Living paycheck to paycheck is disturbingly common • Hacker News Board

Re: Living paycheck to paycheck is disturbingly common

#121

Post by closeparen » Mon, Dec 31, 2018, 6:59 PM UTC

49531 wrote: post #57

SmirkingRevenge wrote: post #28

As someone who didn't learn the very basics of personal finance at the optimal point in life, I feel like it should be part of our standardized education. I'd like to think that would make things at least marginally better. Another thing I'd love to see, would be for banks to fundamentally reorient themselves to be their customer's advocates/financial guardians, instead of being yet another party encouraging people t…

You'll never have banks working in consumers self interest as long as they are profit driven organizations. Public banks tend to work better for actual sensible banking.

The government wants money to flow, to drive the economic growth and job creation that gets it reelected. It's the last thing that's going to encourage low-consumption/high-savings lifestyles.

Re: Living paycheck to paycheck is disturbingly common

#122

Post by Draiken » Mon, Dec 31, 2018, 7:09 PM UTC

anoncoward111 wrote: post #4

Not even 200 years ago, most people exchanged labor for food. Currency was not used, as you most likely lived on the farm you worked for. There was no form of advancement to be seen, but also no rent, student loans, medical bills, child care etc. There was also no Whole Foods or freedom of speech. But how much farther have we really come in 2018? We have more things, but if you stop working, you will starve or go ill…

Living in a completely unsustainable capitalism system, I am surprised how much we're stuck in our own little bubbles.

Personal finance shouldn't even be a thing. We have the capacity to provide every basic need to everyone, but we choose not to, in order to make very few people extremely rich.

Oh well, it's not like anything will ever change (at least while I'm alive)

Re: Living paycheck to paycheck is disturbingly common

#123

Post by SmirkingRevenge » Mon, Dec 31, 2018, 7:09 PM UTC

vailprogrammer wrote: post #82

SmirkingRevenge wrote: post #28

As someone who didn't learn the very basics of personal finance at the optimal point in life, I feel like it should be part of our standardized education. I'd like to think that would make things at least marginally better. Another thing I'd love to see, would be for banks to fundamentally reorient themselves to be their customer's advocates/financial guardians, instead of being yet another party encouraging people t…

I like it. How would the bank make its money? The standard exploitative practices of other banks, just with smaller fees ($5 overdraft fee instead of $37?, or lower interest rate spreads?) or just charge $50 a year, and do away with those fees? Would that lead to too many people taking advantage of it?

To be honest, I don't know what the business model would be, but it seems like it should be in the banks long-term best interest to create rich, prosperous people with invest-able funds. They are literally in a position to create their own wealthy customer base.

What would it actually do for a big bank, if it were the exception rather than the rule, that their low/middle-class account holders had enough savings to cover several months of expenses and small/medium emergencies without relying on credit, had a reasonable portfolio of retirement investments, and on their way to being in a financial position to get involved with other kinds of investments, eventually?

The banks could automate all the best practices of personal finance for most their account holders, to make all of the above happen for their average customer. Software is cool like that.

- They could divert a percentage of all deposits to emergency funds by default.

- They could set aside money for expenses, based on your cash-flow history by default.

- They could set aside spending money, also based on your cash-flow history by default.

- They could manage a persons credit debt (think pay minimums while savings/cushion is built, then use the extra cash flow from savings goals into debt payments).

- If the customer dip into savings because your car broke down or something - starting filling up the emergency fund again.

- If credit debt is paid up, savings goals are hit, they could start automatically put portions of savings into low risk long term investments (IRA's etc).

(Simple.com does some of the above kind-of but its a manual process - but quite nice compared to what 21st century online banking has been, so far)

And I'm sure there's much much more - and for the people who do really well, then they can funnel those people into more customized investment approaches. Are market forces so screwy, that all this would actually be bad for the banks bottom line, in the long run?

Re: Living paycheck to paycheck is disturbingly common

#124

Post by mac01021 » Mon, Dec 31, 2018, 7:11 PM UTC

SmirkingRevenge wrote: post #28

As someone who didn't learn the very basics of personal finance at the optimal point in life, I feel like it should be part of our standardized education. I'd like to think that would make things at least marginally better. Another thing I'd love to see, would be for banks to fundamentally reorient themselves to be their customer's advocates/financial guardians, instead of being yet another party encouraging people t…

So, when you log into the Bank of America website, you want to be greeted every time with things like the following?

"Dude, maybe you should sell this car that you're paying $450 per month for and get a $7000 used car."

"Did you know that between starbucks and happy hour you spend an average of $120 per week, and that amounts to 10% of your take-home pay?"

"You currently spend $2500 per month on rent. If you downsize from 2 bedrooms to 1, you can save $X over the next 3 years."

Re: Living paycheck to paycheck is disturbingly common

#125

Post by [deleted] » Mon, Dec 31, 2018, 7:12 PM UTC

SmirkingRevenge wrote: post #28

As someone who didn't learn the very basics of personal finance at the optimal point in life, I feel like it should be part of our standardized education. I'd like to think that would make things at least marginally better. Another thing I'd love to see, would be for banks to fundamentally reorient themselves to be their customer's advocates/financial guardians, instead of being yet another party encouraging people t…

[deleted]

Re: Living paycheck to paycheck is disturbingly common

#126

Post by holtalanm » Mon, Dec 31, 2018, 7:14 PM UTC

zeta0134 wrote: post #104

One of the simplest and most effective things I did recently was to split my bank account into two checking accounts, and one savings account. I carry two debit cards with me that are visually distinct. One is for day to day purchases, and the other is meant for bills and the occasional unusual expense, like maybe tools for a surprise home repair. Each time I get paid (every two weeks) I have my employer deposit the…

we have a similar system in our household. Each month, my wife and I essentially give ourselves an "allowance" that goes into our own accounts (our main account is joint). Then we put a budgeted amount into savings from the main account. Almost everything in the main account at that point is budgeted for planned expenses. Once our allowance amount is gone, we just wait until the next month.

So far, it has helped us immensely in keeping our spending low. We still have the occasional lapse where we end up spending too munch every once in a while, but all in all, it has been a net positive since we started this. I'll give all the credit to my wife, who thought of it. I'm pretty horrible with money, myself.

Re: Living paycheck to paycheck is disturbingly common

#127

Post by [deleted] » Mon, Dec 31, 2018, 7:14 PM UTC

RickJWagner wrote: post #109

We are mostly tech people here, right? Given that, I have a suggestion. We should all be smart, compensated well, etc. If you worry about things like this, study what's been said by Warren Buffet, Jack Bogle, and Ray Dalio. These guys have won the game and explain clearly how anyone (yes anyone) can slowly accumulate wealth. It really does work. The site Bogleheads.org is full of helpful ideas and people that will gu…

[deleted]

Re: Living paycheck to paycheck is disturbingly common

#128

Post by sys_64738 » Mon, Dec 31, 2018, 7:16 PM UTC

Show us your incoming wage and outgoings then we can discuss whether you are living paycheck to paycheck. Living paycheck to paycheck means your needs are not being met rather than your wants. Cable (free OTA), eating out at all (pack sandwiches), heat (wear more clothing), etc, are all things which need to be cut if you think your outgoings are greater than income.

Re: Living paycheck to paycheck is disturbingly common

#129

Post by Johnny555 » Mon, Dec 31, 2018, 7:16 PM UTC

zeta0134 wrote: post #104

One of the simplest and most effective things I did recently was to split my bank account into two checking accounts, and one savings account. I carry two debit cards with me that are visually distinct. One is for day to day purchases, and the other is meant for bills and the occasional unusual expense, like maybe tools for a surprise home repair. Each time I get paid (every two weeks) I have my employer deposit the…

Carrying a debit card (at least by the american definition of "debit card", other countries may have more sane CC security) is a risk in itself -- if you lose the card (or just the number), then your bank account can be wiped out before you can stop it, then you'll start bouncing checks.

And since you have a card for each account, they can wipe out your savings too, making it harder to replenish your checking account.

You'll most likley get the money back, eventually.

I carry only an ATM card (PIN required), no debit card that debits directly from my bank account.

(note that this isn't just a hypothetical vulnerability, my company had to give a paycheck advance to an intern who lost her debit card in a bar, had her account wiped out and couldn't get money back from her bank in time to make rent)

Re: Living paycheck to paycheck is disturbingly common

#130

Post by mac01021 » Mon, Dec 31, 2018, 7:19 PM UTC

fromthestart wrote: post #72

vailprogrammer wrote: post #61

Earlier quoted context omitted.

> media like these focus exclusively on this negative minority and exaggerate the negativity of the status quo. Can you expand on 'this negative minority' ? Because I think there are a lot more poor people than 'upper middle class' people in this country. > I have little sympathy for people who consistently plan poorly and make bad decisions Why not? Self control isn't some moral, righteousness, trait. To possess a c…

>Why not? Self control isn't some moral, righteousness, trait. Exhibit B. Personal responsibility is increasingly fading from the collective American vocabulary, and articles like these, which normalize nonsensical, narcicisstic decisions, like throwing away a decade pursuing 3 low demand liberal arts degrees, make the media complicit. Self control absolutely is a moral, righteous trait, particularly because those wi…

Not disagreeing with anything about your main point but

> Somehow other cultures tend to place virtue in the development of discipline

to which cultures are you referring?