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(Wall Street Journal)   Thanks to the Great Recession, people under 35 are now doing something with money called "saving"   (blogs.wsj.com) divider line 130
    More: Spiffy, shahs, moving average, risk averse  
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4959 clicks; posted to Main » on 06 Mar 2013 at 8:33 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-03-06 09:18:09 AM  

Generation_D: dynomutt: The government doesn't need to send armed troops to steal your savings, if you keep it in a bank.

They just need to keep printing and printing (or its electronic equivalent).

Read "When Money Dies", especially the vignette about the German woman who broke her leg skiing, stayed in Switzerland for about a year to heal up, and came home to find that her entire life savings was less than the cost of the stamp of a letter from the bank indicating that her account balance was too small to keep the account open.  BTW: The numeric balance of the account had not gone down.

I bet you've read several books.


assuming the story it true is must have been during the hyper inflation Germany experienced between WW1 and WW2. If we ever get to that point now a defunct economy will be the least of our problems.
 
2013-03-06 09:19:38 AM  
6-month emergency fund: have one.
 
2013-03-06 09:25:35 AM  

Bruce Campbell: If you were to look at my bank accounts, it would appear that I am not saving by any significant amount.  My investments are in the businesses in which I have control or at least 51% control and aren't subject to rampant speculation by others.  To me, saving in the traditional sense is a losing endeavor.  I'd rather invest my money in things I can control rather than putting money in a bank to earn a pittance.  I'd rather put money in my own business than purchase shares of stock in a company that will have a different board of directors in 3 years than it does presently because they didn't operate at a short term profit.  I might "save" in 20 years after I divest from these endeavors, but for now, I'm happy with the rates of return I make for myself.


t.im9.eu
 
2013-03-06 09:27:37 AM  
Saving takes money out of the economy. I think Obama should use the commerce clause to implement a tax on savings.
 
2013-03-06 09:28:11 AM  

Fubini: Not just saving- getting married as well.

Live off of one person's paycheck, put the other person's paycheck entirely into savings. In a few years you could buy a modest house for cash money.


And then lose it all to your ex and some lawyers a few years later. That is terrible financial advice.

/you don't need to be married to get a roommate and split expenses.
 
2013-03-06 09:30:51 AM  
when all the baby boomers cash out their 401k plans, these investors will be the only cushion before the market completely bottoms out
 
2013-03-06 09:30:57 AM  

Thunderpipes: Saving takes money out of the economy. I think Obama should use the commerce clause to implement a tax on savings.


Herpa derpity doo!
 
2013-03-06 09:31:40 AM  

Thunderpipes: Saving takes money out of the economy. I think Obama should use the commerce clause to implement a tax on savings.


You better rethink that one. (double taxation)
 
2013-03-06 09:32:47 AM  
Two16

Indeed.
 
2013-03-06 09:33:45 AM  

Lost Thought 00: Elites hate this, because it slows the rate at which the top 0.00001% get to siphon off money from the rest of the populace. 500 people control over 50% of all the money in the world. Those 500 people, and all their heirs, need to die in order for society to continue functioning. Their greed will destroy the human race if we don't destroy them first


I read a story about how 25% of Americans have zero or negative net worth. Since they are obviously a drain on society, if these 25%, and all their heirs, die, we will be a totally rich. Idiot.
 
2013-03-06 09:33:55 AM  
I only make 1300 a check take home. I have 3000 saved from taking little by little from each check. No student loans, no car payments and cheap rent and braces are my only monthly expenses. I have a 401k set up with work so I hope I'm doing it right.
 
2013-03-06 09:35:21 AM  

umad: And then lose it all to your ex and some lawyers a few years later. That is terrible financial advice.

/you don't need to be married to get a roommate and split expenses.


Most people aren't going to buy a house with their roommate.

Worst case scenario (unless you've seriously married the wrong person) is you split the savings in a divorce at which point you end up no worse off than if you were splitting costs with a roommate. If your spouse is doing something that jeopardizes your joint savings plan then you really ought to be on guard to begin with.
 
2013-03-06 09:38:08 AM  

Baryogenesis: dynomutt: The government doesn't need to send armed troops to steal your savings, if you keep it in a bank.

They just need to keep printing and printing (or its electronic equivalent).

Read "When Money Dies", especially the vignette about the German woman who broke her leg skiing, stayed in Switzerland for about a year to heal up, and came home to find that her entire life savings was less than the cost of the stamp of a letter from the bank indicating that her account balance was too small to keep the account open.  BTW: The numeric balance of the account had not gone down.

Go ahead and explain what hyperinflation in Weimar Germany has to do with our current economy (inflation last year was ~2%).  I'll wait right here.


Ask Boskin how it works. According to him a computer that costs 700 dollar now is cheaper than a computer that cost 500 dollar 15 years ago because the modern computer is at least 300% better. Therefore the price for the computer can be "corrected" for quality, making it just 250 dollar in the inflation index. The increase in the price of steak is ignored because people will eat more hamburgers, therefore the amount of spendable money remains the same and no inflation occurred. Which would be somewhat acceptable if people at the bottom weren't being forced into eating the cheapest crap available while the people at the top claim everything is going fine since the amount of spendable income remains the same.

The actual inflation number is much higher. Inflation as tracked by a Dartmouth cum laude graduate.
 
2013-03-06 09:41:57 AM  
Good lord I'd love to have any extra money to put away.

/kill me
 
TWX
2013-03-06 09:41:59 AM  

WienerButt: I only make 1300 a check take home. I have 3000 saved from taking little by little from each check. No student loans, no car payments and cheap rent and braces are my only monthly expenses. I have a 401k set up with work so I hope I'm doing it right.


Assuming that you're paid every other week, that's almost $34,000 a year take-home. I'm going to guess that you make around $45,000 before taxes. If so, you make more money than 71% of wage earners in the United States.

Source: Link
 
2013-03-06 09:50:27 AM  

Fubini: Not just saving- getting married as well.

Live off of one person's paycheck, put the other person's paycheck entirely into savings. In a few years you could buy a modest house for cash money.


Yep, DINKs4life.  We didn't buy a house with cash moneys, but we're on our way to paying off our mortgage in 5-6 years total with this method, and I'm only 25.

Then we plan on reducing our work hours so we can enjoy life a little more.  And we'll still be saving a ton from each paycheck.
 
2013-03-06 09:52:31 AM  

Fubini: Not just saving- getting married as well.

Live off of one person's paycheck, put the other person's paycheck entirely into savings. In a few years you could buy a modest house for cash money.


Assuming you both can actually get well paying jobs that make that possible.

/was netting almost $800 a month after rent, car note, bills and expenses while single
//got married...now lucky to put away $100 a month.
 
2013-03-06 09:58:19 AM  

WienerButt: I have a 401k set up with work so I hope I'm doing it right.


Try to put in the max amount if you can. You'll benefit from the advice down the road.

/27 years with my 401k so far
 
2013-03-06 10:02:35 AM  

dynomutt: The government doesn't need to send armed troops to steal your savings, if you keep it in a bank.

They just need to keep printing and printing (or its electronic equivalent).

Read "When Money Dies", especially the vignette about the German woman who broke her leg skiing, stayed in Switzerland for about a year to heal up, and came home to find that her entire life savings was less than the cost of the stamp of a letter from the bank indicating that her account balance was too small to keep the account open.  BTW: The numeric balance of the account had not gone down.


Sigh, someone just posted the numbers in another thread, but inflation is the lowest it has been in a very long time.  Using the calculator at  http://www.usinflationcalculator.com/ and correcting for a few things (they call total inflation over four years an "annual rate" when it is a cumulative amount), I get an average annual inflation rate of 1.79% over Obama's first term, 2.43% over both Bush Jr. terms, 2.57% over both Clinton terms, 3.90% over Bush Sr.'s term, 3.96% over both Reagan terms...
 
2013-03-06 10:08:52 AM  

DerAppie: The actual inflation number is much higher. Inflation as tracked by a Dartmouth cum laude graduate.


That's not what we are discussing though, the topic was inflation as it matters to the worth of currency in the global bond market and its affect on the purchasing power in markets.

Now yes, if you want to get into the microeconomics models then there is a speculative argument that because wages have stagnated the actual inflationary number is higher but now the topic is purchasing power and there are a whole host of other variables that go into those models.

Not an economist, but I did stay at a Holiday Inn. Which based on the intelligence of todays current economists might just put me up there with them.
 
2013-03-06 10:09:12 AM  

Mose: I'm saving and keeping my cash balance on the low side.  Sucks getting interest rates that aren't even par with inflation.  Money losing its value just sitting around is depressing, but it's still good to have a 6 - 12 mo. emergency account liquid just in case...


Yeah, I am using a Vanguard S&P500 account as my real "savings" account with only a little bit of cash in an actual savings account.  I put most of the money in on a very bad day in August of 2011, so I am feeling kind of smug about the "interest rate" I've been getting since then.
 
2013-03-06 10:10:19 AM  

AlwaysRightBoy: WienerButt: I have a 401k set up with work so I hope I'm doing it right.

Try to put in the max amount if you can. You'll benefit from the advice down the road.

/27 years with my 401k so far


How much of it disappeared from 2008-2010?

Pretty much everyone I know lost 30-40% off theirs during that time. Was pretty ridiculous.

A lot of thats looking like its back on track now, but nothing will change the fact we had a significant chunk of the "savings" knocked out by one short series of economic blunders.

None of which have been prosecuted, I might add.
 
2013-03-06 10:11:39 AM  

ltdanman44: Slaxl: Why? Haven't we just seen a collapse caused by the same issues that are still going on, and any money you have in banks will be lost when they go under because next time we can't bail them out? Live for the now, because when we're all 70 the man who didn't save will be as poor as the man who did save.

 My father saved his entire life and just about when he was going to collect his pension, it vanished.

And now they are coming for his (and yours) social security.  And you know what?  They will get it, they will get it all.


Pension? Social Security? I don't think saving means what you think it means.
 
2013-03-06 10:12:24 AM  

AlwaysRightBoy: People under 35  lived through the Great Recession of 1929?

/ doesn't know what we would have done with this last one if was as bad as the one 1929


Yes, we experienced the Second Great Republican Recession.

We know who to thank.
www.muslimvideo.com
 
2013-03-06 10:16:17 AM  

DerAppie: Inflation as tracked by a Dartmouth cum laude graduate.


Um, isn't Dartmouth the out-in-the-boonies-where-they-won't-be-noticed "Ivy league" school where rich people stick their kids who couldn't get into the real Ivy league schools?
 
2013-03-06 10:17:48 AM  

waterrockets: ltdanman44: Slaxl: Why? Haven't we just seen a collapse caused by the same issues that are still going on, and any money you have in banks will be lost when they go under because next time we can't bail them out? Live for the now, because when we're all 70 the man who didn't save will be as poor as the man who did save.

 My father saved his entire life and just about when he was going to collect his pension, it vanished.

And now they are coming for his (and yours) social security.  And you know what?  They will get it, they will get it all.

Pension? Social Security? I don't think saving means what you think it means.


The point was you need money when you retire.  Where that money comes from doesn't matter if its not there for you when you need it.
 
2013-03-06 10:19:48 AM  

waterrockets: ltdanman44: Slaxl: Why? Haven't we just seen a collapse caused by the same issues that are still going on, and any money you have in banks will be lost when they go under because next time we can't bail them out? Live for the now, because when we're all 70 the man who didn't save will be as poor as the man who did save.

 My father saved his entire life and just about when he was going to collect his pension, it vanished.

And now they are coming for his (and yours) social security.  And you know what?  They will get it, they will get it all.

Pension? Social Security? I don't think saving means what you think it means.


I did your intervals last night.  They hurt, a lot.  But thanks anyway.

/you're famous, like, on the internet!
 
2013-03-06 10:22:08 AM  

CapeFearCadaver: Good lord I'd love to have any extra money to put away.

/kill me


As you spend money on a TotalFark account...

The people that I usually see whining about not having money to save are spending that money on wasteful things. Cable TV, super duper high speed internet, $100/month cellphone bills, new cars....etc.

Like an earlier poster said, its quite easy to save when you live below your means. I make a good middle class salary, but am able to save quite a bit as I don't have cable (OTA HDTV is free!), lowest tier internet, family plan cellphone, 11 year old car, etc. I get the reputation in my group of friends for being the "frugal/cheap bastard." Joke's on them, because I hope to be retired long before they stop working.  Cut out the fat and you can easily have money left to save.
 
2013-03-06 10:25:56 AM  

waterrockets: Pension? Social Security? I don't think saving means what you think it means.


Many people refer to the money they put into a retirement fund as "saving up for retirement".  It's not wrong to do so, even if the account involved is not an actual "savings account" like the ones banks used to offer.  Many banks no longer offer them--I went through a stretch around the turn of the century where my bank would keep getting bought out by a bank that would convert my savings account into a "pay us a fee to store your money" account, and I would have to find a new bank, which would get bought out a year later...
 
2013-03-06 10:33:28 AM  
HotWingConspiracy: "Shame our economy is designed to punish savers."

High savings and deflation ain't so great either.
Having to choose between them, I'll take our problems over that.
 
2013-03-06 10:35:44 AM  

joness0154: As you spend money on a TotalFark account...


I was sponsored.
 
2013-03-06 10:38:07 AM  
THey have to save, since they can't get approved for credit. NTTAWWT
 
2013-03-06 10:38:32 AM  

NateGrey: We know who to thank.


You need to post a lot more pictures than just that one.
 
2013-03-06 10:40:02 AM  
I put my money into real estate. People will always need a place to live.
 
2013-03-06 10:40:10 AM  

CapeFearCadaver: joness0154: As you spend money on a TotalFark account...

I was sponsored.


Also, no cable, no home internet, 14 year old truck, cheap cell phone and plan, beans/rice/ramen are my foods (as my stomach grumbles), cheapest TP, soaps, cleaners there are, etc, etc, etc. No debt or credit cards.

But thanks for playing Mr. Keeping up with the joness.
 
2013-03-06 10:44:09 AM  
DerAppie: "The actual inflation number is much higher. "

How is it we're told it's only "common sense" to consider substitution effects when we calculate inflation for determining benefit adjustments for retirees, the disabled, etc -- but when it comes time to calculate inflation to show the erosion of not-invested wealth, all that "common sense" becomes a huge government conspiracy?
 
2013-03-06 10:46:15 AM  

internut scholar: I put my money into real estate. People will always need a place to live.


Right you are, which is why I sunk my money into refrigerator boxes.
 
2013-03-06 10:57:58 AM  

CapeFearCadaver: CapeFearCadaver: joness0154: As you spend money on a TotalFark account...

I was sponsored.

Also, no cable, no home internet, 14 year old truck, cheap cell phone and plan, beans/rice/ramen are my foods (as my stomach grumbles), cheapest TP, soaps, cleaners there are, etc, etc, etc. No debt or credit cards.

But thanks for playing Mr. Keeping up with the joness.


Try corn + beans as a veggie staple.  They have complimentary amino acid profiles, one of the reasons the natives did so well on the "three sisters" gardens they had before they all died of our small pox.  Also growing your own herbs inside is a good way to make bland food much less so, and is easy, and fresh and dried grocery store herbs are about the worst value there is.

/font of obscure but occasionally useful knowledge
 
2013-03-06 11:00:03 AM  

CapeFearCadaver: joness0154: As you spend money on a TotalFark account...

I was sponsored.


God derm socialism!!! :)
 
2013-03-06 11:00:33 AM  

joness0154: As you spend money on a TotalFark account...


Some of us whore ourselves out for TF

Speaking of which, anyone...anyone? 5 dollar make you holla, love you long time.
 
2013-03-06 11:33:35 AM  

MyKingdomForYourHorse: DerAppie: The actual inflation number is much higher. Inflation as tracked by a Dartmouth cum laude graduate.

That's not what we are discussing though, the topic was inflation as it matters to the worth of currency in the global bond market and its affect on the purchasing power in markets.

Now yes, if you want to get into the microeconomics models then there is a speculative argument that because wages have stagnated the actual inflationary number is higher but now the topic is purchasing power and there are a whole host of other variables that go into those models.

Not an economist, but I did stay at a Holiday Inn. Which based on the intelligence of todays current economists might just put me up there with them.


Ah, but the person I responded to said that inflation was at 2% last year. I pointed out that due to various methodological insanities that number is too low.

Also, if we are duscussing purchasing power how does a higher inflation (compared to the official number) not factor into it? Especially if we assume that once upon a time wages were corrected for an inflation number, which was artificially reduced, and that inflation correction on their wages is something people can only dream of?

/Also not an economist
//have been reading up on it
 
2013-03-06 11:48:32 AM  

Thunderpipes: Saving takes money out of the economy. I think Obama should use the commerce clause to implement a tax on savings.


He's too busy trying to find his REAL birth certificate for you.
 
2013-03-06 11:49:27 AM  

Bruce Campbell: Two16

Indeed.


Quite...
 
2013-03-06 11:53:00 AM  

TWX: WienerButt: I only make 1300 a check take home. I have 3000 saved from taking little by little from each check. No student loans, no car payments and cheap rent and braces are my only monthly expenses. I have a 401k set up with work so I hope I'm doing it right.

Assuming that you're paid every other week, that's almost $34,000 a year take-home. I'm going to guess that you make around $45,000 before taxes. If so, you make more money than 71% of wage earners in the United States.

Source: Link


As someone who makes $55k a year before taxes with no loans or debt and has a 401k setup, this horrifies me.  What's worse is had I decided to go to college like I originally intended, I would not have it as good as I do now as I would have finished my degree in 2008...
 
2013-03-06 12:04:23 PM  

ringersol: HotWingConspiracy: "Shame our economy is designed to punish savers."

High savings and deflation ain't so great either.
Having to choose between them, I'll take our problems over that.


Serious question, why is deflation bad? Sure, it is not smart to take on debt, but if left to a natural cycle inflation and deflation will pretty much negate each other. Money will, on average, maintain its value instead of devaluating year after year.

Besides, deflation might be bad for debtors but inflation is bad for the people lending the money. They need to charge higher interest rates to ensure that they won't lose money on the deal.
 
2013-03-06 12:12:25 PM  

Two16: Bruce Campbell: Two16

Indeed.

Quite...


Indubitably
 
2013-03-06 12:17:20 PM  

Mose: CapeFearCadaver: CapeFearCadaver: joness0154: As you spend money on a TotalFark account...

I was sponsored.

Also, no cable, no home internet, 14 year old truck, cheap cell phone and plan, beans/rice/ramen are my foods (as my stomach grumbles), cheapest TP, soaps, cleaners there are, etc, etc, etc. No debt or credit cards.

But thanks for playing Mr. Keeping up with the joness.

Try corn + beans as a veggie staple.  They have complimentary amino acid profiles, one of the reasons the natives did so well on the "three sisters" gardens they had before they all died of our small pox.  Also growing your own herbs inside is a good way to make bland food much less so, and is easy, and fresh and dried grocery store herbs are about the worst value there is.

/font of obscure but occasionally useful knowledge


A diet based upon heavy consumption of corn and beans has... certain drawbacks, which may necessitate increased expenditure on toilet paper.

I use the cheapest, single-ply toilet paper, which I buy in vast quantities when it goes on sale at the dollar store.  And I do not wastefully discard it after only using one side, like most of you profligate big spenders do.
 
2013-03-06 12:25:24 PM  

Parthenogenetic: Mose: CapeFearCadaver: CapeFearCadaver: joness0154: As you spend money on a TotalFark account...

I was sponsored.

Also, no cable, no home internet, 14 year old truck, cheap cell phone and plan, beans/rice/ramen are my foods (as my stomach grumbles), cheapest TP, soaps, cleaners there are, etc, etc, etc. No debt or credit cards.

But thanks for playing Mr. Keeping up with the joness.

Try corn + beans as a veggie staple.  They have complimentary amino acid profiles, one of the reasons the natives did so well on the "three sisters" gardens they had before they all died of our small pox.  Also growing your own herbs inside is a good way to make bland food much less so, and is easy, and fresh and dried grocery store herbs are about the worst value there is.

/font of obscure but occasionally useful knowledge

A diet based upon heavy consumption of corn and beans has... certain drawbacks, which may necessitate increased expenditure on toilet paper.

I use the cheapest, single-ply toilet paper, which I buy in vast quantities when it goes on sale at the dollar store.  And I do not wastefully discard it after only using one side, like most of you profligate big spenders do.


I've fallen in love with you during the past couple of weeks, BTW.
 
2013-03-06 12:25:47 PM  

HotWingConspiracy: Shame our economy Reality is designed to punish savers.


FTFY
 
2013-03-06 12:31:25 PM  

Parthenogenetic: Mose: CapeFearCadaver: CapeFearCadaver: joness0154: As you spend money on a TotalFark account...

I was sponsored.

Also, no cable, no home internet, 14 year old truck, cheap cell phone and plan, beans/rice/ramen are my foods (as my stomach grumbles), cheapest TP, soaps, cleaners there are, etc, etc, etc. No debt or credit cards.

But thanks for playing Mr. Keeping up with the joness.

Try corn + beans as a veggie staple.  They have complimentary amino acid profiles, one of the reasons the natives did so well on the "three sisters" gardens they had before they all died of our small pox.  Also growing your own herbs inside is a good way to make bland food much less so, and is easy, and fresh and dried grocery store herbs are about the worst value there is.

/font of obscure but occasionally useful knowledge

A diet based upon heavy consumption of corn and beans has... certain drawbacks, which may necessitate increased expenditure on toilet paper.

I use the cheapest, single-ply toilet paper, which I buy in vast quantities when it goes on sale at the dollar store.  And I do not wastefully discard it after only using one side, like most of you profligate big spenders do.


There are ways of preparing both that get rid of, or minimize the unsoluble fiber.
 
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