patrick.net

mell says

WookieMan says

Most boomers are on fixed income.

That means nothing, everybody is when they stop working. There is no reason for a boomer to be broke, just look at the house price appreciation. It's the same for the east coast. Pension and 401k plans just started getting slashed in the past 2 decades til now, and some may still be too high to be sustainable.

I understand the "pensions getting slashed", but what does "401k getting slashed" mean?

RWSGFY says

Money needs time to grow. You don't have to be a genius to have couple of mil by the time you are the boomers age. And there is nothing abnormal in not having much money when you're fresh out of school. It's just how money works.

Yeah that is why I put $4000 in Vanguard Healthcare Fund back in 1993 and never withdraw from that fund as of today.

Its about "time value of money" and hold-long-term in reliable or safe assets.

.mell says

There are some rich Gen x ers who made good money with tech stocks but once you crossover to Y/Millenials it's looking bleak for them due to rampant inflation and high debt pressure. They don't make enough to invest much in the already inflated asset market. They would benefit greatly from deflation but they're not gonna get it, that's one reason the housing/rent market won't crash.

We shall see when the Trump tax cuts expire next year. CPI is now down to 3% and PCE has remained below 3% since October 2023, yet short term rates like 1 year Treasury are not budging much.

All of this points to less inflation and I've noticed in my county that rents seem to be holding steady for last 2 years while household income has risen some.

Younger generation like 21 to 30 year old need to do side hustle like work gigs (i.e., online surveys) to earn an extra $250 a month which can go into their Roth IRAs and into a stable/reliable asset like Total Stock Market Fund.

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RWSGFY says

mell says

WookieMan says

Most boomers are on fixed income.

That means nothing, everybody is when they stop working. There is no reason for a boomer to be broke, just look at the house price appreciation. It's the same for the east coast. Pension and 401k plans just started getting slashed in the past 2 decades til now, and some may still be too high to be sustainable.

I understand the "pensions getting slashed", but what does "401k getting slashed" mean?

They don’t have them. Go to Home Depot and look at the demographic. Same with restaurants. Boomers are broke for the bottom 90%. They have to work menial jobs to pay bills. I’m 41 and generally don’t work.

If someone can tell me how boomers are doing it right send me the notice. Ain’t seeing it.

WookieMan says

They don’t have them. Go to Home Depot and look at the demographic. Same with restaurants. Boomers are broke for the bottom 90%. They have to work menial jobs to pay bills. I’m 41 and generally don’t work.

If someone can tell me how boomers are doing it right send me the notice. Ain’t seeing it.

I see boomers working in Colorado and Florida panhandle at the Ace Hardware stores, Walmarts, etc.

I think maybe at most 30% of boomers are financially thriving, and those include my family member who has a $900,000 home (and now a reverse mortgage with a 1.25% margin rate and 0.5% FHA insurance rate), a $1300 monthly payment from Social Security, and has a net income or profit of about $500 a month from renting a garage apartment (for $1300 a month).

The rent for the garage apartment goes to property tax and insurance, utilities, and maintenance and repair for the entire real property on 5 acres.

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WookieMan says

I like you guys here, but you need to realize that CA is NOT the rest of the country. Not by a long shot.

This is one of the best comments on Patnet. Where are all the California fluffers here to respond to this ?

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Many boomers are desperately waiting to sell their "Haddonfield, IL" house for $500k to buy a townhouse somewhere cheaper.

The problem is: The buyers aren't there.

And Chinese or Colombian uber wealthy foreign buyers and wannabe AirBNB moguls aren't interested in Haddonfield, IL (or Woonsocket, RI or Erie, PA or Des Moines, IA)



This used to be owned by a corrections officer married to a P/T cashier wife. Or a divorced cop. Or a mechanic with a SAHM wife. Now it's 6-8x median household income ($300k+)

AD says

WookieMan says

I like you guys here, but you need to realize that CA is NOT the rest of the country. Not by a long shot.

This is one of the best comments on Patnet. Where are all the California fluffers here to respond to this ?

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Interesting, I was going around DC area last month. While talking things different around in a group, one guy cut short and said, CA is not exactly US, like WookiMan said, discussions ended abruptly!

This house sold in 2018 for ~$260k, a few years before that in 2014 for $120k (probably a fixer upper that flipped). Then again a few years ago for ~$425k. Now they want $440k for it. This house doubled in price in less than a decade. Did salaries?

And you've got the infamous NJ Property Tax, which must be murder on a $400k+ house.

Edit: Almost $10k year in property tax, double from a decade ago.

If you made $70k/year, your property taxes alone before maintenance, insurance, mortgage payments, etc. would be around 15% of your gross income.

https://www.zillow.com/homedetails/1111-River-Rd-Piscataway-NJ-08854/39151376_zpid/

Here's a "Haddonfield" equivalent house: $550k

This one doesn't look like a sale/transfer was done in the past 15-20 years, for a long while the assessment was about $110k. I'm guessing maybe early-mid 90s was the last purchase before this sale. Have wages/salaries gone up 450%-500% since the 90s?

https://www.zillow.com/homedetails/248-Westfield-Ave-Piscataway-NJ-08854/39150949_zpid/

WookieMan says

I understand the "pensions getting slashed", but what does "401k getting slashed" mean?

They don’t have them. Go to Home Depot and look at the demographic. Same with restaurants. Boomers are broke for the bottom 90%

But it means they never had them in the first place, not that "they are getting slashed".

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https://www.zillow.com/rental-manager/market-trends/32407/?propertyTypes=townhouse&bedrooms=3

https://www.zillow.com/home-values/71975/panama-city-beach-fl-32407/

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Eric Holder says

But it means they never had them in the first place, not that "they are getting slashed".

Exactly. I'm a spoiled brat by choice. Wealthy parents. Coached my wife to have an amazing career. I get to sit on my ass. It's still work though. Carried the family the first 15 years and now it's her turn. She's got her network and makes bank.

Put this way, I have more in savings than probably any boomer on this site. NOTHING inherited. I make money happen. In a minor argument I was notified I haven't worked a full time job in 7 years. lol. She golfs and goes out to eat. High probability you've seen her on TV. We do well. Not bragging, but it just takes work. Burned 15 years of my life that I regret. I would have lived poor. It's great now. 41. No complaints from my end and she doesn't have any either.

This is why blacks go to crime. You need a man in your life. My wife would have been lost with any man she was interested in. All the chicks I wanted to fuck and they liked me are all mid 6 figure earners now. Most guys are deadbeats if you're being honest. On paper I am, but in reality I've provided the life we live.

AmericanKulak says

Hector the Mexican and Alice the $18/hr cashier single mom can't afford $450k for a 1800 sq ft ticky tack shack they don't need and can't buy.

A houseload of such hot-bunking hard-working adults living their American Dream pool their money and make it work to get a mortgage.

My neighborhood has many such folks That's why it's so difficult to find parking where I live.

B.A.C.A.H. says

A houseload of such hot-bunking hard-working adults living their American Dream pool their money and make it work to get a mortgage.

My neighborhood has many such folks That's why it's so difficult to find parking where I live.

So what third world shithole town in California do you live in ?

Yes, they over-occupy a house and do other things to make the neighborhood look like a third world shithole.

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AD says

So what third world shithole town in California do you live in ?

Cool And Hip San Jose, in The Cool And Hip Silicon Valley USA.

AD says

make the neighborhood look like a third world shithole.

Ahem, make the neighborhood look like a third world a shithole.

AmericanKulak says

And you've got the infamous NJ Property Tax, which must be murder on a $400k+ house.

Before they all left Long Island or died out, this was a big freaking concern of my Long Island middle class homeowner relatives back in the 70's - 80's. The taxes were so high that it took a long time to sell a house.

The taxes on a new purchase are even more ridiculous here in the Bay Area. But so far at least we have no shortage of Greater Fools rushing to buy-in to the super high taxes that come with the "privilege" of being a Cool And Hip Bay Area Homeowner. Like that dude with the handle "BayArea" who used to post on this blog.

B.A.C.A.H. says

Before they all left Long Island or died out, this was a big freaking concern of my Long Island middle class homeowner relatives back in the 70's - 80's. The taxes were so high that it took a long time to sell a house.

Friends who still live there say there are now 5-6 story apartment buildings all along 25A and as far east as Wildwood Park.

The South Shore is worse... there are now big time M13 gangs and daily gang-related murders all over the Town of Babylon.

RWSGFY says

mell says

WookieMan says

Most boomers are on fixed income.

That means nothing, everybody is when they stop working. There is no reason for a boomer to be broke, just look at the house price appreciation. It's the same for the east coast. Pension and 401k plans just started getting slashed in the past 2 decades til now, and some may still be too high to be sustainable.

I understand the "pensions getting slashed", but what does "401k getting slashed" mean?

You are correct, I used it as a broader term for benefits. There are annuities, 401ks, pensions, sometimes employers match 401ks. Used to be the norm, not anymore. So matching got slashed, not the 401k itself.

B.A.C.A.H. says

AmericanKulak says

Hector the Mexican and Alice the $18/hr cashier single mom can't afford $450k for a 1800 sq ft ticky tack shack they don't need and can't buy.

A houseload of such hot-bunking hard-working adults living their American Dream pool their money and make it work to get a mortgage.

My neighborhood has many such folks That's why it's so difficult to find parking where I live.

Exactly. Back in the days a single earner would do, no over occupation. It's ridiculous to argue that today's avg wages have an even remotely similar buying power than the boomers.

@B.A.C.A.H. Around south east side, prices are rising at least in some pockets. I know someone sold for 2.7 and bought slightly up on the hill side for 3.7m cash (nvidia options)

AmericanKulak says

there are now big time M13 gangs and daily gang-related murders all over the Town of Babylon.

That's sad. I never lived there, but when I was a kid visited a lot.

I have lots of fond memories of times in The Village of Babylon and visiting folks in South Shore Communities, taking LIRR into NY, going by car to the Mets and Yankees.

One relative "escaped" to the North Shore (long since retired and "escaped" again to low-tax Tennessee).

I'm glad for the "Haddonfield" childhood I had. Those days are gone.

My grandparents lived a stone's throw from the Babylon HS and Public Library.

mell says

Exactly. Back in the days a single earner would do, no over occupation. It's ridiculous to argue that today's avg wages have an even remotely similar buying power than the boomers.

Aaron Clary (Fellow NY'er and Xer) has a great intro on this:
https://www.youtube.com/live/PYo2KrXm7eM?si=8elVbe4deIsanpp5&t=32

"I brought my first house for twenty five thousand dollars, I worked all year waiting tables at the dinner and saved every dime for the $5000 downpayment! You can pick yourself up by the bootstrapps, bucko!"

I had a taste of it, so no harsh feelings on my end for the Boomers, but to tell Zoomers this is more out of touch and out of date than lacing Hall and Oates drinks with LSD. 12-year old Kias with 100k Doordash miles are going for $10k, you don't even get a Guinea Gunboat or 70s Dart with a backseat big enough to have an orgy in the width of 3 rows of economy on Delta.

And those boomers who are like "$25? that's bullshit" my dad's first house, which last sold for $380k around 2000, he brought NEW for $40k in 1970. And Nassau County was one of the highest priced suburbs in the country then.

I remember visiting 1200 sq ft ranch modles in Sebastian, FL for $80k in the mid 90s when my dad was about to retire as a teen. New.

Based on internet search :

Median price of house in USA in 1975: $39,300
Median household income in USA in 1975: $11,800
Home price to income ratio in 1975: 3.3
Average 30 year mortgage rate: 9%

Median price of house in USA in 2024: $420,800
Median household income in USA in 2024: $77,345
Home price to income ratio in 2024: 5.4
Average 30 year mortgage rate: 7%

1970 was a census year.

The median house price in 1970 was $23,000
Source: https://www.huduser.gov/periodicals/ushmc/winter2001/histdat08.htm

The median income: $9,840 (I also saw $8,900 but also that the Census jerked around their metrics several times)
https://web.stanford.edu/class/polisci120a/immigration/Median%20Household%20Income.pdf

So a house was about 2.5x-3x the median income in 1970.

Did those median incomes in 1970 include a workforce that had college degrees (and attendant debt) to the extent the modern one does? .

What was the college tuition like at a State School in 1970 vs. 2020? Trade Schools? Weren't Public Schools providing Trade Education to HS Students for free in the 60s and 70s vs. today?

Most importantly, what was the demographic skew of the population in 1970 vs. 2020?

AmericanKulak says

Yep, from 300% of income to ~500+% of income.

If the ratio is 3 or less, then there is incentive to save a lot of money and make at least a 50% downpayment.

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AD says

If the ratio is 3 or less, then there is incentive to save a lot of money and make at least a 50% downpayment.

Agreed.

Here's one question: What was the average age of a purchased house 30-40 years ago versus today. There are claims we didn't build enough, and claims we did. My hot take - not married to it - is that we built fine, but built the wrong kind. Wokies wanting multifamily 15 minute city shit and the Obamunist plan to move Sec 8 multfamily buildings smack dab into nice suburban neighborhoods, and Developers still thinking June and Ward Cleaver but on zero lots. When we needed modest 2-3 bed, 1.5-2 baths as the household size is smaller today with more single income households.

My area isn't a good metric because of Space Program. There's a shit ton of hasty 60s cinderblocks for Apollo and the USAF Missile Range, very little in the 70s, then a boatload of Yuppie Palaces in the 80s (Shuttle) including the Geometric Domed Moldy Monsters, then very little in the late 90s - 2010s as the Shuttle got clawed back then cancelled. Starting in the mid 2010s they built again, and MOAR started as COVID got going, but now those Condo and Zero Lot developers are going bananas trying to move them fast.

AmericanKulak says

What was the average age of a purchased house 30-40 years ago versus today. T

So much difference then and now as far as economy and demographics. Women are more employed now, for example.

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AD says

So much difference then and now as far as economy and demographics. Women are more employed now, for example.

The life insurance purchasing is almost as low, regardless of income or dependent status, interestingly...

AmericanKulak says

$450k for a 1800 sq ft ticky tack shack

Bargain! BUY!

FortwayeAsFuckJoeBiden says

in idaho out here, a lot of people moved in which spiked sales a lot. it keeps going. however interesting enough flippers see losses. 4 different guys who came here tried flipping, 3 lost money and one made very little. no one buys flips here, mainly new construction.

This looks crazy!

HeadSet says

Around here, there is a shortage of home listed because people do not want to sell their homes. One major reason is this example:

Current home, $1,000,000 mortgage at 2% has a monthly payment of $3,696.
Downsize home, $750,000 mortgage at 7% has a monthly payment of $4,990.

Moving to a smaller home at today's interest rates actually can increase the monthly nut and that is after costs like realtor commission and loan origination fees.

One possible exception to the above is if you have lots of equity in the home. If you had a $2MM home with a $1MM mortgage, you could take $0.9MM profits (after taxes) and buy the lower-cost home outright.

That said... yeah, the current surge in interest rates has put a big halt to many buyers.

AmericanKulak says

Did those median incomes in 1970 include a workforce that had college degrees (and attendant debt) to the extent the modern one does? .

I'm reasonably sure that college debt is a relatively new phenomenon.

Debt can and does kill societies.

GNL says

Debt can and does kill societies.

Personal debt is anti-American.

gabbar says

Personal debt is anti-American.

Oh, personal debt is an American tradition. Irresponsible, yes, but quite the practice in the US.

HeadSet says

gabbar says

Personal debt is anti-American.

Oh, personal debt is an American tradition. Irresponsible, yes, but quite the practice in the US.

Yet to meet a millionaire that didn't use debt to make their wealth. You don't use your own money if you want to be wealthy. And then YOU become the bank and make more. Rarely are W-2'ers millionaires. Their check goes to putting food on the table and their house. They're broke or on food stamps even if they pull in $100k.

WookieMan says

Yet to meet a millionaire that didn't use debt to make their wealth.

Personal debt and investment debt are two different things. Borrowing to buy rental property or company equipment is not the same as borrowing to buy that 'vette.

WookieMan says

HeadSet says

gabbar says

Personal debt is anti-American.

Oh, personal debt is an American tradition. Irresponsible, yes, but quite the practice in the US.

Yet to meet a millionaire that didn't use debt to make their wealth. You don't use your own money if you want to be wealthy. And then YOU become the bank and make more. Rarely are W-2'ers millionaires. Their check goes to putting food on the table and their house. They're broke or on food stamps even if they pull in $100k.

It still can and will end up crushing a society over time.

I'm a guy who didn't use debt to achieve wealth.
I'm a weirdo to my friends however.

HeadSet says

WookieMan says

Yet to meet a millionaire that didn't use debt to make their wealth.

Personal debt and investment debt are two different things. Borrowing to buy rental property or company equipment is not the same as borrowing to buy that 'vette.

Personal debt is what is used to build wealth at the beginning if you have no family money. Putting a skid steer on your credit card to start a construction company is personal debt. There are stories everywhere of people using personal CC's to put a down payment on rental properties. You need OPM or personal credit to make the big money.

clambo says

I'm a guy who didn't use debt to achieve wealth.
I'm a weirdo to my friends however.

Like I said, there are people that can do it. My wife and I could retire tomorrow if we wanted at 41 and live to 95. If you save and live frugally when you're young it's pretty easy. I don't want the hassle of big wealth, but could easily get into 9 figures pretty quickly. I don't like dealing with people. Whether he's P Diddy or P Diddler now, his song was right. Mo money mo problems.

We'll build the house, go on 3-4 trips a year or buy a vacation property in the Caribbean and call it a day. My mom and MIL will take care of any finances for the grandkids as there's about $2M for my two sons. MIL has another $1.5(ish).

I like my financial independence. I don't need more money or care to work for more money. Life is short. I don't want to spend all my time adding digits to a banks account working like a dog.