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Nearly 1 in 3 American workers run out of money before payday—even those earning over $100,000

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Well, this doesn't seem to match with what we've been hearing about the Greatest Economy Ever. If 1/3 run out of money before the next paycheck, what happens when the next downturn gets here?

......"These are just some of the many ways many Americans are making it work when money is tight. For about a third of Americans, this is a regular financial stress, with 32% running out of money before their next paycheck hits, according to a new survey fielded by Salary Finance of over 2,700 U.S. adults working at companies with over 500 employees.

Contrary to popular belief, “this is not just an issue for people at the lower end of the income spectrum,” Dan Macklin, Salary Finance’s U.S. CEO and co-founder of SoFi, tells CNBC Make It. About 31% of respondents earning over $100,000 also regularly experience a budget shortfall before payday. salary-finance-running-out-of-money.1581

No matter the underlying reason, the struggle to pay bills and put food on the table when you’re short on cash leads to a lot of stress, the survey finds. Financial stress is very prevalent today, with 42% of working Americans experiencing it. It’s a percentage that Macklin finds “extremely worrying.”

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Stupidity knows no income boundaries. For every wisely budgeting minimum wage slave that scrapes by, there s dozen credit card running up spendthrifts living way beyond their means. I personally knew at least 4 or 5 people like this where I used to live that bought huge houses and multiple cars and travel and expensive designer crap, always running out of money.

This comes from CNBC, so its' 100% bullshit as well. Might as well peddle CBD snake oil, Snipey

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5 minutes ago, matty said:

This comes from CNBC, so its' 100% bullshit as well. Might as well peddle CBD snake oil, Snipey

Actually it wasn't, you need to read better:

31 minutes ago, Sniper said:

according to a new survey fielded by Salary Finance

Salary Finance’s U.S. CEO and co-founder of SoFi, tells CNBC Make It.

Does that say CNBC?

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Hard to draw a correlation between living pay check to pay check and the health of the economy.. 

It's the very principle of recessions.. people build up debt in good economic times.. until it catches up to them. When people earn more they spend more..  then the idea living paycheck to paycheck becomes a choice.

With low interest rates, people arent afraid to borrow.. to buy big items and spend lots of cash they dont actually have. 

 

The diagram itself shows just that... people making over 40k have about the same probability as people making over 200k. Clearly no correlation to income.

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2 minutes ago, Handyman said:

I'm sorry, but if you are making six figures living paycheck to paycheck, you are living beyond your means. I know a dope that keeps defaulting on student loans but drives a BMW. 

Hopefully, his credit is shit and no one lends him more money... the problem is when institutions lend out money to these idiots at high rates

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43 minutes ago, matty said:

Dan Macklin, Salary Finance’s U.S. CEO and co-founder of SoFi, tells CNBC Make It

Since you apparently know more, please post YOUR charts showing us the real truth.

15 minutes ago, Handyman said:

I'm sorry, but if you are making six figures living paycheck to paycheck, you are living beyond your means.

There seems to be a trend:

MW-HL737_consum_NS_20190619152202.png

US-consumer-credit-total-2019-Q4.png

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Mmmm... I'm still not convinced this reflects on the economy. As others pointed out, I think these charts could just as easily reflect individuals' sloppy money management practices... which could just as easily be attributed to a cultural decline (e.g., principles like "personal responsibility" and "self-reliance" are not as revered as they once were).  Who knows, maybe the good economy/low unemployment rate exaggerates people's bad financial tendencies, because they develop a false sense of security about the future?  

Regardless, I think personal financial management should be covered far more than it is in schools, quite frankly. It's a critical life skill that a lot of people simply don't have.  

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12 minutes ago, Mrs. Peel said:

Mmmm... I'm still not convinced this reflects on the economy. As others pointed out, I think these charts could just as easily reflect individuals' sloppy money management practices... which could just as easily be attributed to a cultural decline (e.g., principles like "personal responsibility" and "self-reliance" are not as revered as they once were). 

Ahhh, someone who gets it. Yes, my point to the thread was that the economy is being "advertised" as the best it's ever been, but for the majority of the population, that means nothing, because they don't take personal responsibility for their financial situation. Or, they're "sheep", who believe what they are told, and take on huge debt, without any idea how they will pay it back.

Plus, they AREN'T saving for the future either:

135937-16821.png

And, this is why Bernie will win in November, unless he has another heart attack or gets Arkancided....

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The irony is that if one spends only 95% of their income, they are still living paycheck to paycheck in the short term.  Having been "house poor" in  the past, I have a much greater interest in NOT buying the biggest house that I can afford, especially knowing that at the end of my next 30 year mortgage, I will probably not bringing in income like I am now.

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What all these graphs correlate is that people are confident in paying off their debt when they have good jobs, so they dont worry about taking it on..

It's hard to justify big debt when you might lose your job..

 

I'm not sure what the revelation is here... we have always seen increased debt in a improving economy.. and when it gets out of control it throws us into a deep recession. Economic down turn wouldn't be so bad if people saved money and accrued manageable debt limits.

The underlying issue is that banks a "too big to fail" in the eyes of the government... so if they arent held accountable basically no one is.

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54 minutes ago, JackDaWack said:

What all these graphs correlate is that people are confident in paying off their debt when they have good jobs, so they dont worry about taking it on..

No, what it correlates to is people not understanding their finances, and just make the minimum payment each month, while racking up interest at 15% -20% of their balances. Same with cars and houses, people buy "payments", and just base taking on the debt if they can pay the minimum. That's why some car loans are going out 8 years. Low monthly payments. Period. No thought on the debt.

Over 60% don't pay off their credit card balance each month, and keep rolling it over.

Meanwhile, more people are defaulting on debt, half of people with medical debt have defaulted, 40% of college loans are in default, sub-prime car loans at record default levels, credit card default levels rising..

If you really think these are signs of people doing well in a good economy, I have some really nice oceanfront property to sell you in Kansas.

54 minutes ago, JackDaWack said:

Economic down turn wouldn't be so bad if people saved money and accrued manageable debt limits.

I just showed you in the charts above, neither one of those is happening. So what happens when the recession gets here at the end of the year?

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The problem is too many weak minded people have been conditioned to buy anything they want on impulse because, they deserve it.  Your life will be miserable with anything less than the latest iphone.  Must keep up appearances with a new car every two or three years, make sure you get something you can barely afford.  You work soooo hard, don't cook when you get home, eat out, take it easy, you deserve it.  Is Trump bringing you down, are you very very very sad, go have a spa weekend to shake that icky TDS, you deserve it.

Our society has developed a culture of living in the moment instead of looking ahead and contemplating the consequences of immediate self gratification.  The advertisers push push push, and suckers keep buying, buying, buying, even what they can't afford to.  Believe me, I know, I used to be one of those suckers.  Basically, living hand to mouth is a bit like over eating, except you are eating your account balance and your future.

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6 minutes ago, Scorpio64 said:

Our society has developed a culture of living in the moment instead of looking ahead and contemplating the consequences of immediate self gratification.

Reminds me of the last housing crash, when banks were giving mortgages to anyone who could hold a pen. When a guy working at the car wash got a $600K home loan, then couldn't pay for it, he blamed the bank for giving him the loan, instead of taking personal responsibility for signing the mortgage note, knowing full well, he couldn't afford the payment.

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2 hours ago, Sniper said:

No, what it correlates to is people not understanding their finances, and just make the minimum payment each month, while racking up interest at 15% -20% of their balances. Same with cars and houses, people buy "payments", and just base taking on the debt if they can pay the minimum. That's why some car loans are going out 8 years. Low monthly payments. Period. No thought on the debt.

Over 60% don't pay off their credit card balance each month, and keep rolling it over.

Meanwhile, more people are defaulting on debt, half of people with medical debt have defaulted, 40% of college loans are in default, sub-prime car loans at record default levels, credit card default levels rising..

If you really think these are signs of people doing well in a good economy, I have some really nice oceanfront property to sell you in Kansas.

I just showed you in the charts above, neither one of those is happening. So what happens when the recession gets here at the end of the year?

That's not at all what I'm talking about. And you're arguing a well established point that has been a confounding problem in america for over a 100 years. People don't save money... it's why we started SS. But that has nothing to do with economic strength 

The data YOU provided shows a clear and obvious trend In economic growth vs average debt. After 2008 people didnt just get money smart and cut revolving credit in half , they just got poor... maybe filed bankruptcy and never recieved new credit for years.

In fact about the only difference between now and 2008 for a typical american, is the total amount of student loan debt due to the highest rate of default..

We wouldn't have recessions if a majority of people lived financially responsible. And people have criticized the concept of middle class envy since the early 1900's, familiar with "keeping up with the joneses"?

We've also hit a record high amount of corporate debt, which doesnt happen unless an economy can support that debt... 

Our economy is cyclical.. people didnt all of a sudden just become financially retarded.. it's been this way since borrowing money became common place, and people realized they could own more better things without having to pay up front. 

The better the economy becomes the more likely banks are to hand out debt. They are still kicking out profits as others default. Our economy would be stronger and stable in the long run if debt was managed better, but a lot of that debt drives our markets. And we are all about free markets.. but since a majority of americans are greedy on both sides of the market.. its a certainty a good economy leads use right into a recession almost like clock work.

 

My point is, and to your original statement.. people live paycheck to paycheck in a good economy, just like they do in a bad one.. making it a poor point of comparison. 

Economists were calling for a recession back in 2017, prior to the "trump" economy.. and they've been calling for one every year since...

That is a interesting point to consider because the higher we go, the harder we fall.

 

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many people are living well above their means. i've been seeig this since at least 2000. people have multiple credit cards, and use those to buy shit they don't need, and otherwise couldn't afford to buy. on top of this they're living in homes in towns that they can't afford.

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13 hours ago, Sniper said:

Ahhh, someone who gets it. Yes, my point to the thread was that the economy is being "advertised" as the best it's ever been, but for the majority of the population, that means nothing, because they don't take personal responsibility for their financial situation. Or, they're "sheep", who believe what they are told, and take on huge debt, without any idea how they will pay it back.

Plus, they AREN'T saving for the future either:

135937-16821.png

And, this is why Bernie will win in November, unless he has another heart attack or gets Arkancided....

No, the story was created for the audience of CNBC so they could get more viewers among the college debt and spendthrift demographics. Bernie voters. The study 'author' is a guy who ran/runs some operation refinancing student loans. Probably backed by Soros or Warren Buffett.

Anyway,  what the story was saying to those of us in the real world is that when people get more money (great economy) there will still be a large number of grasshoppers that forgot or never learned that good times never last. What it is probabkly saying to the FSA army is that 'It's Trumps fault you still have no money in boom times'.

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23 hours ago, Sniper said:

Actually it wasn't, you need to read better:

Does that say CNBC?

No it says salary finance, which is a company trying to hawk debt consolidation and payday loans into a new abomination. I'd question their numbers without seeing the methodology explained. 

It's hardly an argument for a shitty economy. If the people making over 200k a year are being impacted by a shitty economy more than those making 40k a year, then the issue isn't the cost of living vs wages. The issue is how 1/3 of people spend their money. 

 

 

 

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41 minutes ago, raz-0 said:

No it says salary finance, which is a company trying to hawk debt consolidation and payday loans into a new abomination. I'd question their numbers without seeing the methodology explained.

Well, you too, could go read the report, but apparently, that would take some effort.

And since they partner with United Way, I would guess they're not like you describe.

43 minutes ago, raz-0 said:

It's hardly an argument for a shitty economy. If the people making over 200k a year are being impacted by a shitty economy more than those making 40k a year, then the issue isn't the cost of living vs wages. The issue is how 1/3 of people spend their money. 

During a good economy, responsible people pay DOWN debt and save money, they don't take on MORE, and go further underwater. But maybe things work differently in your world.

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3 minutes ago, Sniper said:

Well, you too, could go read the report, but apparently, that would take some effort.

 

3 minutes ago, Sniper said:

During a good economy, responsible people pay DOWN debt and save money, they don't take on MORE, and go further underwater. But maybe things work differently in your world.

Hey, no need to get personal! This is simply a difference of opinion. You seem to believe that if roughly one-third of people have poor fiscal management practices and aren't paying down debt and saving for a rainy date, that means it can't truly be a "good economy" due to all the personal debt and lack of a "nest egg". Fair enough. Others are saying that today's economy is, in fact, gangbusters, even when there's a percentage of people managing their finances very poorly... the latter doesn't affect the former. Also a reasonable opinion.

It's just a discussion. Agree to disagree... instead, it seems we're doing this: :deadhorse: 

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22 minutes ago, Mrs. Peel said:

It's just a discussion. Agree to disagree... instead, it seems we're doing this:

Yep, typical discussion here. One person brings charts, links and data, the others, bring OPINIONS (not backed by anything) which they THINK are facts.

Just another day in paradise!

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16 minutes ago, Sniper said:

Yep, typical discussion here. One person brings charts, links and data, the others, bring OPINIONS (not backed by anything) which they THINK are facts.

Just another day in paradise!

We've also had record low unemployment, and multiple stock market records set - those are also facts - and they are traditional indicators of a strong economy. My point is, there are a multitude of factors that can be looked at... and reasonable people may reach differing conclusions. That's life. So, there's no need to get angry and/or insulting when another poster doesn't immediately embrace your point of view... regardless of how many "charts" you attach!  Let's have civil discourse, that's all I'm advocating.

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57 minutes ago, Sniper said:

Well, you too, could go read the report, but apparently, that would take some effort.

And since they partner with United Way, I would guess they're not like you describe.

During a good economy, responsible people pay DOWN debt and save money, they don't take on MORE, and go further underwater. But maybe things work differently in your world.

I could download it if I wanted to feed info to what appears to be a scumbag operation. Or they could not put it behind a gate. 

 

 

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On 2/16/2020 at 5:55 PM, Mrs. Peel said:

Mmmm... I'm still not convinced this reflects on the economy. As others pointed out, I think these charts could just as easily reflect individuals' sloppy money management practices... which could just as easily be attributed to a cultural decline (e.g., principles like "personal responsibility" and "self-reliance" are not as revered as they once were).  Who knows, maybe the good economy/low unemployment rate exaggerates people's bad financial tendencies, because they develop a false sense of security about the future?  

Regardless, I think personal financial management should be covered far more than it is in schools, quite frankly. It's a critical life skill that a lot of people simply don't have.  

I didn't learn "personal financial management" in school, it was instilled in me by my parents.  Today, my house is paid for, no student loan debt, an auto loan that will be paid in one year, and no credit card debt (I pay it off at the end of the billing cycle, if I can't afford it, I don't buy it).   I didn't know it was taught in schools today.

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22 minutes ago, dilbert1967 said:

I didn't learn "personal financial management" in school, it was instilled in me by my parents.  Today, my house is paid for, no student loan debt, an auto loan that will be paid in one year, and no credit card debt (I pay it off at the end of the billing cycle, if I can't afford it, I don't buy it).   I didn't know it was taught in schools today.

I vaguely recall it being covered... maybe in junior high? In a math class? My point was, it's barely covered at all. And not all parents are as good as yours (and mine). Except for my mortgage, like you... I pretty much operate debt-free. I don't even keep a credit card, just a debit card. Older, paid off car. It's lower stress, I find.

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