> at percentile X would substantially improve their financial security if they spent as much as percentile X-10
This is spot-on.
It's worked for me -- I didn't have a solid handle on my finances when I moved out of my parents' place, so I lowballed and found a place I knew I could afford even with a pretty pessimistic view of financial discipline.
Nine years later I'm living in the same place, and I've gotten a raise every year, so I'm making quite a bit more than I was back then. Driving an even more economical car. Eating better -- buying groceries instead of eating out all the time.
I could fritter it away, let my ISP bleed me dry with a $162 cable+internet+whatever+modem plan when the $30 plan works just fine and I bought my own modem. I could shovel $95/mo to Verizon, but I'm on Ting and I use wifi whenever possible, and my bill averages $26 and I own the phone.
I could send $8/mo to Hulu and $15/mo to HBO and $11/mo to Netflix and $13/mo to Amazon and $10/mo to Spotify and $10/mo to Pandora and.... how many more are there?! But I don't feel like my life would be improved by having all those. (I do Spotify, but none of the others. In the event that I feel like rubbing my nose in a pile of TV, there's this thing called broadcast.)
I feel like there's a never-ending stream of these things, with their pundits on the morning show and Weekend Edition making you feel like you're missing out on life if you don't watch at least one show on every such service. And Disney+ is coming...
To me, it's that incremental monthly spending that inexorably, insidiously, increasingly, gobbles up every spare dollar the middle class can scrape together. I've been literally counseling my friends on how to talk their cable providers into a lower rate.
I read this sanctimonious nonsense in every thread on spending and saving.
The only point you missed was saying that you only spend $5 a day on food.
Tell me this dear sir or madam...
1) How many kids do you have?
2) How much did you spend on healthcare in the last 5 years?
Financial shocks exceeding savings coupled with a system which requires drawing on high APY credit in order to absorb those shocks I think is a more likely culprit.
Just one event like that can have a family struggling to stay afloat and carrying thousands per year in interest payments on top of everything else.
The point that person is making is, if a person who makes more than the minimum wage is to reduce spending to 90% of the current spending they would be better able to absorb these unforeseen financial shocks.
> How many kids do you have?
This is another thing I notice (outside and in the article too). A lot of people who live paycheck to paycheck have 3 or more kids. Naturally more kids increase costs. Now I am by no means saying people shouldn't have more kids, but that number should depend on their financial situation too.
All of those corners you've so frugally cut can be drowned out by the difference between a 3% raise in rent and a 10-15% in rent, or a uncovered medical expense, or a child you're not prepared to have, so I really doubt too many Netflix-esque subscriptions is really the reason why so many seemly middle class income people are living paycheck to paycheck.
Mmm... I'm subscribed to Netflix, to kurzgesagt on Patreon and to duchinese and wordswing on the app store just because I support them. It's 50$/month and I think that's a fine amount to spend if you have the money in order to encourage more of these things.
This is spot-on.
It's worked for me -- I didn't have a solid handle on my finances when I moved out of my parents' place, so I lowballed and found a place I knew I could afford even with a pretty pessimistic view of financial discipline.
Nine years later I'm living in the same place, and I've gotten a raise every year, so I'm making quite a bit more than I was back then. Driving an even more economical car. Eating better -- buying groceries instead of eating out all the time.
I could fritter it away, let my ISP bleed me dry with a $162 cable+internet+whatever+modem plan when the $30 plan works just fine and I bought my own modem. I could shovel $95/mo to Verizon, but I'm on Ting and I use wifi whenever possible, and my bill averages $26 and I own the phone.
I could send $8/mo to Hulu and $15/mo to HBO and $11/mo to Netflix and $13/mo to Amazon and $10/mo to Spotify and $10/mo to Pandora and.... how many more are there?! But I don't feel like my life would be improved by having all those. (I do Spotify, but none of the others. In the event that I feel like rubbing my nose in a pile of TV, there's this thing called broadcast.)
I feel like there's a never-ending stream of these things, with their pundits on the morning show and Weekend Edition making you feel like you're missing out on life if you don't watch at least one show on every such service. And Disney+ is coming...
To me, it's that incremental monthly spending that inexorably, insidiously, increasingly, gobbles up every spare dollar the middle class can scrape together. I've been literally counseling my friends on how to talk their cable providers into a lower rate.
Many of them didn't know that was possible.
Cancel your shit, people.