I really don’t understand how you can earn $150,000 a year and can’t make ends meet without making some really irresponsible decisions, though. My family of four is living off $40,000 (CAD) and all our bills are paid.
Even households earning $150,000 a year are struggling with credit card and car payments
Submitted 3 weeks ago by return2ozma@lemmy.world to aboringdystopia@lemmy.world
https://www.cbsnews.com/news/economy-high-income-households-credit-card-auto-loans-impact/
Comments
RoquetteQueen@sh.itjust.works 3 weeks ago
pdxfed@lemmy.world 3 weeks ago
- college debt
- car debt (public transit has been actively dismantled by oil and car lobby in past 100 years) forcing most people to have to go into hock for a car.
- medical debt because think of the profits
- educational debt - public education that could lead to a populace making better decisions about finance has been deliberately and now almost completely destroyed. We’re going to put crosses in schools but definitely remove math requirements for HS diplomas.
- predatory, colluding landlord practices combined with corporate funds now accounting for 30+% of all residential real estate purchases. Accelerates affordability crisis and related issues
That’s just the starter pack for the US.
Congrats on living in what is likely a low COL area, but many are concentrated in HCOL areas in yhe UD and elsewhere. Look at Vancouver BC and Toronto, same deal in Canada. US has that as well combined with above.
assaultpotato@sh.itjust.works 3 weeks ago
Straight up no idea how you’re doing that - genuinely you should be proud of your budgeting.
My partner and I live quite comfortably admittedly, but we rarely buy “things” - our biggest discretionary spending by far is on higher quality food. Our net expenses last year was around 65k CAD.
24k went to housing, around 20k went into investments and savings, and the last 20k was on “everything else”, including discretionary spending. We live comfortably but not nearly extravagantly and our expenses floor for the two of us is probably 40k… let alone adding two kids.
And we live in an incredibly cheap city compared to Vancouver/Toronto!
Sanctus@lemmy.world 3 weeks ago
Take the 20k out of investments and savings and you have your answer for how they are doing it.
Pyotr@lemmy.world 3 weeks ago
In HCOL areas, 150k/yr can be barely above poverty level. (See SF as an example, poverty income for a single earner is ~118k USD)
Given the number of those kind of areas, and the cost of rent now, it makes perfect sense.
JollyG@lemmy.world 3 weeks ago
It is very difficult to do. You really do have to be over-leveraged and bad with money. Which is probably why 99.966% of households making 150k+ are showing up as not delinquent on loans in these data.
Fredselfish@lemmy.world 3 weeks ago
We live off way less then that. And bills are getting paid. I want to see what they’re spending their money on.
return2ozma@lemmy.world 3 weeks ago
Studios going for $3,400 in my area. Los Angeles
curiousaur@reddthat.com 3 weeks ago
I imagine a lot of people making that much did exactly what I did. Over-leverage but temporarily. House poor basically.
When COVID hit I was renting in the bay area with my girlfriend. During lockdown I proposed, and after deciding we want a family, decided to take our bay area salaries elsewhere to buy a house.
We traded our 3k rent for a 2k mortgage with 1k insurance and taxes. Even.
But, leaving the bay we needed cars. My one little two seater wasn’t going to do it, we’re starting a family. So we got two larger cars, right when the market was inflated. Financed both of them.
The new big property we got has a little barn, let’s renovate that into an ADU for guests and to generate rent. Didn’t have the cash on hand so took out another loan about the same as a car to fix that up.
Now we’re strapped, basically living month to month. But those secondary loans were all 5 year loans, so in 2 more years they’re paid off, freeing up about $3k per month.
I basically don’t think any of these articles about people making that kind of salary are taking into account how weird a time covid was. Lots of people made big changes while interes rates were low, purposely over-leveraging themselves. It also gave everyone this yolo attitude as well, like fuck it all, treat yourself.
I’d be more interested to revisit this in 2027 when any 5 or 6 year car loans and secondary loans taken out during the record low rates are all paid off.
ProdigalFrog@slrpnk.net 3 weeks ago
Are the cars used? Early 2000’s Buicks with the 3.8l engine are incredibly cheap even with low miles (a really mint one is 5k, a good daily driver can be had for 2.5 to 3.5k).
They’re extremely reliable and relatively safe cars. Not bad on gas either, and cheap to repair.
BombOmOm@lemmy.world 3 weeks ago
Yeah, lifestyle inflation is a a problem that so, so many people put themselves into.
They are living paycheck to paycheck, get that nice new job earning 3x as much. And instead of paying off their debt and getting into a very cosy financial space; they instantly start spending 3x as much money on stuff, and now they are suddenly living paycheck to paycheck again.
RaoulDook@lemmy.world 3 weeks ago
There is also a cultural lifestyle inflation that has infected society in the last 5-10 years. Everything that can be has been moved to subscription basis, and people all want to have the latest and greatest of everything. Hire a taxi for your burrito delivery and such.
It’s hard to watch people that I know are struggling financially continuously blow money on stuff like daily food delivery and $200/month cell phone plans. I’m just fortunate to have the perspective that comes with growing up before all that was “normal”
Tollana1234567@lemmy.today 3 weeks ago
most likely irresponsible decision: buying some expensive toys like new cars, shopping eating out everyday, it adds up, getting yourself scammed.
PetteriPano@lemmy.world 3 weeks ago
Struggling with car payments, you say.
Our EU household doesn’t make $150k/y even if you’d consider the hidden supergross taxes.
I’ve never had a car loan in my life, nor anything beyond the most basic insurance.
If you can’t afford to buy a car, then you can’t afford to wreck it.
It’s better to send that extra money into my savings account or stock portfo rather than waste it on interest and extra insurance. Then I’ll at least get too see that money again some day.
return2ozma@lemmy.world 3 weeks ago
Welcome to America where a car is a necessity and public transit is near zero. Average car payment is $700 now and auto insurance is $200
Gearheart@lemmy.world 3 weeks ago
Yes but as a Texan. Majority of cars people drive are status symbols. I see trucks as large as military vehicles driving around like no one’s business.
So yeah… Insurance is going to be higher because of these drivers and payments are going to be high.
My 2007 Honda Accord does not have anything close to a 200$ a month insurance payment, nor I have a car payment to worry about.
BombOmOm@lemmy.world 3 weeks ago
You don’t need to spend $700/mo to get a car. Spending that much is a choice you are free to make, but still a choice in the end.
PetteriPano@lemmy.world 3 weeks ago
I, too, need a car. But I choose not to go down this route.
I bought my current one five years ago for $4k and spent another $2k to get it reliable. Minimum liability insurance is like $20/mo.
I’m looking to trade up in a bit for something twice as pricy, and I’ll skip the loan part then, too.
NewNewAugustEast@lemmy.zip 3 weeks ago
Auto insurance in the us is nuts.
But having to have a car and having to have car payments are two different things. Boggles my mind what people are willing to take loans for. Save the money and buy it, or don’t buy it at all.
gravitas_deficiency@sh.itjust.works 3 weeks ago
The cost of living in desirable locations can only be described as unsustainable. I’m only able to swing it because I’m on a software engineer salary.
curiousaur@reddthat.com 3 weeks ago
Same spot here. Took my permanent remote SE job to a depressed but beautiful coastal California town. A lot of folks seem to dislike me for some reason.
Tollana1234567@lemmy.today 3 weeks ago
most people living there are mostly into programming tech/ in norcal, or unless your high paid nurse, doctor, or engineer, or an executive. the college students ar eliving with roomates here.