Why Gen Y yuppies are unhappy

[Cowboy89]

Originally Posted by GirlySports

income is not guaranteed forever, it's just too risky to over-leverage oneself. We all know the stories of engineers with big houses and cars in 2008 who lost their jobs.

Even if I was under 30 and made over $100K with a husband that also made over $100K, I would still buy a house that's under 500K, put a big downpayment on it or pay it off entirely.. why pay interest at all?

Then I have a nice, affordable 300-400K house (it's just the two of us, or maybe have one kid at that time) then my NEXT house when I'm over 30 will be closer to a million because I have this 400K house plus the money I've saved as a downpayment.

But 20somethings having a mortgage of over 500K? just seem dangerous and unecessary.

I'm a very safe and boring person that hoards money. I don't think I took a single vacation off the continent from the age of 22-28.

How safe is having all of your net worth in a house?

I would rather have the affordable 300-400K house in my 30s and 40s with a large investment portfolio than a million dollar house. Seems to me it's dangerous and unnecessary to focus all attention on climbing the property ladder as a proxy for building diversified wealth.

[Mr.Coffee]

Originally Posted by Cowboy89

How safe is having all of your net worth in a house?

I would rather have the affordable 300-400K house in my 30s and 40s with a large investment portfolio than a million dollar house. Seems to me it's dangerous and unnecessary to focus all attention on climbing the property ladder as a proxy for building diversified wealth.

Can you live inside your investment portfolio?

Again, different people have different priorities.

[Dion]

Originally Posted by Mr.Coffee

Well who's fault is that?

Honestly, yes you can say that people should be more responsible. But when you graduate high school without ever having to take any kind of financial management course, and then you have banks trying to rape and pillage as much as possible.....

maybe these lenders can Fata right off and stop lending the money and OVEREXTENDING themselves if interest rates escalate. It's a risky game but it's also a two way street.

I have no sympathy for someone who over extends themselves and accumulates too much debt. We've become a society of people who think it's okay for the most part to live their life on borrowed money. Credit cards maxed out so they can have it all now. Outside of a mortgage and a car loan can you not save up for what you want?

I agree it should be a course requirement in HS that every student take a financial management course. Too many stupid people spending too much money that they don't have.

[Dion]

Originally Posted by Cowboy89

How safe is having all of your net worth in a house?

I would rather have the affordable 300-400K house in my 30s and 40s with a large investment portfolio than a million dollar house. Seems to me it's dangerous and unnecessary to focus all attention on climbing the property ladder as a proxy for building diversified wealth.

I tend to agree. Putting all your eggs in on basket is a huge risk. A person is better off to diversify their investment portfolio.

[GirlySports]

Originally Posted by Cowboy89

How safe is having all of your net worth in a house?

I would rather have the affordable 300-400K house in my 30s and 40s with a large investment portfolio than a million dollar house. Seems to me it's dangerous and unnecessary to focus all attention on climbing the property ladder as a proxy for building diversified wealth.

oh that's fine too to have the 300-400K house into my 30s and 40s. nothing like a paid off house. I'm just countering the 20somethings who want the 500k+ mortgage right away.

I think in general, a person must be still ok if for some reason they lose their job (how ever they choose to store their money), not be living paycheque to paycheque with a lot of debt.

[valo403]

Originally Posted by GirlySports

income is not guaranteed forever, it's just too risky to over-leverage oneself. We all know the stories of engineers with big houses and cars in 2008 who lost their jobs.

Even if I was under 30 and made over $100K with a husband that also made over $100K, I would still buy a house that's under 500K, put a big downpayment on it or pay it off entirely.. why pay interest at all?

Then I have a nice, affordable 300-400K house (it's just the two of us, or maybe have one kid at that time) then my NEXT house when I'm over 30 will be closer to a million because I have this 400K house plus the money I've saved as a downpayment.

But 20somethings having a mortgage of over 500K? just seem dangerous and unecessary.

I'm a very safe and boring person that hoards money. I don't think I took a single vacation off the continent from the age of 22-28.

Umm, maybe because you can get a mortgage at a rate well below the returns you can get elsewhere. Why by something with your own money when you can buy it with the banks, and invest your money at a higher rate?

Mr. Coffee's point is solid, you're making massive assumptions and generalizations, and also don't seem to have really thought about the actual economic consequences of certain choices.

[polak]

Originally Posted by polak

Also, the greatest generation is far from perfect as people seem to think. They might have fought in a war but outside of that? They committed some of the most embarrassing moments of the last century. Racism, Paranoia, Bigotry, Enviromental carelessness, all of these things are qualities of the "greatest" generation. Also remember that personal credit is a relitively recent creation so who knows what the spending habits of earlier generations would have been like had it existed.

Just to add to this, are we calling the soldiers who fought for the Nazi's part of the greatest generation too?

[valo403]

Originally Posted by polak

Just to add to this, are we calling the soldiers who fought for the Nazi's part of the greatest generation too?

Not really a direct answer, but can we remember that a lot of the guys fighting for nazi Germany were kids being shipped off to war with little idea of who or what they were fighting for.

[bizaro86]

Originally Posted by valo403

Not really a direct answer, but can we remember that a lot of the guys fighting for nazi Germany were kids being shipped off to war with little idea of who or what they were fighting for.

Wouldn't that then logically be true also for those fighting for the allies?

[CaptainCrunch]

Originally Posted by valo403

Not really a direct answer, but can we remember that a lot of the guys fighting for nazi Germany were kids being shipped off to war with little idea of who or what they were fighting for.

I would disagree with you on that, the Nazi Propaganda machine was unbelievable. You didn't see a lot of German's that were unwilling to go to war. Especially thanks to the stupidity of the french and the British.

My grandmother (RIP) was in Germany prior to the great hate, and she basically stated that everyone knew war was coming, it was a war of revenge, People lined up around the block to sign up.

Don't get me into those lads in the SS.

[GP_Matt]

Originally Posted by Dion

I have no sympathy for someone who over extends themselves and accumulates too much debt. We've become a society of people who think it's okay for the most part to live their life on borrowed money. Credit cards maxed out so they can have it all now. Outside of a mortgage and a car loan can you not save up for what you want?

I agree it should be a course requirement in HS that every student take a financial management course. Too many stupid people spending too much money that they don't have.

I over extended myself when I was 25 and it paid off handsomely for me.
I invested 2.5 years salary into my company 2.5 years after graduating. I saved for it quite heavily but there was no way I could save 100 percent of my income so I borrowed the rest. It took a few years to pay off but the investment returns were far larger than the cost to borrow. I looked at the risk and decided for right or wrong that the worst case scenario was the company folding and defaulting on the loan. That would leave me starting again at 28 which didn't seem like such a bad thing and much better than starting over at 48.

[PsYcNeT]

Originally Posted by CaptainCrunch

I would disagree with you on that, the Nazi Propaganda machine was unbelievable. You didn't see a lot of German's that were unwilling to go to war. Especially thanks to the stupidity of the french and the British.

My grandmother (RIP) was in Germany prior to the great hate, and she basically stated that everyone knew war was coming, it was a war of revenge, People lined up around the block to sign up.

Don't get me into those lads in the SS.

You really should read this, because your anecdotal evidence doesn't stack up with the facts.

They Thought They Were Free

My family escaped from Germany prior to the war starting, when the government confiscated their farm to use as a military training ground, and they tell a very different story from what you have wrote above, and a much more similar one to the dozens of stories outlined in the book I linked.

[valo403]

Originally Posted by CaptainCrunch

I would disagree with you on that, the Nazi Propaganda machine was unbelievable. You didn't see a lot of German's that were unwilling to go to war. Especially thanks to the stupidity of the french and the British.

My grandmother (RIP) was in Germany prior to the great hate, and she basically stated that everyone knew war was coming, it was a war of revenge, People lined up around the block to sign up.

Don't get me into those lads in the SS.

That the Nazi propaganda machine was unbelievable is really my point. They were willing to go to war on the basis of a story they had been fed, alluding to them being complicit in the horrible things that were behind that is what I take issue with. The average soldier was just that, average. No different than those across from them really, just fed a different story.

[Red]

Originally Posted by GP_Matt

I over extended myself when I was 25 and it paid off handsomely for me.
I invested 2.5 years salary into my company 2.5 years after graduating. I saved for it quite heavily but there was no way I could save 100 percent of my income so I borrowed the rest. It took a few years to pay off but the investment returns were far larger than the cost to borrow. I looked at the risk and decided for right or wrong that the worst case scenario was the company folding and defaulting on the loan. That would leave me starting again at 28 which didn't seem like such a bad thing and much better than starting over at 48.

This is a great point. If you have a huge mortgage, you have no money to make this investment. Instead, a huge debt.

Less debt = more freedom to do all kinds of things. Gen Y would be wise to stop borrowing.

[llama64]

Originally Posted by Dion

I have no sympathy for someone who over extends themselves and accumulates too much debt. We've become a society of people who think it's okay for the most part to live their life on borrowed money. Credit cards maxed out so they can have it all now. Outside of a mortgage and a car loan can you not save up for what you want?

I agree it should be a course requirement in HS that every student take a financial management course. Too many stupid people spending too much money that they don't have.

Oh god yes - a basic "HOW FINANCE WORKS" course, taught with the same importance as Math 30 (read: not CALM) would be the smartest thing our society could do to combat fiscal ignorance. And make the course mandatory for diploma - passing grade of at least 80%.

Most people do not comprehend what finance is. The most we get taught in school is how to make a home budget. That teaches us NOTHING about real world finance.

The course should teach:
- what IS finance anyways?
- how does the world of finance affect our lives?
- what should I look for when signing a credit card agreement?
- how do credit cards work anyways?
- how do I measure my fiscal capacity?
- what does it mean if I buy something now on credit vs buying it with actual money?
- what is "investing"?
- what is the difference between saving and investing? When should I do which?

Of course there is much more to this, I had to stop myself for the sake of brevity. It took me FAR too long to comprehend even the basics of personal financing and what it means to my life. Had I understood what the implications of a student loan were, or how a credit card works, I would be in a far better position in my life then I currently am. And while I do take ownership of the blame for myself, a basic course in this stuff in high school would have saved me thousands, literally.

The biggest thing we need to combat is the ignorance about the true cost of things. This goes hand in hand with our cultural obsession with the short term returns at the expense of the long term. The "GYPSY"s are merely a manifestation of this obsession. There is a complete unwillingness to wait for anything; information, entertainment, health, etc, it all must be instant. People can dump on the millennial as much as they want, but this is an attitude that permeates every "generation".

[PsYcNeT]

Originally Posted by llama64

Oh god yes - a basic "HOW FINANCE WORKS" course, taught with the same importance as Math 30 (read: not CALM) would be the smartest thing our society could do to combat fiscal ignorance. And make the course mandatory for diploma - passing grade of at least 80%.

This, along with a course on Critical Thinking, would be a fantastic shift in education.

[missdpuck]

Captain, wish I could remember the name of the documentary I watched the other day...in any case, it really brought out the crap Churchill was up against.

Ha maybe I'll watch "The Remains of the Day" again tonight

And yep, kids should be taught about finance and budgeting as early as possible. My parents were from a generation where money was still this dirty word. They did do okay in real estate, though.

[Ozy_Flame]

Finance and money management should be a Grade 1 class and a regular curriculum item right up into Grade 12. I can't believe something like that isn't already mandatory.

Unless the credit card companies / banks are in cahoots with our public education system

[Tinordi]

Originally Posted by PsYcNeT

This, along with a course on Critical Thinking, would be a fantastic shift in education.

And basic classes in policy and government. What is government policy? What tools does the government have to create outcomes? What is the government responsive to? What are basic constraints and pressures that governments face? What is the OPPORTUNITY COST of any policy/spending.

[1stLand]

Kids don't need money management classes if they are living off the parents 'teet'.

"Little Johnny needs a new Computer for school. The most upgraded one, otherwise he will get bad marks and become a failure in life"