Family finances

iVillage Member
Registered: 05-11-2010
Family finances
15
Sun, 09-05-2010 - 11:25pm

I've seen quite a few posts in the recent weeks that have brought up family finances. I was originally going to preface this post by appealing to my fellow geeks, but decided that it's probably not necessary, since all women concern themselves with family finances . . . not just geeks.

Anyway, the following is a lecture that describes how the financial circumstances of American families (using the standard of a 4-person family) has changed over the past 3 decades. It's pretty eye-opening, especially for those who don't have any background of study on the topic, and also especially eye-opening in the context of today's economic woes.

The title of the lecture is the Coming Collapse of the American Middle Class, but it is totally family-centered:

http://www.youtube.com/watch?v=akVL7QY0S8A

Enjoy.



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iVillage Member
Registered: 12-08-2009
Mon, 09-06-2010 - 11:15pm
Julia, thanks for posting this. I think it is a very relevant topic for all of us. ((Too bad I cant HEAR anything on this computer because the sound chip isnt working, but I'd really -like- to see/hear it!))


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iVillage Member
Registered: 05-11-2010
Tue, 09-07-2010 - 1:42pm

No sound? D'oh! Yes, I heard this lecture a while back and have been thinking about it a lot lately.

Recently, my MIL was talking about how much $ they pulled in with 4 kids at home (it wasn't much . . . around $10,000 a year when the kids were all still young), and she kept commenting on how much easier parents have it nowadays because they have so much more $. She doesn't understand how drastically our purchasing power has been diminished (the value of the dollar has actually gone down 94% since the 20s!), and how much more costly all of the big ticket, cannot-function-without basics are . .. even with both parents in the workforce. Her generation, even with most women still staying at home, actually had more disposable income and savings than 2-income families today. She can't fathom it!



iVillage Member
Registered: 07-09-2010
Tue, 09-07-2010 - 3:25pm
Hmmm, from your last post, I am interested in hearing it. No one wants to hear my opinion on finances, cause we do things kind of old school, so most dont agree with us now-a-days... But yeah, when the kids go down, I am going to listen. Maybe I will give my opinion :)
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iVillage Member
Registered: 05-11-2010
Tue, 09-07-2010 - 3:55pm
Oh, yeah, it's definitely worth a listen! I've read extensively on all of the larger issues that affect families and their financial positions (e.g. family structure, workforce participation, educational attainment, income, racial & gender gaps in earnings, health, etc.) and I was actually surprised by some of the findings in this research when the standard family of today was compared with the standard of the 60s-70s. And I'd definitely be interested in what you think about it all. I'd also be interested in your "old-schoolishness"--there's nothing at all wrong with living your life differently than what others do!


iVillage Member
Registered: 07-09-2010
Tue, 09-07-2010 - 6:17pm

Haha well, you asked, so I will share... We do not believe in having debt. We believe in living within your means. So if we dont have the cash for it, we dont get it. (but we do use a debit card)... Also, I do not work. DH's income is in the category of "lower class" Yet we invest wisely and have 2 new cars and a new house. But we have no debt...

Now this does not mean that I think people who do use credit or who are in debt are bad or wrong, its just that we have chosen not to go that route. We would rather know that every penny he makes, we get to spend on what we want now, and not making payments to anyone or anything...

So for us finances are not a problem, but its because we planned early and took care of what needed to be taken care of very early on (we were 18 when we got married)...

I will post more later, but for now, I have to get dinner ready, LOL :)

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iVillage Member
Registered: 05-11-2010
Wed, 09-08-2010 - 10:22am

Carley - I can't believe that anyone (besides credit card companies and banks) would look down on you for not believing in taking on a buttload of debt! That's great that you don't carry much debt! And I'm sure that your staying home helps a lot in the financial department, too. Sometimes that's the most practical move to take. I've known a lot of moms who have worked and actually set themselves back financially b/c of the cost of childcare, gas $ to commute, etc.

I know what you mean about being non-judgmental--I wish that everyone could be like you and carry minimal debt, but there's all kinds of people who are drowning in it, and often, it's not even because they live beyond their means in terms of just buying a lot of stuff they can't afford or don't need. Just one medical issue or lapse in employment can lead a family to run up the credit cards just to keep things going. Having said that . . . about paying in cash, I can't tell you how proud of our countrymen & women I was last Christmas when the data came out showing the huge jump in % of American consumers paying in cash for their holiday purchases instead of credit! Yeah, it does make a difference when you know exactly what's in your pocket to spend. Sometimes I think they should have separate price tickets on all consumer items that estimate the true cost of things with different c. card interest rates. Imagine seeing a sweater with a $40 tag on it and then another tag adding a 10%, 20%, and 30% interest rate on top of the price.





iVillage Member
Registered: 05-11-2010
Wed, 09-08-2010 - 10:49am

Courtney - I'm glad that you enjoyed it. There were people sounding the alarm on the situation of the middle class in the late 90s, early 2000s, but nobody listened b/c those people were academics. (And who gives a rat's patootie about what ivory tower academics have to say, right?!) After adding women to the workforce, one of the only ways for many families to keep their necks above water after being faced with lower wages, benefits, and purchasing power and the increased cost of basics was to deplete savings and rack up debt--hoping of course, that $ from the next paycheck could be applied to c. card debt. Didn't exactly work out well for us once the banks failed and the credit crunch began in earnest.

I don't have any c. card debt, myself. Our nice, practical cars are 7 and 5 years old and paid off. Mortgage--barring any financial surprises--will be paid off in 10 years. What I do have is student loan debt. And I won't say how much, because I don't want to cry. DH LOVES to buy stuff, while I'm pretty much the anti-consumer, but I've got him to curb unnecessary spending significantly over the past 3 years. (He's the sort that always wants to look at new TVs, even though we have 3--one of which we use regularly--and they're all fairly new.)

Even though our own position is okay, I do worry a lot about families, especially kids. There are tens of millions of families barely scraping by, and many of them are two-income families that aren't "poor enough" to qualify for things like food stamps. We do what we can with donating food and also clothes and household goods to Volunteers of America and the Salvation Army. There's no reason to hold onto stuff that we don't use and someone else likely needs.





iVillage Member
Registered: 08-10-1999
Thu, 09-09-2010 - 12:27am

Hey Julia,



Yeah, I know what you mean... I had a HORRIBLE credit crisis years ago. Rather than declare bankruptcy I took the long hard road and paid everything off. EVERYTHING. What did I get for it? Another 7 years of collections showing up on my credit report. :( If I had bit the bullet and declared bankruptcy I would have had a great credit score 7years ago.



At any rate, DH's solution to me improving my credit (which I have NO INTEREST in doing) is to take out a $3600 loan for... a.... (wait for it)....

 


 


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iVillage Member
Registered: 05-11-2010
Thu, 09-09-2010 - 12:50am

Yikes, Courtney! Sounds like a horrendous experience. And I just love DH's idea for rebuilding your credit score. Not!

When I started out in college, I remember people telling me then to fill out all of the applications I got from c. card companies in my campus mail, because taking out lines of credit (and subsequently racking up debt, 'cause c'mon, what else is an undergrad going to do with plastic?) was *the* surefire way at that stage in life to build good credit!

I don't even know anymore what kind of legitimacy credit scores even have. It's like so many people have had the screws put to them with all kinds of new fees and jacked up interest rates (nevermind home foreclosures and job losses) that I'm sure the banks and c. card lenders have slit their own throats in terms of having "credit-worthy" people to lend to in the first place. If you go and mess up people's credit, then those people can't get loans and lines of credit anymore, which ultimately means less $ for the banks, themselves, because they can't leverage the loans anymore.

Wow, congratulations on being so close to paying off the mortgage and the cars. That's awesome! I'll project my well wishes for your success in putting your foot down with DH 5 years into the future. When the mortgage gets paid off and you hear "Goooood luuuuuckkkk" ringing in your ears, know that you're not going crazy . . . it's just my well wishes finally reaching you. ;-)





iVillage Member
Registered: 08-10-1999
Thu, 09-09-2010 - 1:11am

LOL!! Thanks for the future well wishes Julia!



I have to say that having to work through the system in order to get my credit better really helped me to identify with and to help many customers when i was managing the bank branch. It's sad how many people have had issues, AND when they try to fix it they find themselves in a

 


 


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