the new poverty: $68K a year or less

[Liesje]

it doesn't totally make up for it, but in america they have laws in place where you can't add surcharges if you use a credit card. when i bought my phone, i was shocked that i had to pay another 5% if i wanted to use a credit card. fuck that! in america, even the most expensive items are the same price no matter how you pay.

Though some places have a minimum amount you can charge or debit. The cafes/grills at the college where I work only accepted cash, check, or student/staff accounts (where you pre-pay into an account based on your ID number). Then they started accepting plastic but there was a $5 minimum for a while. Then they realized they were making heaps more money by accepting plastic so they scratched the minimum because even though they have to pay to run the charges they are still making way more (and I'm getting fat!).

 

[PhilsFan]

i love the usa, i've never felt more at home....but shit guys, stop bending over.

The only thing that can save the US is an idealist winning the lottery and using the money to run for office. Someone who can pay for a campaign with no corporate interests.

Seriously. That's how much we're fucked. We need a miracle.

 

[LJT]

There is the general idea that is the type of politician and hence politics you get is what you deserve. It is as a collective that we can be so reactionary and juvenile, that until a lot more of us become more idealistic or just grow up that we'll get a better kind of politics.

Something I think is the same in the US as in the UK. People moan about the cuts and all that, but a large number of them must have at least voted Conservative or not at all to make it possible for them to be in power.

 

[kramwest1]

The only thing that can save the US is an idealist winning the lottery and using the money to run for office. Someone who can pay for a campaign with no corporate interests.

Seriously. That's how much we're fucked. We need a miracle.

This.

Problem is that if I win the lottery, I'm fucking out of here. You still can find affordable islands to buy.

 

[kramwest1]

There is the general idea that is the type of politician and hence politics you get is what you deserve. It is as a collective that we can be so reactionary and juvenile, that until a lot more of us become more idealistic or just grow up that we'll get a better kind of politics.

Something I think is the same in the US as in the UK. People moan about the cuts and all that, but a large number of them must have at least voted Conservative or not at all to make it possible for them to be in power.

I completely agree with this. The only additional factor is the media control in the U.S. We have let our media be consolidated into the hands of a few corporations, and therefore people don't get all of the information they should.

Would it change how they vote? Probably not enough to make much of a difference.

 

[Irvine511]

$2.13?! Woah, that's obscene. I suppose it's offset a bit by the culture of tipping there that is simply non-existent in Australia

i adored my time in Australia.

but i really, really missed American waiters.

/random

 

[Irvine511]

Too many other factors at play, namely, cost of living depending on locale. Phil and I live perfectly comfortably on around $68K. Own a nice (in my opinion) home, two vehicles (2004 and 1995).

this is quite interesting to me. not to get too specific, Memphis and i make considerably more than you do, but we live in a (nice) one-bedroom apartment and share one 10-year old car (though we can both either walk or metro to work). owning a home in and around DC is going to be a big challenge. the average one-bedroom condo in DC itself starts around $450K, and if you want a "real" home (townhouse) you're easily starting around $500K. the nicest houses (3 bedrooms, 2 baths or more) probably start around $900K. and this is just DC -- NYC, SanFran, Boston and parts of LA are even more expensive. and, now, everyone demands 20% down, so we have to save $100K to even begin to look at a house. we make plenty so actually affording a mortgage isn't a problem, but saving up for the down payment is daunting. granted, we do have "nice" things and a "nice" lifestyle and we go on "nice" vacations -- and, for now, since there's no real *need* for a home, that's fine. i'd rather build up savings, enjoy my life, and rent a low-maintenance, comfortable apartment than invest my life savings into a property that will require a large amount of upkeep. it seems a little bit strange and almost anti-American, but we've even discussed never owning a home and living in (nice) apartments our whole life, or maybe we buy something small when we retire to the desert or southern california. and all this is fine -- we're city folk, and we like to travel and eat well and walk to things. but it does kind of shock me that you can afford a lifestyle on $68K that would require at least $300K+ a year in a big city.

and on another note, and, sure, this is going to seem like upper class whining, but a very good friend of mine is a lawyer at a fairly high powered law firm. he works, very hard, and sort of immediately wound up with three kids very soon after getting married. he makes a substantial income but he and his wife moved out to a tony suburb with an excellent school system. why? private school is unaffordable to them. we're talking a big city lawyer who was himself easily put through private school by his lawyer parents -- he makes comparatively the same salary his father made at the same age in the 1980s, but the cost of living has skyrocketed, so the trappings of the upper classes doesn't buy what it used to. so what has this to do with the poverty level? what it's going to take are the upper classes (but not megarich) who make between, say, $150-$300K a year who start coming to the conclusion that what was promised to them if they played the game right -- get good grades, go to the best schools, go to the best grad schools, get the best jobs -- are no longer attainable because even these upper pieces of the pie have been put out of reach to even them by the superrich. not asking for sympathy, i doubt any of them would ever trade places with anyone, but it's harder to get by on $200K in a big city when you have kids than you might think, but politicians listen more when the rich start whining.

 

[Liesje]

but it does kind of shock me that you can afford a lifestyle on $68K that would require at least $300K+ a year in a big city.

Right, but we're also comparing one of the absolute cheapest places (we have the some of the highest unemployment and worst housing market in the country) to one of the most expensive cities where it is almost impossible to find available real estate. Would I love living in downtown DC or Manhattan? Hecks yeah, but to me that is a lifestyle choice having more to do with privilege than survival. I can't say I'm poor and we're not making it because we can't live in a posh loft in Manhattan. I want to own a comfortably sized home with a postage stamp yard for my dogs on a relatively quiet street so I can't live in the biggest, most expensive cities in the world. I've always had to choose between where I want to live and work and where I can realistically afford to live and work. I don't consider myself poor and underprivileged because I can't live in the most expensive areas. It's just one factor and one choice in weighing the larger picture of what I want vs. what I need. I could also make twice as much money as I do now doing the same work in another state, or in the for-profit sector. There are dozens of things that weigh in, not just the bottom line or salary vs. cost of living.

 

[anitram]

I am in a similar position to Irvine and find it equally as shocking that people in some places can live on $68K joint income rather comfortably. My b/f and I both make very good money, he has no student debt left and I have some minor $10K which I have basically chosen not to pay off because I was playing around with $ in other ways, and we rent. Granted, it is a very nice place (I just took some pics of it to send to my Mom) in a very nice part of town. I drive a 10-year-old car, he drives an 11-year-old car. We could afford new ones but frankly have no interest in them as we probably use our cars a couple of times a week to go do a larger grocery run or to visit parents in the suburbs or whatever. Neither of us is interested in a condo and the houses that we've looked at, which are very nice, in the same part of Toronto where we live now but by no means the most expensive part are around $1.3-1.6 million. Both of us want to wait for the bubble to burst - figure the interest rates are going up in about 6-12 months and house prices should drop at least a bit. We also don't need a huge place at this point and would rather spend our time traveling, of which we plan to do as much as we can with our jobs.

I wouldn't even be able to afford to rent this place if we made $68K together. Or live downtown or pretty much do any of the extra things we like doing on that kind of a salary. Like Irvine, I don't complain because frankly I like my lifestyle, I like that we can walk everywhere and go out to good restaurants and that I never really think about money as a consideration for daily living needs. Plus our friends are in the area, we both work in the financial core which is maybe 20 mins away by subway, and I am just incredibly happy in this urban setting which very much feels like a quirky neighbourhood full of coffee shops, independent bookstores, gelato places and bars with patios. So it's a trade off which I see as worth it.

 

[anitram]

I should also add that in Canada, the recession just didn't hit us the same way and we didn't have all the foreclosures and our housing market is still incredibly elevated. So there is nothing comparable in this country to large chunks of the US where you can buy nice houses for $100-$200K and live quite well on way less money.

Even out in the 'burbs where my parents live, in a nice but average middle class house, the prices are completely insane and I have no idea how they expect young people to buy a house for $650K which 10 years ago you bought for $300K.

 

[Liesje]

So it's a trade off which I see as worth it.

Exactly, I see most of these things as "trade off" type choices, not really being "poor".

The financial ruin of my peers is probably due more to poor choices like over borrowing for a home, credit card debt, etc than actually not being able to survive anywhere on 68K.

I like living in a city but not downtown, mainly b/c of the dogs and needed at least some amount of space for them, indoors and out. Honestly if we didn't have dogs and that was not a factor we'd probably live in Chicago, Boystown/Lakeview or Wrigleyville area. Where we are now I would not need a vehicle (besides transporting dogs) because I could bike or ride a bus to work and can easily walk just a few blocks to groceries, the library, banks, hardware shop, etc and we are not even in a large city or downtown. I'm not a huge fan of suburbia, if it came to that I'd rather get some actual land in the "country" than a cookie-cutter neighborhood. I need there to be people and activity, like the sounds of traffic, people on their patios, kids in the street. I like my trees and homes to be at least 75 years old The dogs and the "bang for your buck" cost of living here are the main factors in our trade off. You couldn't PAY me to live somewhere if it didn't have the resources I need for properly training and working dogs. That's more important to me than where I work/who I work for.

 

[anitram]

Yeah, I now live in a perfect neighbourhood for a dog which is another thing that's important to me at some point. I work too many hours right now to get one but within the next couple of years I would definitely consider it.

 

[corianderstem]

I couldn't believe that Wisconsin senator/representative/congressman/whateverheis Duffy (the one who was on a season of The Real World, and funnily enough, is related by marriage to a relative of mine) was bitching how hard it was for him to get by on $175,000.

He lives in fucking Wisconsin. That state does not have a high cost of living. So suck it up, you asshole.

 

[financeguy]

Even out in the 'burbs where my parents live, in a nice but average middle class house, the prices are completely insane and I have no idea how they expect young people to buy a house for $650K which 10 years ago you bought for $300K.

Property prices increase only at the rate of wage inflation - no more, no less, over the long term. Long term meaning not 5 or ten years, but 30 years plus. I have no idea whether the Canadian market is overvalued or not - but that's the long term metric. So if average incomes have not doubled in 10 years - my guess is, and granted I'm being simplistic, that's a market in a bubble right there.

The Irish property bubble is only 50%/60% through deflating - and prices have been dropping for four years solidly now. There has not been a single month since early 2007 that has recorded an increase. Property bubbles take a long time to deflate!

 

[financeguy]

The real median earnings of men who worked full time, year-round climbed between 2006 and 2007, from $43,460 to $45,113 (about 3.6 time minimum wage in 2006 to 3.7 time minimum wage in 2007). For women, the corresponding increase was from $33,437 to $35,102 (2.8 and 2.9 times minimum wage respectively). The median income per household member (including all working and non-working members above the age of 14) was $26,036 in 2006.

Household income in the United States - Wikipedia, the free encyclopedia

And those are pre-recession stats.

 

[ryancoke71]

I should also add that in Canada, the recession just didn't hit us the same way and we didn't have all the foreclosures and our housing market is still incredibly elevated. So there is nothing comparable in this country to large chunks of the US where you can buy nice houses for $100-$200K and live quite well on way less money.

Even out in the 'burbs where my parents live, in a nice but average middle class house, the prices are completely insane and I have no idea how they expect young people to buy a house for $650K which 10 years ago you bought for $300K.

I live in Ontario in a smaller town, and my house is worth about $250 000. It is a 3 bedroom, 3 bath home in a great neighbourhood. So again, all of this is relative. We can live comfortably on $68 K, but I sympathize with those in larger markets that struggle to make ends meet.

 

[Irvine511]

Exactly, I see most of these things as "trade off" type choices, not really being "poor".

oh, i agree, and i think at least in terms of where we live we represent rather extreme points of the country, and the $68K needs to be adjusted regionally, and at the end of the day you're only as poor as your expenses. i can pull in $10K a month and if my expenses are $9,999, then i'm SOL. but it's still stunning to think that you can't even save, let alone go on a vacation, (at least on average), unless you are making $70K a year.

 

[cobl04]

i adored my time in Australia.

but i really, really missed American waiters.

/random

We went to dinner in San Diego one night (I'm in Aus too) and we had an awesome waiter. He was maybe 24, 25, and he ended up sitting down with us and talking shit/chewing the fat/shooting the breeze for about half an hour. Whether he was just working for a good tip I don't know, but it was really cool. Here they just aren't remotely interested, even if you've got an accent as cool as David Lloyd.

 

[Irvine511]

Here they just aren't remotely interested

no, they really weren't.

still, indifferent waiters were a small price to pay for the weather, the reef, the rock, the Road, and Sydney.

(Melbourne too)

 

[cobl04]

no, they really weren't.

still, indifferent waiters were a small price to pay for the weather, the reef, the rock, the Road, and Sydney.

(Melbourne too)

I was gonna say, you can't leave Melbourne off that list, it is the greatest city in the universe

 

[mama cass]

French waiters have got to be the worst

 

[mama cass]

flippin heck though... these data are pretty scary indeed... $68k (roughly 47,000 euros) would be considered a pretty decent wage here, even in Paris, but wages are incredibly low here in France... although personal debt is still pretty limited here, there hasn't been a credit card explosion like in the UK/US, and authorised overdrafts are still relatively new... borrowing is hard here and strictly regulated - you are only allowed to borrow up to a third of your income after tax - all loan repayments, mortgages etc have to come out of that amount...

our lifestyle here in rural France is pretty frugal and living can be cheap, many people here seem get by on little, and we grow our own fruit and veggies and keep chickens for eggs, and my only guilty and extravagant pleasure is my horses (and they weren't too expensive to buy as they were babies and i trained them myself), i can't really afford to keep them but scrimp by as they keep me sane lol and counterbalance the stresses of my work... and they bring me and my daughter so much happiness... plus there's nice foodie treats and a bit of wine, keeping up with two growing kids, sloooooooowly doing up the house, the odd bit of travel, and a concert or two here and there... and savings? what's that?! lol! but yeah i am always skint even though i regularly work 50+ hour weeks lol! i do not know where it all goes*! it's insane!

*actually i do... i think Sarkozy knows the answer to that... grrrr @ french tax!

 

[Headache in a Suitcase]

This.

Problem is that if I win the lottery, I'm fucking out of here. You still can find affordable islands to buy.

fuck that... i'll still live here but i'll set up a corporation based in zurich to handle all my business... like doing laundry. those fucking machines are pricey.


what i really want to know is where the guy who wrote the 2nd article in the original post found an apartment for $1,000 a month in new york city.

it really is obscene... one of my best friend's moved to maine. he lives in a nice area right on the water in a fairly large two bedroom apartment with a full kitchen, washer/dryer, dish washer, large bathroom... and he's paying $800 a month for the place. he's a county cop so he's making a good salary.. he's got all the money in the world to burn. the downfall, of course, is that he's in maine... far far away from his friends and family. not too far from portland, which is a pretty fun time and all, but still... not exactly manhattan, or DC or LA or wherever. but he's a cop... he can do his job anywhere.

then there's myself and my fiancée'... we rent a small one bedroom apartment with just the basics. a small kitchen attached to the living room, very small bathroom (i hit my head in the shower).. no washer/dryer/dishwasher in the building, which is a walk up. $1,500 a month. i gave up my car when the lease was up because it's too expensive to have in the city. we live at trader joe's because we can stock up on food for the week at half the price of the local food emporium or what have you. things are extra tight right now because as of april 1st she's on an indefinite furlough/pay reduction brought on by a disagreement between millionaires and billionaires. we have an okay social life, but more often than not are paying attention to which bars have specials on the nights we want to go out in order to save some cash.

our combined salaries (not counting the 10% current reduction) are about $110,000.

$68,000? with kids? please...

the rent... too damn high.

 

[financeguy]

fuck that... i'll still live here but i'll set up a corporation based in zurich to handle all my business... like doing laundry. those fucking machines are pricey.


what i really want to know is where the guy who wrote the 2nd article in the original post found an apartment for $1,000 a month in new york city.

it really is obscene... one of my best friend's moved to maine. he lives in a nice area right on the water in a fairly large two bedroom apartment with a full kitchen, washer/dryer, dish washer, large bathroom... and he's paying $800 a month for the place. he's a county cop so he's making a good salary.. he's got all the money in the world to burn. the downfall, of course, is that he's in maine... far far away from his friends and family. not too far from portland, which is a pretty fun time and all, but still... not exactly manhattan, or DC or LA or wherever. but he's a cop... he can do his job anywhere.

then there's myself and my fiancée'... we rent a small one bedroom apartment with just the basics. a small kitchen attached to the living room, very small bathroom (i hit my head in the shower).. no washer/dryer/dishwasher in the building, which is a walk up. $1,500 a month. i gave up my car when the lease was up because it's too expensive to have in the city. we live at trader joe's because we can stock up on food for the week at half the price of the local food emporium or what have you. things are extra tight right now because as of april 1st she's on an indefinite furlough/pay reduction brought on by a disagreement between millionaires and billionaires. we have an okay social life, but more often than not are paying attention to which bars have specials on the nights we want to go out in order to save some cash.

our combined salaries (not counting the 10% current reduction) are about $110,000.

$68,000? with kids? please...

the rent... too damn high.

Many have much less...sounds like you're doing ok. I pay around that on my mortgage in crappy old Dublin, and it's only a modest 1 bed apartment also....ok, I do have a washer/dryer in the apartment, the development is well-constructed so I rarely need to use the heating except for the recent coldsnap, and the bathroom is a decent size but it's not exactly luxury either. I have one bookcase for my books as there's not point in buying a second one owing to lack of space. I bought in 2002 and after the best part of a decade's mortgage payments I now find I'm in negative equity to the tune of €50k due to the property crash here. You're living in one of the greatest cities on earth with cultural and social opportunities you could only get in very few other cities on the planet, most of them equally expensive...actually, in a way you already won the lottery of life!

 

[mama cass]

yeah i guess it depends on where you live... when we lived in Paris, before we had kids, a third to half of our income went on rent, for the tiniest little studio flat with a mini kitchen and shower room, 6 floors up and no lift lol!! was a great way to keep fit though lugging the shopping up those steps ha... those were some of the best days of my life... we had very few outgoings aside from rent, we didn't have a car then, there was no point, we could walk/metro/bus it everywhere, plus parking would've been impossible... everything was on our doorstep or within very easy reach, shops, bars, clubs, cinemas, rarely a quiet night in there was always so much going on... we didn't even have a tv as we were never home, it was really just a place to lay our heads... so it didn't matter it was tiny... we were skint as usual, but living life to the max with great friends, and we knew all the cheapest bars and places to eat lol, happy times indeed... i think it would've been pretty tough staying in Paris with kids though, but i'm sure we would've managed, we've got many friends in similar situations who do, just a completely different lifestyle that's all, although space and tiny flats would've been a problem... i do miss city life a lot but we're not tied to a particular location for our work, so it seemed a good lifestyle choice for us to up sticks and move out to the countryside... but that has its downsides too... guess nowhere is perfect lol!

 

[Irvine511]

our lifestyle here in rural France is pretty frugal and living can be cheap, many people here seem get by on little, and we grow our own fruit and veggies and keep chickens for eggs, and my only guilty and extravagant pleasure is my horses (and they weren't too expensive to buy as they were babies and i trained them myself), i can't really afford to keep them but scrimp by as they keep me sane lol and counterbalance the stresses of my work... and they bring me and my daughter so much happiness... plus there's nice foodie treats and a bit of wine, keeping up with two growing kids, sloooooooowly doing up the house, the odd bit of travel, and a concert or two here and there...

this makes me swoon with longing for the French countryside. le sigh.

 

[mama cass]

this makes me swoon with longing for the French countryside. le sigh.

heh it's not all it's cracked up to be... i only mentioned the nice bits

we really are out in the arse-end of the back and beyond here and lately i've been finding myself longing for some culture and "civilisation" and the buzz of the city... it can be idyllic sometimes, but sometimes it drives me nuts...

i think the worst thing has been the complete lack of anonymity... it still does my head in when people, complete strangers, shop assistants, etc. seem to think they know more about us than we do lol

i'm quite a private person, so that does tend to freak me out a bit... but mostly people have been warm and kind, and we have made some really lovely friends here, although it did take a long time to feel "at home"...

generally, i do love it really, most of the time lol

 

[Headache in a Suitcase]

Many have much less...sounds like you're doing ok. I pay around that on my mortgage in crappy old Dublin, and it's only a modest 1 bed apartment also....ok, I do have a washer/dryer in the apartment, the development is well-constructed so I rarely need to use the heating except for the recent coldsnap, and the bathroom is a decent size but it's not exactly luxury either. I have one bookcase for my books as there's not point in buying a second one owing to lack of space. I bought in 2002 and after the best part of a decade's mortgage payments I now find I'm in negative equity to the tune of €50k due to the property crash here. You're living in one of the greatest cities on earth with cultural and social opportunities you could only get in very few other cities on the planet, most of them equally expensive...actually, in a way you already won the lottery of life!

first, the lottery of life bit... yea, no.

i'm not complaining, even if it might sound like it. sure i'd love to have a bigger apartment, but i love living in new york more than having the big apartment. was just adding to the conversation about cost of living in metropolitan areas.... and how the idea that $67,000 for two parents and two kids is livable is simply ridiculous, especially if you live in or near a major metropolitan area. and if you work in the corporate world, which my fiancée does, you need to live in or near a major metropolitan area.


on a semi-related but sorta not subject... i find the reverse class exodus in new york and other major metropolitan cities in the US fascinating... once upon a time it was the dream to become successful and move out to the suburbs, while large portions of the major metropolitan areas became slums. now that seems to be reversing, as once terrible neighborhoods are fast becoming gentrified "hip" locations, and the crime rate in the suburbs is soaring.

10-15 years ago long island city was a factory neighborhood that bordered the violent queensbridge projects. now LIC is filled with luxury apartment buildings that start at $2,000 a month for a studio. crazy.

 

[Irvine511]

the same thing is happening in DC. once known as "Chocolate City," the african-american population is now just about 50%, and will continue to drop, as does crime, as housing prices continue to rise. i haven't been here nearly long enough to really bear witness to something that's been happening for decades, but even i can tell you that the city is noticeably different. and the crime rate in Prince George's County has absolutely gone up.

there's also the total absence of a middle class in DC. you're either a yuppie living downtown (and could be of any background), a Blue Blood in Georgetown, a member of the ultra power elite in Northwest sending your kids to private school, or living in poverty. i spent a weekend a few weeks ago in Philadelphia and was stunned at the very visible presence of white, middle class, cityfolk, hipsters who actually are cashiers or own a vinyl record store, not people who just dress like they do. they'd be totally priced out of the good parts of DC, and wouldn't live in the other parts for fear of crime. i'm sure the same is true of not just Manhattan, but Brooklyn and parts of Queens as well.

if you made $68K a year here and had two kids, well, have fun living in Manassass, VA or Laurel, MD, and battling 2 hours of traffic in and out of the city each day. or riding the MARC, which isn't so bad.

anyway ...

 

[Headache in a Suitcase]

let's put it this way... my sister and her husband used to live in rocky point, long island... which is about 75 miles east of midtown manhattan. at least a 2 hour drive in rush hour traffic, and about 20 minutes from the nearest train station, which is in port jefferson. a monthly train ticket to penn station from port jeff is $334 bucks, and the trip averages around 2 hours. tack on a $104 monthly metrocard on top of that. $448 a month just to get to and from work every day (and that's still cheaper than if you drove with gas prices the way they are).

their modest 3 bed, 2 bath, one story house on a small piece of land sold for $550,000. they bought a house about 20 minutes east of hartford that is three times the size, on 5 times the land, for $185,000.