(Not) Keeping Up With Our Parents: Career Struggles
Posted by Lynnae on May 5, 2008
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Salaries have stagnated. Prices have gone up. What’s the answer?
While I’ve disagreed with much of (Not) Keeping Up With Our Parents so far, I thought Chapter 4, Career and Contribution, was weak. I believe the author set out to prove that educated professionals have a hard time succeeding financially, unless they are involved in sales or the tech industry. I think she could have made a case, but she picked some bad examples that left me scratching my head.
Case Study #1
Mooney interviewed a pastor about his struggles making it on a $25,000 salary in Idaho. I don’t doubt that the pastor had trouble surviving on a $25,000 salary, but people in ministry have been underpaid for decades. This is hardly a new phenomenon.
Don’t get me wrong. I think pastors should be compensated fairly for their work. They put their hearts and souls into their work, and they are often underpaid. As much as a church can afford to, I think they should pay their pastors a decent salary.
However, a pastor’s salary is often dependent on the level of giving by the church members. And that’s always been the case. It’s no surprise that someone in ministry would have a low salary. And to the pastor’s credit, he didn’t seem bitter at all. He believed in his career choice.
My husband has worked in Christian radio ministry off and on from the time I met him. Believe me when I say you don’t go into a ministry-type job expecting to live an upper-middle class life. So I questioned Mooney’s use of the pastor as an example.
Cast Study #2
Mooney then interviewed a couple who are currently making $180,000 a year, hardly qualifying them for middle class status. However, the couple had struggled in previous years. The husband lost his job right before 9/11 and didn’t find a permanent job for four years. Their income went from $150,000 to $50,000 a year.
During that four year period of time, the couple racked up $50,000 in credit card debt.
Blame the economy, big businesses, or the government if you wish, but I’m going to stand by my claim that the easy availability of credit plays a HUGE role in the struggles people have today.
Since I cut up our credit cards, my husband and I have had some tight financial situations, such as when we had to pay an unexpected large income tax bill. In the past, I have no doubt that we would have considered it an emergency and reached for the credit card, thinking there was no other way out.
However, we didn’t have a credit card, and we had to scrimp and scrape up the money. But we did it.
I’m not saying that this couple wouldn’t have needed a credit card at all. But $50,000 in credit card debt when you have an income of $50,000 a year makes it seem like they were charging a bit more than the bare necessities.
Case Study #3
This study is actually a group of people. Mooney mentioned artists and other creative types who have a hard time making it in today’s world. She mentions that people strive for flexibility in their jobs through freelance writing, yet end up in bondage to their jobs, because they can’t make ends meet, unless they work excessive hours.
She mentions artists struggling to make it in New York, having to pay exorbitant rents while bringing in next to nothing.
But is that really new? Artists have always struggled. Some make it big, but many many more don’t. And though I believe there are now more freelancers and consultants in the workforce today, is it really a new thing that the self-employed have a harder time getting by than their employed counterparts?
The Things I Can Agree On
Expenses have gone up. That’s for sure. Mooney didn’t really get into the reasons why expenses have gone up, but again, I think it has a lot to do with the easy availability of credit. I’m a huge believer of supply and demand. With the increase in credit, there were more people to demand bigger and better things.
With increased demand, prices can go up. With more credit available, people think they can afford the increased prices, so they buy…on credit. If people didn’t have credit as an option, nobody would pay high prices, and the prices would fall.
Unfortunately, there are innocent people who get hit with the fall-out from our debt ridden society. Expensive housing prices push rent up, so even those trying to make responsible decisions by waiting to buy until a house is in their budget pay large amounts in rent. Which, of course, makes it even harder to save for a house. And so on. And so on.
The Solution
I can’t say I’m sure what the solution is. It’s obvious that Mooney thinks government intervention is the solution. She advocates more government funding for the arts to help the starving artist.
I don’t agree. Unless government spending is brought under control, more government expenses means more taxes taken out of our paychecks, making the average Joe live on even less.
My personal opinion is that the government is pretty inept when it comes to managing people’s lives, and quite frankly I don’t want the government more involved in my life.
Unfortunately I think we’ve been living high on the hog for too long, and that goes for everyone from the individual to the corporation to the government itself. Debt and credit are not stable foundations for a society, and I think we’re going to be in for a tough time as we reap the consequences of too much spending with too little money.
What do you think? Prices have gone up. Salaries haven’t. What is the fix? Is there one? Or are we going to have to ride out the correction until living expenses and salaries are once again in line with each other?
To read the previous parts in the (Not) Keeping Up With Our Parents series, see:
- (Not) Keeping Up With Our Parents
- The Rise and Fall of the Middle Class
- The Cost of a College Education
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26 Responses to “(Not) Keeping Up With Our Parents: Career Struggles”
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I am not a financial expert. I'm just a wife and mom doing the best I can to live a frugal life and get out of debt. Like any human, I make mistakes. I write this blog out of my own experiences, and nothing I write should be taken as expert advice. If you need financial advice, please consult a professional.
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On a personal level, I believe it is important to develop a realistic expectation of lifestyle based on income. For my husband and I, we have noticed a huge increase in our level of satisfaction, by simply shutting out the “gimmes.” We purposely ignore a lot of marketing hype, avoiding catalogs, commercials etc. It’s amazing what one doesn’t miss when they aren’t bombarded with perceived need. It’s not only that salaries have not risen, much of the problem is that the amount of presumed necessities (cell phones, cable, dsl) has increased along with the rising cost of goods.
I am really unsure what can be done on a wider level.
I’m a new reader to your blog and am really enjoying it!
Having lived on your side of the pond (although I live in England and am British) I think that the ways the US gov’t is involved in your lives is quite different than here. I do think that what the UK gov’t does gives families more of an equal playing field - for example we all have free healthy care - that’s free family Dr visits, free hospital care & operations, free physio, speach therapy etc. A significant % of our population has free medicine (anyone pregnant, breastfeeding, disabled, any child under 18, anyone over 60, anyone on low income) and for the rest of us, it is subsidized so we never pay more than $15 per perscription.
We have a tax credit system so that depending on your income and dependents, you are charged less tax which helps most families. We have good work policies - when you have a baby you are entitled to a year off, of which your empoloyer has to pay for about 6 months and the government gives you about $850 a month for the other months. Employers have to consider flexible and part time working for people with children under 8 or anyone with a special needs child under 18.
What does this mean in reality? Even though I have friends on this side of the Atlantic who have had major illness or children with signifiant special needs, no one was wiped out by medical debt because there is none. I’m not sure whether I think the US would be able to ever do the same, despite Canada, the UK and many European’s success. I think it would be a very good start, but they’d have to look to the other countries success’ and failures and taylor it appropriately. For a lot of people, not having to pay private insurance and not having any medical costs would give them more ability to save etc and reduce debt.
Having said all that, I know plenty of people who want the American dream (on both sides of the Atlantic) and spend what they have, so if they have another $500 a month, they’d simply spend it. I think we fundamentally need to downshift our ideas, wants and priorities. We need to see time with our loved ones as more important than building wealth. Of course emergency funds and pensions are important, but I’d rather contribute to both and spend less on “stuff” and enjoy life than work to buy, buy, buy!
Sorry for the LONG comment
I often use my wife’s parents as a measuring stick for how we’re doing - and I often feel frustrated when we’re not measuring up.
I’ve been saying the same thing for years: the accessibility of credit has driven prices for everything up, in many cases up dramatically. And there are times when I feel bitter that I, who am “living like no one else,” am still having to experience the consequences of others’ irresponsible spending. Not most of the time though.
Every day, my husband works with people who have gotten deeply into debt because they’re trying to “keep up,” with an idea of how they want to live. He thinks that the solution is a recession. A good, old-fashioned, Come-to-Jesus style economic fright. It’s not a popular notion, but it’s an effective one. We have GOT to start being afraid–literally afraid–of disproportionate debt.
We live in an “instant gratifiation” society. We want it now, and don’t want to wait until we have the money saved to pay for it. Credit cards have a lot to do with this, also the media shows us how having this “stuff” will make us “happy”.
We are an “instant gratification” society. We want it now and are not willing to wait until we have the money to get it. Credit cards and the media have a lot to do with forming our thinking along these lines.
We live in an “instant graification” society. We want it now and are not willing to wait until we have the money to pay for it. The media and credit card companies make it seem as though this iw what we need for happiness.
I think it’s the living “expectations” that are not only too high but keep rising with every new gimmick on the market…. buy buy buy is what is what we are constantly bombarded by….. Amazing when one doesn’t have TV how one is not pressured that way.
While expenses have risen, there are many ways/places to still live comfortably on under $20,000. No, I don’t keep up with the Jones’s, but I have all that I need and want. As long as I keep my wants in line, there is no problem.
The sense of “entitlement” that is so persuasive in today’s society is not a good thing. Some people feel they are entitled to everything, whether they have earned it or not. Where has the sense of ‘Save up for it’, and “Pay cash for it” that we were brought up with???
Ah, the NO TV thing is by choice, not necessity. I don’t have the time to waste watching it either.
My time is as precious to me as my money, and I am very frugal with both.
This post is a great overview of what has been going on in our country for the last two or three decades. I too disagree with Mooney and do not feel that government is the solution. Anyone that actually takes a look at how our elected officials actually spend our hard earned tax dollars would know that the government would just cause more problems and in turn require more tax dollars to try and fix their mistakes.
I can’t say I know the perfect answer myself either. I do however feel that most of our problems boil down to the “instant gratification society” mentioned above as well as a lack of personal responsibility.
Those of us that are responsible and live within our means are pretty much penalized for doing so, while those that get themselves heavily in debt look to us and the government to bail them out.
I feel very fortunate to have such a hold on my finances at such a young age. My husband and I haven’t always been perfect, but I got my head out of the sand before it got really bad. A big part of what helps me is the gratification I get from hanging onto money instead of always spending it. I’m much happier watching my savings account balances go up rather than watching my closet fill up.
I have easy access to my credit, but I don’t charge much at all. (Just gas for the convenience and to build credit history.) I could go and take out thousands more in student loans, but I don’t. Credit really isn’t the problem, it’s most people’s general attitude towards it and how to use it that gets them in trouble.
There is a big myth out there that education immediately = Big $$. That was blasted for me straight out of the Ivy League years ago! If I were in the same position now, I don’t know if I would have mortgaged by future by taking on significant student loan debt only to be an artiste. I probably would have tried to go to a cheaper school (or maybe I would have qualified for scholarships). I look back at the life my parents had - and they were never extravagent. We had European travel (but the dollar was strong then). The big difference is that my mother never really had to work. And the suburban house - of course.
Those to aspire to those sorts of lives have to realize that certain ways of making $ and a certain level of income are required. Period. Nothing much has changed about that. If I had wanted that lifestyle, I would have chosen a different path. Instead I became an actress and an expert in pennypinching, and actually feel the stronger for it.
I agree, those are really poor examples. Useful information would be how much money people in comparable positions made in the 1960s or 1970s and how their money was spent compared to how today’s professionals spend their money. Part of it has to do with inflated expectations–that couple spending $100,000 a year wasn’t spending all of it on housing, food, and healthcare.
It does seem that real salaries have gone down, but grants for artists aren’t going to solve that! I’m very much in favor of government funding in the arts, but artists always have and always will have a tough time making a living…that has nothing to do with inflation or the general state of the economy. I don’t have any numbers to back this up, but I suspect more people make a living through the arts today than have done so at any previous point in history.
Government follows the people. Not the other way around.
Too many of us want more, more, more. Government gives it to us. And then when they (which is us) can’t afford it, we whine and cry and say that government isn’t doing enough. So, they go out and borrow so that they can make us happy.
When the individual citizen bites the bullet, the government will forced to as well.
RE grants - I have have had any - but at the time I was producing 99 seat theatre in L.A. on a shoestring, I heard artists wait about how they couldn’t DO anything without grant $ - Now, I found that amusing, since I KNEW that if they busted their asses the way I had to, it was, indeed possible. Exhausting, but possible.
Worse than that, the whole grant system was filled with crony-ism. I actually went to a workshop in which the “artist” admitted openly that the best way to get grant $ was to make the grantholders your “best friends”!! (This was a guy who had no visual arts background who finagled a grant for doing just that…) And I knew someone who interned years ago at a place granting $$ on a high level & saw the grantors and how they switched chairs with the grantees and gave each other money within their own ozy circle.
I think the real problem - well, in L.A. anyway is housing. No one can afford to buy a house - and they then commute long distances from where they can afford housing - & what with the gasoline prices, it’s a killer. And EDUCATION - even tho I didn’t turn out to be a rocket scientist, it’s amazing how much I have managed to lived by my wits. My education certainly helped with that. But I have a sneaky suspicion that the ruling elite isn’t that unhappy about developing a docile underclass. It’s just the felons that worry them.
The best thing the current generation could do is not keep up with their parents. Wasteful and foolish consumption is destroying our economy, our families, and the planet. Great post–It really is time to rethink everything we do and how we do it.
I agree with you about her examples. Pastors have never been rich, as far as I know. My old one had a computer consulting business on the side so that he was flexible enough to do church stuff but because he needed more income.
Artists don’t ever seem to get rich and people looking for flexibility may have to sacrifice money. In the same way our parents sacrificed flexibility for money.
At the same time, some things like the minimum wage have increased very little compared to cost of living. It’s easier to see how people can’t make ends meet there. In theory, people outside highschool shouldn’t be having to work at minimum wage jobs, but our society is shaped so that they do.
I don’t really have an answer. But for her examples, I’d suggest looking into alternative income and perhaps reducing lifestyle expectations and instant gratiication.
Ya know, it’s not the “high cost of living” thats the problem it’s the “cost of living high” that snares most people.
Just because the examples given aren’t that great, doesn’t mean that the problem isn’t real. Which set of Americans hasn’t complained about the high cost of gas, or food, or real estate? Some of the basics really are more expensive than they used to be - these will affect the low-paid the most.
But, for most people reading the book, it’s probably not the increasing costs of basics that are hurting them the most.
My parents were the original frugal King and Queen and because they were so frugal, they can afford to live well now but, interestingly, they don’t splurge or live ostentatiously. They rarely go out to eat (my mom’s a better cook then many restaurant chefs), they don’t spoil their grandchildren (well, maybe a little), they buy and wear clothes way longer than most people, they live in a small home albeit in a nice neighborhood, etc. They do drive nice cars but that’s about it. They are both Depression-era babies so that may have something to do with it, too! My mother actually reverses and uses the other side of the Swifter cloth–I’d never even thought of that! So, throughout their lives, they chose to live frugally (I was QUITE aware of that as I was growing up and all my friends seemed to have everything!). So, keeping up with my parents? I’d be glad to have their fortitude and discipline although there have been occasions where I’ve wished they rewarded themselves more often or splurged but their habits are so ingrained that it’s hard for them to do so.
My parents were the original frugal King and Queen and because they were so frugal, they can afford to live well now but, interestingly, they don’t splurge or live ostentatiously. They rarely go out to eat (my mom’s a better cook then many restaurant chefs), they don’t spoil their grandchildren (well, maybe a little), they buy and wear clothes way longer than most people, they live in a small home albeit in a nice neighborhood, etc. They do drive nice cars but that’s about it. They are both Depression-era babies so that may have something to do with it, too! My mother actually reverses and uses the other side of the Swifter cloth–I’d never even thought of that!
Odd that you wouldn’t have thought of reversing the Swiffer cloth - what I learned from my mother to do is exactly THAT sort of thing. That’s how I turned into a bargain queen.
I think that too many Americans today rail against high taxes and the government rather than railing against tax fairness. There’s no reason, Lynnae, that your taxes should have to increase as long as Warren Buffet pays a significantly lower percentage of his income in taxes than his secretary. See http://freakonomics.blogs.nyti.....air-share/
I don’t believe for an instant that the government tries to manage people’s lives, and I further believe that we should expect the government to spend less than it earns, the same way we all have to, but our present administration has taken the previous administration’s Balanced Budget Act and torn it up and thrown it away. Until the last congressional election, the administration hadn’t met a spending bill it didn’t like.
I further submit that if you asked present taxpayers to actually foot the bill for the war, the war would be over in about 8 minutes.
However, I think tax fairness based on a percentage of incomes is oversimplifying things. Warren Buffet probably pays millions in taxes, compared to the paltry $3000 we paid in federal taxes. Furthermore, Warren Buffet can afford to give people jobs to keep the economy going and keep people working, whereas I can’t.
It was an interesting article, and if Warren Buffet really believes he should pay more taxes, he should feel free to do so.