Authored by Kristin Tate, op-ed via TheHill.com,
How long could you sustain your household if you were to stop earning income?
If you are like most Americans, the answer is not for long.
Only 40 percent of Americans can afford an unexpected $1,000 expense with their savings. In fact, nearly 80 percent of workers are living paycheck to paycheck. It is no surprise that the probability of an economic recession brought on by the coronavirus pandemic caused many to worry.
In major cities such as Boston, New York, Los Angeles, and San Francisco, restaurants and businesses have been ordered to close. For many hourly workers, this means no paychecks in the coming weeks. Almost one in five Americans have already lost their jobs or have reduced hours. At the same time, salaried workers are concerned about job security, as mass layoffs at numerous companies loom.
While the situation is understandably stressful for every person affected, it serves as a sobering reminder that Americans must learn to live within their means and regularly save money.
The need for all Americans to be able to sustain themselves for at least a few months on savings is accentuated during a time of crisis. This means planning ahead when times are good. Financial planners suggest saving at least 20 percent of take home income, while spending at most 30 percent on discretionary items. Yet too many workers still fail to think twice about spending entire paychecks for things they want but do not need.
Recent decades have offered us relative luxury. More than 80 percent of Americans own smartphones. The same portion of households own one high definition flat screen television, while over half of households own more than one. Over 60 percent of Americans dine out at least once a week, while nearly 20 percent dine out three or more times a week.
The current panic is refocusing us on what is important. We now stockpile the things necessary for our health. Smartphones, fancy televisions, and restaurant meals are usually luxuries rather than necessities. Living within our means is not just rhetoric. It is a means of guarding ourselves during times like these. We have so much to learn from those who came before us. How many of our grandparents fared the austerity of the World Wars and the Great Depression, discovering to save, mend, and repair?
The availability of credit gave us an opportunity with a great hangover. It made nice homes, flashy cars, and expensive consumer products within reach for earners across income levels. But purchasing on installment is often a trap and a major contributor to our $14 trillion in consumer debt. Financing items as diverse as furniture, laptops, clothing, and more with easily obtained credit opened the door to fiscal recklessness. Consider that average Americans spend $800 monthly on car payments.
It is not only low income and middle income earners who blow through their paychecks every month. Many high income earners also live above their means. Indeed, at least a quarter of households making $150,000 and above live paycheck to paycheck. Our fiscal irresponsibility means that when an unexpected crisis like the one today hits, Americans are unable to sustain their own families, even for a short time period.
So politicians from both parties urge the federal government to step in and dole out checks to everyone across the country. Treasury Secretary Steven Mnuchin has announced that the administration wants to send checks to citizens totaling $1,200 per adult and $500 per child, with another round of assistance to follow if the pandemic continues.
While our leaders must act decisively in times of disaster, our own errors have made this situation untenable over the long run. On top of consumer debt, our government holds $23 trillion in national debt. A combination of stimulus checks, a potential recession, and new bureaucracies to oversee a recovery will further accelerate our rendezvous with financial default in the next generation. The money will eventually come due in the form of taxes, deferred payments for benefit programs, or outright inflation.
We each have a civic responsibility to our families and to our country. The more fiscal control we show at the kitchen table, the better our ability to handle the next crisis. A solid balance of fiscal government and personal finance courses at the high school level is a start. For most young people, however, true financial literacy is taught at home. We have a chance to show the next generation that saving is earning by another means.
I have hope during this crisis. It is a reminder, much like other traumatic events in history, of what is truly important. The survival and prosperity of our families is the key to our success. As the pandemic unfolds, the ability to budget, prioritize, and teach is our chance to make things better. Our grandparents suffered tremendously during the Great Depression. With the right attitude, we can teach our children how to prevent one.
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Sorry i have a 800lb gorilla on my back beating my “savings” out of me, they call them governments, and i don’t wish to feed a 800lb gorilla beating my savings out of me…. nice try to deflect the blame to the victims of the 800lb gorilla tho.
Live within your means and stop making excuses for acting like an adult child.
I do and i will, i am a white man and no one is coming to save me. 14k last year, i fed, clothed, had a roof and vehicle. anything else would of went to feed the 800lb gorilla. Why create more wealth to have it taken by a force that no longer serves me ? I’ve seen and experienced it first hand my whole life, But you are free to feed the gorilla yourself. The last year i bothered to try to prosper, i made 30k,”yeah they almost had me convinced there was something to hard work and bettering my finances” Saved 6k, my taxes were all i saved 6k… then they voted in Obama, gee wonder if my taxes were going up or down after that ?
Work your ass off , save 20%, have it confiscated to spread democracy around the world and have the traitor president say “you didn’t build that”
better the 800lb gorilla dies hungry, best part is i don’t need to do a thing besides survive, the gorilla is killing itself.
I would love to go out and apply my self to building wealth, maybe we could have a system of government and taxation that reflects that ? how about any income under 100k a year there is no tax due ? think of how prosperous we could become as a people ? Or hell a million ? only thing holding the people back are the controls in place.
Many years ago I had a partner that used to say that the best way to help the poor was to not be one of them.
I get what you are saying but you need to stop seeing yourself as a victim and be your own person. The system is what it is, has always been and will always be.
Enjoy your life, it’s the only one you get!
The stupid, it burns like Icy Hot on my sac.
“Back in the Mesozoic Era, President Unga Bunga of the United States Clan…”
Westerners are so ignorant with respect to cycles.
I suspect impermanence is gay.
Also, AOC, you should stop putting Icy Hot on your sac.
I did it once. I had a nasty groin pull after too many leg presses. Either that or my hammy, can’t remember because it was 15 years ago.
What I DO remember is this: Wife stopped at CVS and I started lathering it on before she even got back in the car to drive away. I was crawling up the seat it burned so bad. And having to deal with her crying from laughter and telling everyone was worse.
Yeah, my sac was fucking red. Never again will I trust Shaq.
I do apologize. But I just laughed really hard at your expense. so thank you.
Beat me to something like it; grotesque, ignorant article
starve that monkey
Doesn’t even factor in the pharma mafia sickcare or student loan swindling, or the close to 100 million working-age Americans out of the workforce (imagine believing the “official” unemployment stats). Truly astonishing:
Where is the mother’s husband/child’s father?
Whose problem is this?
Good question, but the situation is similarly atrocious for so many childless singles as well. I knew someone would come back with this.
It don’t mean shit. If I control which way the state guns point, I care not what bitches say.
The author needs to understand that most of the men and women that read TBP have lived within their means. Crisis points such as a cancer event are faced to the best of their ability and how the family can deal with it. The real problem are the 535 classless clowns in the national capitol region who are thinking of themselves and their future employment as a representative or senator as the case may be.
Right now they are horse trading on how best to “pork barrel” spend a reported $2.5 TRILLION dollars that according to reports address everything but COVAD19 requirements. I cannot conceive of the obligation and spending of that kind of money short of a major hog call that every political special interest starts lining up in the vicinity of Dulles airport trying to get their fat asses over the 14th street bridge and rope in as much cash as they can.
COVAD19 some say is the cover operation for the financial failure that we are undergoing…….not sure but according to Washington DC standards it ranks right up there. If they pass all the b/s as it is being reported then you better have gold in you portfolio because this episode is going to get a lot worse when the portfolio of derivatives hits the fan.
So nothing is due to the FED’s gross centralized planning? Nothing is due to the govt.’s teardown of the family unit? No mention of the cost of all of the guns and butter? No word on the lack of law enforcement in the healthcare industry (15 USC Chapter 1)?
Nice spin. May have worked in 2008 but not now. Hopefully all of the author’s savings is digital and/or in the markets. After all, that would save everyone in retirement!
In a word: Propaganda.
i refused to read it elsewhere, and I refuse to read it here. There is nothing to negotiate. I am well-aware of the sound of my enemy’s voice. Unlike a cuck, I would do the opposite of defending the right of my enemy to speak war in my homeland.
“Onward Christian soldiers__ Marching as to war___” Buck the cuck.
True Christianity – of which there is a dearth in the West – solves this problem succinctly. The first shall be last, and the last shall be first. Otherwise known as frog marching dipshit journalists and their co-conspirators until they’re exhausted enough to submit to the back of the soup line. Hut hut!
Justice and mercy. All justice and no mercy equals King George III. All mercy and no justice equals Jimmy Carter. Gotta strike a balance and you’re right about one thing: There are a LOT of cucks in America.
I don’t remember much of what I learned in high school,but there is one class. The class was called business math. It was teaching the business of running ones life.How to do your taxes,how to use a check book, how to save and budget. There was much more,but I think you see the point. That stuff is no longer taught.It has been replaced with social Marxist BS. And parents no longer even use those things.So that is pretty much some of what has got folks in this boat.
Even better, this shit should be taught in the home by way of behavior and teaching your kids that nothing is free and should be earned.
Not being self-congratulatory … but when one of my kids was on the Santa-believing age border … he stood steadfast in the face of the non-believers and said to his friends, “There has to be a Santa because there is NO WAY my Dad would buy me all those gifts for Christmas.”
That’s a cute story, but I opted NOT to lie to my kids in the first place; the first time Santa came up – as the result of private “skool”, I nixed the lie and explained to them that: 1) xmas is a pagan human-sacrifice ritual (saved the “orgy’ truth until they were older) and 2) Santa is a fiction AND added that anybody who attempts to enter our house via the chimney will be shot.
To this day, they can say that I never lied to them. Part of the reason I chose this route is that “santa” is the reason I stopped trusting MY parents when I was a child, and when you can’t trust your own parents, this world will chew you to pieces.
READ THE BOOK: ALL judgments from God are due to two things: Outright disobedience (See King David and the census in Judah) and IDOLATRY. Xmas = IDOLATRY. The greatest lie perpetrated in Christianity is that the “Hebrew” scriptures (“old testament”) no longer apply or have relevance. Read the prophets and YOU WILL SEE the truth that idolatry invites JUDGMENT.
“purchasing on installment is often a trap”. Correction: it is alwaysa trap. Government makes sure that the mortgage trap catches nearly everyone by regulating what sort of “homes” are permissible to build.
“For most young people, however, true financial literacy is taught at home.”. True financial literacy?! “True” financial literacy is taught in specialized institutions outside of academics. Once upon a time, these institutions were not open to the general public and unless one was sponsored by a NYSE member firm, you might learn how to manage a budget at the kitchen table, but you wouldn’t be admitted to learn the money magic that keeps whole societies in thrall.
Remember “mortgage interest tax deduction”?
It’s real name is “bank subsidy.”
How much is a tattoo? How much is a smart phone? How much are booze and cigarettes or dope? How much to eat out and order Starbucks overpriced burnt grounds liquid? How much for piercings? Hair weaves? Fake nails? Video games? Cable or pay per view or any of a host of time wasting ‘entertainments”?
Nice to state the oblivious to people who never listen. Kind of like flushing the toilet that is too full and stopped up. Never say you were not warned. YOU WAS many times!!
Kristan, don’t forget about us Singles, we count too!!!!!!
What it comes down to is what people want more than anything, “something for nothing,”and there are hucksters EVERYWHERE pitching this fantasy.
This is just the 21st century version of the same tired old story.
I suggest you contemplate your moniker.
Kinda of reminds me of how the 2008 crisis was blamed solely on people who had mortgages they couldn’t afford. There was more going on then that. Securitizing the mortgages is what caused the biggest problem, but the fucks who did that got bailed out and no one went to jail.
right, this time they are blaming it on a virus, and pointing fingers at “who released it”
It’s all a crock, this virus has probably been around for a while, and has mutated to become more deadlier than the usual flu, other than that, it is now being used as an event for the power hungry maniacs to show their fangs.
The Coastal liberal elite are shutting down the economy to ensure Trump has no platform for his next campaign.
They are not trying to save people.
They are trying to create a new version of control, the war on terror ended under Trump, the new war on BioTerror will replace it.
It is really that simple.
We have assumed control, we have assumed control….
Like the RUSH reference.
My niece, a good kid, lost her job. I told my sister that the upside is that she is young, has a lot of time to recover, and is learning one of the most important life lessons: why we save money for unexpected downturns. Lecturing children on the need to save money is worthless; everyone learns the hard way, and it is a lesson best learned early. Apparently, some of my fellow Boomers never learned this lesson, which is why a lot of them can never quit their jobs.
A less painful way of learning is to observe and learn from the mistakes that OTHER people make as they wander through life. That should be obvious, but apparently isn’t.
That being said, many circumstances in life are beyond one’s control. However, the smart monkey tries to prepare for these times….
I see the moocher poor doing better than the working poor. Prepare for hard times? How about avoid them by not working as a de facto slave to pompous inferiors? How about not working for a wage less than the cost of transportation and caloric expenditure and future health care costs? Bad feet from 20 years? Oh, well. There are things worse than lack of preparedness for the future. The deepening deepens.
COVID-19 exposes just how screwed up our system is where we have extreme welfare for the corporate looter class and the lower moocher class, all while the struggling, politically disconnected middle class for some dumb fucking reason keeps putting on their boots and carrying the burden while surviving on crumbs. Every 10 years or so you get to see the glistening dick they’ve been screwing you with. “Here it is, suckers.”
Exposes? Exposes? Since Tammany Hall? Since the War Between the States and the Carnival of Fraud? Since the Haymarket Affair? Since the Credit-Moblier scandal? Since the Vietnam War? Since shitworld immigration begun the 1960s? Since the Pentagon Papers? Since H1B visa and dot-com bust? Since 9/11 and Dept. of Homeland looking for Ron Paul bumper stickers? Since the subprime bubble and too-big-to-fail bailouts? Since Edward Snowden was called a traitor by most who noticed? Since killing Julian Assange all legal like? Oh, yes. This COVID-19 really exposes the Establishment for the crooks that they are. News at 11. Sleep. Wake up. News at 11. Sleep. Wake up. News at 11. Sleep. Wake up. News at 11.
You have hospitals begging for PPE and equipment, Why? Then you have the democrats/liberal/leftists all focused on entitlements, free shit, affirmative action and homosexual nonsense. Then you have all kinds of money for wars, illegals, SJW nonsense, sex change operations and whatever corporate pork needs greasing, too big to fail and privatized profits vs. socialized losses.
Instead of inching towards becoming like Venezuela we are on the down slope and becoming an avalanche. Good times await.
What a crock of shit. The entire gd article, but THIS takes the cake. IT is going to take a lot more than “attitude” to prevent another engineered – fuck you and yours “we” are taking it – financial crisis.
A decent car nowadays cost what a house did in 1970. A house costs as much as a private airplane did in 1970. The cost of gasoline? The cost of medical insurance? The electric bill? The water bill? EVERYTHING IN THIS GD WORLD HAS INCREASED IN PRICE WHILE THE VALUE OF THE DOLLAR HAS DECREASED every GD year since 1913. Fuck the Federal Reserve. Fuck Congress. Fuck the Senate. Fuck the office of President. And FUCK YOU. Not a GODDAMN ONE OF YOU HAS HELPED ANYTHING or ANYBODY. FUCK YOU.
Probably could support my family for about 3 years. I put most of my savings into silver and gold. I also buy cashflowing RE for the tax benefits and, well, the cash. If you’re paying significant amounts of income tax, you’re doing it wrong as there’s MANY legal ways to reduce your tax liability. Books on how to do so are free at the library.
How’s that cashflowing RE going to work when your tenants can’t/won’t pay rent?
I did the “last feed store run outta Vietnam” and had to buy goat feed because there is no rabbit feed in two counties.
Do you know the ancient armies carried rabbits in cages with them to war. They liked playing with bunnies too.
Bunnies bring the new life in little colored eggs and then, they deliver huge litters of kits which are edible in 3 months. Sustaining life is part of the Easter miracle, so perhaps the rabbits are symbolic.
Perhaps.
Anyway, I walked into Amish country and bartered a breeding pair (doe is pregnant) of rabbits for maple syrup. No financial irresponsibility at all here.
Am a big fan of the book of Daniel. A bigger fan of Veggie Tales.
EC is the road guard as the slavedriver at the bunny factory in Veggie Tale Babylon. It’s a wonderful little story for kids bored at home with their families.