Couple feels they are entitled to a certain lifestyle

[Time2]

This couple feels they are entitled to a certain lifestyle and they don't even realize that they are doing it.
This was the first time I have seen Ramit Sethi, he seems to be a counselor, or at least was in a previous life. He asks questions to get this couple to look at what they are doing and get them to understand how they are not the simple people they think they are, but rather people that are much more dependent on things that their money buys.

 

[LateToFIRE]

Never been a fan. Basically, the guy wrote a blog and a book on how to become "rich" when he was twenty-something, based on zero experience and simply regurgitating age-old frugality wisdom. And then he morphed all that into a Susie Orman level finance guru marketing and educational business, thereby making himself... RICH.

Have to admire his industriousness and business acumen though.

[update: Actually watched portions of the video, pretty good stuff, I liked his encouraging approach]

 

[brett]

I have a SIL who seems to to have lived her entire life believing that she was entitled to a certain lifestyle.

Part B is that she has concerned herself and managed her affairs on the basis of what others may think of her.

As a result she has spent he entire adult life in hawk to consumer credit, moaning about her financial affairs and more recently completing a reverse mortgage in order to finance an kitchen reno of her 12 year old home.

She is now in her late sixties. No longer working and facing a grim retirement.

The head scratcher is that she seems surprised.

I suspect that there a fair number of people with the same traits, same habits.

 

[LateToFIRE]

I suspect that there a fair number of people with the same traits, same habits.

A recent Barrons/Harris poll says about 78% of Americans earning less than $50,000 a year report they live paycheck to paycheck - no brainer on that one.

But, more troubling, they said that 51% of Americans who make more than $100,000 a year say the same thing.

Now, I don't know what their definition of "paycheck to paycheck" is. Heck, I'm still earning a salary and we run out of money each month, buuutttt we have assets, investments, properties, etc., not to mention expected lumpy year-end bonus, RSU's, etc. Would we count as living paycheck to paycheck?

 

[pb4uski]

... I suspect that there a [-]fair number[/-] boatload of people with the same traits, same habits.

Fixed it for ya.

And the real head scratcher is that is isn't a deep, dark secret that SS alone is insufficient and that one needs to save for retirement.

 

[MichaelB]

So, a link to a 1 hour 16 minute video with the subtitle “I will teach you to be rich”. I’ll pass.

I don’t see how this video has any information or lessons needed by our members. The situation described by the OP (entitlement) doesn’t seem to apply to us. It is a situation chosen and used to promote his business.

 

[LateToFIRE]

So, a link to a 1 hour 16 minute video with the subtitle “I will teach you to be rich”. I’ll pass.

I don’t see how this video has any information or lessons needed by our members. The situation described by the OP (entitlement) doesn’t seem to apply to us.

Yes, true no one on this board needs any info in that video. And I can't watch 1 hour 16 minutes of anything straight thru unless its an action-thriller.

But, I will admit to appreciating their example of how the other 95% live. Been a long time since I inhabited that space. I could relate. I was as clueless and irresponsible as that couple before I met DW, which fortunately occurred in my mid-twenties, so did not have an extended opportunity to accumulate a mountain of credit card debt (not quite so fortunate with my student loans though).

I suspect a lot of folks in here grew up with decent role models of frugality and financial self-discipline, and have no idea how people could behave as idiotic as this couple. But, if you grew up with the opposite, as I did, you'd understand - you don't know what you don't know. And the power of peer pressure and comparison is a force stronger than gravity. I'm lucky DW had great "Millionaire Next Door" role models to follow, and once I married into it, I was infused with many tenets of that culture as well. Had I not, I might be in one of those videos with Ramit.

Anyhow, I do have some young adult family that could really use a forced viewing of the video - wondering how to make that happen

 

[aja8888]

I suspect a lot of folks in here grew up with decent role models of frugality and financial self-discipline,

Nah, many of us grew up in poor or in less than average households and made our way on our own with few, if any, role models. Some here, however, did have a "good start" in life.

 

[easysurfer]

There is no such thing as a free lunch .

 

[Bigdawg]

Nah, many of us grew up in poor or in less than average households and made our way on our own with few, if any, role models. Some here, however, did have a "good start" in life.

Some of us got our heads shaved and made less than 10k/yr for their first six years. But, that COLA pension that arrives every first of the month sure is nice.

Not surprised that folks making under 50k/yr are paycheck to paycheck. Very surprised that so many making over 100k/yr are.

 

[tryan]

OK ... I watched until the dude went to a loan shark for $750 and paid 680% on the debt. No need to see more. They are 40yo going on 12 ... ME ME ME! NOW NOW NOW!

 

[LateToFIRE]

Nah, many of us grew up in poor or in less than average households and made our way on our own with few, if any, role models. Some here, however, did have a "good start" in life.

Many does not necessarily equal most. I suspect the following:

(1) Those of us who "pulled ourselves up by the bootstraps" are probably louder and prouder about it than others.

(2) Those of us who grew up in poor or below average households very likely still had some strong role models, whether that was hard work, frugality, education, street smarts, etc.

(3) In general middle-class and above people tend to not recognize the seemingly minor family factors [i.e. learned behaviors, education, networks, financial assistance] that contributed to their long-term success [and therefore view themselves as "self-made" ].

For example, my family though poor at times, infused me with: an extraordinarily strong work ethic, focus on education, competitive spirit, high ambition and motivation, and a sense of unlimited potential. Paired with the right fiscally responsible spouse, those underpinnings made up for the lack of fiscal education/support from family.

At any rate, I certainly can't vouch for this community as I have only been a participant for a few months and we're all kinda anon. Perhaps this board is particularly attractive to smart, self-made, highly adaptive, self-learning folks who started from the bottom.

But, my life experience and observations have shown me that substantial upward financial mobility is for the most part very, no make that extremely rare.

 

[Time2]

So, a link to a 1 hour 16 minute video with the subtitle “I will teach you to be rich”. I’ll pass.

I watched it laying in bed, I did fall asleep 3/4 through, and watched the rest this morning.

 

[LateToFIRE]

OK ... I watched until the dude went to a loan shark for $750 and paid 680% on the debt. No need to see more. They are 40yo going on 12 ... ME ME ME! NOW NOW NOW!

LOL, guess I skipped over that part, kinda watched the first bit and then the end part.

 

[aja8888]

Some of us got our heads shaved and made less than 10k/yr for their first six years. .

Yeah, I went in 1964 and got out in 1968 (USAF overseas). That time gave me a view of the world I didn't know existed. Good thing for the G.I. Bill after that.

 

[threeonesix]

A recent Barrons/Harris poll says about 78% of Americans earning less than $50,000 a year report they live paycheck to paycheck - no brainer on that one.

But, more troubling, they said that 51% of Americans who make more than $100,000 a year say the same thing.

Now, I don't know what their definition of "paycheck to paycheck" is. Heck, I'm still earning a salary and we run out of money each month, buuutttt we have assets, investments, properties, etc., not to mention expected lumpy year-end bonus, RSU's, etc. Would we count as living paycheck to paycheck?

Keep in mind that many Americans who live paycheck to paycheck did not have parents who left them considerable financing. That is true for nearly all of my friends and myself, and is true for a lot of people who live here in the Midwest. It used to be that many of us inherited lots of land but little money. Then along came scandals, bank collapses and ag-corps and now all the land is owned by them but leased to and farmed by the people whose families have lived on the land for generations. They don't even own the crops they grow. The entirety of Gen X that grew up in the Midwest has gotten hosed out of inheritance. Many millions of Gen X'ers.

Compare that to Gen X kids who grew up in New York City. When they were born NYC real estate was in bad shape. Today when their parents pass they inherit multi-million dollar small apartments and reap rewards for selling. Same is true for many east/west coast cities.

 

[ls99]

deleted

 

[RunningBum]

So, a link to a 1 hour 16 minute video with the subtitle “I will teach you to be rich”. I’ll pass.

I don’t see how this video has any information or lessons needed by our members. The situation described by the OP (entitlement) doesn’t seem to apply to us. It is a situation chosen and used to promote his business.

I just don't get why people post videos and articles like this. They are of no value to us. Are we supposed to feel superior for not being this way? Why clutter up the board with these?

 

[Gumby]

Keep in mind that many Americans who live paycheck to paycheck did not have parents who left them considerable financing.....

How can a person claim to be an adult if they're still relying on their parents to bail them out by way of inheritance?

 

[RetiredAt55.5]

OK ... I watched until the dude went to a loan shark for $750 and paid 680% on the debt. No need to see more. They are 40yo going on 12 ... ME ME ME! NOW NOW NOW!

That was annoying to watch. Who takes out a loan without knowing what the actual interest rate is? That's INSANE.

And purchasing a "midrange" mattress at a mattress chain store for $2,200 (given their money problems).

I didn't bother continuing the video after that. I wonder if this whole thing was staged. Yea, if you continue to make dumb money decisions, it's no wonder you have money problems.

 

[Lewis Clark]

Who takes out a loan without knowing what the actual interest rate is? That's INSANE.

I once sold a house to a buyer who used two mortgage loans. One loan was a balloon loan. The buyer did not understand any of the balloon loan terms and had a long discussion on that topic at the closing with his realtor.

 

[LateToFIRE]

Keep in mind that many Americans who live paycheck to paycheck did not have parents who left them considerable financing. That is true for nearly all of my friends and myself, and is true for a lot of people who live here in the Midwest. It used to be that many of us inherited lots of land but little money. Then along came scandals, bank collapses and ag-corps and now all the land is owned by them but leased to and farmed by the people whose families have lived on the land for generations. They don't even own the crops they grow. The entirety of Gen X that grew up in the Midwest has gotten hosed out of inheritance. Many millions of Gen X'ers.

Compare that to Gen X kids who grew up in New York City. When they were born NYC real estate was in bad shape. Today when their parents pass they inherit multi-million dollar small apartments and reap rewards for selling. Same is true for many east/west coast cities.

I would love to somehow dispute what you said, but then I gave it a second thought, and you know what, I know of at least a dozen shiftless [boomer/gen-x] knuckleheads who lucked out and inherited wildly appreciated property from their parents in the NYC/Tri-State area. Sooo.... not statistically significant, but guess maybe you're onto something there.

Added: Also know dozens of folks who got financial assistance from their parents vis a vis large down payment to purchase wildly inflated property in same area. Not that there's anything wrong with any of that. I just kinda sorta wish I coulda had some of that kinda luck. By the time DW got her inheritance, we'd already accumulated most of our hard-earned NW, so was more icing on the cake rather than life-altering. In hindsight, first world complaints for sure. But, I can very much identify with that couple's frustration and sense of falling behind their peers. Fortunately, I had DW to keep me grounded and focused on the long-term objectives rather than keeping up with the proverbial Jones.

 

[badatmath]

+1 on the "wish I had some luck" latetofire I have had no parental assistance since college.

Not sure I agree on the Midwest as a friend inherited 2 farms worth quite a pretty penny . . . . as well as some cash . . . but there were a lot of good decisions made in that family over the years. And luck.

 

[aaronc879]

A recent Barrons/Harris poll says about 78% of Americans earning less than $50,000 a year report they live paycheck to paycheck - no brainer on that one.

But, more troubling, they said that 51% of Americans who make more than $100,000 a year say the same thing.

Now, I don't know what their definition of "paycheck to paycheck" is. Heck, I'm still earning a salary and we run out of money each month, buuutttt we have assets, investments, properties, etc., not to mention expected lumpy year-end bonus, RSU's, etc. Would we count as living paycheck to paycheck?

I have made under $50K every year for my 25 years of working and I have not lived paycheck to paycheck since I was 21. My definition of paycheck to paycheck is being unable to pay a bill if I miss a paycheck.

 

[LateToFIRE]

+1 on the "wish I had some luck" latetofire I have had no parental assistance since college.

Not sure I agree on the Midwest as a friend inherited 2 farms worth quite a pretty penny . . . . as well as some cash . . . but there were a lot of good decisions made in that family over the years. And luck.

Exactly - those of us starting from behind have the added burden that our parents and family are often dependent on us helping them out as opposed to them helping us out.

if you think about compounding in reverse - negative compounding then maybe you start to see how stacked the deck can be. We're running a maze in life where very early situations, choices and decisions have excruciating far-reaching consequences. We make most of those decisions when we're young idiots. That is why family and culture are such powerful determinants of our future.