Friday, March 12, 2010

Comment Moderation Fun, Savings and Debt, Life Choices and Education

 I moderate comments and have been doing so for some time. IMO comment sections on a relatively popular (ie read by other than immediate family, friends, etc) open blog often regularly turn into a huge mess of flame wars with spam and extremist hate speech in between.  I really tried and it just doesn't work. I don't know a blogger who has had success with it. At the end of the day I am Captain of this ship so I sail it the best I can, or at least the way I want. One of the biggest downsides of moderating comments is that they slow down the flow of ideas and make those great sideline discussions which either nail down a point or move in an otherwise interesting direction harder. However you take what you can get.

I do like that I get to see all the comments. Usually if it is about a fairly recent post I know what is going on. Sometimes I go back and comment. Other times something jumps out at me, maybe it is interesting or brings us in a new direction or whatever. This is one of those times. Here was a comment from my recent post on Savings and Debt.

5:59 said "Chris: It's easy to say, "they made their bed", but it's not that simple. When an 18 year old is leaving high school, everyone in the world in telling them "you should go to college"; they don't know any better. They go and get a piece of paper and end up with 50k in loans and an entry level job and realize by about age 30 that they should have taken up a trade. It is a problem with our society, and you can't blame an 18 year old for listening to "older, wiser" people.

It is damn near impossible for a family to pay off 50k in student loans, have a decent used car, a house that is out of the city enough to be somewhat safe, and still put away a 3 month emergency fund.

That is not an accident, it is all by design of the government to keep everybody underfoot, and I realize that, but it still pisses me off. We make decent money and are not living above our means, but I can barely afford to buy a little extra food to put back every month let alone put back 3 months savings."


TOR here: Well  now it is time for my thoughts. This comment reeks of a lack of accepting responsibility. It is full of they and them and everybody and society in an effort to somehow pass on responsibility to everyone else. We will revisit this theme in a minute.

Educational costs, debt and career prospects/ income are an interesting discussion. Our society seems to want people to do hard jobs (education and social work come to mind) for modest pay and require expensive degrees. We can't seem to understand why these jobs often (certainly not saying it is all of them but if you work in either you know there are some) attract lazy or not particularly capable people and that the turn over is high. Don't know what the answer is but I imagine either things will keep slogging along dysfunction-ally as usual or something in the equation will change. In any case getting back to the point.

On average a college graduate (BA/BS) earns a heck of a lot more in their lifetime (think it is a million dollars) on average than non college graduates. I do think those statistics are somewhat skewed for two reasons. First in general (remember we are talking about millions of kids, not onesies and twosies) the young adults who graduate from college are far more motivated, smart and hard working then their non college peers. They could be locked in a closet for 4 years and still demolish the other kids in earnings. Secondly I think we are talking about one fairly narrowly defined group and a very poorly defined one. We are comparing adults who went to and graduated from a university or 4 year college with all other adults. Those other adults include highly skilled craftsmen, union workers, various professionals, laborers, small business owners, service employees and shiftless layabouts. The stats would probably not be so skewed if we compared say college graduates and highly skilled craftsmen.

Revisiting my first point. I have a suspicion you were talking about yourself but that doesn't really matter. I do not know you and am going to make some generalizations. Maybe they apply to you and maybe not but they likely apply to some other people. Certainly I do not want to make you or anyone else feel bad. Well except when I obviously bash somebody for being a jerk which is rare these days. I have never heard of Tony Soprano and his friends coming to anyone's house to force them to go to a certain college or take out a bunch of loans or go into a certain career field afterwords.  Eighteen year old kids can get married, sign legally binding documents, buy firearms and fight in wars. They certainly do not make perfect decisions and often don't even make good ones but that is called life. For heavens sake take some personal responsibility.

Far too often people box themselves into a corner and then complain that they are trapped in a corner. Every individual decision they make might be reasonable on its own merit but together they are not reasonable.  Lets break this down with commentary. 5:59's words are in italics and mine are not. 

...It is damn near impossible for a family. Consider your financial situation before getting married, let alone having kids. Like many things in life it is not romantic or feel good but inherently practical.

...to pay off 50k in student loans, have a decent used car, a house that is out of the city enough to be somewhat safe, Here is where many people box themselves in. They say they 'have to have' a certain sort of car and live in a certain type of place and then turn around and blame society and "the system" for their choices. They got those loans to get that degree from that school. They also chose that car and decided they just had to live in a certain place. Nobody put a gun to their head and said to drive a 3 year old shiny SUV instead of a 10 year old Honda Civic with a dented fender or forced them to live in a nice house in the burbs instead of a trailer park or a little apartment.

I really hate when people talk about how there is some sort of a system by our government to keep them down in terms of life expenses, bills, housing, etc. To be blunt that is a very unsuccessful attempt to somehow pass ownership for ones decisions to anyone but their own self. I can get how people back themselves into a corner or stay in a less than ideal situation because of work/ family/ etc. I do have empathy but that doesn't mean they didn't make and aren't still making those choices. Don't get me wrong there are all sorts of legitimate criticisms such as inflation and zoning but that is a different discussion. Pretty much everywhere Americans can make broad and diverse choices about lifestyles and housing. You can go all Dakin and shred your monthly expenses with the purchase of a travel trailer and a bit of land. If that isn't practical because of your urban setting or zoning you can get a tiny apartment and have room mates. Yeah, neither of those options are any fun but that is a reoccurring theme of most practical decisions.

...and still put away a 3 month emergency fund. Lets revisit the last point. Of course you can't save up 3 months of household expenses when you spend almost everything that comes in. In order to be able to save real money or aggressively pay down debt you are going to have to earn more money or go crazy slashing expenses. [Not saying this applies to you but it is a thought I have right now. It amazes me how people don't understand how they stay stuck just barely getting by but haven't changed anything like say; increased their income or slashed their expenses. Somehow the same pay and the same bills come out more or less the same every month. Isn't a definition of insanity continuing to do the same thing and expecting a different result?] I agree that with what was laid out as your/ the above situation the math on an emergency fund just doesn't work. If one diligently saved  the surplus 2-4% of their income towards an emergency fund it would take a really, really long time (not willing to do the math) to save 3 months of income.

Do whatever you want, it is your life. I would like to leave you with two questions to mull over. First, are you willing to take some responsibility for where you are? Second, are you willing to do some unpleasant things in the short term to make your life better in the long term?

15 comments:

Wyn Boniface said...

I agree to an extent about the loans and university. One the university does rip students off. They hold on to the money to rape it for interest while you are getting hit with interest. I find this criminal. They also mess you up with their release date. I lost 3 months due to them releasing mine before I graduated. They do not explain anything that is going to happen, and by the time you got educated enough to figure it out . . . it is late in the game. It is usury to an extreme level. If I knew now what I did then I would probably skip the entire experience. I am not saying everything is the banks fault. Actually I am blaming the university for unethical practices more then anybody, and yes schools do differ. Mine was horrible in that department, and we still hate each other. I had gone stomping through their office many times forcing them to do their jobs. I even had the president of the place do it. I would have done trade, save, then university. Also in today's glutted market it really does not pay off as many think.

Anonymous said...
This comment has been removed by a blog administrator.
Flight-ER-Doc said...

As I see it the problem is not only that everyone is told to go to college (as you quite correctly point out) but they make incredibly BAD choices about the college education they get.

Just how many jobs are there for people with what are laughingly called 'humanities' degrees? Music, film, art, sociology, undergrad psychology, literature, english, most foreign languages (yet they can't speak any well, including english), communications, kinesiology (I remember when it was called physical education), even such things as geography, soft pseudosciences like 'earth sciences' or ecology, etc.

4 (or these days, more likely 5) years on someone else's money to get this sort of craptacular education and then no jobs (at all) for someone with those 'qualifications'?

At least in California, the community colleges and state colleges are just as bad - degree programs in cartooning and the like. For people with talent, the jobs are there degree or not: For the talentless, the degree doesn't matter but does give you $50K or more of debt.

I usually wind up pissing off parents when I counsel their kids to not go to university unless they are seeking a professional degree (in the hard sciences, mathematics, engineering or the like) OR they plan on being an underpaid state teacher. Everyone else should go get a job and learn how to work (first of all - simple things like showing the fuck up on time), working and getting along with other people, and how to learn on their own. With skills like that, they can do anything they want...including going back to university if needed and get a piece of paper.

Skills, by the way, that a short enlistment in the military usually teaches pretty damned well.

Mayberry said...

Raising a family today is way beyond expensive, and that's just for basic stuff. My wife and I made $43,000 last year. Modest home, no car payments, no credit cards, no other debt. We are hanging on by our fingernails, paycheck to paycheck. I lose $800 per month to taxes (just me, wife loses too), insurance, and retirement. That's a hell of a lot of money skimmed off my bottom line, money that would make me damn comfortable. Money that would allow me to save, put up tons of preps, buy some land, whatever. But it gets sucked away before I ever see it, against my will. You don't miss the money that's stolen from you so much, because the military gives you things like COMRATS, BAQ, COLA, etc.... In the real world, those things don't exist.....

So maybe you should think a little more before you spout off, because you're just getitng your feet wet. You got a long way to go, and here in the real world life ain't cut and dried....

Mayberry said...

"the young adults who graduate from college are far more motivated, smart and hard working then their non college peers"

That is total crap. Most of the young college grads I know are lazy, and have a major superiority complex because their professors told them their expensive piece of paper makes them better than the "uneducated". I know plenty of young non-college grads who bust their ass, and happily. They also respect folks with more experience, whereas college "smart" people do not, for the most part....

"I really hate when people talk about how there is some sort of a system by our government to keep them down in terms of life expenses, bills, housing, etc."

There is such a system: it's called taxation. It's called lobbyists. It's called inflation. When 50% of a mortgage payment is taxes and insurance (escrow), there is a major problem. When the price of a "decent used car" doubles in ten years time due to inflation, there is a problem. I paid $8,000 for a four year old F-150 XLT with 22,000 miles on it in 1992. That same deal today is near $20,000. In 1985 (or thereabouts), $8,000 would have bought a brand new truck.

"To be blunt that is a very unsuccessful attempt to somehow pass ownership for ones decisions to anyone but their own self."

And so you expect people to roll over when property taxes go up 100% in less than ten years? When insurance doubles? Food, gas, utilities.... At 3% per year, one's salary doesn't increase 100% in ten years. The result is a major loss in purchasing power. This is real world stuff. Many folks, like me, who were responsible, and lived within their budget just plain got screwed. There are hundreds of thousands of people out there who were promised wonderful, high paying jobs if they'd fork over $50K for an "education". There are millions of folks who busted their butts for a company, then got laid off, and can't find jobs that pay anywhere near what they were making. Those who want to sell their homes can't, because the market is in the crapper. Many, MANY folks got caught between the proverbial rock and hard place, through no fault of their own.

Factor in that EVERYONE is force fed the "American Dream" virtually from birth. We were taught that we would always have a job if we wanted one, you must finance a home (try to find something more than a crack house for less than $80K in any city who's economy is still anywhere near functional). Anywhere short of the countryside folks are forced to use city water, sewer, garbage collection, must have electricity service, all at ridiculous rates, stacked with taxes and "fees".

TOR, I like you, but you're in for a really rude awakening when little Walker arrives. You'll be blown away if and when you leave the military. You guys are making way more than I did back in '95. Damn good money. Better than a lot of private sector folks doing similar work. In 1993, as an E-4, single, I was making $14,000 per year. BEFORE taxes. I knew married E-4s on food stamps. Housing, if you could get it, was WWII era. So count yourself lucky, because you are.

Continued....

Anonymous said...

Regarding your comments on taking responsibility, I call this the Homey D. Clown "the Man tryin' to keep Homey down" rationalization. Homey D. Clown was a character on a comedy show in the 90's I enjoyed watching on AFRTS). That perception is often real to the person saying it because he has never seen it any other way. For example, I'm in my mid-50s and grew up in a relatively small town--a town with its own power elite class. The elites controlled jobs and the best jobs always went to relatives and relatives of business partners/friends which left the poor jobs for everyone else to fight over. Unfair? Yes. BUT, all you had to do to beat them at their game was to simply move away. I did and returned a few decades later with a decent education from the school of hard knocks (and a college education to boot), more assets than I left with, and confidence. Getting ahead often means taking risk. Interestingly a lot of those relatives who were given all the advantages didn't have the work ethic needed and ran the businesses/family fortunes into the ground. Yin/yang I guess.
WVtreehanger sends.

theotherryan said...

Wyn, Schools are pretty bad about that. Again I guess it comes down to individual choices. Kids spend more time choosing what sort of stuff from Target will decorate their dorm room than how their loan package.

Flight-ER-Doc, One thing my Grandfather (a PHD) always told me is to think about what sort of job you want to do then look at degrees. If X degree gets you to Y job that is great. However too many students stumble into a random degree without even the thought of what they will do with it. My Dad calls those hippy dippy degrees underwater basket weaving.

theotherryan said...

Mayberry, The thing about the college grad vs non college grads is that we are talking about big numbers. Millions of kids not ten or twenty. Also the numbers don't lie. You may well say the system is rigged but in fact it is what it is, sorry you don't like it.

Yeah we have to pay taxes. I am not a fan of them either but complaining doesn't help.

I do not expect you to "roll over" about increases in taxes. You can either complain or figure out how to get it changed or figure out how to deal with it.

Inflation should help with your home loan and will in time.

I agree that we are force fed the American dream. It is a hard decision to do something else, like what you can really afford. Again nobody stuck a gun to your head.

You said "TOR, I like you, but you're in for a really rude awakening when little Walker arrives. You'll be blown away if and when you leave the military. You guys are making way more than I did back in '95. Damn good money. Better than a lot of private sector folks doing similar work. In 1993, as an E-4, single, I was making $14,000 per year. BEFORE taxes. I knew married E-4s on food stamps. Housing, if you could get it, was WWII era. So count yourself lucky, because you are."

I am sure there are going to be a lot of crazy things when Walker comes. However I imagine the change in our finances will be among the smallest impacts. The housing here is WWII era. Married E4's can still be on food stamps. Interestingly enough if I wasn't in the Army we would make way more. Wifey would be making what I am now and everything I made would just be gravy.

The thing is that I am lucky in a lot of ways. I was born healthy and reasonably intelligent to a good family in the best country in the world. Other than that everything I have I have gotten for myself. I have a degree from a University and a pretty good job. Nobody handed those to me. I went out and worked hard and got them.

You talk about BAS, COLA, etc. Yeah this job has some perks. Lots of jobs have different perks. In order to get a given set of perks you have to go out and get that job.

"So maybe you should think a little more before you spout off, because you're just getting your feet wet. You got a long way to go, and here in the real world life ain't cut and dried...."

Ok my friend this sort of hacks me off. As for the real world. We own one car I paid cash for 8 years ago. Most of our clothes are 'gently worn' or purchased at great discount or thrift stores. Our furniture is a combination of hand me downs, stuff we scavenged or purchased used at great discounts. We have one computer and one beat up little TV. We eat cheaply and watch our money. We have no credit card or other such consumer debt. Regardless of who I work for I live in the real world and am succeeding at it.

Instead of complaining about inflation and taxes and bills why don't you go out and do something to make your circumstances better. That is the real world.

theotherryan said...

Mayberry, Something occurred to me on the drive home from dinner. For all your talk about private to public wage disparity and the "real world" don't you work for the state?

Mayberry said...

Yes I do, only because it's all I could find. And lucky me, this particular job pays less then private sector. The wife refuses to move, so this is what I'm stuck with. For now...

Chris said...

I think a college degree is, for most people, a good thing. Its probably better to have a four year degree (even if its not in a "hard science" or profession) than to not -- if you can get it at a reasonable cost, that is. I agree with Flt ER Doc that you need to have a plan for how to use a degree, but I won't go so far as to say that all those humanities degrees are worthless... I think a degree steeped in the classical liberal arts is useful for the reason that this education has always been one of a free man (hence the name, "artes liberales...").

I know folks who CHOSE to go to top-tier northeast schools that cost >$50K. Some were able to get scholarships to cover part of the cost but that only takes the edge off. Some worked part of the time but that just covered room & board. Their parents refused to let them do ROTC, but the parents also did not pay for school. They chose degree programs that required a full four years to do and couldn't be finished early (to cut costs). These were ALL choices.

As has been pointed out, a lot of other factors are more important than the name on your degree -- your work ethic, responsibility, intelligence, social networking ability, skills, luck, etc. Those folks that went to expensive schools are a bit dismayed to find out that once you've been in the real world for a few years, employers don't really care where you got that degree. Plus, they're even more dismayed to find out that employers care much more about where you get your master's than your bachelor's (and there's no money left for the master's!).

However, these are all CHOICES that people make and choices have consequences in the adult world. I think the worst blame falls on parents who are not honest with their kids. My folks told me how much was in the college fund and let me make a decision. Many parents won't do this; they want their kid to go the most prestigious school they can get into and don't want money to be a factor. They are uncomfortable talking about money, and don't give their children wise counsel about what $50K in student loans will mean for years after graduation as far as impacts on lifestyle goes.

So, don't blame a government conspiracy, or greedy rip-off universities... I'd look first at the choices that adult individuals make and then at the quality of the counsel they get from those that have the most influence (usually the parents).

Chris from AK

Chris said...

And to respond to 5:59...

Three years ago DW and I graduated from college with $20K in student loans and a $25K unsecured personal loan (at the absurdly low rate of 2%!!). We did have the major advantage of receiving two paid off cars as gifts from parents (a 1990s-era sedan and a newer sedan), which was their way of reimbursing me for the money my ROTC scholarship saved out of the college fund. And we had a few thousand bucks that we had diligently saved by working summers and part time during the school year.

Today we have paid off the student loan and most of the unsecured loan, drive two cars that are both paid in full (and have enough cash in the bank to go buy a replacement for the 1990s sedan if it dies tomorrow), and have a four month emergency fund. We have some mid-term investments and we max out our ROTH IRAs. We save aggressively (100% of her salary and a good chunk of mine) and live below our means. But it is possible.

I don't have much sympathy for adults who think its an impossible challenge. For example, I always think that joining the military -- even just for a few years -- is an option. You instantly gain healthcare for your entire family, allowances for housing and food, and guaranteed income with predictable advancement. You also get 100% tuition assistance which covers the cost of getting your degree, and the GI Bill when you get out. You'll likely get marketable skills and a marketable security clearance.

You can do a 6-year enlistment or 4-year officer commitment (yes, with at least one and maybe more tours overseas) and get out with no debt, a healthy family, a fat war chest/rainy day fund, a bachelor's degree, and the GI bill benefits which will pay for more school.

The military is not for everyone (even a short stint), but if you made some bad choices earlier in life, what it does do is allow you to push the "reset button" and get a fresh start and be in a totally different place six years later. If you're single or childless then taking the King's Shilling may not be the best option but if I was in a bad fix and had kids to take care of I'd certainly consider it.

I may not stay in forever but I do have to say that the ROTC scholarship + 4-7 years of active duty service will set me up great for whatever I want to do next.

Chris from AK

theotherryan said...

Chris, We are in relatively similar situations though I am a bit behind time wise. The thing that I think gets a lot of our age group is that we get out of school and try to have everything right away. Instead of paying off those pesky student loans we go out and get a fairly nice new or couple year old vehicle. We rent or purchase the nicest place we can get. Instead of living below our means, saving and getting ahead we get a home entertainment system that looks like a Best Buy display. Folks get stuff and expenses right up to the very edge of what they can afford and go figure, they can't make accelerated debt payments or save much of anything.

Chris said...

Yup, that's very true.

I've got to admit, I've been tempted to replace the old 1990s sedan this summer with a utility vehicle or truck. I mean, a sedan in Alaska is not much fun... But I just tell myself that every month I can hold onto that old car (which is running pretty good) is like saving $300 ($27K to buy a SUV divided by 96 months = around $300/month). The sedan only has ~85K miles on it and I only use it for a 5 mile commute every day so I think I can stretch it out for another two years.

But I can't tell you how many E-4s and O-1s I know that have large, expensive cars, IPhones, top-rate cable, big rent checks far beyond BAH, etc...

student loan calculator said...

Regarding your comments on taking responsibility, I call this the Homey D. Clown "the Man tryin' to keep Homey down" rationalization. Homey D. Clown was a character on a comedy show in the 90's I enjoyed watching on AFRTS). That perception is often real to the person saying it because he has never seen it any other way.

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