Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

In Their 20s, Struggling to Save and Tired of Being Lectured About It

nytimes.com

Post reply on HN
Print view View original

41–50 of 131 posts

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#41

Post by specialp »

mhb wrote: post #27
kelnos wrote: post #16

> But saving is especially difficult right now because on top of student debt, housing and food costs remain high even as inflation has started to cool. Statements like this are weird to me, because "cooling inflation" doesn't mean "prices are dropping", and suggests that the author doesn't really understand basic economic concepts. When inflation raises the price of something, that's it: that's the new price. Absent…

I had a government college loan at 3.5% that I absolutely should not have paid off early. Why? You knew of a better opportunity to make a risk-free 3.5% (less any tax deduction)?

Yes it is called inflation. That 3.5% loan principle and payment has become 2% less valuable most years, and recently it has become 9% less valuable. So if that money was put into buying assets that the OP needed, that would be risk free gain.

Also the tax deduction you point out is nullified by paying off the loan. The deduction is on student loan interest. So now that is lost every year. If someone qualifies for that deduction and inflation is normal/high it is pretty hard for 3.5% to be worth paying off early.

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#42

Post by yamtaddle »

rcme wrote: post #33
timr wrote: post #18

The first example is a junior level social worker -- that's fine, but come now: we all know that social work is not a high-paying industry. The second example is a lady with 76k in debt, who has managed to pay down nearly 70% of it . Somehow this doesn't qualify as savings to the author. The third woman actually makes a lot (they won't say how much) and has "achieved financial stability" (thus undermining the thesis…

> The first example is a junior level social worker -- that's fine, but come now: we all know that social work is not a high-paying industry. This is an unfair dismissal. Most industries are not high paying, therefore most workers are not earning enough to save. You're basically saying "they're not saving because they're not earning more!" Also, what is your proposed solution here? To stop having social workers? > so…

Saving $200 a month just means you won't have to go into debt when you need to hire a plumber or auto mechanic or have a very-minor, insured ER visit.

[EDIT] Assuming you don't have more than ~2 such urgent expenses per year, that is. And none worse than that.

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#43

Post by mhb »

fnfjfk wrote: post #29
mhb wrote: post #27

Earlier quoted context omitted.

I had a government college loan at 3.5% that I absolutely should not have paid off early. Why? You knew of a better opportunity to make a risk-free 3.5% (less any tax deduction)?

Any decent index fund? “Risk free” is too high a bar for any investment, compare the expected outcome instead.

Paying off the loan is risk-free. Expected value of an index fund is not obviously better. But you knew that.

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#44

Post by notch656c »

rcme wrote: post #33
timr wrote: post #18

The first example is a junior level social worker -- that's fine, but come now: we all know that social work is not a high-paying industry. The second example is a lady with 76k in debt, who has managed to pay down nearly 70% of it . Somehow this doesn't qualify as savings to the author. The third woman actually makes a lot (they won't say how much) and has "achieved financial stability" (thus undermining the thesis…

> The first example is a junior level social worker -- that's fine, but come now: we all know that social work is not a high-paying industry. This is an unfair dismissal. Most industries are not high paying, therefore most workers are not earning enough to save. You're basically saying "they're not saving because they're not earning more!" Also, what is your proposed solution here? To stop having social workers? > so…

Someone with the skills to be a social worker, on average, can use those skills for higher paid work.

They are knowingly trading the good feeling they get when helping people for the cash they could get by being a cold capitalist. You can make the argument social workers should be paid more but probably not the argument the person is employed in the highest saving ability profession they could reasonably hope to work in.

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#45

Post by timr »

nivenkos wrote: post #40
timr wrote: post #34

Earlier quoted context omitted.

I mean, sure. But my point remains: 90k is not even remotely a lot of money in NYC, even if it's above the median. Anyone who manages to save 24k a year on a 90k salary in NYC -- where the median studio apartment will set you back more than 2k a month and coffee and lunch out can easily exceed $20 -- is doing a good job.

$90k isn't too bad though. London has similar conditions to that and far fewer people are earning $90k+.

It's not bad, but compared to the others he's clearly an outlier in terms of his savings rate.

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#46

Post by saiya-jin »

timr wrote: post #18

The first example is a junior level social worker -- that's fine, but come now: we all know that social work is not a high-paying industry. The second example is a lady with 76k in debt, who has managed to pay down nearly 70% of it . Somehow this doesn't qualify as savings to the author. The third woman actually makes a lot (they won't say how much) and has "achieved financial stability" (thus undermining the thesis…

The whole premise of the article is beyond ridiculous - you are not supposed to be saving in your 20s (which first half is spent on studies for many) but enjoying the life, whatever that means for you! Once responsibilities like parenting and career ladders come into play its too late, there is no going back to that sweet careless freedom.

If I had a dollar for every person telling me 'I should have traveled the world more when I was young', that would be quite a sum. Backpacking can be done extremely cheaply in places like India or Nepal, in 2010 I spent roughly 500$/month all costs included there. Was it fancy snobbish type of trip? Heck no, riding on top of buses or cramped inside in fetal position for 12 hours straight next to chickens, eating in local dhabas, and still those were the best moments of my life, 3 months felt like 2-3 decades there. As a bonus such an experience will make you a better person overall, certainly it worked for me.

You simply can't get this kind of exposure to the real world in any other way, expensive organized trips certainly don't do same magic.

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#47

Post by bachmeier »

> Ms. German-Tanner said 20-somethings were often encouraged to take financial steps like build emergency funds, save for retirement and pay off debt. They’re advised to invest when the market is down and to start thinking about their futures as early as possible.

"Build an emergency fund" is basically impossible for a lot of people. I remember hearing that advice. The problem was that food, housing, my car, and related necessary expenses ate up most of my paycheck. Getting rid of cable would have saved a tiny bit of money, made life miserable for me inside my small apartment, and contributed approximately nothing to an emergency fund equal to even one month of income. I knew it would be nice to have more money in savings before anyone told me.

> I feel like the older generation is constantly pushing you to do stuff like they did when they were in their 20s, but it’s not even comparable to when they were in their 20s

Anyone that says this does not understand what it was like for the older generation. Most of the time if someone is pushing financial advice, they're either trying to sell you something, or they're trying to help you avoid the problems they faced. It was never easy.

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#48

Post by monero-xmr »

rcme wrote: post #33
timr wrote: post #18

The first example is a junior level social worker -- that's fine, but come now: we all know that social work is not a high-paying industry. The second example is a lady with 76k in debt, who has managed to pay down nearly 70% of it . Somehow this doesn't qualify as savings to the author. The third woman actually makes a lot (they won't say how much) and has "achieved financial stability" (thus undermining the thesis…

> The first example is a junior level social worker -- that's fine, but come now: we all know that social work is not a high-paying industry. This is an unfair dismissal. Most industries are not high paying, therefore most workers are not earning enough to save. You're basically saying "they're not saving because they're not earning more!" Also, what is your proposed solution here? To stop having social workers? > so…

> Also, what is your proposed solution here? To stop having social workers?

Reduce expenses to live within your means, or figure out how to earn more money. The plight of... every person on earth

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#49

Post by KronisLV »

I am currently in my mid/late 20s and living in Latvia (Eastern Europe). After getting my Bachelor's and Master's degrees from a local university, working for about 5 years with gradually increasing salaries/hours (started while studying), saving and/or investing on average around 50% of what I make, I have about 50'000 Euros saved up.

It's better than some of my peers, worse than people in the more wealthy countries, but still feels both like a necessity and something that's also not enough at the same time. In the last year, I've seen my investments (bank managed funds) go from being +10'000 Euros over the value at which I got in, to being in the red, to slowly recovering now. The inflation isn't all that good, either.

I'm taking a short break from working altogether to upskill myself and work on some personal projects, so it's nice to have savings for cases like these (as well as things like unforseen medical expenses, though most are manageable here), but something tells me that I'll need to keep living a somewhat spartan lifestyle, getting some limited peace of mind in exchange for that, saving similarly wherever I work next.

To be honest, I feel bad for people in high cost of living areas, especially those who have cars and families to take care of, as well as debt - the economy should probably be in a better spot, and certain groups of services should be more affordable than they are now.

Re: In Their 20s, Struggling to Save and Tired of Being Lectured About It

#50

Post by jewayne »

notch656c wrote: post #44
rcme wrote: post #33

Earlier quoted context omitted.

> The first example is a junior level social worker -- that's fine, but come now: we all know that social work is not a high-paying industry. This is an unfair dismissal. Most industries are not high paying, therefore most workers are not earning enough to save. You're basically saying "they're not saving because they're not earning more!" Also, what is your proposed solution here? To stop having social workers? > so…

Someone with the skills to be a social worker, on average, can use those skills for higher paid work. They are knowingly trading the good feeling they get when helping people for the cash they could get by being a cold capitalist. You can make the argument social workers should be paid more but probably not the argument the person is employed in the highest saving ability profession they could reasonably hope to work…

Again, you seem to believe that eliminating the job of social worker from society is a viable option.
Post reply on HN