Lifestyle Expectations.

I had an interesting conversation with several 20-somethings in my office Friday. They were taking a break and looking at real estate and bemoaning how they would never be able to afford anything. Between their student loans and their rent, they said, saving up for a down payment is impossible. Their generation, they said, is excluded from building wealth and the dream of home ownership.

Now, I know that lots of younger people are struggling with poor job markets and low-paying career paths. Especially in this blog’s readership, among whom postdoctoral wages, for example, mean that making more than about $50,000 a year is unlikely prior to about age 32 or so. I know many live in more expensive housing markets. I know that many people don’t have the privileges that the people in my office have. But for the remainder of this post, I want to talk about the behavior and thought processes of people who do have them.

Because there are a lot of those people. Young, educated professionals with average student loan debt (about $37,000 upon graduation), a degree, and a well-paying professional job. As of now, huge numbers of millennials fall into this category. I would estimate that about 30% of the employees at MECMC do. The specific individuals I was speaking to make much more than the median salaries of college-educated millennials.

The starting salaries of people in my office is generally between $60,000 and $70,000. For people who join us with no professional experience but promise and a good degree and recommendations. The people I was speaking to have been here a few years and are all making between $75,000 and $85,000 a year. None have children, or family they are caretakers of. Some have partners also working.

As this group was looking at real estate, I mentioned that they ought to be able, if they wanted, to save $1,000 a month. At that rate, a down payment for a modest starter home should be manageable in 2-3 years. And they openly laughed at me. I was told that saving a thousand dollars a month is “impossible”.

I didn’t press. But it is worth noting that a couple of them live alone in two-bedroom apartments in downtown ECC. Those sorts of places go for around $2,200 a month. They all talk about the nice restaurants they go to weekly. They go on international vacations once or twice a year. They own cars in a city where car ownership is as much a hassle as a liberty.

Now, I’m not deriding their priorities. People are allowed to spend their money however they like, and if these are the choices they’re making that’s totally ok with me, and also it’s none of my business. But I don’t understand how someone paying $2,200 a month to live alone in a huge apartment, and another $600 a month to own, park, maintain, and insure a car in a city where that’s totally unnecessary can argue that saving is “impossible”.

We have created a lifestyle expectation in the USA that in inaccessible to almost everyone. People without dependent family – making around $80,000 a year – in an affordable city feel pressured to maintain a lifestyle that doesn’t allow them to save anything. They’re not (just) entitled shits. They’ve been trained somehow to feel inadequate and socially lesser if they don’t appear to be incredibly wealthy.

It drives unhappiness.

And I know, I know, I’m one to talk. I have all the things I’m criticizing them for wanting. But that’s just it. I’m not criticizing the wanting. Nor am I criticizing the priorities. I’m saying, recognize choices. I’ve said this before about the academic career path, and other things. We often make choices that we feel are forced upon us when in actuality they’re about picking what we want.

Many people don’t want a roommate. But having a roommate for a few years will propel a person who has a good salary toward financial independence very rapidly, if they’re conscientious. It’s a choice people make, and it has lifelong consequences. Owning a car in a major metropolis is a choice. Living immediately downtown in the expensive district is a choice. Eating out at fancy restaurants is a choice. Having a short commute is a choice. All the choices cost, or save, money.

They’re not all like this. My own analyst has a roommate and lives in a less expensive part of town. No car. Walks to work. Makes toward the lower end of the spectrum I’ve discussed because he’s new still. I don’t know his saving habits, but he doesn’t discuss spending any money ever, really, except a once-a-year weekend skiing trip. Cooks at home.

He’ll be rich.