Sep222015
Training the next generation of foolish Ponzi borrowers
In its simplest form, a personal Ponzi scheme is borrowing money to pay debt service: acquiring new debt to pay old debt. It’s a path to disaster.
Carpe diem — “Seize the Day” — The first Ponzi
Have you ever wondered why people make foolishly irresponsible financial decisions? Sometimes the mistakes are made in ignorance as people learn from their own mistakes, but sometimes this ignorance is willful and people don’t want to learn a truth that might adversely impact their pursuit of short-term gratification.
People make bad financial decisions because they want to pursue their short-term (and short lived) pleasures at the expense of long-term goals and wants. People want instant gratification, and lenders learned to use this instinct to enslave people from a young age. Not long after people discover debt, they also discover the “sophisticated” financial management technique known as Ponzi borrowing.
Personal Ponzi Schemes
What does it mean to run a personal Ponzi scheme? Aren’t Ponzi schemes the advanced financial management crime of sophisticated money managers like Bernie Madoff? Not really.
A Ponzi Scheme is any investment where the returns come not from the investment but from the capital contributions of new investors. If you change the terms slightly, a Ponzi Scheme is also any debt where the payment of debt comes from borrowed money rather than current wages. In that respect, personal Ponzi schemes are easy to begin and grow. Anyone can borrow money to pay debt, right?
The first step toward going Ponzi is to embrace a lifestyle choice of instant gratification. Some Millennials already learned to be completely self indulgent, and the “experts” are teaching others how to do the same.
If You Have Savings In Your 20s, You’re Doing Something Wrong
Lauren Martin, Sep 16, 2015
Lauren Martin is a Senior Lifestyle Writer at Elite Daily. After graduating from PSU, she moved to NYC to write fart jokes at Smosh Magazine. Making her way to ED, she now writes riveting commentary on nude pics, condoms and first dates.
I don’t have any savings, but I also don’t have any wants.
I don’t know about you, but I like to enjoy my life. I like to go out to eat, buy clothes I don’t “need” and spend money with friends on memorable nights out.
This goes back to a piece of advice a very successful friend gave me: “Don’t save money. Make more money,” he nonchalantly stated, pushing me into a taxi.
Nobody in the history of the world has ever increased their income faster than their ability to spend it. The world is full of pro athletes and lottery winners who end up broke and bankrupt shortly after wasting their windfalls.
Unlike most things people tell me, this advice did not go in one ear and out the other; it stayed with me and changed the way I look at everything from my career to my savings.
Before this piece of advice, I was frantic. I was always doubting and always feeling guilty. I lived in the most exciting city in the world (also the most expensive) and had yet to experience it.
I was trying to save, which meant trying not to eat. I wasn’t going out with friends, had yet to go to a club and had never seen the inside of a taxi.
I couldn’t enjoy my life because I was too busy worrying about my bank statement. I was too busy watching my savings instead of savoring my youth.
Neither extreme is good. As both Aristotle and the Buddha pointed out, a happy life is lived at the middle ground between the extremes.
Why did I feel so guilty about spending money on myself and my life?
When did our 20s start to feel like our 40s? When did we get weighed down with the same pressure and stresses as a woman with four kids and a second mortgage?
We don’t have kids. We’ll be renting for the foreseeable future, and we have no problem eating McDonald’s when we’re skint.
She will certainly be renting if she isn’t saving.
I’ve recently figured it out: This pressure, this third-party stress, is ingrained within us. It’s this looming doom our parents carved into our unconscious, only to come out anytime we make an impulse purchase or have to spend the night without Netflix.
In other words, she was raised with good morals and a proper understanding of what it takes to succeed in life.
But like most things our parents have ingrained in us, we must consciously work to push it out. Because while they may have the best intentions, they don’t always have the best insight.
Wow! Just, wow.
They want us to save because it provides us with a safety net, but that’s exactly why we shouldn’t. Their need for us to have a safety net is just a giant metaphor for the difference between our parent’s generation and ours.
Her sense of entitlement is shocking.
They were getting married at 20 while we’re just getting our first apartments. They were saving for kids while we still want to be kids. We’re on different schedules, different paths and totally different savings plans.
We’re taking our time growing up, refusing to be shackled by mortgages and diapers. We’re not trying to live with safety nets; we’re trying to live on the edge. …
But she fully expects that safety net to be there when she fails.
When you’re too worried about your bank statement, you’re not making your own
When you live your life around your retirement fund, you may as well retire now. You can’t make a mark on the world if you’re too cheap to live in it.
Refusing to give yourself the luxury of enjoying your money negates the whole point of making it.
If this were a parody, it would be genius, among the best I’ve ever read; however, she is serious in her advice.
When you’re saving for yourself, you’re refusing to bet on yourself
People who are saving in their 20s are people who don’t set their sights high. They’ve already dropped out of the game and settled for the minor leagues.
WTF? People who are saving in their 20s are the only ones with any chance of reaching the major leagues. People who don’t save will never create the opportunities to swing for the fences.
Your 20s are not the time to save; they’re the time to gamble. $200 a month isn’t going to make the dent that a $60,000 pay raise will after spending all those nights out networking.
LOL! Networking? ROFLMAO!!!
When you have something to bank on, you have nothing to reach for
When you have nothing to lose, you have everything to gain.
You’d be surprised at how cautious people get with just a few thousand in the bank. This isn’t the time to safeguard — it’s the time to bet all your chips and hope to make it big.
When you live your life by numbers, you strip yourself of poetry
What memorable experience does money in the bank give you?
If you save enough, money can buy you experiences not available to those living paycheck-to-paycheck.
How well-rounded can people become sitting at home, watching their limited funds gain interest?
Life is to be lived, not watched from the inside of your rent-controlled apartment.
When you die, you can’t take your money with you.
When you’re acutely aware of your mortality, it makes spending money that much easier. Those who don’t plan for the future aren’t planning for their death.
I hope they are planning on a life of work or poverty in their senior years because that’s what awaits them.
When you deprive yourself, you don’t learn how to TREAT YO SELF
It’s good to be cautious and plan for unexpected events. It’s also good, however, to learn how to release and destress. Everything works out, and if you’re smart, able and had a job once, you’ll have one again.
Don’t waste your youth worrying about expenses when you should be worrying about experiences.
When you care about your 401k, your life is just “k”
When you’re 40, you’re not going to look back on your 20s and be grateful for the few thousand you saved. You’re going to be full of regret.
You’ll regret the experiences you didn’t take, the people you didn’t meet and the fun you didn’t have because you were too worried about a future that came and went.
Since Ms. Martin has so eloquently prepped her audience on how to think and behave irresponsibly, allow me to complete their training, and their journey to the dark side will be complete.
Going Ponzi
The Ponzi lifestyle is a slow seducer offering tempting pleasures. Most people take cautious steps toward the Ponzi lifestyle, but once people with the mindset exemplified by Ms. Martin discover Ponzi borrowing, they often embrace it as a sophisticated financial management technique.
Introduction to Ponzi
Ponzi borrowing is the practice of borrowing money to make debt-service payments. For example, credit card companies accept cash-advance checks from other credit cards as payment. By borrowing from one credit card to pay another, no wage income is required to pay the bills; thus it’s free money.
A Taste of Ponzi
Everyone should try paying credit card bills one month with borrowed money. Once people discover how painless the process is, they often eagerly embrace it, particularly if the debt is held against a personal residence that goes up in value, providing more free money.
The Comfort of Ponzi
Once people discover Ponzi borrowing, their stress levels often go down because they never have to worry about having enough money to pay the bills. It’s far easier to simply borrow more money than working hard and trying to earn more money.
The Sophistication of Ponzi
The best part of going Ponzi is the smug sophistication Ponzi borrowers feel. Ponzis watch others work hard and sacrifice, yet Ponzis don’t believe they have to. Ponzis believe their sophisticated financial management techniques make them intellectually superior to the fools who work to save money rather than spend it. Plus, Ponzis get to live better on less income, so they are smarter, more financially sophisticated, and they live a better life.
What’s not to like?
Ignore the weight of Ponzi
At some point, the growing pile of debt starts to cause worry, but this shouldn’t be a big concern. Ponzis have faith that some lender somewhere will extend them the credit they need when they need it. Faith is a powerful antidote to foolish concerns about hitting a credit limit.
Outspend the Joneses
Truly successful and abundant people are concerned with impressing the neighbors or keeping-up-with-the-Joneses. Spiritually evolved people elevate themselves above others and seek to elicit jealousy. The jealous procure an enduring power; through consumerism and comparison, they revel in the emotional payoffs when other people want what they have.
What kind of life do you want?
I had fun in my 20s. Not as much as many others around me, but I never felt my life was particularly out of balance. I emerged from my 20s with an advanced degree, a decent job, and by today’s standards a small amount of student loan debt.
About a third of the population lives like Ms. Martin suggests, spending every penny as it comes in. This group will spend their senior years working and complaining about how little Social Security provides them. The group that learned different lessons and made different choices will enjoy a stress-free retirement with a much higher standard of living.
How much are you willing to sacrifice today in order to enjoy a better tomorrow?
[hat tip to Ben Lane and Hamilton Nolan]
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This author is the anti-Dave Ramsey. They’re both extremists. I actually heard him advise an eighteen year old to delay entering his first semester at ASU because he couldn’t pay cash for the ~$3K tuition, solely because debt is Ramsey’s Devil. That is how extreme he is, and how dumb his advice can be. At least he acknowledged that this advice scared him, because he knows the stats on kids who delay or take semesters off. They don’t return to school.
In general, he gives pretty good advice about not going into debt to fund education, but the problem is this is a nuanced topic and you can’t give one-size-fits-all answers. I used to listen to him regularly about 4-5 years ago, but once you’ve listened to his show for a few months, you pretty much know his position on every topic and there’s no longer a need to listen.
Still, he’s essentially helping people that are debt-addicted to see the havoc that it’s wreaking on their lives, and giving them steps to quit. Just like a recovering alcoholic can’t touch alcohol after they have quit, the same thing applies with Ramsey’s audience. These people have a toxic relationship with debt and they need to avoid it at all costs. There is no compromising when you are an addict.
Yes, I always liked that part of Ramsey’s message. I share his disdain for consumer debt, and for most people it isn’t something they manage very well. Plus, it isn’t necessary if you manage savings.
Most people are like the author of this article. They will spend every penny of savings, so when an unexpected expense comes along, they end up in debt. Then, rather than managing savings and earning interest, they end up managing debt and paying interest.
While I think Ramsey does go too far at times, it’s better to error on the side of caution when it comes to debt.
BTW, I discovered last night that Verizon changed the way they report the contract for phone service. Now they explicitly tell you how much you are paying for your phone each month. It made me furious when I saw that I was paying them to finance my phone. When the truth of that was hidden from me before, I didn’t have a problem with it, but now that I know I am paying for my phone over time, I will probably write them a check to pay them off just because the idea of consumer debt annoys me that much.
I was at a T-Mobile store recently dealing with a billing issue and it amused me to see the wall posters advertising financing for phones. I don’t remember seeing that before, but now that they no longer subsidize phones when you sign a contract, maybe that’s the new thing.
What is funny is when a seller tks $60k out for vacation, then once the house is sold, upset w/you because their net was low.
You may get a kick out of this cartoon:
I used to write daily about the rampant HELOC spending during the housing bubble. After profiling about 1000 really egregious cases of borrower theft, I finally stopped. There wasn’t much more to say about it.
Thanks for sharing your comment. Welcome to the board.
Spinning the Bad August Existing Home Sales Data
Total existing home sales, which are completed transactions that include single–family homes, townhomes, condominiums and co–ops, fell 4.8% to a seasonally adjusted annual rate of 5.31 million in August.
Matthew Pointon, property economist for Capital Economics, says what went into the disappointing August report will weigh on sales in the short term, but as lending recovers sales should pick up by the end of the year.
“The dip was enough to wipe out the gains recorded in both June and July, but sales are still up by over 6% compared to a year ago,” he says. “Existing sales have now recorded a positive annual growth rate for the past 11 months.”
Pointon says that following a surge in activity in recent months, some contraction in existing sales had been expected. Mortgage applications for purchases have been subdued of late, and the pending homes sales have fallen back from the high recorded in May. Furthermore, a lack of inventory is likely to have put a dampener on the recovery in sales, he says.
“But it is not all bad news. The economy is performing well, the labor market is creating jobs and banks have loosened their lending criteria,” Pointon says. “While mortgage rates are set to rise, affordability should remain favorable for at least the next couple of years. That should enable more mortgage-dependent buyers, particularly first-time buyers, to return to the market.
“Indeed, the NAR survey revealed that FTBs made up 32% of sales in August, up from 28% in the previous month. Inventory levels should gradually improve as housing starts rise and more households emerge from negative equity,” he says.
A More Realistic View of Home Sales and Rising Rates
“Housing activity remains solid, however, slightly less robust than months past with still-historically favorable, 30-year mortgage rates circa 4%,” says Lindsey Piegza, chief economist for Stifel Fixed Income. “Housing appears to be well positioned for a slow and steady upward trajectory should demand remain favorable.”
But, she says, rising rates amid a still-lackluster labor market could derail many potential buyers.
“The Fed is all too aware of the effects rising rates can have on the consumer’s willingness and ability to afford a home purchase,” Piegza says. “In this environment, with 2% GDP and nonexistent inflation — as opposed to 4% growth and 3% inflation prior to the 2004 liftoff — even a 25bp hike can feel like 100bps.”
More Executive Wrist-Slapping
SEC settles with former Fannie Mae execs over subprime fraud
A 2011 lawsuit brought by the Securities and Exchange Commission against two former Fannie Mae executives over charges that the Fannie execs misled investors about the quality of subprime mortgages, is over, and it ended with a whimper.
According to a report from the Wall Street Journal, the SEC reached a settlement agreement with Enrico Dallavecchia, Fannie Mae’s former chief risk office, and Thomas Lund, Fannie Mae’s former chief of the single-family operation, for a mere $35,000.
In its 2011 lawsuit, the SEC alleged that Dallavecchia and Lund, along with former Fannie Mae CEO Daniel Mudd, excluded nearly $100 billion in loans written to borrowers with weak credit histories from its financial disclosures.
The SEC also accused Fannie Mae of failing to count $28.5 billion in mortgages bought from the Countrywide subprime unit in 2007.
In addition, the SEC sued executives from Freddie Mac, alleging that its executives also misled investors over subprime mortgages.
Both lawsuits alleged that the former executives caused the now government-sponsored enterprises to “materially misstate” their holdings of subprime mortgage loans in periodic and other filings with the SEC, public statements, investor calls, and media interviews.
At the time, the SEC said that it was seeking financial penalties, disgorgement of ill-gotten gains with interest, permanent injunctive relief and officer and director bars against the Fannie and Freddie execs.
The lawsuit against the Freddie Mac execs also ended with a whimper, with the execs settling for $310,000.
Now, despite having spent years in court over the charges, the cases against the Fannie and Freddie execs each ended without serious punishment.
“Fannie Mae and Freddie Mac executives told the world that their subprime exposure was substantially smaller than it really was,” Robert Khuzami, the director of the SEC’s Enforcement Division said when the lawsuits were filed in 2011.
“These material misstatements occurred during a time of acute investor interest in financial institutions’ exposure to subprime loans, and misled the market about the amount of risk on the company’s books,” Khuzami continued. “All individuals, regardless of their rank or position, will be held accountable for perpetuating half-truths or misrepresentations about matters materially important to the interest of our country’s investors.”
In the end, it was full of sound and fury, signifying nothing.
“When you’re 40, you’re not going to look back on your 20s and be grateful for the few thousand you saved. You’re going to be full of regret.”
Just a comment from somebody that has no understanding of compound interest. If you have 20 years to save it isn’t just a few thousand it’s more like hundreds of thousands if not a million.
Saving money is easy if you have a decent job (which it sounds like the author has) and are really able to determine what is a want vs a need.
I hope she writes a follow up article when she is in her 40s expressing regret for not saving in her 20s. Either she will acquire wisdom with great life experience, or she will feel a burning regret in her 60s when she is flat broke and facing a life of work or living on social security.
In my experience, the people that decided to live for the moment in their 20’s soon found themselves living for the moment in their early 30’s. It happened very fast. Now most of these people are pushing 40 and they are still living for the moment, haven’t figured out what they want to do in life, and don’t have any goals beyond getting shitfaced next weekend.
And I don’t begrudge these folk livin’ for decades like their 20s never end (you can see a lot of ’em in Corona Del Mar bars); but at some point, they start blaming the system for what they don’t have. They become extreme leftist/Occupy Wall Street types.
My brother’s son is this guy. He dropped out of high school, did all of the typical things drop-outs do, and had a lot of fun. Now he’s in his 30s, with no real consistent job, living on others’ couches. He’s a daily poster on Facebook as he’s become an avid reader of Marxism. Of course…
Everybody is free to choose their own path in life, and I wouldn’t try to change that, but I do wonder what the end game is for some of these people. Some will eventually get bailed out by an inheritance of their parents’ appreciated OC house, but without that it seems like this lifestyle would be unsustainable at some point. The regret when that moment sets in must be overwhelming.
The author of this article has yet to face this moment, but she will….
Exactly, avoiding responsibility for one’s own actions demands that they blame someone, anyone else for their problems.
It’s “the man,” the system, anything other than their decisions and actions.
Chase Mortgage CEO: FHA loans same as “subprime lending”
Lending standards are obviously not too tight
Kevin Watters, CEO of Chase Mortgage Banking, said in an interview with CNBC on Monday that the Federal Housing Administration’s loan requirements look an awful lot like subprime lending.
“FHA requirements are down to a 520 FICO (credit score) and you only have to put 3.5% down; that’s subprime lending, and we’re not in the subprime lending business,” CNBC quotes Watters saying.
Jason Lobo, a spokesperson for JPMorgan Chase (JPM), said Watters is only reiterating standards the company already holds.
However, this is noteworthy since at the beginning of the month the U.S. Department of Housing and Urban Development released a revision to its previously announced proposal to change the FHA loan level and lender certifications that each lender must adhere to.
The previous proposal eliminated the requirement that lenders approved by the FHA certify on each loan application that they are not, or have not recently been, subject to certain charges or penalties.
The new proposal from HUD reinstates that stipulation, but made it part of the annual lender certification instead of the loan level certification, as it was prior to the first round of proposed changes.
JPMorgan isn’t the only major bank to reiterate or change its stance with FHA loans.
John Shrewsberry, Wells Fargo’s (WFC) CFO, said last Wednesday that the San Francisco bank will not make loans to FHA borrowers with low credit scores because of their higher rates of default.
Any loans below 640 FICO are considered subprime, which could apply to other loan programs as well. The difference with FHA is the level of risk layering, with 3.5% down, higher DTI’s, and gifted funds & seller credits that makes their program much closer to the irresponsible lending of the early 2000’s than anything else available.
How you can get a mortgage right now even with bad credit
What can you do if you’re wanting to buy a home and looking at a FICO score that is below 620?
Here are some key things you can do.
1. Get an FHA, then refinance ASAP
Got a credit score below 600? You’ll need 3.5% down and insurance on the mortgage from the Federal Housing Administration. Despite being federally backed, FHA mortgages cost more, because of the added risk. But, it’s those same, higher costs that should incentivize you to refinance.
A bad credit mortgage may seem like the borrower is signing away their life on a bad deal, but it may be the way to go if it’s the only option available right now.
So once you get the “bad” credit mortgage, keep in mind you want to refi into a better deal ASAP. This will be possible so long as you, the homeowner, maintain your credit after the mortgage is signed. This way, you can be eligible to refinance for a much better deal within two years, and credit will have improved.
In short, a bad credit mortgage is a short-term solution that gets you in a home. It’s important to bear in mind that bad credit needn’t follow the borrower longer than necessary.
2. Ask about options
The 30-year mortgage is a popular choice, but maybe not the right one if the borrower’s credit is weak. Adjustable rate mortgages are also a possibility, depending on the circumstance, during which time the borrower can work on repairing and maintaining their credit while paying at a lower interest rate than are offered on fixed-rate mortgages. Here is the Consumer Financial Protection Bureau’s handbook on ARMs.
Many people who had their credit torn up in the recession were not the typical bill skippers. They were hard-working, responsible people whose world was upended through layoffs, downsizing, the loss of contract work, and a dozen other legitimate reasons.
3. Get a co-signer
Many have some other assets, or have family members who are responsible. These people may be willing to co-sign. Federal Housing Administration rules allow for a co-signer on loans.
Above all, check with HUD, FHA, the FHFA, Fannie Mae and Freddie Mac for information on pathways to homeownership for those who have damaged credit.
Golf cart-like vehicles part of the plan at Rancho Mission Viejo
In this county of sprawling freeways and housing tracts, a master planner is laying miles of trails with the notion that suburbanites will drive around their local streets in souped-up golf carts.
The neighborhood electric vehicles, or NEVs, don’t come free; they cost up to $15,000. And so far, only a few homeowners have bought them.
So in a sense, what’s unfolding at Rancho Mission Viejo – once a 19th century cattle ranch – is a 21st century lifestyle experiment. Over the next two decades, an estimated 14,000 homes – plus parks, schools, shops, a community farm, restaurants, and more – will crop up on roughly 23,000 acres near Ortega Highway. The master-planned community’s second neighborhood, called Esencia, opens today.
Connecting it all will be multi-modal trails for bicycles and NEVs. Yes, there are regular streets, too.
Rancho Mission Viejo LLC – the master planner and developer that also is behind Mission Viejo, Rancho Santa Margarita, Ladera Ranch and Las Flores – says the concept is backed by research that says that buyers of all ages prize open space, multi-use trails, and social and geographical connectivity. This, its final community, will test whether that’s true.
Dan Kelly, senior vice president of governmental relations and corporate communications with Rancho Mission Viejo, imagines a day when a homeowner will hop in a NEV to grab a gallon of milk at the market or meet friends for coffee. The excursion, by its very nature, would bypass busy thoroughfares and perhaps ease congestion.
“Times are changing,” said Kelly as he gave a tour of the development recently. “Fifty years ago, no one was thinking of electric and low emissions. I think people are more mindful and more thoughtful about greenhouse gases, the cost of fuel, healthier lifestyles. Today there’s a greater emphasis on pedestrian circulation, bicycling, NEV.”
“So in a sense, what’s unfolding at Rancho Mission Viejo – once a 19th century cattle ranch – is a 21st century lifestyle experiment.”
The more things change the more they stay the same. The main byproduct of cattle ranching and developers is fragrant and promotes growth.
Instead of having one car, and one road, we now have multiple cars/roads to purchase/build and maintain. NEVs aren’t zero emission. They just displace the emission elsewhere. There is also the emissions resulting from producing the NEV in the first place and the emissions to generate the electricity. Even with solar, there are emissions required to produce the solar cells.
I’ll admit there is probably a net benefit even with displacing emissions outside urban areas, and it is headed in the right direction, but would it be better to spend the money developing the technology before building dual road systems? We already have too few new housing units.
This is basically an enclave for the more affluent. The left would have a field day with it were it not for the environmental angle. I wonder if there was a meeting where the developers were balancing the lost revenue from lower density vs. some sort of environmental tax break. This developer spokes-hole was then sent out to sell the new concept with a generous amount of bs.
I suspect they were going to build improved walking trails throughout the development anyway, so these vehicles aren’t adding a transportation system, just providing a different method of using it. I believe these are light enough to drive on ordinary sidewalks without damaging them.
When I was reading the article, I wondered if these vehicles won’t be obsolete in 10 or 20 years as California moves to encourage (and finally mandate) zero emission electric cars.
Subprime mortgage lending rises sharply
Subprime 2.0 has arrived
The number of first mortgages extended to subprime borrowers was up 30.5% in the first five months of 2015, according to data from consumer-credit agency Equifax EFX, -1.00% At the same time, the number of home equity loans to subprime borrowers climbed 29.5%, while home equity lines of credit to subprime borrowers was up 20.4%.
Subprime borrowers are generally defined as those with a credit score below 620. Still, the segment remains just a fraction of overall mortgage originations, said Equifax, and is far below the pace of subprime lending that was being extended prior to the Great Recession.
“The data make it very clear that almost nobody is getting home equity lines of credit if they don’t have a credit score above 620,” said Amy Crews Cutts, Equifax chief economist. “But we are seeing a rise in first mortgage and home equity installment loan origination subprime shares. It appears that American lenders still believe in second chances, and without subprime loans, there would be no second chances in the housing market.”
Still, Equifax said lenders have clearly taken steps to reduce risk. In 2008, more than 10% of first mortgage originations went to subprime borrowers, compared with about 4.6% in 2015.
“When you’re 40, you’re not going to look back on your 20s and be grateful for the few thousand you saved. You’re going to be full of regret.
You’ll regret the experiences you didn’t take, the people you didn’t meet and the fun you didn’t have because you were too worried about a future that came and went.”
No matter how many experiences you take, people you meet or fun you have, you will always regret not having done more. That’s life. You will also regret not having saved any money. Find a balance.
Just because you save, that doesn’t mean you can’t occasionally splurge too. If your whole life is a series of extravagances you can’t afford, then nothing is special. Allocate part of your budget to wasteful spending. When you have covered all other expenses, you can spend guilt free.
Earning more money means spending more hours at work. This is the biggest source of regret for many retirees. Not having saved too much money.
Well clearly going out to an expensive bar and dropping 20 dollars on a craft cocktail is a far superior experience than to just have all your friends over and making them yourself for less than a dollar.
It’s definitely worth spending extra hours at work to pay for it all.
Nobody on their deathbed ever regretted not putting in more hours at the office.
I missed out on a high-paying job last year because I wasn’t willing to work 60+ hours per week. I don’t regret that decision at all.
What would I have done with the extra money? I wouldn’t have any time to spend it.
Wow. It seems like this woman is actually claiming that hanging out at bars is “investing” in yourself.
I didn’t save any money until I was 28 because I was in graduate school living on a minimal income. That’s an investment.
If I had started working at 21 and then didn’t have savings at 28 because I was “networking” at bars you know what that would make me? A fool.
I live in one of the most expensive cities in the world. I save money. I don’t get bottle service at Karaoke bars every weekend, hoping I’ll meet some bigwig who will give me a $60,000 raise. Instead I take my wife and son to the park. I regret nothing.
When I first read her comment about networking, I burst out laughing. I spent a few hours doing research to make sure this article wasn’t a parody because statements like that are so transparently stupid, only a comedian could come up with them as part of a parody. Ordinarily, people have enough shame and common sense not to put embarrassingly stupid ides like that in print.
Bar hopping is a solid career move?
Only if she’s building a resume as an exotic dancer.
The powerful lesson of time value of money. You might succeed in ignoring this in high school or even college. But eventually it finds you. And when it does, you may not like what it has to say about your future.
Every Ponzi stares into that abyss eventually. Denial only takes them so far, then finally, they must face the music. Contrary to their belief, lenders won’t support them living beyond their means forever.
“Your 20s are not the time to save; they’re the time to gamble. $200 a month isn’t going to make the dent that a $60,000 pay raise will after spending all those nights out networking.”
I have had some tremendous pay raises in my career over 20 years… but I have never cracked the $60K bar… and networking? LOL
This is why I talk like an old man and hate millennials haha