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Old 06-13-2012, 01:13 PM   #1
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Financial Illiteracy

You have to love the boo hoo story:
http://finance.yahoo.com/news/living...094900498.html

a) I wasn't aware that making 100k+ for 20 straight years was considered middle class?

b) How does someone that was making 130k have so little equity in their house?

c) I have a hard time feeling sorry for people that were buying new cars every five years and taking a lot of vacations at the expense of paying off their debt and having any savings beyond a 401k
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Old 06-13-2012, 01:26 PM   #2
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I am not going to laugh too hard. IMO it could happen to a lot of people and we are the ones paying for it. There are a number of factors that contribute to the problem, and I agree that financial illiteracy is one of them.

When a lot of people go looking shopping for bigger expense items, they let others tell them what they can afford rather than figuring out what they will be comfortable paying for. Personally, when I go shopping and need to finance something (like a house) I do not want to know what someone else tells me I can afford - that leads to trouble when you get emotional about something expensive. I figure what I want to spend and then shop around that. That being said, everyone can go broke if the circumstances ever get bad enough.
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Old 06-13-2012, 01:40 PM   #3
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But I will agree that everyone should have a plan if your personal financial life goes to .
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Old 06-13-2012, 01:59 PM   #4
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That makes me feel like a financial genius.
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Old 06-26-2012, 08:07 AM   #5
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Today's amusing story:
http://finance.yahoo.com/news/inflat...070038493.html

"Not only has standard inflation steadily eroded the real value of a $100,000 income, but the cost, of housing, health insurance and college tuition have risen dramatically in recent years."

"According to Labor Department statistics, the average inflation rate for 2011 was the worst since 2008, with consumer prices rising 3.1 percent, compared to an average of 1.6 percent in 2010."

Interesting, when you strip out increases in the housing, medical, and education costs, then you find the government's inflation....

"Many now consider $250,000 the new $100,000 income. Adam says that level of income is typically required to provide what many have before expected of a six-figure salary. Adam also points to other expenses that are not necessities but are considered part of a middle class lifestyle -- things like cellphones, high-speed internet access, vacations, karate lessons, iPods, laptops and digital cameras."

So, those that make six figure income are not wealthy enough because they blow to much money on random junk.....

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Old 06-26-2012, 11:05 AM   #6
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I will just say take any salary number with a grain of salt. I know many people that come out of school (ages 25-30) making $100k+ per year on paper, but the true salary is a lot closer to $50k-$60k/yr by the time you factor in what is necessary to get and sustain that type of salary. It is still comfortable, but the $100k that is seen on paper is not what they have to use. It is all about living within your means, which some are better at than others, but a single number on paper tells very little.
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