Keeping up with the jones

[Ima saver]

Re: Keeping up with the jones

They all started small like I did. I bought a house I could afford when I was 20, got it paid off when I was 31 and have traded up ever since. (4 times) I have always owned house 2,3 and 4 mortgage free.

[Joan.of.the.Arch]

Re: Keeping up with the jones

Do you assume that people who are shopping and buying stuff cannot afford it? Or assume that someone with 6 children is in debt? Do you see someone driving a fancy car and assume it's leased?

No, I do not think about whether other shoppers can afford what they are buying. About the only thing I think about other shoppers is whether we are in each others' way in the aisles. Once in a while, I'll think something like, "Oh, I like that bluegreen she's wearing." But really I don't think of others' finances while shopping....I don't at all assume that having several kids means having debt. But I tend to like people who like kids so much that they have that many, so I have a basically positive attitude toward large families.....I have never once assumed someone must be leasing a car. It just doesn't occur to me. Is it even true that expensive ars are more likely to be leased? I have no idea.

How does it affect you to see people spending their money on life luxuries instead of saving it?

Well, no doubt I am prone to a certain amount of jealousy. And I do think about how often it is the truth that those who earn relatively less work just as hard, contribute just as much positively to society as those who can buy many luxuries. Also, I share the concern someone else mentioned--the concern that there are a very large number of people who will not be able to support themselves in illness or old age and that this will affect our who society in ways we are all unprepared for.

Are you in debt? Did you keep up with the Jones and thus assume that everyone else does too? Or have you never been in debt, but just frugal and would never spend money on that?

Like many, the first debt I accrued was for college. I paid it off very quickly and did not have debt again until in my early thirties my spouse and I bought a house. Still have debt for that, and sometimes I muse about all the cars I see that are cost well over the total purchase price of my house :-) I doubt if anyone on this board keeps up with the Joneses, even if they do have a lot. Keeping up with the Joneses implies reflexive spending just to look as good as the Joneses. I think everyone on this forum is more thoughtful and self-determining than that,

I'm curious, because I often read on these message boards people who say they would never buy a new car, bigger home, etc. Proudly brandishing their frugality, which is good, and yet it raises the question, is it bad to spend money?

It is good to spend your money conscientiously, with awareness to what it means to your present and future and to the present and future of the people around you.

It is bad to buy yourself a nice home, nice car, pay for college, go on vacation?

I'm not clear what you are asking here. I don't think you are asking these questions literally, but I don't know what you might be asking metaphorically. Sorry.

Shouldn't someone's lifestyle be based on whether they can afford it? And not based on what others think?

That seeems like a good start. But as someone said above, 'afford' is a loaded word. I can pay cash now for a lot of things, yet in a sense I cannot afford them because, with the way the world is organized, I will need to provide for myself in my old age. I cannot afford to spend now what I must save for my property taxes, medical care, food, warm winter boots, and so on when I am 70 years old and beyond.

MonkeyMama, you have brought up a lot of interesting points that I would like to see further discussed.

[Ima saver]

Re: Keeping up with the jones

I own a big nice house, but it is good advertising for my husband who is a custom builder, plus we can afford it.

[disneysteve]

Re: Keeping up with the jones

It is bad to buy yourself a nice home, nice car, pay for college, go on vacation?

Shouldn't someone's lifestyle be based on whether they can afford it? And not based on what others think?

Absolutely yes to your last question. Your spending should be dictated by what you can afford.

The problem is that many, many people allow others to dictate their spending. They buy things because they see ads on TV or because their neighbor just got one or because their siblings have them or just because they want one and have to have it. Whether or not they can afford it seems low on the list of criteria.

I've said many times that the whole "keeping up with the Joneses" phenomenon would go away if you just knew how much the Joneses earned and/or how in debt they were. Sure, your neighbor might have a 60 inch plasma screen, but he might also earn 3 times as much as you. Or, alternately, he might have 10K in credit card debt. In either case, do you really want to try and keep up with him?

How does any of this affect me? I'm really concerned about the future of the country when people start hitting retirement age with little to nothing saved. How will the rest of us be affected? Will taxes shoot up? Will SS (if it exists) be cut to those of us who built up big nest eggs so that the government can afford to support all those who blew their money while they were working?

[DivaJen]

Re: Keeping up with the jones

I did an activity recently with my Algebra students, looking at cars and depreciation. I was shocked at how much some of these cars cost new! So, do I think people may be living beyond their means or failing to save for their future when I see them driving one of these cars costing upwards of $60-$100k? Yes, now I do.

[disneysteve]

Re: Keeping up with the jones

One area where I really question what is happening is housing. I know what I earn and how much my house cost. I see developments in my area with homes selling for 600K, 700K and more and I can't imagine who the heck is buying these things, but they all get sold. My income puts me in the top 10% of wage earners in this country and I couldn't afford the prices these homes are going for. Are there really that many people around who make that much more than me? Or are there just a lot of people taking out insanely large mortgages?

[LivingAlmostLarge]

Re: Keeping up with the jones

Nope the point is I was chastized on another board for admitting to enjoying getting my nails done. I do enjoy it and I think it's a luxury I like. But to immediately judge and say that all women who are getting their nails done are in debt, like to spend money, made me wonder? Do you just make automatic assumptions about people and their spending habits?

How do you really know what their net worth really is? I mean I'm terribly jealous of a lady with 6 kids who looks affluent, because rather than think they are in debt, I'm more likely to think "man they make bank to afford that many kids."

But how many people categorize others as being debt, broke and keeping up with the Jonese if they admit to buying new cars, eating out, and enjoying traveling?

[Joan.of.the.Arch]

Re: Keeping up with the jones

LivingAtLarge, are you simply asking how common it might be that people think you have poor money management skills if you do things like get manicures, drive a new car, eat out, and travel?

I think that would be pretty uncommon. I don't imagine many people think about your finances at all. They have other things on thier mind. When you participate in forums such as this, you are among people who specificly have personal finances on their minds, at least while they are reading the forum. Most people probably never give your finances a thought. There's no need to feel judged, generally.

[disneysteve]

Re: Keeping up with the jones

Nope the point is I was chastized on another board for admitting to enjoying getting my nails done. I do enjoy it and I think it's a luxury I like.

But how many people categorize others as being debt, broke and keeping up with the Jonese if they admit to buying new cars, eating out, and enjoying traveling?

On another board I'm very active on, disboards.com, there are very often threads by people asking for help and advice with their financial situation. They go on to discuss how much debt they have, trouble making payments, you know the story. But their post carries their sig with a list showing that they've made 5 trips to Disney World in the past 4 years and they have a ticker counting down the time until their next trip. Those are the folks who just don't get it. Then they get all offended when someone suggests that maybe they wouldn't be so deep in debt if they stopped taking so many vacations, and ask if they've cancelled the upcoming trip.

If you enjoy getting your nails done and you've got the money to do it, go right ahead. We all have our luxuries. Ours is travel. In 2005, we spent nearly 10% of our gross income on travel. Could we have done something more practical with the money? Of course. But we also put 26% of our gross into savings. We have no debt other than our mortgage (which is pretty modest in today's terms). We pay our CC bills in full. We have a 529 for our daughter. All of our obligations are met. With what's left, we choose to travel. Doesn't make us rich. Also doesn't make us irresponsible.

[I'm going to win]

Re: Keeping up with the jones

I work with John Q Public and my office has a very nice view of the parking lot and cash register, I like to keep an eye on my stuff. Well anyway it always makes me wonder what people are thinking when they stop by to pick a bat or baseball glove, go to the counter to pay for said item pull out CC and and the bells and whistles go off and DECLINED. Pull out another card and samething. I watch them leave climb, into a $50K SUV thing and off to the bank ATM back in 5 minutes with cash. Now if I can't pay $300.00 on the credit card maybe Johnny can do without the bat for awhile. The other thing that seems to be common among the DECLINED NSF group is a fair number of them work for the goverment. Is this why they can't live within thier means? and am I talking about customers or the goverment. I think it's inner changable.