"WEEKEND INVESTOR Six-Figure Incomes"

[serie1926]

"WEEKEND INVESTOR
Six-Figure Incomes—and Facing Financial Ruin
Some High Earners Live Paycheck to Paycheck. Here's How to Break the Cycle of Overspending."

Sad state of affairs...


http://online.wsj.com/articles/six-figure-incomesand-facing-financial-ruin-1409936418

 

[eta2020]

I can't read it without subscription to WSJ.

But what is a surprise. Building a nest egg is as much about LBYM as about making good money.

 

[Walt34]

My sister worked with some people who had six-figure incomes and were living paycheck-to-paycheck. Astonishing.

Here's a link that doesn't need a log-in. At least it didn't for me. http://online.wsj.com/articles/six-figure-incomesand-facing-financial-ruin-1409936418

 

[LOL!]

That Northern Trust sample budget was a hoot. I didn't see where they showed the $80,000 a year paid to Northern Trust, but maybe I missed it.

They also put less that maximums into retirement accounts and had pathetic contributions to charity.

 

[photoguy]

I think the article would be more interesting if it were based on real data as opposed some hypothetical family that spends 30k on groceries a year.

Sent from my Nexus 5 using Early Retirement Forum mobile app

 

[tfudtuckerpucker]

My sister worked with some people who had six-figure incomes and were living paycheck-to-paycheck. Astonishing.

Here's a link that doesn't need a log-in. At least it didn't for me. http://online.wsj.com/articles/six-figure-incomesand-facing-financial-ruin-1409936418

There's a way to read paid sites, with the "Google First Click Free" hack:

It works like this. You first copy the web address of any news article that is behind the registration firewall and paste that URL into the Google Search box. Now click the first Google result and you’ll be able to read the full text of the corresponding story without registering or subscribing.

 

[robnplunder]

There's a way to read paid sites, with the "Google First Click Free" hack:

It works like this. You first copy the web address of any news article that is behind the registration firewall and paste that URL into the Google Search box. Now click the first Google result and you’ll be able to read the full text of the corresponding story without registering or subscribing.

It worked like a charm. Thanks!

( I can always count on this forum to learn something useful now and then. )

 

[JoeWras]

I think the article would be more interesting if it were based on real data as opposed some hypothetical family that spends 30k on groceries a year.

Sent from my Nexus 5 using Early Retirement Forum mobile app

Hold the phone! I mentioned my BIL in another thread. This is nearly exactly his profile. I mean, it is scary how close it is to their reality. The utilities and taxes are spot on for a large home in IL. The groceries are not as nuts as you think when you are addicted to the finest meats and wines.

Cars? Only the best luxury SUVs. They are not buying Corollas every 5 years.

Did they mention the country club?

Don't pooh pooh it folks. I've seen this.

 

[ERhoosier]

I was blown away by the lady first mentioned in the article. Even after going through a half-million $$ bankruptcy 9 years ago, she gets herself right back in deep financial trouble by vastly overspending what her big $200k/yr income could sustain. Her explanation: "I felt entitled".......What utterly oblivious, misguided, narcissistic CRAP. No one is "entitled" to continuously spend on luxuries far beyond their means. Some one eventually gets stuck with the tab.
And BTW- after that 2005 bankruptcy, (Ch 13 vs Ch 7 not stated), what mental midgets in the financial industry approved her credit limit increases to get right back to $300k in the hole?

And agree 100% with JoeWras. This is NOT a unique story. I've seen it a few times too. Hardly the kind of folks a solid economy is built on.

 

[athena53]

I made in the low 6 figures for the last 20 years of my career although the first 10 of those was in NNJ so a huge chunk went to housing. Sometimes I think it was a no-brainer that DH and I were able to save as much as we did. Then I remember my Ex, who really did try to live like the people in that article. I chose better the second time!

 

[Mulligan]

I was blown away by the lady first mentioned in the article. Even after going through a half-million $$ bankruptcy 9 years ago, she gets herself right back in deep financial trouble by vastly overspending what her big $200k/yr income could sustain. Her explanation: "I felt entitled".......What utterly oblivious, misguided, narcissistic CRAP. No one is "entitled" to continuously spend on luxuries far beyond their means. Some one eventually gets stuck with the tab.
And BTW- after that 2005 bankruptcy, (Ch 13 vs Ch 7 not stated), what mental midgets in the financial industry approved her credit limit increases to get right back to $300k in the hole?

And agree 100% with JoeWras. This is NOT a unique story. I've seen it a few times too. Hardly the kind of folks a solid economy is built on.

I generate about 80k a year in retirement. I have thought about taking a PT job but 2 reasons keep me from it. The taxes and the fact that 20-30k a year extra would not change my lifestyle unless I leveraged debt with it. People who declare bankruptcy a second time should be given a public flogging along with the people who approved the loans!


Sent from my iPad using Tapatalk

 

[Major Tom]

Hangonasec. So you're saying that some people who earn a lot spend every penny they earn and don't save anything?

Well I never.........

 

[JTOrt]

I felt entitled".....

From my almost 40 years of megacorp experience, I honestly think this really means 'I cannot add or subtract'.

 

[photoguy]

The groceries are not as nuts as you think when you are addicted to the finest meats and wines.

Perhaps this is not so contrived then although I still have a hard time believing the estimate is not way over the top even for those saving little (the 30k doesn't even include dining out for which another 20k is allocated).

Most of the high income couples I know are getting burned by some combination of daycare, nanny, private school, etc which weren't even mentioned in the article.

 

[FIREd]

I do think that the Northern Trust spending estimates are overinflated. They would make Chicago at least twice as expensive as San Francisco.

 

[jollystomper]

This is similar to what happened to a SIL (one of DW's sisters). After her 2nd marriage she and new husband had a combined income of over $160K in a relatively low cost state (Florida), no mortgage on the house (from her first divorce), and additional rental income from late FIL's condo (which she forged papers to show she was co-owner when he died, but that is another story).

Even with 3 kids still in the house they could have saved SOMETHING... but it was fancy cars, expensive tastes, parties all weekend (and dumping kids off at Grandma's house for free baby sitting), trips, etc. Then they started using the house and rental property as home equity and 2nd mortgage ATMs.

Of course when things came crashing down after about 5 years of this they came us and their mother for help to sustain this lifestyle - and felt "insulted" when we wanted to find out why they needed money given their lifestyle and the "things" they had. When I suggested they sell one of their cars - they would still have had 3 - you would have thought I told them to throw their kids of a cliff as a sacrifice. The entitlement mentality is wonderful...

 

[nash031]

Simple math escapes some people.

 

[Lucantes]

People who declare bankruptcy a second time should be given a public flogging along with the people who approved the loans!

I am still trying to figure out how everyone that went "underwater" on their mortgage is something that I should care about, or be somehow responsible for. You make an agreement or contract with someone, you honor your commitment (pay your debts!). I am completely fed up with the current prevailing attitude that nothing is anyone’s fault anymore.

 

[JoeWras]

I do think that the Northern Trust spending estimates are overinflated. They would make Chicago at least twice as expensive as San Francisco.

There's some inflation, sure. Like I said, the grocery component has to include something expensive, like a few $40 bottles of wine each week.

The property tax and utilities were unfortunately almost exactly what my BIL pays. When he gets drunk on his wine, he starts complaining about these costs. I had to look up their property tax on the records because I just thought he was drunk. Nope. $25k per year.

Now, that house is large and has a pool. But it is typical of a neighborhood of thousands of houses just like it.

 

[scrabbler1]

I am still trying to figure out how everyone that went "underwater" on their mortgage is something that I should care about, or be somehow responsible for. You make an agreement or contract with someone, you honor your commitment (pay your debts!). I am completely fed up with the current prevailing attitude that nothing is anyone’s fault anymore.

I fail to see how being underwater on one's mortgage is necessarily a terrible thing, too. I bought my co-op apartment in 1989 just before the real estate crash of the early 1990s so I was underwater for a few years before its value bounced back. I had no plans to move so I kept making my payments, doing a refi along the way to knock down the interest rate 6 points.

I paid off the mortgage in 1998 while the apartment's value was rebounding and today it is worth more than I paid for it. The fact that I was underwater for a few years meant nothing to me.

 

[serie1926]

"I am still trying to figure out how everyone that went "underwater" on their mortgage is something that I should care about, or be somehow responsible for. You make an agreement or contract with someone, you honor your commitment (pay your debts!). I am completely fed up with the current prevailing attitude that nothing is anyone’s fault anymore."

My understanding is it wasn't the pain of being underwater for most, it was folks got into mortgages they could have never afforded under any circumstances.

Re "anyone's fault anymore". We've started down a slippery slope in most areas of life, if not all, as a society that I'm doubtful we'll ever come back from.

I won't get on my soapbox...

 

[Letj]

There's a way to read paid sites, with the "Google First Click Free" hack:

It works like this. You first copy the web address of any news article that is behind the registration firewall and paste that URL into the Google Search box. Now click the first Google result and you’ll be able to read the full text of the corresponding story without registering or subscribing.

Wow. Thanks for tip; worked great

 

[marko]

DW's friend just HAD to live in the most expensive town in the state. Big house, big cars, weekends in the Caribbean... of course, the electricity/gas/phone was always being shut off for non-payment...but it looked good from the outside!

These friends eventually divorced and had to sell the house...a $4MM house (including inflation) and all they had to show for it was to walk away with less than $100K.

As Buffet said: "A rising tide may lift all ships but when the tide goes out you get to see who's swimming naked"

 

[Lcountz]

I see they quote Robert Bell in the article....his blog "Living Stingy" is one of my favorite sites...he hits the nail on the head about how much money people waste on nonsense, and how to avoid the pitfalls of debt....

He is also REALLY BIG on personal responsibility...

Check it out!!!!!!

 

[aim-high]

There's a way to read paid sites, with the "Google First Click Free" hack:

It works like this. You first copy the web address of any news article that is behind the registration firewall and paste that URL into the Google Search box. Now click the first Google result and you’ll be able to read the full text of the corresponding story without registering or subscribing.

Thanks!