Q about wealth/poverty

[Denise in Florida]

Used goods can be an investment. Wait long enough and they become antiques. New things? Who knows how long it'll last?

 

I often buy shirts and tops at thrift stores.

 

 If they have been worn a few times and been through the wash and still look nice enough to buy that is a big plus. Too many of the shirts I buy new at the mall shrink, pill, fade or warp in the wash. This way I know they will last a while.

[goldberry]

I mentioned shopping at a secondhand thrift store once to my grandmother, and she said something about how she would never have done that. I think that because she grew up very poor during the depression things like secondhand clothes were shameful to her, a reminder of her family's inability to provide anything better.

 

Someone who knows they have the option to buy new if they want has no reason to feel shame over buying secondhand.

 

 

This is VERY TRUE.  I grew up middle class and my mom loved thrift store bargain hunting and taught me how to do it well.  There was certainly no shame attached to it, probably because it was not a necessity and I was never "conscious" of where my clothes came from.

 

I have a very close friend who grew up poor, and she never goes to thrift stores now, because she remembers how ashamed she was of it when she was a child.

[kiana]

In my experience, the poorer one is, the smaller one's world. An upper middle class family generally spreads its wealth over a larger area. Middle class families may be using their money to buy a home, plan for retirement, go on vacation, have a large Christmas (including buying for multiple relatives,) paying for their children's college, going to the theater or a sporting event, traveling across country (maybe for a wedding or funeral or graduation,) sending their kids to summer camp, paying for ballet or gymnastics. The middle class (and above) world is very large. A poorer person doesn't foresee a future where he/she will ever be able to buy a house, or retire or pay for their children's education. Their self worth and status in their family and community generally encompasses much smaller things like a new bike or a new car or nicer clothing. Items they can realistically aspire too.

 

In addition to this excellent post, I will also add that frequently they (subconsciously) fear that if not spent, the money will go away. This is especially common in those who grew up in situations where you had better spend the grocery money fast because otherwise dad will drink it or mom will smoke it.

[goldberry]

We have great thrift stores here, so everyone shops used.  The population is something like thirteen thousand people, but we must have six or seven thrift stores now.  A huge Goodwill just opened up a few blocks away from me, and it's fantastic.  

 

 

 

Jealous!  I grew up in an area with lots of thrift stores with VERY nice things.  I moved rural, and the thrift stores have changed.  They still have nice things, but as someone mentioned, you have to go often and look harder to find them.  My rural Goodwill is not the best.  When I am in "town", I try to hit the thrift stores there.  But there are some friends I know that make a special trip to Denver (about 1 1/2 hours) and spend all day hitting the thrift stores there.  

 

Again, that is certainly not something a person in poverty could do...

[goldberry]

 I'm sure people whispered about me when I pulled my EBT card out of my fancy purse at the grocery store.  

 

It is ridiculous to assume that we know someone else's story.  That's why I hate those kind of anecdotes... "I saw someone at the store with an Iphone using food stamps..."  :(

[elegantlion]

One more observation and about thrift stores...

 

Shopping for decent stuff at thrift stores can take time. If you're busy working because you need to make ends meet, you don't always have that time to scour three thrift stores before you find a pair of snow boots for your ds. You just need to buy them quickly and know they're the right size. So in a way having the time to shop used can be a luxury.

 

I've posted about this before, but where my parents live (30 minutes from me) are at least two thrift stores. The Goodwill sits at the end of a high end neighborhood and has tons of more expensive clothes, most of them look barely used. The other thrift store is in the older part of town and the contrast is night and day in the clothes on the racks. Most of these items are worn and dated and more low-end brands. They're about 5 miles apart. Where do you think we shop? 

 

edited to remove personal information because apparently my opportunity tree died and I'm just not doing it right. 

[Sherry in OH]

We have great thrift stores here, so everyone shops used.  The population is something like thirteen thousand people, but we must have six or seven thrift stores now.  A huge Goodwill just opened up a few blocks away from me, and it's fantastic.  

 

I think it's probably more regional than class-based.  We bought most stuff used when dh was unemployed and we were way below the poverty line.  Now he has a good job and we're middle class, and our shopping habits haven't really changed, except that we have slightly nicer gadgets.  There are a high number of affluent people here, so the thrift stores are filled with high end stuff.  It would be stupid not to buy used here.  If I lived somewhere where the thrift stores were filled with stained Walmart cast-offs, I'd probably buy new just because I hate throwing money away on junk.

 

I'd also like to note that this means we were fairly well-dressed even when we were broke.  Dd had an indecent amount of Ralph Lauren clothes as a toddler.  I had designer purses.  All purchased used at the thrift store.  I mean, if you're going to pick between a Walmart bag and a Kate Spade bag and you're paying three bucks apiece either way, well, you're going to end up with nice purses. ;)  I'm sure people whispered about me when I pulled my EBT card out of my fancy purse at the grocery store.  So for those of you inclined to do so, don't judge.  It's ridiculous that I had to feel ashamed of having nice things when we were broke, but now that dh makes a living wage it's suddenly okay, even though I'm still paying next to nothing for them.

 

I felt self-conscious sending my oldest to daycare in Ralph Lauren.  They were hand-me downs from a friend who bought them at a yard sale.  One day, ds would be in designer duds, the next Circo.  

[AimeeM]

I've never bought a new car. I've never had any significant vehicle repair costs. My car is 9 years old. The van we share with my father is 12 years old. Both run extremely well and I doubt we will be shopping for a car again for several more years. That said, I've never bought a clunker but there are new cars that will be clunkers sooner rather than later.

I've never purchased a new car either, but the used ones they had purchased in the past, were purchased outright with cash in hand... and this generally happened at tax return time. The types of used cars she was able to buy for just a couple thousand dollars simply were not quality used cars in good condition. This may, too, have had more to do with WHERE she purchased the car - and that she turned down our offers to have our mechanic first check out the car before she purchased. I applaud that she didn't want a car payment, but in the end they always ended up with clunkers that required a TON of money to fix within months of purchase. I'm glad she now has a reliable vehicle... even if that does mean payments. This is their only family car (shared between her and her husband), so it needs to last and it needs to run well.

[creekland]

Perhaps I'm the only one reading this thread who has no idea who is wearing designer clothes and who isn't.  I never pay attention to be honest.

 

IME people spend money on what they care about and we all care about different things.

 

Granted, for most of us, our first "care" is food/shelter/clothing, then other things, but even within that "first care" people have different ideas about what they care about.  It doesn't really matter a ton how much they have (short of having nothing).

 

We choose to spend our "second care" $$ on travel (and college tuition now), so that can even bite into my first care decisions.  When our water pipes were leaking, we replaced them (after several repairs).  But fixing the hole in the ceilings and walls where they needed to access the pipes, repainting, etc?  Yeah, we haven't gotten around to that yet.  We could have, but my "second care" decisions have higher priority.  I know that wouldn't be the same priority for many others whether in my economic class (middle class) or not.

 

We rarely buy clothes - only when truly needed a couple of times per year.  I don't care if they are new or used.  We tend to look in the thrift store first, then head to the new stores.  I do, however, always have the hiking boots of my choice (new).  ;)

 

I know very wealthy folks who look the part and those who don't.  It all part of what they care about and what they care about it totally up to them IMO.

[AimeeM]

It is ridiculous to assume that we know someone else's story.  That's why I hate those kind of anecdotes... "I saw someone at the store with an Iphone using food stamps..."   :(

Word. I know people who are volunteering their time shopping for elderly, or disabled, persons... and are allowed to use that person's EBT card. I know foster families taking care of SN children who, regardless of their own income, have cards like EBT cards to use for the child's needs. Regardless, even if they aren't volunteers or foster parents, it doesn't serve anyone well to assume we know why anyone is on EBT, or why they have nice things - it isn't our business and we have no clue what their story is.

[Sdel]

You might be interested in the book The Millionaire Next Door by Thomas J. Stanley and William D. Danko.  Its about the habits and qualities of self-made millionaires. 

 

Stefanie

[Catwoman]

I felt self-conscious sending my oldest to daycare in Ralph Lauren. They were hand-me downs from a friend who bought them at a yard sale. One day, ds would be in designer duds, the next Circo.

Why would you feel self-conscious about it? :confused:

[Lolly]

Dh grew up with. I grew up with ehh...we didn't lack for anything, but most was used or Kmart. Dh buys his shoes at Kmart to this day. Most of his clothes are from discount stores. I will not wear another pair of discount shoes. It was a very hard thing from my childhood because it is something that was made fun of. Clothes were often hand-me-downs from a neighbor who then pointed it out in front of other kids at school. I purchase mostly brand name new clothing for myself and my children. (I am pretty good at deals though!) My children, they tend to shop at discount and thrift stores. (Except for the girls' undies; they love Victoria...)It is like it is a challenge for them. Since they were never made fun of for the things they had or didn't have, they tend to not care or notice. 

[Arcadia]

I felt self-conscious sending my oldest to daycare in Ralph Lauren.

There is no need to be self-conscious. There were brand conscious parents when I sent my older to public school. Not my cup of tea but I mind my own business.

 

I'm surrounded by premium outlets here. Ralph Lauren prices would be normal and close to Target's prices weird as it may seem. Besides the fact that Ralph Lauren's XS sizing is closest to what I need.

 

The thrift stores here don't have much and my neighbors donate to the domestic violence shelter nearby.

 

ETA:

I had felt self conscious growing up with tailored school uniforms because I was off the charts skinny. Tailored school uniforms were costly. After that I gave up caring as when I was in 4th grade, lots more classmates need their uniforms tailored or altered.

 

We bought cars new because we are bad at haggling and not good at assessing used cars or doing car repairs.

[aggieamy]

Why would you assume that?  :glare:

 

I'm so tired of people assuming that if you buy expensive things or live in a great neighborhood or drive luxury cars, you must automatically be up to your ears in debt.  It's an offensive assumption.

 

 

This would probably be us.  We are pretty frugal on things but when I went and bought my Mercedes station wagon I sure got teased by my group of friends.  "Woooo.  Amy's driving a Mercedes!"  LOL.  They are all driving brand new mini-vans and SUV's that cost $45k.  My used 2004 station wagon cost us $10K cash.  Yet it's my little car that gets the comments.  

 

DD is also wearing about $250 worth of clothes right now.  Banana Republic, J Crew, Ann Taylor.  Except we purchased them at the thrift store for $20.  Yay.  

 

My parents are very wealthy.  You can't tell at all.  The last time they visited I commented that I remembered when my mom bought the shirt she was wearing because we were on vacation in Dallas.  I was ten at the time.  She's had the same shirt for 20 years.  My dad's pants had patches in them.  

[LucyStoner]

Me too, to some extent. Grunge and family poverty hit almost at the same time for me. A lucky coincidence.

 

I was thinking also about the point about how thrift stores in poorer neighborhoods have worse stuff... that's not so much the case in my area, since the neighborhoods are so mixed in terms of class (either genuinely mixed or micro-neighborhoods where one is upscale and another not but they're very close together). But that's a consequence of living in a heavily urban area. And urban areas are one of the things that often keep people in poverty since goods tend to be cheaper in the suburbs. It has really changed in my part of the city - there are now Wal-Marts and cheaper retail, but there are other parts of the city where food, consumer goods, etc. are still more expensive. I think when you have to leave your neighborhood to shop then it makes sense that there's perceived value in getting name brand goods. Or if you may be less aware of how to shop more savvy since it's less accessible to you.

What I found was that in the cities, the finds at the cheap thrift stores were often bought up by vintage shops and stuff. So we'd hit the areas where the racks were less picked over.

 

Though now I look at the prices and wonder- there's a St. Vincent de Paul shop near here which is absolutely not well priced except on 50% off days. I am so not paying $9 for used Old Navy jeans.

[6packofun]

POTOH, many of my friends who have financial struggles have fancier clothes, cars, bikes, etc than me.

 

 

And you are 100% sure how those friends obtained every one of those items and how much they paid if it was not a gift AND that they are "new"?

[JumpyTheFrog]

I read one of the linked articles. While I think it's important to dress properly for an interview, it sounds like some people are using it as an excuse. Let's face it, "I need an $800 purse or a $40,000 car so I can get a job," is a rationalization, not a real reason for most people. Sure, some super high end jobs might "require" it, but most jobs people are aspiring to don't.

 

There are two groups of poor people: Those who are poor because of an income problem and those who are poor/broke/in debt up to their eyeballs because of a spending problem. One of my uncles is in the second category. He recently lost his CPA license because he didn't have the $500 or whatever was needed to renew it. He has spent decades living it up as a party boy: expensive ski trips, $2500 month rent because he wanted to live right on the ocean, etc. He had a good paying job plus was earning an extra $50,000 per year on the side doing taxes. Yet he was constantly broke because he was a fool with his money.

 

I'd add a third group of poor people: those who have a combination (past or present) of income and spending problems.

 

Just as poor people here get tired of being judged for having nice things, I frankly am a bit tired of people telling others that it's always wrong to think some people are stuck being poor because they don't use their money wisely. Do all poor people fritter their money away? No, frugality runs across the income spectrum. But our culture is quite materialistic and frugal people who live below their means are not always wrong when they point out that paying $1000-2000 for a set of rims on a car is a waste of money if a person doesn't have any savings.

 

[creekland]

My parents are very wealthy.  You can't tell at all.  The last time they visited I commented that I remembered when my mom bought the shirt she was wearing because we were on vacation in Dallas.  I was ten at the time.  She's had the same shirt for 20 years.  My dad's pants had patches in them.  

 

We have a neighbor like this.  No one would ever guess his net worth.  We're not even sure just how high it is, but it's high.

 

Yet his favorite way to fix something?  Duct tape.  And he'd generally rather fix than buy new, but when he wants new, he gets it whether cars or anything else.  He also enjoys restoring old cars, tractors, etc.

 

He's a great neighbor.

 

On the other side of us is another wealthy neighbor - probably a little wealthier than the first, but I'm not sure how much either have in total assets.  This guy looks the part though with his house and car.  His clothes?  You couldn't tell the two apart based upon what they choose to wear.  Neither choose expensive.

[JumpyTheFrog]

Working hard and being frugal are generally necessary, but not sufficient to becoming a millionaire. There is no magic formula.

[JumpyTheFrog]

If I remember correctly, the people interviewed for The Millionaire Next Door generally got that way by living frugally on middle or upper middle class incomes. Owning their own business was a common method. Of course, I read the book 10-15 years ago, so my memory may be incorrect. The main point, however, was that most millionaires don't look the part (aka, what Hollywood portrays) because conspicuous consumption would kill their savings/investing rate.

[creekland]

the rest of us aren't in the league where we can afford $4k in gifts yearly

 

The Millionaire Next Door would not be going to the thrift store to buy the book..s/he would be biking or walking over to the library to borrow their copy, if its not available in the downloadable e-reader versions.

 

4K year for Christmas???  Do middle class people seriously do this?  We are not even remotely close to that high of a figure - nor do I plan to keep up with the Jones' if that's true.  We don't even come close to 1K and that's with adding food, etc.

 

And yes to your second comment.

[TranquilMind]

Please don't flame me! I have an honest question for people who have BTDT. Please don't get preachy if you haven't BTDT.

 

I have friends from across the spectrum of wealth and cultures. I've noticed that many of my upper middle class friends buy used clothes, used cars, even used jewelry. OTOH, many of my friends who have financial struggles have fancier clothes, cars, bikes, etc than me.

 

Can someone explain this cultural phenomenon? Also, I've lived across the USA, so I have come to recognize some regional differences. I'm in the midwest currently, if that helps. I think things were different when I lived in Cali.

 

Emily

(who loves her used car, used couch, second-hand jewelry, and $20 bike, and is packing used clothes to take to the thrift store she shops at)

I can explain it.  The "Millionaire Next Door"  book explains it also.

Most people who have money (excluding Hollywood) live very modest lives.  They don't like to show off their wealth.  

 

They have money in the first place because they are good bargain hunters.  They pay attention, and spend as little as possible on necessary items.  They buy older cars outright for cash, rather than get huge loans and pay monthly.  Many of them had Depression-era parents and they grew up economizing. 

 

One of my kids played travel hockey for years.  Some of those parents appeared incredibly wealthy, if you looked at their cars, and their houses, and their travel RV's. 

 

More than one lost it all and went bankrupt in the last crash. 

[TranquilMind]

I read one of the linked articles. While I think it's important to dress properly for an interview, it sounds like some people are using it as an excuse. Let's face it, "I need an $800 purse or a $40,000 car so I can get a job," is a rationalization, not a real reason for most people. Sure, some super high end jobs might "require" it, but most jobs people are aspiring to don't.

 

There are two groups of poor people: Those who are poor because of an income problem and those who are poor/broke/in debt up to their eyeballs because of a spending problem. One of my uncles is in the second category. He recently lost his CPA license because he didn't have the $500 or whatever was needed to renew it. He has spent decades living it up as a party boy: expensive ski trips, $2500 month rent because he wanted to live right on the ocean, etc. He had a good paying job plus was earning an extra $50,000 per year on the side doing taxes. Yet he was constantly broke because he was a fool with his money.

 

I'd add a third group of poor people: those who have a combination (past or present) of income and spending problems.

 

Just as poor people here get tired of being judged for having nice things, I frankly am a bit tired of people telling others that it's always wrong to think some people are stuck being poor because they don't use their money wisely. Do all poor people fritter their money away? No, frugality runs across the income spectrum. But our culture is quite materialistic and frugal people who live below their means are not always wrong when they point out that paying $1000-2000 for a set of rims on a car is a waste of money if a person doesn't have any savings.

Right.  You can go to TJ Maxx and get a nice purse and shoes and still spend under $100. 

 

There is also a category of people who became poor through medical costs.  Don't forget them.  But yes, generally, people are living above their means. 

[kiana]

You'll need to do the math for your situation!!!  When we did, we cut out the extended family Christmas.    Extended fam Christmas gifting now just includes those with pensions that include medical...the rest of us aren't in the league where we can afford $4k in gifts yearly instead of into the 401k for our retirement and the HSA for our future health care.

 

The Millionaire Next Door would not be going to the thrift store to buy the book..s/he would be biking or walking over to the library to borrow their copy, if its not available in the downloadable e-reader versions.

 

I wonder how many people here actually spend 4 digits on Christmas gifts in the first place? I know I sure don't. Most people get homemade candy or cookies from me.

[Farrar]

What I found was that in the cities, the finds at the cheap thrift stores were often bought up by vintage shops and stuff. So we'd hit the areas where the racks were less picked over.

 

Though now I look at the prices and wonder- there's a St. Vincent de Paul shop near here which is absolutely not well priced except on 50% off days. I am so not paying $9 for used Old Navy jeans.

 

I was thinking at one point about starting a photo feed of "Things priced higher used at Value Village." Just the other day, they had a pair of lamps I just bought at Ikea for $9 priced at $12.99 each.  :001_rolleyes: And I've seen Target Circo brand stuff priced higher many, many times. Sigh. Usually there are deals. And I'm pretty sure they price some things specifically for 50% days.

[Sdel]

'I am looking forward to finding out how saving my extra cash and being frugal with the rest, plus a little hard work, can mean millionaire status for me!

 

 

In my opinion, the book isn't about being frugal and saving money little by little to become a millionaire. It is about the attitudes behind money.  It also goes beyond money into social and cultural aspects and beliefs that support wealth generation.

 

Stefanie

[Sdel]

In my opinion, the book isn't about being frugal and saving money little by little to become a millionaire. It is about the attitudes behind money.  It also goes beyond money into social and cultural aspects and beliefs that support wealth generation. 

 

Stefanie

 

Just wanted to add, those social and cultural beliefs tend to be missing in large segments of the poor population.

 

Stefanie

[Catwoman]

I hope the thrift store has a copy of the Millionaire Next Door.

 

I am looking forward to finding out how saving my extra cash and being frugal with the rest, plus a little hard work, can mean millionaire status for me!

 

As I already work hard and am frugal with what I have, it must be the Christmas money the IL's just sent me that's standing in my way! If only I'd saved my Christmas money each year instead of spending it on a yearly board game for the kids I'd be rich, I tell you, rich!

 

In a very unobtrusive way.

If you steal the book instead of buying it, you'll already be saving money. ;)

 

Just something to consider....

[Catwoman]

4K year for Christmas??? Do middle class people seriously do this? We are not even remotely close to that high of a figure - nor do I plan to keep up with the Jones' if that's true. We don't even come close to 1K and that's with adding food, etc.

 

And yes to your second comment.

I don't think 4k a year (or considerably higher) for Christmas would be at all uncommon.

[mom2scouts]

I was thinking at one point about starting a photo feed of "Things priced higher used at Value Village." Just the other day, they had a pair of lamps I just bought at Ikea for $9 priced at $12.99 each.  :001_rolleyes: And I've seen Target Circo brand stuff priced higher many, many times. Sigh. Usually there are deals. And I'm pretty sure they price some things specifically for 50% days.

 

This is why I rarely buy things at our local thrift stores.  I can buy new at Kohl's with a 30% off coupon or at Walmart for less than they charge at the thrift stores.  Our area has a low average family income and a large student population, so we don't find lots of high end brands anyway.

[mrsrevmeg]

My mother was that way. They had very little money, but would buy new things, go on vacations, etc, trying to look to the outside that things weren't bad. Meanwhile, they would eat Spam and Ramen noodles when nobody was looking. My family buys clothes from clearance sections or thrift stores, we rarely go out to eat, almost never go on vacations, but we are more stable in our day-to-day lives. We don't care if someone else thinks we are poor, we are not going to spend above our means. My mother even used to try to out-do my in-laws with Christmas and birthday presents for my kids. it took several years for her to realize that they weren't getting huge things from the other grandparents. I have seen others who do the same. Pretend to the world that they are comfortable, while in reality, they are struggling.

[TranquilMind]

I don't think 4k a year (or considerably higher) for Christmas would be at all uncommon.

Well, I don't know anyone who does that, but I am positive they exist. 

[NorthwestMom]

I mentioned shopping at a secondhand thrift store once to my grandmother, and she said something about how she would never have done that. I think that because she grew up very poor during the depression things like secondhand clothes were shameful to her, a reminder of her family's inability to provide anything better.

 

Someone who knows they have the option to buy new if they want has no reason to feel shame over buying secondhand.

 

This is true for my MIL. She is horrified at my 11yo, banged up minivan. To me, it's paid off and runs like a dream. To her, who grew up very poor, it's an embarrassment. 

[SarahW]

Re: new cars - 

 

I grew up LMC and thrifty-poor. Paying cash for a used car was gospel truth.

 

Truth is - banks and other actual lenders will not give you a car loan for less than around 8k, and only for a newer car. Also, I get Medicaid and WIC for my kids, and one of the stipulations is that we're not allowed to have over 2k in liquid assets.

 

So how does someone in this situation get a car? They get a new or newer one with a huge loan.

 

Or be lucky enough to have a mechanic friend who will do a low-cost trade-and-fix-up. Which we did. But otherwise we'd be sunk in a hole with a car more expensive than we could afford.  :banghead:

 

 

 

Oh, and yes, Goodwill is a rip-off these days. $6 for an old shirt? No thanks, I'd rather spend my money at the clearance rack at TJMaxx. And if the thrift store gets anything good it walks out the back door to be listed on the employees' ebay.

 

[Sdel]

Uh-huh. It's a bootstrap book, in other words.

 

The lack of understanding on these boards today is, ironically, understandable.

 

The lack of compassion, on the other hand, while also ironic given the spiritual composition of the boards, is not.

 

Luckily, I'm not stupid, so I know what 'social' and 'cultural' issues really signify.

 

And it doesn't signify tackling the systemic issues that lie outside the individual and are most responsible for poverty.

 

Okay, judge a book without reading it.  It is simply a statistical analysis of surveys from self-made millionaires as determined by net worth that covers as much social and cultural data as possible.  Nothing more, nothing less.  It's commentary of social and cultural philosophy is contained to what is reported in those self-surveys.  As much as you may not like it, wealth accumulation is in part due to being educated about attitude towards money and work.  Part of the phenomena addressed in the book (or maybe it's the sequel)  is the idea that "wealth" rarely survives past the third generation because the values associated with what it takes to accumulate the wealth is not taught to the following generations.

 

It is not a book designed to be a guide to becoming a millionaire and it doesn't claim to be.  A lot of the habits and values in this book are things that many of the self-reported non-millionaires in this thread claim they do.  Many of these habits are *not* expressed in large segments of the poor population for whatever reason.

 

 

 

Stefanie

 

 

[LucyStoner]

I don't think 4k a year (or considerably higher) for Christmas would be at all uncommon.

4 in 5 American families are grossing 80k a year or less. Half of families earn at or under $50k or so. That's commonly more than one job per family, be it two workers or one worker with more than one job. The vast majority of people do not have $4000 to spend on Christmas. The average is about $700, many spend less. It is not common for people to spend that much on Christmas. Average per family Christmas spending has never exceeded $900 or so adjusted for inflation.

 

I don't think it is wrong for people to spend their money at Christmas but let's not pretend that most people can even find that kind of money to spend on Christmas. Way more families are living off less than that in a month than are spending it on Christmas.

[NorthwestMom]

Seriously ?

 

You are telling me to do the math ?

 

How condescending is it possible for one poster to get ? Rhetorical question - I don't want to find out.

 

I don't give presents to my IL's. FYI even though MYOB.

 

I wouldn't spend anywhere near 4K on gifts. Not even a 1/10th of that.

 

I catch the bus or walk EVERWHERE I GO.

 

But really, persist in making assumptions.

 

((Sadie)) This thread seems to be hitting some sensitive areas for you. I'm sorry if I am forgetting financial troubles you have posted in the past.

 

I don't think anyone is trying to make superficial suggestions to you. Or judge you.

 

The Millionaire Next Door is not a simple list of suggestions to build wealth. It's based on scientific research the authors conducted regarding the habits of millionaires. I found it interesting, but it's not a money advice book. I am going to meekly suggest you stop being angry about it if you haven't read it. 

 

:grouphug:  :grouphug:  :grouphug:  :grouphug:

[JumpyTheFrog]

From what I remember, the book wasn't a "how-to" book. The author's thesis was that millionaires rarely look rich. They often look no wealthier than middle class. I just saw numbers today that said 88% of luxury cars are bought by non-wealthy people. In other words, people who "look rich" with the fancy houses, cars, and clothes are more likely to be highly in debt than actually wealthy. Many of them are just trying to fake keeping up with their neighbors, who are faking keeping up with them. As an outsider, it looks crazy.

 

My motto is more like "Loose lips sink ships." If we became millionaires, I wouldn't tell anyone but DH (I do the bookkeeping). I'm pretty frugal, though, and showing off isn't really my style.

[Catwoman]

4 in 5 American families are grossing 80k a year or less. Half of families earn at or under $50k or so. That's commonly more than one job per family, be it two workers or one worker with more than one job. The vast majority of people do not have $4000 to spend on Christmas. The average is about $700, many spend less. It is not common for people to spend that much on Christmas. Average per family Christmas spending has never exceeded $900 or so adjusted for inflation.

 

I don't think it is wrong for people to spend their money at Christmas but let's not pretend that most people can even find that kind of money to spend on Christmas. Way more families are living off less than that in a month than are spending it on Christmas.

Where I live, most of the middle class families we know are grossing far more than 80k per year, and they are definitely spending more than 4k per year on Christmas gifts.

 

Perhaps things differ elsewhere, but it doesn't negate the fact that plenty of families are spending far more than the "average" amount . I never suggested that "most" families were spending that much.

 

I don't know why people always get upset (and often quite defensive) when it comes to things like how much money other families are spending at Christmas.

[Laura Corin]

I don't think 4k a year (or considerably higher) for Christmas would be at all uncommon.

 

Wow!  Really?!  Okay.  I think of us as comfortable but there's no way that we (or those we know) would spend that much.  We spend closer to 1/5th of that.  I have no objection to people spending  4K, but I just haven't seen it.

[JumpyTheFrog]

I will say that financial illiteracy is very high in the US. It's something most people never learned and never think to pass on to their kids. Furthermore, too many people get their idea of what their house and car should look like from TV, which is constantly portraying people living in places about 3-5x more expensive than that character could afford in real life with the same job. So I think the upper middle class falls into a trap where they have good incomes but overspend so much that they end up living paycheck to paycheck. These are the kinds of people Mr. Money Mustache wants to smack upside the head because what excuse do they have (other than medical issues and such)?

[JumpyTheFrog]

Where I live, most of the middle class families we know are grossing far more than 80k per year, and they are definitely spending more than 4k per year on Christmas gifts.

 

That's crazy! What on earth are they buying? I could hope that most of that is spent on giving people money for their kids 529 plans, but somehow I doubt it.

[maize]

Where I live, most of the middle class families we know are grossing far more than 80k per year, and they are definitely spending more than 4k per year on Christmas gifts.

 

 

I think that where you live and the people you interact with are not representative of most of the country. Median family income around here is closer to the $50,000 range, and I don't know anyone personally that I would suspect of spending $4,000 on Christmas gifts.

 

I do know that cost of living (especially housing) can have a huge impact on lifestyle and how much income is required to live a decent middle class life, but have also seen that people's conception of what amounts to a middle class lifestyle differs vastly according to life experience and the social groups you run in.

[Ravin]

I am poor. Have been for a while now. Hopefully won't be by this time next year. I'll probably still be mostly broke, but if things go right I'll have a salary at a living wage. Yay me.

 

First things on my list for the family: A new car. Yes, new. I've never had a new car and by gum, I want one. Something that gets GOOD gas mileage and I don't have to worry about what's going to break next, and whether someone will lose a job before we can afford to fix it--like I've had to with the cars we've had for the last ten years for the most part. The next time I own a car with 100K+ miles on it, it'll be because I put them there myself.

 

Second thing: A better place to live. We will move into someplace a bit bigger and a lot nicer than this place, and probably not for much more $$ per month. But we haven't been able to afford to move despite facing the increased rent our landlord has foisted upon us each year, because we can't get the money together for moving costs.

 

Third thing: After years of having to give IOU's for things bought in January for Yule gifts (like this year, DD has a new bike coming her way, but can't buy it until spring financial aid. Why?? Car repairs!). I would rather buy one good quality thing than a dozen cheap things for my kids. But I'll probably do both next year and also get gifts for family members I haven't been able to give gifts in years because we couldn't afford it. Not to mention random boardies and angel trees and other pay-it-forward opportunities.

 

Finally, what is it with people and being judgmental of others? I keep hearing from Christians who could use a dose of their own holy book. 'Judge not, lest ye be judged' for example. Work toward positive change in the world and show compassion, instead of blaming every problem people have on their own choices--which, news flash, aren't based on the same array of options as yours. No matter whether you think you've BTDT or not.

[Ottakee]

 

Truth is - banks and other actual lenders will not give you a car loan for less than around 8k, and only for a newer car. Also, I get Medicaid and WIC for my kids, and one of the stipulations is that we're not allowed to have over 2k in liquid assets.

 

 

You might want to double check that.  That used to be the rules but I think with the new Obama care, they ONLY look at income, not assets.    I understand the reasoning behind the 2K limit but on the flip side, if you can't save over 2K then how can you afford to buy that good used car, fix the roof on the house, etc. without going into debt.

 

I have 2 kids on disability due to mental impairments.  They have the 2K rule for their benefits.  I had to laugh when one of the suggestions was to use that money to buy them a car or a power wheelchair............not sure who is writing that stuff done but $2000 isn't going to get them a good reliable car and isn't going to pay for a custom power wheelchair........or a down payment on a house which was another suggestion.

 

[justamouse]

We never buy used cars--even my Benz was bought used and for very cheap. We are frugal with food $, and we very rarely buy new clothes. We go to estate sales to buy furniture, crystal, china and stuff. We are upper middle class. Apart from our mortgage, we are debit free. 

I grew up around really old money (even though we were pretty much poor) and I learned a lot from them. They wore holy shoes, and clothes, had rusted cars, and spent their $ very differently than what I had assumed about them. Very Millionaire Next Door (excellent book btw). But they had second houses on Acadia, Maine. We used to joke that the more wealthy they were, the poorer they dressed. 

I do think that in poor areas, there is lack of access to second hand like that, the same way in many areas of concentrated poor there is not easy access to fresh veggies and healthy foods. 

[hornblower]

 

Perhaps things differ elsewhere, but it doesn't negate the fact that plenty of families are spending far more than the "average" amount . I never suggested that "most" families were spending that much.

 

 

plenty of families spend more & plenty of families spend less. Hence "average" :) 

 

It would be nice to know the median. It would also be nice to know it as % of income. As it is, we're all just speculating about whether people spend a lot or a little because this avg amt that pollsters come up with (which is per household & not per person) is not a terribly useful data point.

[LucyStoner]

Where I live, most of the middle class families we know are grossing far more than 80k per year, and they are definitely spending more than 4k per year on Christmas gifts.

 

Perhaps things differ elsewhere, but it doesn't negate the fact that plenty of families are spending far more than the "average" amount.

Not "perhaps". That is reality. Your town and your lifestyle is not typical. That is ok but don't generalize affluence to being the norm. It's not. Making it seem overly common is part of why we have a cultural value to spend beyond our means.

 

This isn't defensive. This is my values. Stating what I do is not attacking what others do. I simply *could not* spend $4000 on consumer goods for me and mine for giftmas unless we had some big needs I was redefining as Christmas, lol. I just couldn't do that. And I am in the position of having had that much to spend and in the not too distant future it will be back in that position. The families we have spent the most on in the past weren't ours- they were donations made to families in need. I've had years we spent what I consider too much on our kids I still couldn't get close to $500 for a single child. I do believe there is such a thing as conspicuous, over consumption. As I've said before no amount of charity compensates for or offsets over consumption in the face of truly desperate people.

[Catwoman]

plenty of families spend more & plenty of families spend less. Hence "average" :)

 

It would be nice to know the median. It would also be nice to know it as % of income. As it is, we're all just speculating about whether people spend a lot or a little because this avg amt that pollsters come up with (which is per household & not per person) is not a terribly useful data point.

That's an excellent point. A general "average" doesn't really tell us very much.