Careers vanish after subprime freefall

I kind of feel sorry for those people because both of them losing their job at the same time must be very stressful. But the fact that they realize they are heading full speed toward a wall yet don't seem willing to seriously cutback on their expenses (I don't consider exchanging a corvette for a suburban much of a cutback) is shocking to me. If I were in this situation, I would go into survival mode, count every penny and make sure that my savings last as long as possible.
 
FIREdreamer said:
I kind of feel sorry for those people because both of them losing their job at the same time must be very stressful. But the fact that they realize they are heading full speed toward a wall yet don't seem willing to seriously cutback on their expenses (I don't consider exchanging a corvette for a suburban much of a cutback) is shocking to me. If I were in this situation, I would go into survival mode, count every penny and make sure that my savings last as long as possible.
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And before I even thought of touching my 401K, I'd be renting out rooms in that McMansion, taking in laundry, tutoring, and doing everything else I could think of between filling out job applications.
 
I especially liked how they cashed out "her" 401k. What a caring dude. Let's see he's 59 and she's 37....I won't go there.

I also liked how she felt working for the No.2 "subprime" lender in the nation should have provided security in her job. No.2 subprime lender, now that's something to be proud of.

Dopes I say, who cares. Think instead of the poor suckers they ripped. Oh sh*t, I pay taxes, that's me!
 
Want2retire said:
And before I even thought of touching my 401K, I'd be renting out rooms in that McMansion, taking in laundry, tutoring, and doing everything else I could think of between filling out job applications.
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Indeed. That's probably why you will never be in their position.

Regarding WB, the same Fortune column notes that he has a poor credit rating(!)

When the Berkshire Hathaway CEO recently checked his credit history, his FICO score in one report was 718, slightly below the U.S. median.
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The magazine suggests that this may be a case of mistaken identity.
 
Milton said:
Regarding WB, the same Fortune column notes that he has a poor credit rating(!)



The magazine suggests that this may be a case of mistaken identity.
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Sometimes people who don't use credit cards can have lower credit scores because of a lack of credit history--a case in which one is punished for spending responsibly.
 
718 is poor? I dont think so. The scales I've seen say 680 to 720 is A+, but maybe they changed the scale? Fico doesnt care about net worth!
 
Want2retire said:
Obviously, I have much to learn about spending money!!! :eek:

I spent $21 yesterday on frivolous things, though! I bought a $17 drawing and a $4 lace style tablecloth at an antique shop. It's creeping in.... today, $21, tomorrow, $187,200, I suppose. :)
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hmmm W2R, with your new baseline, I think you need to take out your ss and recalculate.
Unless you are planning on leaving a bundle to your family or cat you need to open up a bit and enjoy. Maybe if you see the numbers that will help you get over your overly obsessive LBYM habits. You seem to be taking it to extremes. Just an observation. :D
 
Gosh, I thought I was in with a bunch of big spenders here. You guys are pikers compared to me. I went shopping for some lumber yesterday, came home with three sheets of plywood, three sheets of furniture grade, veneer core, good two sides, mahogany plywood. Only $125/sheet, plus tax. :cool:

Let's get with it folks, you're falling behind. :bat: You got a long way to go get to $187K.
 
megacorp-firee said:
hmmm W2R, with your new baseline, I think you need to take out your ss and recalculate.
Unless you are planning on leaving a bundle to your family or cat you need to open up a bit and enjoy. Maybe if you see the numbers that will help you get over your overly obsessive LBYM habits. You seem to be taking it to extremes. Just an observation. :D
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Well, it has only been a month and a half since my financial picture changed so much. I'm easing into it. :)

To tell the truth, the drawing that I bought on Sunday is one that I saw in February and wanted but didn't buy due to kneejerk behaviors. Then when I got home, I "kicked myself" for being so stingy! So, when I saw it again on Sunday I took it straight to the cash register, negotiated only a 10% discount, but bought it anyway.

Yesterday I did spend $17 on framing and matting materials for it, which is almost as much as the drawing. I had a lot of fun putting everything together last night, and hanging it. It looks great to me. I really do think I have more fun with what money I do spend, than most.

It seems so luxurious to me, to just be able to buy little things like this. Although I am in no danger of blowing my money in a year on sportscars and parties like a basketball star, I am definitely enjoying the process of gradually ramping up my spending habits!

And believe me, I check those numbers at least once a day. Got to make sure I'm not dreaming. :2funny:
 
UncleHoney said:
Gosh, I thought I was in with a bunch of big spenders here. You guys are pikers compared to me. I went shopping for some lumber yesterday, came home with three sheets of plywood, three sheets of furniture grade, veneer core, good two sides, mahogany plywood. Only $125/sheet, plus tax. :cool:

Let's get with it folks, you're falling behind. :bat: You got a long way to go get to $187K.
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:2funny: Obviously I need to trade in my 1558 square foot house for a McMansion, because I can't imagine where I would have room for all that plywood! Sounds like you are planning to build something nice.

When Frank and I move to Missouri in a couple of years, I do plan to get a slightly larger house (maybe 1800 square feet? don't know) with a two car garage and maybe even a basement. Then I will probably buy a lot of high quality furniture for it. Also I am planning to get a new car when I retire next year as a "good for me" present from me to myself. So look out! We're catching up. :D
 
Want2retire said:
:2funny: Obviously I need to trade in my 1558 square foot house for a McMansion, because I can't imagine where I would have room for all that plywood! Sounds like you are planning to build something nice.

When Frank and I move to Missouri in a couple of years, I do plan to get a slightly larger house (maybe 1800 square feet? don't know) with a two car garage and maybe even a basement. Then I will probably buy a lot of high quality furniture for it. Also I am planning to get a new car when I retire next year as a "good for me" present from me to myself. So look out! We're catching up. :D
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When you retire in 18 months there should be some good deals on McMansoins.

The plywood is almost all cut into pieces now and on the way to being an entertainment center for my yet to be purchased BIG SCREEN TV. Got to get this thing finished before that rebate check gets here. :D

Now where's my check GWB? I need my check!! Current calculations say we've only spent the check about 3 times so far. :p
 
Want2retire said:
To tell the truth, the drawing that I bought on Sunday is one that I saw in February and wanted but didn't buy due to kneejerk behaviors. Then when I got home, I "kicked myself" for being so stingy! So, when I saw it again on Sunday I took it straight to the cash register, negotiated only a 10% discount, but bought it anyway.

Yesterday I did spend $17 on framing and matting materials for it, which is almost as much as the drawing. I had a lot of fun putting everything together last night, and hanging it. It looks great to me. I really do think I have more fun with what money I do spend, than most.
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Good for you ... you go girl ;) ... enjoy :D
 
A854321 said:
How can you possibly rack up $10K a month expenses?
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Is it really so difficult to imagine? My wife and my monthly expenses are $8K/month.

Granted, the couple in the article are utterly oblivious to their own idiocy. They've made their bed and will lie in it.

But for middle-class DINKs, $8K-$10K/month isn't that hard.

$2,100 - Mortgage
$2,000 - Retirement savings
$400 - Property taxes
$700 - Groceries
$600 - Car payment, maintenance fund
$500 - Natural gas, electricity, water, phone, cable, internet
$1,000 - Discretionary spending ($500/each)
$300 - Insurance - car, home, life, disability (this is Canada, hence no medical insurance)
$400 - Gas for car, bus pass, house maintenance

That, in fact, is pretty much our exact budget. It's not as hard as you think. Keep in mind, that's all *after* tax money. Neither my wife nor I have 6-figure incomes.

Note that that doesn't include a gardner or a housemaid, no country club dues or fancy sports cars, no boats or private planes. Note that there isn't even an item in there for clothing, dining out, gifts, hobbies, or vacations (that all comes out of our "discretionary" money). I don't have a cell phone, I won't even pay for "caller ID" on our landline. We don't get the movie channels. I take the bus to work and brownbag my lunch every single weekday. We actually live quite frugally.
 
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JustCurious said:
Kombat, retirement savings do not count as "expenses."
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I guess that depends on your priorities. :) Neither my wife nor I have corporate pensions to fall back on, so retirement savings is an absolute priority for us.

But even if you dispute that item, it's not hard to imagine a couple with, say, some credit card debt or student loan debt, combined with a gym club membership, maybe a few meals out to fancy restaurants, and a vacation or two amortized over the year filling in the gap left by "retirement savings."
 
kombat said:
IsBut for middle-class DINKs, $8K-$10K/month isn't that hard.
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I don't think "middle-class" and $6-8k/month after-tax spending go together. Median household income in 2006 was about $48k/yr.
 
My table saw will only do about 26"...

Definitely fun to man-handle sheets of plywood. Wouldn't want to make to many false moves on a $125 sheet of mahogany.
 
TickTock said:
I don't think "middle-class" and $6-8k/month after-tax spending go together. Median household income in 2006 was about $48k/yr.
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I think you are right. $6k to $8k is closer to upper class.
 
Razor said:
I think you are right. $6k to $8k is closer to upper class.
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OK, we're all in agreement. Kombat, we officially deem you an upper class family! Enjoy your new status in life (especially the taxes, ugh! :p)
 
Haha, thanks guys, this is great news! I've already made an appointment at the Mercedes dealership for Thursday. My wife will be overjoyed! :)

Seriously though, I don't think any of the expenses I listed are really exorbitant. How do people make it on less? What about single income families with kids in the picture? No wonder people have such a hard time getting out of debt and building up any kind of savings.
 
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