New data suggest these high income earners are living paycheck to paycheck, have fewer assets, and can't retire.
It seems that even the upper middle classes are suffering too. I can remember the managers at my old company working all the hours under the sun, because if they wanted to get anywhere they had to put the hours in. That's okay if you enjoy it, or work for yourself and you can see the long them benefits, but are a lot of middle management just under too much pressure? When they get home there are piles of letters to open and emails to check. And on Saturday they would spend hours doing more work for the company.
They are trapped, as they have the ability to be good managers and don't want to stay on the shop floor, so they move up to get a more interesting job, but end up having the life sucked out of them, just like everyone else. And as everyone else is on low money, they don't how they can get out of the rat race. Just go Buddhist and live in monastery.
This wasn't how it was back in the 70's, when some of the managers would even come down the pub with us at lunch time. Now, no one goes down the pub at lunchtime, it's have a quick lunch and get back on with it. And the kids at school get it in the neck too, when they are continuously tested and graded. But it doesn't matter, because the pharmaceutical industry has the 'happy pills' to mend everyone and get them back on the treadmill again. It's all a machine turning 24/7.
Malvina Reynolds - Little Boxes
A six-figure income should bring long-term stability. But members of the upper-middle class find themselves prisoners of voluntary yet inescapable costs. A multi-generational phenomenon has unfolded, its roots traceable to the economic slowdown of the early 2000s and the subsequent Great Recession. There is a feeling of anxiety among Baby Boomers who cannot retire, Gen. Xers saddled with expensive mortgages and child care costs, and Millennials paralyzed by insurmountable student debt. Data cannot measure emotion. The sense of unease is palpable despite the economy’s booming conditions.
Such findings suggest that seemingly high earners are living paycheck-to-paycheck. While Federal Reserve data has since found that median family income grew 10 percent between 2013 and 2016, a disproportionate number of upper-income Americans still cannot retire. In addition to their own financial woes, they must support their elderly parents, which involves innumerable costs. Overwhelming debt has become a vicious trap.
In one Brookings Institution study, researchers reported that nearly one quarter of households earning $100,000 to $150,000 a year claim to be unable to pull together $2,000 in a month to pay bills. Sustained economic growth has not repaired this cycle of debt. According to Deutsche Bank economist Torsten Slok, Americans have more debt than cash than at any time since 1962. The 2018 Northwestern Mutual Planning and Progress Study found that the average American’s personal debt (independent of home mortgages) now exceeds $38,000. Stock market growth and rising home prices have not altered this trend.
The American Conservative
“In one Brookings Institution study, researchers reported that nearly one quarter of households earning $100,000 to $150,000 a year claim to be unable to pull together $2,000 in a month to pay bills.”
ReplyDeleteReally? They make $150,000 a year ($12,500 per month) and yet they can’t meet obligations of only $2,000 a month?
That’s like having a full-time U.S. job at minimum wage ($1,200 per month) and not being able to pay expenses of only $184 per month.
Maybe these upper middle class idiots should buy fewer Ferraris and luxury beach houses. Some of them are like John McCain, who literally did not know how many houses he owned.
https://www.politico.com/story/2008/08/mccain-unsure-how-many-houses-he-owns-012685
It’s tough being rich, aye?
It's strange about human behavior, Konrad, because they don't have to suffer as they could choose to live in a much smaller house and downsize their lifestyle. Their workload may still be too high, but they needn't have money worries. But they crave the status and the material possessions of the high life. Their professional friends probably all struggle too, trying to keep up with each other and pretending everything is fine.
ReplyDeleteWe are status creatures, so even in paradise (which it must be if you live on that kind of money in the richest country in the world) they still manage to turn life into hell for themselves. Everyone wants more. The Buddhists are right about desire, it's a pain.