US economy thread (2 Viewers)

[DevilDog919]

My wife and I are in our 30s and make about 130k a year. We have a nice house and some land in the country. Our neighbor, a ways down the road, is an old boomer. He delivered for Pepsi and his wife was a stay at home mom. They have lived at the same nice house with 35 acres of land most of their lives.

Boomers that say the economy is fair for the generations following them have blinders on.

 

[NutterButter]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

Then why did you buy it?

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

And why are u not posting that in the restaurant thread?

 

[FreeBaGeL]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

Then why did you buy it?

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

And why are u not posting that in the restaurant thread?

I've posted it a bunch of times in the restaurant thread.

 

[NutterButter]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

Then why did you buy it?

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

And why are u not posting that in the restaurant thread?

I've posted it a bunch of times in the restaurant thread.

I was talking about Mr 5 guys. Maybe I should've used "he" instead of "u". The inner web can be hard for this geezer.

 

[Keerock]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

But you did buy it.

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

Willing to pay it and willing to go in debt for it are different things...

 

[FreeBaGeL]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

Then why did you buy it?

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

And why are u not posting that in the restaurant thread?

I've posted it a bunch of times in the restaurant thread.

I was talking about Mr 5 guys. Maybe I should've used "he" instead of "u". The inner web can be hard for this geezer.

Ah, got ya. I think Five Guys has been thoroughly blasted in that thread. And rightfully so!

 

[fruity pebbles]

Kind of funny this thread has been around for a year where the economy has been objectively quite strong. Inflation has stabilized from 2022. Unemployment has stayed sub 4%. NASDAQ is up.

The economy right now is just everyone bitching about how impossibly unaffordable everything is and then buying it anyway, magically being able to afford it.

I mean we have this thread complaining about the economy and the next thread down is the "I went into Costco for a hot dog and came out with $800 worth of stuff I didn't need but felt like buying anyway" thread.

Things are definitely harder for younger people now than they were when we were younger. But the change in asset prices is only half of that. Half of it is just that society has changed into a much more experience driven society, and people spend (A LOT) more money on different things now. That's not a bad thing (it's a good thing!), but it costs a lot more.

It used to be that a starter home was an American dream and that was what you worked and saved for. We took small vacations once a year and big vacations a couple times a decade. Most of us didn't do a big international trip until we were in our mid 30's. We ate out sparingly.

Now you can barely find a 30 year old that hasn't been to 16 different countries and who doesn't travel a half dozen times a year, and who doesn't eat out for the majority of their meals. Money is being spent on different stuff, but the home thing is treated like it's supposed to be automatic because the old people that didn't spend nearly as much money on all that other stuff got one. Partially wanting to have their cake and eat it too. I realize this doesn't apply to everyone and homes are empirically more expensive now, but it's not like only old people are spending to drive up prices. Prices are high because everyone, including young people, keeps spending like crazy and can stomach the price increases, even if they post on facebook or FBGs on their brand new iPad that they can't.

Fair point. I wonder, myself, when the spending stops. Credit card delinquency rate is the highest since 2011 I believe.

 

[Grahamburn]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

But you did buy it.

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

100%. Until people change their spending habits it will not matter.

The average American is drowning in debt.

 

[Grahamburn]

Kind of funny this thread has been around for a year where the economy has been objectively quite strong. Inflation has stabilized from 2022. Unemployment has stayed sub 4%. NASDAQ is up.

The economy right now is just everyone bitching about how impossibly unaffordable everything is and then buying it anyway, magically being able to afford it.

I mean we have this thread complaining about the economy and the next thread down is the "I went into Costco for a hot dog and came out with $800 worth of stuff I didn't need but felt like buying anyway" thread.

Things are definitely harder for younger people now than they were when we were younger. But the change in asset prices is only half of that. Half of it is just that society has changed into a much more experience driven society, and people spend (A LOT) more money on different things now. That's not a bad thing (it's a good thing!), but it costs a lot more.

It used to be that a starter home was an American dream and that was what you worked and saved for. We took small vacations once a year and big vacations a couple times a decade. Most of us didn't do a big international trip until we were in our mid 30's. We ate out sparingly.

Now you can barely find a 30 year old that hasn't been to 16 different countries and who doesn't travel a half dozen times a year, and who doesn't eat out for the majority of their meals. Money is being spent on different stuff, but the home thing is treated like it's supposed to be automatic because the old people that didn't spend nearly as much money on all that other stuff got one. Partially wanting to have their cake and eat it too. I realize this doesn't apply to everyone and homes are empirically more expensive now, but it's not like only old people are spending to drive up prices. Prices are high because everyone, including young people, keeps spending like crazy and can stomach the price increases, even if they post on facebook or FBGs on their brand new iPad that they can't.

Fair point. I wonder, myself, when the spending stops. Credit card delinquency rate is the highest since 2011 I believe.

Ha. Beat me to it. Didn't make it all the way to this one.

 

[FreeBaGeL]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

But you did buy it.

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

Willing to pay it and willing to go in debt for it are different things...

I think we're going full circle here as I feel like we had this conversation months ago, but the debt thing is kind of silly because debt is essentially always at an all-time high.

The debt chart is essentially just a straight line diagonally upwards. And it's pretty much designed to work that way. Other than during recessions, the all-time high for debt is today. That is true today and it will be true tomorrow, and the day after that, and the day after that.

It's just a "gotcha" that gets thrown around. Every year there are more people and things costs more via inflation. Of course total debt goes up.

I would think something like debt to income (debt relative to income) is a much more meaningful metric, and that's pretty low right now.

The most recent debt payment-to-income ratio, from the fourth quarter of 2023, is 9.8%.

That means the average American spends nearly 10% of their monthly income on debt payments. Despite debt increasing overall, Americans are still spending less of their income on debt than in most of the 2000s.

Total household debt by type

A column chart showing household debt by type.

www.fool.com

DTI Chart: https://fred.stlouisfed.org/series/TDSP

But regardless, even if debt WERE increasing, that's at least partially indicative of people choosing to spend to do more. It's not like debt is high and non-essential spending is low, meaning people are borrowing to stay afloat (obviously some people are, but I mean as a whole). Non-essential spending continues to break all-time highs. Travel is up another 11% year over year, after being up almost 20% the year prior, which doesn't happen in a struggling economy. The busiest travel weekend in history was July 4th 2024, breaking the record from way back on Memorial Day 2024. Ski Resorts are packed with more people at a single resort than used to ski in an entire state. Taylor Swift resellers can't find a ticket price high enough that young people won't pay. Netflix raises prices and cuts down on password sharing and everyone says they're going to quit, but no one does. People happily buy a $20 Five Guys burger and then pay an extra 10 bucks to have someone bring it to them instead of spending 10 minutes to go get it.

It's both. Yes, it's harder. But a HUGE part of it is people are making the choice to spend more money on fun and luxuries than ever before, and not by a little bit.

 

[Scoresman]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

But you did buy it.

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

Of course I bought it. It's 5 Guys. That craving is no joke!

 

[massraider]

Now you can barely find a 30 year old that hasn't been to 16 different countries and who doesn't travel a half dozen times a year, and who doesn't eat out for the majority of their meals

Come to the east coast, I will introduce you to as many as you like.

 

[Hawks64]

This may not be the right place for this, but I’ll ask anyway. If my kid wants to buy a house for $400k, can I gift him $100k for a down payment without either of us getting killed by the IRS?

This may not be the right place for this, but I’ll ask anyway. If my kid wants to buy a house for $400k, can I gift him $100k for a down payment without either of us getting killed by the IRS?

You can gift them way more than that. You just need to fill out a form letting the irs know since its above like $18k in the year. As long as you don't exceed like $13M, you're good.

You can gift up to 18k a year without tax implications. More than that you will be dealing with some type of taxation issue.

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

And new McDonalds workers make 20 bucks and hour.

You think $20 an hour in California is living large? Most are only getting part time hours now too.

California is its own animal.

Also nobody is talking about living large. A 22 year old should be struggling

Why should ANY one need to struggle? That's a ridiculous sentiment.

 

[IvanKaramazov]

Now you can barely find a 30 year old that hasn't been to 16 different countries and who doesn't travel a half dozen times a year, and who doesn't eat out for the majority of their meals

Come to the east coast, I will introduce you to as many as you like.

Yeah, I would question whether any of us are really meeting a representative cross-section of 30 year olds. Pretty much 100% of the people that I know in that age group are freshly-minted assistant professors. The men look like they just started shaving two weeks ago. I don't think this is a good sample that I can draw any sweeping conclusions from.

 

[Scoresman]

This may not be the right place for this, but I’ll ask anyway. If my kid wants to buy a house for $400k, can I gift him $100k for a down payment without either of us getting killed by the IRS?

This may not be the right place for this, but I’ll ask anyway. If my kid wants to buy a house for $400k, can I gift him $100k for a down payment without either of us getting killed by the IRS?

You can gift them way more than that. You just need to fill out a form letting the irs know since its above like $18k in the year. As long as you don't exceed like $13M, you're good.

You can gift up to 18k a year without tax implications. More than that you will be dealing with some type of taxation issue.

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

And new McDonalds workers make 20 bucks and hour.

You think $20 an hour in California is living large? Most are only getting part time hours now too.

California is its own animal.

Also nobody is talking about living large. A 22 year old should be struggling

Why should ANY one need to struggle? That's a ridiculous sentiment.

"A smooth sea never made a skilled sailor"

- Mike "The Situation" Sorrentino

 

[Grahamburn]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

But you did buy it.

Prices are high because the demand is there, and people are willing to pay it. Even if they post on FB/FBGs that they're not.

Willing to pay it and willing to go in debt for it are different things...

I think we're going full circle here as I feel like we had this conversation months ago, but the debt thing is kind of silly because debt is essentially always at an all-time high.

The debt chart is essentially just a straight line diagonally upwards. And it's pretty much designed to work that way. Other than during recessions, the all-time high for debt is today. That is true today and it will be true tomorrow, and the day after that, and the day after that.

It's just a "gotcha" that gets thrown around. Every year there are more people and things costs more via inflation. Of course total debt goes up.

I would think something like debt to income (debt relative to income) is a much more meaningful metric, and that's pretty low right now.

The most recent debt payment-to-income ratio, from the fourth quarter of 2023, is 9.8%.

That means the average American spends nearly 10% of their monthly income on debt payments. Despite debt increasing overall, Americans are still spending less of their income on debt than in most of the 2000s.

Total household debt by type

A column chart showing household debt by type.

www.fool.com

DTI Chart: https://fred.stlouisfed.org/series/TDSP

But regardless, even if debt WERE increasing, that's at least partially indicative of people choosing to spend to do more. It's not like debt is high and non-essential spending is low, meaning people are borrowing to stay afloat (obviously some people are, but I mean as a whole). Non-essential spending continues to break all-time highs. Travel is up another 11% year over year, after being up almost 20% the year prior, which doesn't happen in a struggling economy. The busiest travel weekend in history was July 4th 2024, breaking the record from way back on Memorial Day 2024. Ski Resorts are packed with more people at a single resort than used to ski in an entire state. Taylor Swift resellers can't find a ticket price high enough that young people won't pay. Netflix raises prices and cuts down on password sharing and everyone says they're going to quit, but no one does. People happily buy a $20 Five Guys burger and then pay an extra 10 bucks to have someone bring it to them instead of spending 10 minutes to go get it.

It's both. Yes, it's harder. But a HUGE part of it is people are making the choice to spend more money on fun and luxuries than ever before, and not by a little bit.

The amount OF debt will always increase, but does the amount of people IN debt have to increase? I was always taught to pay off my credit cards 100% every single month. If I couldn't afford to pay it off don't put in on there. I imagine many of us behave similarly. I don't think that's the case for the vast majority of people though. They aren't sacrificing anything and eventually it will be a big problem.

 

[AAABatteries]

Kind of funny this thread has been around for a year where the economy has been objectively quite strong. Inflation has stabilized from 2022. Unemployment has stayed sub 4%. NASDAQ is up.

Corporations are making massive profits due to the prices they’re charging. Stocks are up. That’s great if you can afford to own stocks.

40+ year old FBGs that already own homes and stocks are probably fine.

What about our kids though? A lot of them are struggling.

I had two requests this week to pause 401k contributions for mid-20s female staff members.

The increases in index funds won’t help much if they have to sacrifice their futures to afford their present.

It really is an economy of the haves and have nots largely separated by age. We are an older group and most of us are doing just fine. Economy is good. I work with largely a younger group. It’s not good for them. Until recently, new nurses were able to afford to live. Many now have an additional part time job. That was never a thing and these are kids making well above average for their age. They laugh when the topic of buying a house comes up. We are spending future dollars today which have largely propped up asset prices. The under 35s have not benefitted from that, yet they will be the ones footing the bill. I don’t want to get too far into it because it will end up being a boomer discussion about how hard we worked, they need to sacrifice, stop buying Starbucks etc. Objectively looking at it though, starting out has never been less affordable.

This is basically my read of the situation as well. Those of us with time in the market are doing great. It does seem like 20/30-somethings have it tougher than I did at that age.

I agree with both of you but it is weird that many have great salaries - or seem to. My 22 year old son (almost 23) is debt free and making about 55-60k. I know that's not a great salary but it's without a degree. He was renting at 21 and got so expensive he moved back home (we convinced him). Now, his mother and I love having him here but want him to be able to buy. I've told him stay here as long as needed, put as much as humanly possible in your 401k and then save for a down payment. Oh, and clean up your ****ing room.

 

[massraider]

Yeah, I would question whether any of us are really meeting a representative cross-section of 30 year olds. Pretty much 100% of the people that I know in that age group are freshly-minted assistant professors. The men look like they just started shaving two weeks ago. I don't think this is a good sample that I can draw any sweeping conclusions from.

As always, I remind myself we are a big country, with a bunch of different economies.

I employ 10 people, all under that age. They are not taking vacations.

 

[AAABatteries]

The 23 year old graduated from college a year ago and has been waiting on her boyfriend to graduate before making a job decision. It's muddled up but she is interviewing for a recruiter job in Atlanta that starts at $40k a year. Those of you that live in the ATL can speak to whether you can live on that there or not. I know in Charlotte, NC it would require a roommate or possible two. She told us a year ago she would never be able to afford a house and I laughed at her. Now I'm not so sure she wasn't right.

We are in the suburbs and like I said, my son is priced out of housing making 15-20k more than that. He had two roommates before but was smart to stop throwing money at an apartment room when he can stay here for free in a nicer home with more "amenities". In Atlanta, no chance of buying a home unless you gamble on a old, potentially unsafe area that may be next up in being rejuvenated.

 

[NutterButter]

This may not be the right place for this, but I’ll ask anyway. If my kid wants to buy a house for $400k, can I gift him $100k for a down payment without either of us getting killed by the IRS?

You can gift them way more than that. You just need to fill out a form letting the irs know since its above like $18k in the year. As long as you don't exceed like $13M, you're good.

You can gift up to 18k a year without tax implications. More than that you will be dealing with some type of taxation issue.

You just have to report it above 18k. Doesn't mean you have to pay taxes on it. I thought you got taxed after 18k as well but its only if you've also exceeded your lifetime limit which I doubt is happening for any of us where its at.

The 2024 gift tax limit is $18,000. For married couples, the limit is $18,000 each, for a total of $36,000. This amount is the maximum you can give a single person without having to report it to the IRS in 2025 on Form 709
[3]
.

If you exceed the annual exclusion in 2024 and need to notify the IRS, you still might not have to pay any taxes, unless you have also exceeded the additional lifetime gift tax exclusion.

Gift Tax: How It Works, 2024 Exclusions and Rates - NerdWallet

For those considering gifting money or property to another person, gift tax can come into play. Thankfully, two factors — the annual gift tax exclusion and the lifetime exclusion — often help keep the IRS out of most people's hair. See 2024 exclusion amounts and rates.

www.nerdwallet.com

 

[-OZ-]

Why should ANY one need to struggle? That's a ridiculous sentiment.

Y’all seem to be defining “struggling” differently. There’s “barely able to put cheap food on the table while working 60+ hours each week” then there’s “will buy a new $50,000 car at 6% and pay it off over 7 years and only take two vacations this year, possibly cut down to 3 frapacinos this week” struggling.

 

[NutterButter]

This may not be the right place for this, but I’ll ask anyway. If my kid wants to buy a house for $400k, can I gift him $100k for a down payment without either of us getting killed by the IRS?

This may not be the right place for this, but I’ll ask anyway. If my kid wants to buy a house for $400k, can I gift him $100k for a down payment without either of us getting killed by the IRS?

You can gift them way more than that. You just need to fill out a form letting the irs know since its above like $18k in the year. As long as you don't exceed like $13M, you're good.

You can gift up to 18k a year without tax implications. More than that you will be dealing with some type of taxation issue.

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

And new McDonalds workers make 20 bucks and hour.

You think $20 an hour in California is living large? Most are only getting part time hours now too.

California is its own animal.

Also nobody is talking about living large. A 22 year old should be struggling

Why should ANY one need to struggle? That's a ridiculous sentiment.

"A smooth sea never made a skilled sailor"

- Mike "The Situation" Sorrentino

I was just gonna leave a laughing reaction but its just b/c of who you quoted. I actually agree with the idea that your 20's are when you should be sacrificing and making hard choices to lay the foundation for the rest of your life.

 

[AAABatteries]

As a boomer with a one daughter that is 28 and one that is turning 23 this week, this is pretty much exactly the situation. The 28 year old is a teacher in SC, she barely makes a livable wage accordingly. If she lived on her own, she would require a roommate to afford anything in the area. She has areas she could cut spending (her dog being the most expensive part of her life) but she doesn't live an extravagant lifestyle, she simply doesn't get paid ****.

The 23 year old graduated from college a year ago and has been waiting on her boyfriend to graduate before making a job decision. It's muddled up but she is interviewing for a recruiter job in Atlanta that starts at $40k a year. Those of you that live in the ATL can speak to whether you can live on that there or not. I know in Charlotte, NC it would require a roommate or possible two. She told us a year ago she would never be able to afford a house and I laughed at her. Now I'm not so sure she wasn't right.

But isn't that normal? I lived with roomates....basically forever! Through college, after college through my 20s (lived with 3 other people in two different places from like 23-29), and then moved in with my then future (and now ex) wife. Through all of those years I couldn't afford a place, even a rental, on my own. Maybe that's just the way it's always been out here on the coast, but I don't know too many people that lived on their own in their 20s. I expect my daughter when she graduates next year will continue to live with roommates for several years, just like she has through college.

The one friend I had who was able to buy a house by about 25 years old "house hacked" it - he had three buddies move in and pay rent, essentially covering his mortgage. And he bought a fixer-upper and gradually improved it over several years.

It does feel like everybody (somewhat understandably) want their own place. I lived at home until I was 25. I wasn't a deadbeat and was working and going to college the whole time. I just recognized that it was kind of dumb not to take advantage of what my parents were offering, and it did help me get off on a better footing than some. I had large student loans though because 1. my folks had no money at all and 2. I was dumb and didn't put all my money into paying off school tuition/fees - I didn't have good guidance on student loans. Hey, really low interest loans while I'm in school - let's do that!

 

[the moops]

Also nobody is talking about living large. A 22 year old should be struggling

Why should ANY one need to struggle? That's a ridiculous sentiment.

I'm all for BIG and all that, but in today's and yesterday's reality, young just out of college people always struggle. I'm not talking can't put food on the table struggle, but they typical 20 year old struggle of having ****ty roommates who pay bills late, messy apartment from last nights party, hungover showers in the morning trying to sober up for work. And yes, also not having disposable income to buy 8 dollar lattes everyday

 

[AAABatteries]

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

For real?

A pint of domestic beer is like $6 right now.

I ordered Five Guys delivery for just myself the other day and it was $32.

Damn! You should start a thread about that.

 

[the moops]

The average American is drowning in debt.

This has been true for at least 40 years.

 

[the moops]

Anyone complaining about prices, yet ordering a 32 dollar delivery of a burger and fries, should be ignored

 

[Hawks64]

Why should ANY one need to struggle? That's a ridiculous sentiment.

Y’all seem to be defining “struggling” differently. There’s “barely able to put cheap food on the table while working 60+ hours each week” then there’s “will buy a new $50,000 car at 6% and pay it off over 7 years and only take two vacations this year, possibly cut down to 3 frapacinos this week” struggling.

Well the way @the moops posted, I took it as your first statement. That is some how builds BS nonsense character wise.

 

[Ministry of Pain]

The average American is drowning in debt.

This has been true for at least 40 years.

When I entered the mortgage field in the late 90s we were doing 1.25 loans in Florida, 125% of the value of your home, Subprime.
Then we were doing 2/28 loans at about 8-10% trying to let folks use their equity to pay off credit cards and such
You're right, it never changes and I don't put all the blame on the folks in debt...a lot of it yes but not all of it.

 

[-OZ-]

The 23 year old graduated from college a year ago and has been waiting on her boyfriend to graduate before making a job decision. It's muddled up but she is interviewing for a recruiter job in Atlanta that starts at $40k a year. Those of you that live in the ATL can speak to whether you can live on that there or not. I know in Charlotte, NC it would require a roommate or possible two. She told us a year ago she would never be able to afford a house and I laughed at her. Now I'm not so sure she wasn't right.

We are in the suburbs and like I said, my son is priced out of housing making 15-20k more than that. He had two roommates before but was smart to stop throwing money at an apartment room when he can stay here for free in a nicer home with more "amenities". In Atlanta, no chance of buying a home unless you gamble on an old, potentially unsafe area that may be next up in being rejuvenated.

I have no idea what my oldest is going to do, but our second (sophomore) is already saving money for his down payment, probably 3 years away. He’s lucky enough to make $25/hr while in school and he doesn’t spend much money. He basically has an offer waiting at the credit union for $70-80k upon graduation. He’s probably alright. But he’s a rare breed.

 

[Hawks64]

Also nobody is talking about living large. A 22 year old should be struggling

Why should ANY one need to struggle? That's a ridiculous sentiment.

I'm all for BIG and all that, but in today's and yesterday's reality, young just out of college people always struggle. I'm not talking can't put food on the table struggle, but they typical 20 year old struggle of having ****ty roommates who pay bills late, messy apartment from last nights party, hungover showers in the morning trying to sober up for work. And yes, also not having disposable income to buy 8 dollar lattes everyday

Well, struggling to me is having to buy ramen, being unable to pay bills on time, etc. But being able to afford to live on your own, even with roommates, isn't struggling. It's just sucky.

 

[-OZ-]

Also nobody is talking about living large. A 22 year old should be struggling

Why should ANY one need to struggle? That's a ridiculous sentiment.

I'm all for BIG and all that, but in today's and yesterday's reality, young just out of college people always struggle. I'm not talking can't put food on the table struggle, but they typical 20 year old struggle of having ****ty roommates who pay bills late, messy apartment from last nights party, hungover showers in the morning trying to sober up for work. And yes, also not having disposable income to buy 8 dollar lattes everyday

Yep. We didn’t really struggle, I had a decently paying job right out of college (commissioned immediately), but we sure didn’t spend like sailors on shore leave.

 

[AAABatteries]

The 23 year old graduated from college a year ago and has been waiting on her boyfriend to graduate before making a job decision. It's muddled up but she is interviewing for a recruiter job in Atlanta that starts at $40k a year. Those of you that live in the ATL can speak to whether you can live on that there or not. I know in Charlotte, NC it would require a roommate or possible two. She told us a year ago she would never be able to afford a house and I laughed at her. Now I'm not so sure she wasn't right.

We are in the suburbs and like I said, my son is priced out of housing making 15-20k more than that. He had two roommates before but was smart to stop throwing money at an apartment room when he can stay here for free in a nicer home with more "amenities". In Atlanta, no chance of buying a home unless you gamble on an old, potentially unsafe area that may be next up in being rejuvenated.

I have no idea what my oldest is going to do, but our second (sophomore) is already saving money for his down payment, probably 3 years away. He’s lucky enough to make $25/hr while in school and he doesn’t spend much money. He basically has an offer waiting at the credit union for $70-80k upon graduation. He’s probably alright. But he’s a rare breed.

My son was a Covid graduate and for several reasons decided traditionally college wasn't for him. Mom worried but I was all for it. Why spend a bunch of money and get loans (which is how he would have had to pay) for a degree you aren't passionate about. My college aged daughter is also living with us and is a year away from having her nursing degree. With in-state tuition and Zell Miller scholarships she's going to graduate with almost zero debt. Her boyfriend will be doing the same. They will most likely get engaged next year and married the year after. In theory, they have everything set up perfectly for them - all they will probably be fine (or even better) but it is a little scary. I try to remind them what FB was talking about above. Don't expect to take multiple (or even one) nice vacations and eat out and go to events, etc. It's not realistic just yet to do that and buy a home, etc.

 

[Ministry of Pain]

Kind of funny this thread has been around for a year where the economy has been objectively quite strong. Inflation has stabilized from 2022. Unemployment has stayed sub 4%. NASDAQ is up.

This is complex and you make some great points...this particular forum is going to be difficult to have meaningful discussion as every one is spread out and some folks in here actually prepare meals from scratch and save a lot of money but I bet most DO NOT

-How many FBGs will cut up a whole chicken into pieces form the grocery store to cook with?
-How many FBGs will cook up a 15-20 lb turkey when it's NOT Thanksgiving and cut up all the meat to use for lots and lots of meals?

The MoPs like most of you are doing pretty well in terms of investments and real estate but I am sad to report that only 1 in 4 Americans takes part in the market.
Who's fault is that? Not taking advantage of employers matching in their 401k? How can you afford not to invest a little each paycheck?

Discipline is a tough thing to actually have and use when things are getting tight

 

[Ministry of Pain]

Kind of funny this thread has been around for a year where the economy has been objectively quite strong. Inflation has stabilized from 2022. Unemployment has stayed sub 4%. NASDAQ is up.

The economy right now is just everyone bitching about how impossibly unaffordable everything is and then buying it anyway, magically being able to afford it.

I mean we have this thread complaining about the economy and the next thread down is the "I went into Costco for a hot dog and came out with $800 worth of stuff I didn't need but felt like buying anyway" thread.

Things are definitely harder for younger people now than they were when we were younger. But the change in asset prices is only half of that. Half of it is just that society has changed into a much more experience driven society, and people spend (A LOT) more money on different things now. That's not a bad thing (it's a good thing!), but it costs a lot more.

It used to be that a starter home was an American dream and that was what you worked and saved for. We took small vacations once a year and big vacations a couple times a decade. Most of us didn't do a big international trip until we were in our mid 30's. We ate out sparingly.

Now you can barely find a 30 year old that hasn't been to 16 different countries and who doesn't travel a half dozen times a year, and who doesn't eat out for the majority of their meals. Money is being spent on different stuff, but the home thing is treated like it's supposed to be automatic because the old people that didn't spend nearly as much money on all that other stuff got one. Partially wanting to have their cake and eat it too. I realize this doesn't apply to everyone and homes are empirically more expensive now, but it's not like only old people are spending to drive up prices. Prices are high because everyone, including young people, keeps spending like crazy and can stomach the price increases, even if they post on facebook or FBGs on their brand new iPad that they can't.

Many things in the 80s we didn't spend a lot of money on and could afford basics like a roof over our head

-Cell phones...I did not have a cell phone for quite a while.
-Data plans...this runs along with the cell phones.
-Subscription Services...yes we had CBS Records sending tapes and CDs we didn't really want but it wasn't as mass digested as everything fed to these newbies coming up
-Cloud Storage

-Ride sharing Uber/Lyft
-Online Education
-Smart Home Devices
-Gym Memberships...you just found your way to free exercise some how some way

-GOURMET COFFEE!!!
-Meal delivery services
-CRYPTO

 

[AAABatteries]

While I think it makes us sound old (and maybe out of touch) I do think there's validity to the idea that kids are living lifestyles well beyond what we did as kids. Maybe that was true of me compared with my parents, but it doesn't feel the same.

It's mostly my fault and I'm subsidizing it - I try to be realistic with them and explain they can't spend like drunken sailors when they are on their own but sometimes I'm not sure it gets through. And we as a family as doing well. I see almost all of their friends doing the same with parents that I know can't afford it. Which may be another part of the problem - we want our kids to have everything other kids do so we go in to debt to make it happen.

 

[SFBayDuck]

The busiest travel weekend in history was July 4th 2024, breaking the record from way back on Memorial Day 2024.

Saw this tweet yesterday and I lol'd: Economy so bad 83% of Americans are living airport-to-airport

 

[beer 30]

As a boomer with a one daughter that is 28 and one that is turning 23 this week, this is pretty much exactly the situation. The 28 year old is a teacher in SC, she barely makes a livable wage accordingly. If she lived on her own, she would require a roommate to afford anything in the area. She has areas she could cut spending (her dog being the most expensive part of her life) but she doesn't live an extravagant lifestyle, she simply doesn't get paid ****.

The 23 year old graduated from college a year ago and has been waiting on her boyfriend to graduate before making a job decision. It's muddled up but she is interviewing for a recruiter job in Atlanta that starts at $40k a year. Those of you that live in the ATL can speak to whether you can live on that there or not. I know in Charlotte, NC it would require a roommate or possible two. She told us a year ago she would never be able to afford a house and I laughed at her. Now I'm not so sure she wasn't right.

But isn't that normal? I lived with roomates....basically forever! Through college, after college through my 20s (lived with 3 other people in two different places from like 23-29), and then moved in with my then future (and now ex) wife. Through all of those years I couldn't afford a place, even a rental, on my own. Maybe that's just the way it's always been out here on the coast, but I don't know too many people that lived on their own in their 20s. I expect my daughter when she graduates next year will continue to live with roommates for several years, just like she has through college.

The one friend I had who was able to buy a house by about 25 years old "house hacked" it - he had three buddies move in and pay rent, essentially covering his mortgage. And he bought a fixer-upper and gradually improved it over several years.

That's fair and something I should have considered given that I lived in a house full of guys until I was 26. What I will say is my first job out of college I took a pay cut from the job I was working at a local machine shop. I was able to get a two bedroom apartment on my own and buy a new car without a roommate so I feel like something has shifted here. The cost of housing just makes that impossible today. For reference this would have been 1990 I think, went from a $25k/yr to $20k.

The 23 year old graduated from college a year ago and has been waiting on her boyfriend to graduate before making a job decision. It's muddled up but she is interviewing for a recruiter job in Atlanta that starts at $40k a year. Those of you that live in the ATL can speak to whether you can live on that there or not. I know in Charlotte, NC it would require a roommate or possible two.

A 23 year old should have a roommate or two. I'm skeptical that any young 20 year old is any worse off than we were in the mid 90's.

Again, fair point. The 20 year old has said she doesn't ever see herself without a roommate or a live in significant other. Not so much because she has to but she just likes having someone else in the house.

 

[massraider]

Housing in the ‘90s vs. Today. What’s Changed? | Homie

Homie researched median home sale price data in the ‘90s to 2022. The results were shocking. Home’s got more expensive and commission rates stayed the same.

www.homie.com

Median home prices (Pulled from US Census)

Idaho:
1990--$58,000
2000--$106,300
2022--$478,715

Median salary in Idaho since 1990


If anyone wants to trade places with a 25 year old, please check in here. Please show the math on how some meal planning is gonna get you that starter home.

k thanks

 

[the moops]

The cost of housing just makes that impossible today. For reference this would have been 1990 I think, went from a $25k/yr to $20k.

That 20K a year is now like 50K in today's dollars. If I was 22 years old, and making 50K I could find a place to live in most cities in this country

 

[massraider]

The cost of housing just makes that impossible today.

When I was young, renting was the sucker move, and the hurdle was getting the down payment, and then you were actually spending less than rent on your mortgage, and what a great investment.

That math equation does not work anymore.

 

[the moops]

Housing in the ‘90s vs. Today. What’s Changed? | Homie

Homie researched median home sale price data in the ‘90s to 2022. The results were shocking. Home’s got more expensive and commission rates stayed the same.

www.homie.com

Median home prices (Pulled from US Census)

Idaho:
1990--$58,000
2000--$106,300
2022--$478,715

Median salary in Idaho since 1990


If anyone wants to trade places with a 25 year old, please check in here. Please show the math on how some meal planning is gonna get you that starter home.

k thanks

Mortgage rates were 15% in 1990, FYI

 

[massraider]

Mortgage rates were 15% in 1990, FYI

Yeah.

On a 60,000 home, that what 733 a month.

Still not CLOSE

 

[belljr]

Mortgage rates were 15% in 1990, FYI

Yeah.

On a 60,000 home, that what 733 a month.

Still not CLOSE

Homes in my neighborhood are going on market approximately DOUBLE what I paid for mine in 2003. Thats insanity to me but idk

 

[the moops]

Mortgage rates were 15% in 1990, FYI

Yeah.

On a 60,000 home, that what 733 a month.

Still not CLOSE

Homes in my neighborhood are going on market approximately DOUBLE what I paid for mine in 2003. Thats insanity to me but idk

In his Idaho post, looks like house prices are doubling every 10 years or so - dating back to 1990

 

[belljr]

So my 300k house at 4% is not 600k at 7%??

I couldn't afford to buy my own house now

 

[the moops]

Mortgage rates were 15% in 1990, FYI

Yeah.

On a 60,000 home, that what 733 a month.

Still not CLOSE

If interest rates would just go back down in the 4.5% range it gets close.

60K home - 733 a month with a 25K income.
480K home - 2400 a month with a 75K income

 

[NutterButter]

So my 300k house at 4% is not 600k at 7%??

I couldn't afford to buy my own house now

Paid 450 for my house in NJ in 2006. Zillow has me at 612 today when I should be at 701 according to this handy dandy inflation calculator. Rate is almost the same. I could in theory buy more house now.

 

[IvanKaramazov]

Mortgage rates were 15% in 1990, FYI

Yeah.

On a 60,000 home, that what 733 a month.

Still not CLOSE

Homes in my neighborhood are going on market approximately DOUBLE what I paid for mine in 2003. Thats insanity to me but idk

I get what you're saying, but I think people lose perspective of the "investment" part of their house. If you had invested your home equity in the S&P 500 instead of your home, your money would have appreciated by about 350% since 2003 (I'm approximating here). So if your house doubled in value, that's not really insane. It's gone up significantly less than stocks.

 

[Ministry of Pain]

Mortgage rates were 15% in 1990, FYI

Yeah.

On a 60,000 home, that what 733 a month.

Still not CLOSE

If interest rates would just go back down in the 4.5% range it gets close.

60K home - 733 a month with a 25K income.
480K home - 2400 a month with a 75K income

I've read a lot of posts that have erupted in here today, I find myself agreeing with many of your viewpoints but I do not share your POV that interest rates could drop back under 5%
I don't even think they will break 6%, the door that was open for a long time where we played tug of war over 2.75%-4.5%, anyone who bought a home in there on the way up or down got a pretty amazing deal and some folks might have been able to acquire a few homes when rates and prices were relatively low.

Those days were not prominent prior to the low mortgage rates in the 2010s, don't see them coming back any time soon my friend.