larger context that makes them less useful though. It’s tough out there, try to be frugal, seems like great advice. I like that it’s not political as well. Once you move the discussion to policy, people get territorial. The “American dream” of the 20th century was never sustainable. We’re just now realizing that en masse. Being frugal is just a natural realignment of c…

I agree on the first point, but I think part of the point of this article is that there no such thing as "not political" since everything you say in public has a place in the public consciousness which is the engine of democracy.

Regarding the American dream, maybe it's sustainable or maybe it's not, but it's clear that it would be a lot more sustainable if people where willing to create a world with fewer obstacles to attaining it e.g. by implementing universal health care. If we tell ourselves that people who can't afford health care probably deserve to struggle with money because they're not being frugal, then that's a problem.