Originally Posted by calgaryhhr:
I think this is something that many people overlook or never mention when they start talking about the shrinking middle class. The middle class is essentially killing itself by being over-extended and trying to live high-class lifestyles when they can't afford it.For the last 20 years at least there has been a major push within the middle class to live beyond their means and try to represent themselves as being better off than they really area.The middle class should have focused more of saving and smart financial planning instead of taking expensive vacations, buying a new SUV every second year or trying to risk it all in real estate investments.I know the decline of the middle class is a lot more complicate than just this but this is a real part of the problem.
I agree that is a big part of the problem. I have been low income my whole life, yet have always saved compulsively, in part to create a safety net that in turn creates options, and to create a growing core of wealth. Net result is I bought this modest retirement home for cash in 1998, and a debt free way of life that my friends say resulted in my retiring at 48. I'm not "retired" as I do need to generate about $700 a month for basic life support, but I DO feel free to do what I wish each day when I wake up. That is a stark contrast to many people I know, who, despite their incomes being many many times more than I have ever known, have for years been enduring sleepless nights trying to not lose the home they borrowed against as if it were an ATM machine. But their sense of self esteem is VERY much based on what they drive and live in vs. developing an inner sense of self and confidence, and a passion for living. Quite a few used to criticize me for my frugality..."you only live once, borrow that equity, travel, send out for gourmet pizzas weekly, etc." Whatever happened to that quaint notion of living WITHIN one's means, saving 10-20% of one's income FIRST, or avoiding debt, or at least paying it down aggressively. In my view, addiction to debt and living beyond one's means disempowers you, making it easier to become then stay a modern day serf enslaved by corporate fascism.
"The only normal people are the ones you don't know well". unknown