How many admit living paycheck to pay check?
 

I heard the percentage is like 70 percent of americans live paycheck to paycheck. Can you believe it it this high? Are people more concerned with keeping up with the jones's than saving for retirement? This might be a personal question but it's just a poll .

We did for a long time, for the first 30 years of my life and especially in college. At our current spending level, we could probably get by for about six months before I'd have to sell my stereo! :D

Kuan

The adult literacy rate inside the city limits of Washington DC is 37%, measured at the third-grade reading level of competency.

Match these statistics up....

:)

Ken300D

It's a statistical fact that American households save far less than households in other countries.

It's the culture...we are pounded daily by the media on the need (and desire) to spend and live for today.

Americans also maintain a much higher debt load than those in other countries.

That trickles down to high rates of write-offs by banks and creditors due to loan defaults and bankruptcies that inevitably result.

So with things as they are today, Americans don't have the nest egg to fall back on, which translates into a torturously slow economic recovery.

The dissolution of lucrative IS contracts caught me off guard, and my income is about half of what I made during the "boom" years. But I still carry the mortgage and debts of those days, which forces me to maintain a "shoestring" budget. :(

What nest egg we did have got murdered when tech stocks plummeted in value, and is worth far less than it used to be. But at least we didn't have Enron, Kmart or Worldcom in our portfolio...;)

Re: How many admit living paycheck to pay check?
 

and the remaining 30% live beyond their means :rolleyes: . how many people do you know that live with maxed out credit cards all year...

Just saw Bowling for Colombine at the local theater. Michael Moore has an interesting theory that our political and industrial leaders want to keep us in fear (of crime, of other races, other religions, etc.) because it makes us isolated, self-absorbed AND better consumers....

So, if most people are really living paycheck to paycheck - they've done a good job! :eek:

I am a financial planner and paycheque to paycheque would be an improvement for some of the people I have seen. That's why you see all of those places willing to cash you next cheque a week in advance for a modest 20% fee. My wife usually runs out of money a few days before her next pay, but that is because I make her transfer half her pay to a savings account each payday. Paying yourself first really does work. Last year we saved/invested 35% of our gross income (even after paying for the 420 .:D )

What's wrong with the US
 

It seems to me that the classic American ideal of spending money one has not yet earned to buy things one does not need to impress people one does not know is caused by the constant presence of advertising, advertising and yet more advertising.

It is also probably true that what Michael Moore says is partially true: after WWII we had the Cold War to make us feel afraid and insecure, and we are susceptible to advertising more because buying stuff makes us feel more secure. The purpose of Muzak in department stores is intended to make us feel more infantile and insecure: they play sons from when the target market (18-34) was much younger.

It is also related to why we tend to buy more guns and shoot one another many times more than Europeans and Canadians.

Europeans and Japanese have a more homogeneous culture and the future is therefore less uncertain for them.
It is also ture that the number of ads Americans see is much greater (because ever since Reagan, the TV channels can show as many ads per hour as they wish).

Of course,neither of the big political parties ever comes close to recognizing this issue.

Work hard every day for the rest of your life. Spend less than you earn, pay yourself first. Healthcare, disability, and life insurance. Max your 401k and IRA opportunity. Set and stick to a monthly budget. No debt.

We save a little each month, but not lots now that we're single income. Now, I was fortunate that I had quite a substantial income for some time, and we have no debt other than a small mortgage.

If the worst happened, we could make about eight months before sweating profusely. Now, this wasn't true for many many many many years.

When Helen was in school, I had all sorts of low paying jobs, and with tuition bills, we had more than a few months of juggling bills and eating KD more than a few time.

When she started teaching, she barely made more than I had been, and I was racking up tuition bills. It seemed like it would never end.

When our income went up, the money went out faster than it came in. We were just so amazed to actually be able to buy things. New car? Yup! Clothes, trips, the works. Well, it didn't take long, but we figured out this was the road to ruin. I understand how most folks would be behind the 8-ball. We were, and it took a real effort to get out.

Getting credit can be one of the best/worst things that can happen to a young person or couple (as my wife and I found out). Seemed like we were working to pay off interest for years. Took many years to work out of it (the IT boom was a big contributor there - though not any more!).

We're probably a few months out right now since the Mrs. had to take a 40% pay-cut to keep her great job (that cuts out any retirement contributions though), but I know the feeling of the paycheck-to-paycheck thing.

The insecurity of the Tech-sector is not encouraging either (me being a techie layed-off twice in two years). We've turn our household in a pretty tight ship out of neccessity, and will probably do so for quite awhile. THe mortgage will get paid, the cars will get thier oil changed, and we might squeeze in a vacation since fares are so competetive, but Christmas gifts are about the only luxuries we'll be indulging in for awhile.

The influence of the marketing machine in this country is truly amazing, but not something that really hits until you are an adult and are forced to fight it - after it's got its slimy hands around your neck.

Regards,
- Ryan

Don't ask me what percentage of my retirment savings have dissolved in the past two years.:( But retirement is a long way off and if the stock market ever gets back on track, "dollar cost averaging" will pay off for me in the long run.

Does anyone know the date during the year at which you stop paying the government and begin working for yourself ?? It's somewhere near JUNE, if I remember correctly.

Maybe if we got rid of a few useless programs and stopped paying for foreingers to live here with more benifits than our own citizens, we'll be able to stop giving so much of our OWN money to the government and not have to live paychek to paycheck. I know that statement will open a can of worms. I'm a first generation Italian. I just hate seeing things like people crossing the boarder and having children, for example, at our expense while our own tax paying citizens can't enjoy at least similar benefits. (Many more/other issues at play here...)

I paid off all my credit cards a little over a year ago. Except for my car I'm almost completely debt free. Nice place to be. Hopefully I'll be buying a condo or something within a year. (Of course, living in the DC area, it'll be a small condo!)

taxes
 

This kind of relates. I came across this a few days ago. I hope the economy turns around by the time I get out of college, I would like to have a really nice job.
I think this relates to the new tax cut bush is proposing, so if you read on you will find that you have to do a really big cut to get the money down to the most people.

I kind of find it funny that people that advocate various programs on ballets that are funding with raising taxes are the ones that cant afford the tax increase
Austin

How Taxes Work....
This is a VERY simple way to understand the tax laws. Read on -- it does make you think!!

Let's put tax cuts in terms everyone can understand. Suppose that every day, ten men go out for dinner. The bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this.

The first four men -- the poorest -- would pay nothing; the fifth would pay $1, the sixth would pay $3, the seventh $7, the eighth $12, the ninth $18, and the tenth man -- the richest -- would pay $59. That's what they decided to do. The ten men ate dinner in the restaurant every day and seemed quite happy with the arrangement -- until one day, the owner threw them a curve (in tax language a tax cut). "Since you are all such good customers," he said, "I'm going to reduce the cost of your daily meal by $20." So now dinner for the ten only cost $80.00.

The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still eat for free. But what about the other six -- the paying customers? How could they divvy up the $20 windfall so that everyone would get his "fair share?" The six men realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, Then the fifth man and The sixth man would end up being PAID to eat their meal. So the restaurant owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay. And so the fifth man now paid nothing, the sixth pitched in $2, the seventh paid $5, the eighth paid $9, the ninth paid $12, leaving the tenth man with a bill of $52 instead of his earlier $59. Each of the six was better off than before. And the first four continued to eat for free.

But once outside the restaurant, the men began to compare their savings. "I only got a dollar out of the $20," declared the sixth man, pointing to the tenth. "But he got $7!". "Yeah, that's right," exclaimed the fifth man, "I only saved a dollar, too, ........It's unfair that he got seven times more than me!". "That's true!" shouted the seventh man," why should he get $7 back when I got only $2? The wealthy get all the breaks!". Wait a minute," yelled the first four men in unison, "We didn't get anything at all. The system exploits the poor!" The nine men surrounded the tenth and beat him up. The next night he didn't show up for dinner (or, in the real world, he took his business out of the country), so the nine sat down and ate without him. But when it came time to pay the bill, they discovered, a little late what was very important. They were FIFTY-TWO DOLLARS short of paying the bill! Imagine that!

And that, boys and girls, journalists and college instructors, is how the tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up at the table anymore. Where would that leave the rest? Unfortunately, most taxing authorities anywhere cannot seem to grasp this rather straightforward logic!

T. Davies Professor of Accounting &Chair, Division of Accounting and Business Law The University of South Dakota School of Business

And Mikemover says that there are no neo-liberal academics! Yikes! I know libertarians that find the idea of equal taxation pretty radical.

True, there is strong evidence to show that tax rates over 50% are a dissincentive and can reduce tax revenue from the highest tax brackets.

The idea of simply adding up the cost of doing business as a society and dividing it equally among each member of the population might sound neat on paper, but do you have any idea of how to make someone that works at Wal-Mart for $4.00 an hour pay it?

Do you really think this equal taxation policy could ever work without slashing government programs to barely existant?

Also, your example is much too simplistic. There is no multiplier effect from having the money circulating in the economy. Your example does not consider the cost benefit analysis of the "public good" of providing certain services, and how much impact these services have on different income groups.

Perhaps in a world where gov't spending was a "one good" and marginal utility was equal for the "one good" for all "consumers" this model would make perfect sense. Otherwise, it does not.

I've always wondered why Bill Gates didn't move the heck out of the country, and take Microsoft with him. No antitrust BS to deal with, and perhaps nothing to speak of in the way of taxes.

:)

Ken300D