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[flagged] Wait a Minute. How Can They Afford That When I Can’t? (nytimes.com)
38 points by SREinSF 14 days ago | hide | past | web | favorite | 55 comments

What’s with the recent stream of low quality NYT articles? This reads like the author recently discovered Mr. Money Mustache and decided to publish some blogspam. There is 0 new information.

Suggestion for mods: replace NYT link with original: https://forum.mrmoneymustache.com/welcome-to-the-forum/the-'...

Wealth is correlated with luck and not causal to success. Nothing new here.

I'm shocked how often people discover this, and then immediately forget it, and when they rediscover it are just as surprised as ever.

It's like we're ingrained to think there's no luck in the world.

Yeah I was just about to ask that too... like the Times can’t afford to pay for traffic like everyone else.

>Not only do people want to play down their inherited wealth or money from family “but they actively try to hide it,” Mr. Conley said. “We have this ideology of individualism and worshiping of the self-made man or woman.”

I have almost exactly the opposite mentality w.r.t. this scenario. I was always taught to not talk about money because it will only lead to problems, strife, envy etc.. (not that I'm rich or from a rich family but there's always people on both sides of you money-wise).

I think a lot of it too is that if you have money, people feel entitled to your time and money because you have it.

I felt this when I joined a sales org as a Sales Engineer. I felt like I was making a healthy salary but couldn’t believe the cars I was seeing driven by the reps I supported. Until one day I had a conversation about it with a few of them and found out they do everything in terms of payments. As in can I afford the payment with no concern about what that costs in interest etc. Eye opening experience.

I’ve been told that in sales teams it is common for them to be highly encouraged to go out and buy a new car and other things like that so that they have an incentive to make their quotas. Think that scene in Boiler Room where the guy running the firm told all the brokers to go out and buy a new car.

There’s a school of thought that when hiring commissioned salespeople, that you want to hire the ones who have a large monthly outflow they need to cover every month.


Embodied with all the expected toxicity in this article.

Yikes. That’s pretty much the reason I left the org I was referring to.

'Image' versus Reality.

Some people are more concerned with displaying 'Image' than whether or not they can keep up with Reality.

This has been historically the difference between 'Old Wealth' and the 'Nouveau Riche'. The Nouveau Riche mentality is that if you have it, you must flaunt it ostentatiously. The people whose families have been wealthy for generations very often don't show it at all, or maybe they have some things that are 'very good' but 'old'. (To take that to its logical conclusion, think "a 40-year-old Rolls Royce".)

My sister always looks like she wouldn't have two cents to rub together, but she keeps several million dollars stashed away so that all of her (4) kids could be given a million bucks at any time if necessary. Note that if she can give it to one child, then she feels she should give it to all four as a matter of 'fairness'. Then again she has three houses, all set up with clothing and furniture and appliances, so that she just has to arrive and everything is available for her immediately.

How can we get young people a better concept of money and wealth quantities and trajectories?

I remember having the light bulb go off for me—previously I had zero clue and tried not to worry about—that most of those around me doing very well around age thirty had had help with a house down payment and their college costs. So the difference was simply they had the nut to get into home ownership and they didn’t have a monthly student loan.

Save you time: "When people seem to be able to afford much more than their income would suggest, it’s often because there is hidden wealth or hidden debt."

Then some extra stuff to try to make people feel bad for having wealth.

Having family that contributes is also a major theme of the article, but isn't necessarily what you might think as "hidden wealth". That made me think the most, particularly about what contributions my extended family might have made (directly or indirectly) and also if there are any contributions I should be making back.

What else can one think? Either people have money to buy the things they buy or they don't and they borrow. I guess a few could be in illegal businesses or maybe has a sugar-daddy/momma. It's like saying, that customer who just bought a lottery ticket either wins or won't win. Yeah, I guess so.

What else can one think?

You could be wondering if you're getting cheated on your salary.

> Wait a Minute. How Can They Afford That When I Can’t?

In debt over their eyeballs?

Mirror to avoid paywall: https://archive.is/ve4mL

Mirror to avoid paywall: disable javascript

I don’t really get the point of this article.

If you know how much someone makes, then you can deduce relatively quickly that they are either a.) in serious amounts of debt, or b.) have some other form of income that you aren’t aware of.

I remember when I first started dating my wife, I encountered a number of people she knew from the same immigrant community (South Korean) who were driving expensive cars and living in nice houses despite working fairly low-end jobs. I asked her about it and she explained that basically these folks were either:

a) up to their eyeballs in debt with no savings of any kind

b) involved in some kind of "scam"

c) were being floated by rich relatives or friends somewhere else, but the story there was complicated

My wife has always been very frugal so I found this curious, but she explained that having a "rich" appearance was very important in the tight night social community that most South Koreans found themselves in. These three versions of what was happening were often occurring at the same time. An example true story:

A person she knew, despite working two jobs as a cashier at a grocery and a dry cleaners, owned an expensive house and drove around in a luxury SUV. This person took payment, in part or in full as cash and often simply didn't pay taxes. At church, they'd chat up friends looking for business opportunities. When one was finally spotted (an investment opportunity), it was realized they didn't have any cash to participate. They then convinced a close friend to loan them basically their life savings upon which the investment was made with "a few percent" skimmed off the top as a finders fee to purchase a few luxury goods to keep the game going. There were multiple investors, and eventually somebody ended up stealing somebody else's identity, drained their bank account and fled the country. The investment ended up buying a large inventory of very poorly made products that were unsalable and it failed. The person she knew ended up with no serious money lost and just moved on to the next strike-it-rich plan.

The house was mortgaged under somebody else's identity who had good credit and income as a "favor". The main floor was furnished elegantly for parties and after church activities, the rest of the house was entirely devoid of furniture. The SUV was a car they bought from a mechanic friend after it had been totaled by the previous owner and had new bodywork and some engine work done at extreme discount -- it barely ran day-to-day.

This wasn't a rare story. It seemed to pervade a large portion of the community and everybody was inexplicably blind to it, and fell for the same money-lending, identity theft scams over and over again.

When the Russell Crowe movie "Cinderella Man" came out, there's a scene where his manager, played by Paul Giamatti, is confronted by the main character's wife at his apartment. It's revealed that the apartment, and fancy lifestyle are all a display to give him credibility. https://youtu.be/e4fb7N_ICj0

It was then that I really understood what the success signaling and veblen goods in my wife's immigrant community was all about.

I've seen this in the Persian community as well. I was dating a Persian woman and she was telling me how proud of her brother she was-- he had become a bank vice president and bought a home (at the absolute height of the first housing crisis, think 500k condo in Anaheim), and even purchased a Nissan GT-R (100k give or take). Eventually, it got out that he was making 80k, which I was making a multiple of and wouldn't even CONSIDER these extravagances.

I also have several Persian friends who seem to piss away money like it's not a thing, but that's the most egregious example. Still, love them to death :)

Why is this a thing? My total, all-encompassing expenses are less than 15% of my income annually and I have zero debt. I rent a modest apartment because I am in my 20s & the loss on rent is, for now, less than the would-be loss of property taxes + HOA + home loan interest. I drive a nine year old Prius I bought when I was 18 - and I know that statistically everyone my age driving a luxury vehicle is either in debt, has outside income, or simply out-performed me financially - all of which are okay. This is just a youthful and inexperienced opinion, but it sure as hell seems like the root of the issue is not income inequality, or social theory, or any other problem requiring a solution but our national obsession of not minding our own business since people aren't at peace with themselves.

Mind you, these are sentient, presumably self-aware, humans doing this - this isn't the behavior of a bot in a game, but actual people. Yikes

15% of the average US take home salary is about 7.5k. Can you live on that for a year? How about support a family?

You have truly lost touch with average people if you think your situation is even close to normal.

Is there any evidence to that? There is no way anyone could possibly survive for a year (outside of a third world country) on that. Those statistics likely include students working part-time etc...

On $50,000/yr? Lots and lots of households are doing exactly that, yes, especially if we're calling that after-tax income. But no, not by spending only 15% of their income per month. More like 100%. It'd take 15% of $50k just to rent a barely-livable old, rotting single-wide and a lot way outside the city to keep it on, before any other expenses like utilities or food or transportation, and this is a pretty low-cost area.

In my friend group at least three families (two with kids) are making under $50k pre-tax income, as households. A couple others are a little over it but not by much. There are three with household incomes way over that and... go figure, each has one tech-sector worker in it. Age ranges of something like 25-36, none in college.

I like to point people towards Malcolm In The Middle. It's actually a very optimistic take on the struggle for a vast swath of American families; certainly not an exaggeration of the difficulties.

I think you misread the person you're responding to. The average isn't 7.9k, 15% of the average is 7.9k - they are implying that the parent commenter makes far more than the average US household. (and further down, the OP states that their yearly income is ~360k, which pretty clearly demonstrates the point)

There are millions of families in the US living below the poverty line.

You sound like you’re managing things very well, and I don’t want to discount that in any way.

I do suspect your income is relatively quite high. Where I’m at, a modest apartment alone is more than 20% of any 20-something’s average income.

Cheapest rent is about $1,800/mo in my area (California, eh) - my car is by far the worse one around. To me, it's about what trajectory you funnel your income in to generate wealth - tangible, liquid, appreciating assets as well as ETFs, bonds & recurring revenue. The notion of someone who's my age looking at a luxury or exotic car which is a chump change spend for someone who's had 1-3 more decades to generate wealth and concluding that wrecking their own long-term trajectory by incurring depreciation & loan interest - all for the sake of superficial equality, is absolutely insane to me.

Right. I make $360k a year, and just living in a decent apartment already eats up 24% of my after tax income. Sure, if I had roommates and lived in a basic apartment, I could cut that down to 12%. Point being, it's hard to get by on only another 3%, and I'm making pretty okay money...

We are at roughly the same compensation. If you save 60k a year vs 120k a year, the time it takes to own a house is cut in half, the rent and interest bleed stops twice as fast.

Now you're saving 180k a year by reducing bleed even though your expenses are the same, etc etc. Compound finance is a helluva drug

Heck, if you save 120K per year and work for 2 years, you can basically retire to places like Thailand and live like a king.

On $250k in investments, you could only sustainably withdraw $10k per year. That's not even $1k per month. That's upper middle class in Thialand, which is not exactly kingly.

Yeah but you're living like upper middle class in Thailand at age 24 with no responsibilities in OP's scenario.

Ok, fair enough, not a king. To me it'd be kingly, but I guess I feel like a king quite quickly.

Just me? Ah, alright.

Pretty okay...cmon buddy.

Whoa there buddy. How are we going to keep this consumer driven economy afloat if irresponsible people like you go around living within their means?

Please teach me how to rent an apartment that is less than 15% of your income.

In Amsterdam: cheapest rooms I've found (not apartments, rooms) are 650 euro's. If you can get these you're really lucky.

Salary for entry level is 1600 net. This goes up to about 2300 to 2500 after 3+ years of experience (that's truly the fastest trajectory forecast FYI, it's more like 5 years).

Alright, so let's live somewhere cheaper in The Netherlands. The cheapest I could find that's in reasonable distance of Amsterdam (that's where the jobs are) is about 500 euro's.

So how do you do it? I want what you have as well. Heck, I'd live in a simple garage with very basic amenities if I'd have to.

Edit: I've tried to apply to startups in the US, there are no takers because of the visa restrictions. I've also applied to FAANG, also no takers. I have 3 CS or CS-related degrees (1 bachelor, 2 masters) and 1.5 years of work experience.

This kid makes "roughly the same compensation" as someone making $360K/yr.

I mean, that's feekin rad for them.

But as for what that has to do with people I know, or my life?

I think I was sorely misunderstood ...the point is to not spend on what you don't need - whether that's 15% of your income, or 80%, it was there to illustrate just that. When I started working at 18, my living expenses could've been 100% of my income if I even tried to live "like average". I lived like I was on welfare and saved my money and because of that, avoided the typical mid-20s credit card sinkhole, the fancy cars, and all the other crap nobody really needs. Career trajectory aside, the savings from the years when it was the hardest to save were the only way to get to this point.

IMO that's the easy part. Getting in $100K+ that isn't going to be taxed at 50% is going to be the hard part (The Netherlands, fun place).

The trick to affording things is mostly about earning. Saving definitely has its place, but if you don't earn enough, you can't save it either.

And I know that there are quite some hedge fund managers out there wasting money left and right, but in all honesty, it's tougher to get to that point than just to save.

At least, when you're me. I suppose for some people it's easier to make bank and spend it as much as possible as well. They wouldn't know how to save up.

I'm the same as you, thought the same at the same age - and saved a lot of cash. I remember telling people, why spend $1 now, when I can 12% * 40 years that $1 to make it $93.

Plow it away - families change things. Wife, kids, houses are often negative financial ROI (relative to early life), but have some life ROI. People in their 20's are often driven by status, or comparison - and not very good at thinking 30 years down the road. I Keep on...


Because when I moved to America at 16 and had nothing, and was homeless so I could pay for college, I didn't give care about how I looked relative to others. And if I spent my money impulsively or even worse cared about impressing anyone other than myself, I'd likely be in crushing debt right now just like most people who appear to be "living the life". Last I checked, hard work is not privilege.

Nobody likes to talk about how the "self made people who need their privelege checked" did before they were well off. Not the pitfalls, not the multiple years of 90 hour work weeks.

It’s great if you worked crazily hard and, against all odds, somehow paid for college, landed a job with an amazing salary, and have remained clear sighted about necessities vs. desires. You might just be the only truly self-made man in America.

If so, in all seriousness, congratulations on a remarkable accomplishment.

I would, though, caution you against thinking that your own experience is reproducible in any reliable way, or that it can serve as a useful prescription for success for others. When folks complain about privilege, they aren’t talking about you.

I can tell you for a fact that the person you're responding to isn't the only self made person in the US. Not everyone here is wealthy, but there is a lot of opportunity. I too am an immigrant and nothing was handed to me. I have been lucky in picking the right field, and finding good opportunities.

How can they afford a NyTimes subscription? https://web.archive.org/web/20191108011522/https://www.nytim...

NYTimes subscription is $10/month through the iOS app... it’s not exactly in the same ballpark as even a single vacation :-)

"it's just $X/mo"

That's the mentality that often gets people into debt.

Budget monthly if you have that trouble, I run a monthly surplus without issues. $120 a year for news is not that much and is cheaper than paper newspapers used to be.

(Edit: obviously, yes, if you cant afford it don’t buy it. News is a luxury too, just a much cheaper one. The only things people actually need are food, transportation, housing, &c.)

Paradoxically, the reason why I can afford things is because I don't buy shit I don't need just because it's "$120 a year" and "not that much". It does add up. And then it also compounds. As a rule, I try to avoid buying things with zero (or negative as in the case of NYTimes) residual value.

That’s your decision. Go for it if it’s what you need for your financial situation.

My only point was that it wasn’t the same type of spending described in the article.

$10 here, $20 there, then multiply by 12, pretty soon you're looking at real money.

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