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Many don't have $2,000 for a rainy day

money.cnn.com

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Re: Many don't have $2,000 for a rainy day

#81

Post by Confusion »

ebiester wrote: post #24
billybob wrote: post #6

If you don't have enough money to handle an emergency, you have an emergency. Go ahead and panic. Trade your car for a cheaper one, move into a cheaper apartment, stop eating out, sell your TV, and get an emergency fund . If you're already living on toasted rats in a cardboard box, that's different, but if you've got unnecessary expenditures, you should really cut those out and get an emergency fund. To do otherwise…

You're looking at it from a middle class perspective. Unfortunately, most of these people are also deep in debt and have already made such cuts. This is the byproduct of double digit unemployment as much as anything. As much as we talk about consumption, most of it is at the middle class level. Now, I've seen poor people make very bad decisions, but many are on purchases you and I would make without a second thought.…

You're suggesting that 50% of the US population is deep in debt and lives as frugally as possible to resolve that issue? I don't think so.

Re: Many don't have $2,000 for a rainy day

#82

Post by gte910h »

robflynn wrote: post #9
fr0sty wrote: post #8

I wonder whether or not there is a difference between the 'ability' and the 'perceived ability' to raise cash quickly. Many people are cash-poor, yes, but I am surprised that over half the population has no cash equivalents, hard assets, or access to credit (even from a relative or friend). N.B. This is not meant to be financial advice, but just to point out that people usually have many more options than they think…

Based on my post below, I do not have, on hand, $2000 that I could use in case of emergency. I am fortunate enough, however, that if I absolutely needed it, I have ways of getting the money. (Via family mostly, but I really dont like tapping into that unless it truly is an emergency.) I'm also extremely thankful for a couple folks that approached me to write some web apps (php/rails) for them. Without them those last…

Medical payments are the most easy to renegotiate. As long as you are paying something continually, almost all hospitals are very understanding.

Don't beggar yourself to pay medical bills in the amount they originally ask on the timescales they originally ask.

Re: Many don't have $2,000 for a rainy day

#83

Post by huherto »

anonymouser wrote: post #43

I have a question for HN hackers. I make over 6 figure a year. My wife doesn't work. She keeps telling me that we are not middle class, and that I should earn more if I want to afford us a middle class lifestyle, because everything is very expensive now. She also thinks that I'm a bit of an underachiever, professionally, for earning only 120K a year. Am I an underachiever or is she out of touch with Midwestern Americ…

Do not value yourself based on that. This is a race you cannot win. If you win the race against the Jones, are you going to start competing against the Jobs or Gates?

It is very easy to criticize, if she is still believes you are an underachiever(you are not) Do what Fraajad says, let her find out how easy(or difficult) it is to succeed.

Re: Many don't have $2,000 for a rainy day

#84

Post by pgh »

jswinghammer wrote: post #44
pkamb wrote: post #25

Earlier quoted context omitted.

Does the UK not have something like FDIC Insurance?

No very few countries do.

Yes, the UK does have something like FDIC. It's called FSCS http://www.fscs.org.uk. Moreover quite a few EU countries have something similar too: http://en.wikipedia.org/wiki/Deposit_insurance

Re: Many don't have $2,000 for a rainy day

#85

Post by rb2k_ »

hugh3 wrote: post #50
ebiester wrote: post #24

Earlier quoted context omitted.

You're looking at it from a middle class perspective. Unfortunately, most of these people are also deep in debt and have already made such cuts. This is the byproduct of double digit unemployment as much as anything. As much as we talk about consumption, most of it is at the middle class level. Now, I've seen poor people make very bad decisions, but many are on purchases you and I would make without a second thought.…

Unfortunately, most of these people are also deep in debt and have already made such cuts. Sometimes I wonder about this. How many poor folks are wasting their limited budget on frivolous crap? One reality show I really would like to see would be about a sensible financial advice type who parachutes into the lives of low-income, deeply-in-debt people and shows them how to budget properly.

We actually have a show like that in Germany... It's mostly the same basics over and over again (cut the cigaretes, no Pay TV, Why do you have 4 Cell phone contracts, ...). It could very well be scripted though. Maybe I'll remember the name over the next hour or so :)

Re: Many don't have $2,000 for a rainy day

#86

Post by GFischer »

illumin8 wrote: post #66
GFischer wrote: post #30

Earlier quoted context omitted.

I currently don't have U$ 2.000 (not an American, but having money for a rainy day should be worldwide), but I could raise them with a (high interest) loan in about 30 minutes. The article says they don't count, though: "29.5% said they would have to resort to credit cards, a home equity line of credit, reverse mortgage or unsecured loan. "

I hate to break it to you but you're living beyond your means. A high interest loan is not an emergency fund. Ideally you should have enough money to live for 6-12 months if your income stopped tomorrow. I know when I was younger I didn't have such things, but then the recession of 2002 hit and I found out really quickly how much it sucks trying to make a house payment with an unemployment check.

I know I am, but one of the niceties of a socialist system is that if I get fired, I get paid my salary for a year and a half in unemployment :) , plus three months' salary straight away.

I actually wish I was fired :) (though the black mark in the CV here is really bad). The really bad thing about this system is that it's based on seniority, if I switch jobs, I lose all those perks (start back at zero, only get some minor unemployment after 3 months on the job)

I'm also neither a homeowner nor a parent, and could scale back my spending to zero pretty quickly (moving in with my grandfather and selling my car). Not a long term strategy, obviously, and I am thinking of becoming a parent (in 2-3 years) which will force me to be way more conservative with money.

Re: Many don't have $2,000 for a rainy day

#87

Post by mattw »

noodle wrote: post #80
dailyrorschach wrote: post #68

Earlier quoted context omitted.

This is exactly how I've been doing it. Auto-transfer set up on the bank account, and taking cash out for spending money instead of just letting myself use a credit or debit card.

credit cards are useful tools. i use mine and just pay it down monthly. if you have any plans on obtaining a loan/mortgage at any point in time, the easiest way to establish yourself with good credit is through actually using a credit card.

Everybody says this, but I've obtained three different mortgages in my lifetime and never had a credit card. In lieu of credit history, the bank has just asked for other evidence that I pay my bills, like statements from the utility company.

Maybe I'm just lucky, but in my opinion, wanting a good credit score is a pretty bad reason to get a credit card.

Re: Many don't have $2,000 for a rainy day

#88

Post by JCB_K »

I'm definitely not in the part of my life yet when I have to worry about money...but still I do. I actually just made my first proper budget (proper as in not just write down what I'm expecting to spend, on the back of a napkin, but doing it by month, comparing it to what I get per month, planning stuff.) and you know what? It actually made me feel good.

Knowing exactly what I can spend on what is a really comforting thought. When I'm in a shop and I see something I want, before I would have to quickly count up the big expenses of the coming months, see what I have left, and decide if it's worth it. Now I know exactly in what category the item is, and how much money I have left. If I don't have enough and I feel like I really need it, I can take a look at my budget and adjust it slightly.

On a sidenote, I'd love to start a business one day, but as long as it's not completely necessary (and safe) I would never want investments. I'd much rather bootstrap my product instead: the risk is much lower, and the relaxed feeling much higher.

Re: Many don't have $2,000 for a rainy day

#89

Post by JCB_K »

artmageddon wrote: post #72
AndyKelley wrote: post #65

Earlier quoted context omitted.

What part of that does insurance play?

I had a problem similar to this about two years ago. 9 hours in the ER on a Friday night to get checked out for a pain cost $13,000. I had to pay around $100 upfront, and then insurance kicked in and took care of the rest.

That is crazy. A couple of months ago I had to go to ER, was there for 2 hours or so, and went home. A week ago I got a bill of £12 for the penicillin they gave me for a week, as that wasn't for inside hospital. I'm not insured (in the UK), and I don't pay taxes (anywhere).

Re: Many don't have $2,000 for a rainy day

#90

Post by [deleted] »

anonymouser wrote: post #43

I have a question for HN hackers. I make over 6 figure a year. My wife doesn't work. She keeps telling me that we are not middle class, and that I should earn more if I want to afford us a middle class lifestyle, because everything is very expensive now. She also thinks that I'm a bit of an underachiever, professionally, for earning only 120K a year. Am I an underachiever or is she out of touch with Midwestern Americ…

[deleted]
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