This is the bravest thing I've read for a long, long time. For a reporter--an economic reporter--to admit that he's been in the hell of excess debt and unpaid bills that he reports on is a major statement in middle class America. There was a time when America tolerated a certain amount of this in its writers--one reads nearly approvingly of the repeated flirtations with bankruptcy undertaken by the likes of Dorothy Parker or F. Scott Fitzgerald. But these days, their profligacy, like their alcoholism, is no longer admired, or even tolerated, in the editorial world.
Yet writers are, as a class, extraordinarily at risk. They spend their twenties, and often their thirties, living paycheck to paycheck. They are extremely well educated, and all that education is not only expensive, but builds expensive habits. You end up with a lot of friends who make much more money than you--who don't even realize that a dinner with $10 entrees and a bottle of wine is an expensive treat, not a cheap outing to catch up on old times. Our business is in crisis, and we lose jobs often. When we do, it's catastrophic.
This is what David Brooks calls "status-income disequilibrium", and unless you are among that happy breed of writers who is married to someone with a high-paying job, or who has a trust fund, you feel it keenly. Everyone you write about makes more than you. Most of the people you know make more than you. And you come to feel that shopping at the farmer's market, travelling to Europe, drinking good coffee, are minimum necessities. Your house is small, your furniture is shabby, and you can't even really afford to shop at Whole Foods. Yet you're at the top of your field, working for one of the world's top media outlets. This can't be so.
And so the debts creep up, one happy hour or Colorado backpacking adventure at a time. They are confessed in moments of panic: the 420 credit score that requires a cosigner on a new lease, the $10,000 in credit card debt, the car loan that can't be paid off nor recouped in a sale of the sadly depreciated vehicle, the deliberately bounced checks and collection calls.
But those are among friends. Hanging it out there for the world to see is something entirely different. We're the children of the middle class. And ever more, a clean credit report, a good FICO score, are the standards of a life well lived.
I don't mean to moan about how terribly hard it is to be a writer. Being a writer is great. It's the best job I've ever had, and it's only by a most unlikely chain of coincidences that I get to do it, so I'm well aware of just how lucky I am. All the writers I know could be doing something else more lucrative, but they like being writers, so they're willing to bear the risk.
Rather, I'm glad that Andrews is saying this because we could all use an object lesson. Trying to live as if we aren't, well, writers, can be disastrous--indeed often is, except that the disasters are carefully hidden by people terrified of seeming to drop out of the middle class. The biggest prophylactic against getting into this sort of trouble is cultivating a notion of the good life that allows most writers to live within their means. This should be easy to do, because most writers are friends with other writers. And yet, so many of us get into trouble. And yet even in a milieu now filled with people getting laid off by closing or shrinking outlets, there's visible discomfort when I state something that to me is obvious, unembarrassing, and uncontroversial: that until Peter finds a job, there are a lot of things our household can't afford to do.
Until we're comfortable with talking publicly about the fact that we don't make much money and likely never will, that our lives are risky, and that this has obvious impacts on our ability to consume on the level of our educational peers, writers will keep getting into trouble. Bravo to Andrews for leaning into the strike zone and taking one for the team.
Copyright © 2009 by The Atlantic Monthly Group. All rights reserved.
He is admitting to having made some remarkably bad decisions over and over again. While I know that this is fairly common, it does lead me to question his ability to write about economics. His bad decisions seem to go beyond what I consider understandable and well into the "What the hell were you thinking?" realm. And I say this as someone who has made plenty of bad decisions and have debt that I shouldn't have from things I shouldn't have done...
On the other hand, I feel downright brilliant after reading this.
My experiences with free-lance writing suggests that it's even tougher for folks without a major publishing house behind them. From publishers who don't respect your intellectual copyright to those who want work for nearly free, writers are on the short end of the income chain.
So I'll post on blogs now, but I won't put in the dozens -- if not hundreds -- of hours needed to produce a well researched, nuanced work in a comment.
Many of the writers I know who have any sort of in-depth knowledge of a topic are now writing for industry -- the folks they used to cover. Business writers writing company research for investment firms, environmental writers writing fund-raising letters for non-profits, etc.
You do it because it's a labor of love, not because it's a sensible life choice, I think.
But Megan, I'm grateful for your writing here. I frequently don't agree, sometimes question your research, and often despair of your responders. But I value your honesty. I subscribed to the Atlantic because of you, Andrew, TNC, and Fallows. You've got some excellent company. I just wish there were other women on board; perhaps something they'll consider if they look for a new voice to replace Douthat.
The really sad part about this, is that guy in fact does make a lot of money. A $120,000 base salary, with apparently some stock options (he mentions liquidating his NYT portfolio) is a lot more than even most professionals make. I think the key financial lesson from this is something my dad told me a long time ago. If you want to be financially stable get married, but only once.
That may make me sound like some kind of prude or whatever, but take the article. He spends $4,000 a month in alimony payments, plus the expenses of his new family. The $4,000 is less than his monthly mortgage payment, so he could have his new house and still be generating positive savings.
No, LC, you're absolutely right. Divorce is absolutely horrible for a person's finances, whether that person be middle class or lower class -- and that's without counting the costs of the divorce itself (legal fees, etc.) Turning one household into two is a very good way to run out of money very quickly.
And yet for political reasons, one cannot question the wisdom of divorce; if one does, one is a religiousrightwingnutmoralizer.
I think there are two factors in criticizing divorce. You certainly can criticize a particular divorce. People make all sorts of bad personal decisions and whatnot.
Criticizing divorce as something people should be able to do is different though. This only has the goal of making divorce more difficult or impossible. Making it more difficult is -worse- for all the parties involved (at least financially). Making it impossible is just awful, promoting abusive relationships that can't be ended and a kind of slavery for people trapped in contracts they can never ever exit.
Getting divorced sucks, and people often do it stupidly, that doesn't mean they shouldn't be allowed to. Futzing in other people's marriages seems like a very bad idea for the government to get involved in.
Peter,
You're leaving out the possibility of someone arguing that divorce is broadly a bad thing, and is likely overused, without proposing to make it harder to get.
There are a great many things which are legal, and which should remain legal, but which are bad ideas. For example, running up lots of credit card debt to keep up with your wealthier friends surely ought not to be made illegal, but it's a really bad idea. Similarly, spending all your free time either studying up on "game" or in bars trying to pick up girls (or boys, depending on preference) ought to remain legal, but it's probably not going to do you a lot of good, long term. In the same sense, I suspect that a lot of folks who get divorced are making a pretty bad decision, though it may also be that the seeds of that decision go back to when they decided to marry in the first place. That doesn't mean we need to make divorce or marriage harder, just that it's worth noticing that not all available choices are good ideas.
--Futzing in other people's marriages seems like a very bad idea for the government to get involved in.
But they don't unless you GET DIVORCED.
The State has a vested interest in what happens to the children in a divorce, because it often falls on them. If you stay married, the State stays out of it.
Making divorce more difficult is not worse for all parties involved, especially children, because many people wouldn't DO IT if it were more difficult. People divorce because they think it's easy to do, and it'll be easy to find a new partner. They are wrong on the last count quite often. But time and again, studies show that children do not care a smidgeon about their parents not getting along, as long as its not abusive--they are happy with their parents together and miserable.
I just finished reading Ms. McArdle's article on bankruptcy in the June issue and feel she really missed the boat on the drivers of economic distress. Every study I've seen says that bankruptcy is primarily caused by the Three D's - disability, divorce, and death. In her otherwise very good article, she said only that those who enter bankruptcy have more debt than those who don't. Well, yeah.
Mr. Andrews may not have realized it, but he was in financial peril due to divorce even before he took on a new wife, step-children and a house he couldn't afford. Like millions of others, financial responsibilities that would have been manageable without the big D became impossible to fund without debt. In our family, a life-threatening staph infection that came along with a new hip caused a year of real financial difficulty. We had set aside savings to cover two months off work and copays for one surgery - not nearly enough to cover a year off work and copays for three operations. Without additional savings and our ability to access debt I don't know how we would have covered the additional expense. We have nearly paid that debt down now, but if it had gone on for much longer, it certainly could have capsized us.
The point is that many people who are doing okay on their salaries, get into deep trouble when one of life's big ones slaps them upside the head.
I, too, admire Mr. Andrew's courage in putting this out in public. It really can happen to anybody.
Not to nitpick but I think the complaining about Whole Foods is overwrought. I typically go there once a week to buy fish and meat. Went to the one at Logan Circle Wednesday and some shrimp, sausage, trout and chicken breast ran me about $18. Add some rice and frozen veggies with each dish and each dinner comes out to about $5. Not sure that is really a big deal.
You only get in trouble when you get the prepared food or more exotic offerings.
In fact, in The Undercover Economist Steven Landsburg went to the Whole Foods on Wisconsin Ave and then to the Social Safeway in G-town and said that a basket of identical goods cost almost the same.
As for the article, I couldn't get over how he made over $120,000, had an employed wife and still worked his way into a big hole. I have a hard time feeling sorry for him and will not be buying the book.
To take a slightly different tack than some of the above commentors:
This guy has $2,777 in take-home pay after taxes and alimony, and that would barely cover a month of living in a 1-bedroom apartment (page 1)? I am quite happy NOT to be living anywhere near the East Cost. Pardon, coast.
It's not an east coast problem, it's an "I'm too upper class to live outside manhattan" problem.
The east coast isn't that pricey. I'm 15 minutes outside manhattan, and I pay $900/month for a huge studio in Jersey City. If I cared, I could pay $200-300 less if I traded down on space/distance to the path. Even upper manhattan (read: where black people live) isn't that pricey.
Some people are just unwilling to give up luxuries.
I'm guessing you're single, but you definitely do not have kids. If you do you have to worry about space to play in, good school district, their personal safety...etc. It's easier to be blase about safety when it's only your own you're worrying about. I know I was in my 20s.
$900/month for a studio only sounds cheap if you're comparing it to lower Manhattan. For the rest of the country, that gets you a lot more.
However, it did surprise me that they still had cable even after they saw how dire things were.
My father pays about $1000 for a 3 BR in Carlstadt which is a 30 min bus trip to Manhattan. It's a very nice little town which is exceptionally safe and has good schools. However many New Yorkers never think of crossing the Hudson and if you tell your NY Times colleagues you live in "Carlstadt" you'll get puzzled looks.
Regarding the cable, keep in mind his profession. He probably spends a couple hours a day keeping current on every available news source and would handicap his career by not having it.
The kids don't live with him, remember he pays child support. So school district is irrelevant.
Incidentally, JC has space to play in and most of it is quite safe. Greenville is a bit dicey, but the heights/grove/square areas are excellent places to live. Union City/Weehawken are even cheaper, although trips into the city require planning (buses come every 30-60 minutes).
As for rent, I realize $600-900 (about $1300 for a 3br) is fairly pricey by national standards. But it is easily attainable with his salary.
This guy doesn't have kids either. His (former) wife has custody of the kids, and he's paying child support for them.
Lets not forget the important fact here. It was his choice to get married in the face of his obligations to his first wife and his children. Saying, "But I couldn't help it, I was in love!" most definitely doesn't excuse him from doing the necessary financial due diligence.
Also, the fact that he's making more than twice the salary I will make when I graduate from college isn't helping his case either.
As for the article, I couldn't get over how he made over $120,000, had an employed wife and still worked his way into a big hole. I have a hard time feeling sorry for him and will not be buying the book.
It was the dingbat new wife who hadn't worked in years and must have had a very successful husband. He even states that he suspected she didn't understand money - where it came from and where it went.
I totally understand how that can happen - I got into less trouble than this guy - but it took near total collapse for my partner to learn how money worked.
I guess I'm just a hopelessly unromantic ex-engineer but I can't understand that at all. I can not contemplate having a partner that was so financially ignorant and completely opposite my own thinking money. I might like someone or lust after them but love (and thus any sort of marriage) would be out of the question.
A $120,000 base salary...
Seriously? I'm a lawyer, I make less than that (without stock options), and I support a wife and two children easily. We just bought a house in a lovely suburban neighborhood, we're planning a massive remodel, and I've been comfortably able to participate in the Great Obama Panic of 2009 and stock up on guns and ammo. What is WRONG with this guy?
Your wife doesn't insist on the finer things in life. A couple of pairs of $600 jimmy cho's and a $5,000 Kelly bag and you'd be sunk.
Yeah, well, then she wouldn't be my wife, would she?
More to the point, he doesn't have an ex-wife and two kids that cost him $4k/month in alimony and child support
The author would have been fine with his $120k base salary, it's the $48k deduction that hurts.
Let's put this in perspective: The 4800 in alimony/child support is about 50% more than an LD on Capitol Hill makes, yet they manage.
The main issue here is simple financial irresponsibility. As to Megan's example, making $76,000 a year is not the stuff of having trouble affording a $25 meal with a friend.
The problem, as the author admits, is when you already have a mortgage you can't afford, $14,180 in credit card debt, and THEN you keep spending $350 on groceries, $700 at J. Crew, $179 at Gap Kids, $700 in plane tickets and $1600 on a beach house (and after the fact he only considers the $1600 embarrassing!) Once you get that far down, it's almost impossible to dig out.
I also agree with Megan that it's a brave story to write. Hopefully it's a cautionary tale, that at the first indication that cash outflow is greater than inflow, tighten the belt.
This picture says it perfectly.
He's hardly the first to be derailed by a taste for expensive, unproductive women. Working women everywhere look at the wives in these scenarios and just roll our eyes. Alimony? What the heck? Child support is one thing, but what healthy adult needs dependency payments? And the wife in this story who demanded a holiday from thinking about money on her birthday -- good grief!
Come on, ladies! It's one thing to agree to a traditional division of labor where you take care of the family and he earns the money. But shopping isn't labor. In truly traditional families, mom took care of the family by MAKING the clothes. That's work that adds value. Something is wrong if tending to the family is primarily about spending absurd amounts of money.
You live in a major urban area? If so, $120,000 is still good money, but not what it is in, say, Indianapolis. It sounds insane, but $120,000 in big cities with student loan debt and dependents leaves you with very little.
"This guy has $2,777 in take-home pay after taxes and alimony, and that would barely cover a month of living in a 1-bedroom apartment (page 1)? I am quite happy NOT to be living anywhere near the East Cost. Pardon, coast."
It all depends on what you are willing to live on. After grad school I was earning a very good wage, maybe about $3,500 after taxes but living in NYC. A 1-bedroom apartment would have cost around $2,500 in rent, if you add in utilities, cell phone and costs for going out it is pretty easy to see how that would have been reduced to $0 very quickly (a strategy employed by many of my co-workers was to just assume a big bonus was coming every year, live off credit cards and then pay them off. Clearly this only works in an up-market).
I took a different tack. I moved to New Jersey (which oddly saved me in income tax), commuted and split an apartment and paid $1,200 a month. Although there was the whole social obbrobium of living in "Jersey" and not the city. But whatever, I was liquid.
Well, yes, I could probably blow away more than half of my income in rent on a 1BR if I wanted to live anywhere near Denver's LoDo district. Thing is, even if I did work in the city center, there are beautiful suburban environments less than 25 minutes away where a person can (without any social stigma) spend perhaps a third of a post-tax "good wage" on decent accommodations, maintain a reliable vehicle, and still have money left over for savings and recreation.
Part of the rub for journalists is that they need to be near the action in NYC/DC - which is killer on finances. Like aMouse, I live in Denver and a person can live here pretty well on reasonable salaries.
"A $120,000 base salary..."
The New York Times paid him that, but after his ex-wife took her cut he was left with a lot less. It sounds like he was paying her with post-tax dollars. So the NYT gave him $10,000 a month, the government took $3,300 and then his wife took $4,000.
$2,777 after taxes is equivalent to say a $5,000 pre-tax income. Or about $60,000 a year. I could imagine how it is very difficult to keep a family of four on $60,000 a year (or to buy a house that costs $460,000). Although if he hadn't gotten divorced in the first place, this would all be moot.
What a great example of the huge divide in our country. For most people $60,000 a year (or $2,777 after tax) is not a bad income. He wasn't making upper middle class money, he shouldn't try to live an upper middle class lifestyle.
It's not a lot at all in DC.
I don't think that's right. I make about 57K and my after-tax is about $3,600.
Alimony is usually deductible, and considered income for the ex. Child support is post-tax for both of you.
Rob,
You also must not be very competative. For many guys, seeing another father being able to provide a much better life for his family than you can for yours is very difficult. On the other hand, some guys don't really care that they are poor providers.
Yeah, Rob, if you want to prove you're a loving father, you need $700 J. Crew and Baby Gap spending binges on your credit cards that end up losing your children their home. Clear?
I'm actually kind of embarrassed to put my kids in the designer stuff my mother-in-law sends. Makes me feel like a tool.
But yeah, I'm competitive. It pleases me to pass most of the other runners in the morning and to bench press more than guys twice my size. It pleased me even more to punch a hole in a 35mm film at 30 yards that some active-duty Army guys brought out as a joke.
it's funny. reading this article, you would almost expect the author to be arguing for more social services. but, luckily no. mustn't let reality force me into a leftist rant. must remain a libertarian. must keep pretending i actually have money.
What does this mean? This guy realized that he was borrowing too much, decided to do it anyway because he was "in love" and then his gamble failed miserably. What social services would have helped him? Maybe the "stop me from falling in love" office in the "don't be stupid department" would be his first stop, followed by some time in the "don't buy shit you can't afford" group therapy room perhaps?
I'm not a conservative but I'd think one could make the argument that "conservative values" would be a hell of a lot more use to this guy that social services. How about:
1. Don't get a divorce.
2. Don't marry again if you do get a divorce.
3. If you have to marry again, actually get to know the person first and their attitudes toward important things like money.
4. Save your money and pay cash for stuff.
I'm really interested, what "social services" could have stopped this guy for getting into this trouble? He doesn't say that he had child care costs (kids seem to be in public schools). I truly don't understand.
One point made in The Millionaire Next Door (which is probably still the best book ever on this subject) was that research showed that most men who earned their own wealth had wives that were more frugal than they were. In many of these relationships, the man earned the money in his small business and his wife scrutinized the family's spending.
"Social services" are part of what did him in - public education that is. Unfortunately, in the US good public education in major metropolitan areas tends to come with a high price tag - on real estate. Finding a more affordable home would likely mean living in an area where schools are lousy.
He could have lived in an inexpensive town within commuting distance to work and had his wife home school his kids.
I would simply apply the codicil that if a man does remarry, he should only do so with a prenuptial agreement. And this becomes more important as he reaches his peak earning years. Marriage for a middle-aged man is objectively a minefield, financially. There's very little upside and a vast, catastrophic downside. You'd better be in love, chum, because otherwise you're an idiot for getting married at your age.
mrmanley, I'm a middle-aged man and I did remarry. I did as you advised and had a prenup.
I'm not sure I agree that there's little upside. The family income approximately doubled. Since we're in different occupations in different industries, there's increased financial stability.
Without children, a divorce would be simpler than my first time.
But yes, I am in love. That's the best part.
He makes $120k a year in base salary. Under what "reality" would any sort of social services be able to subsidize people making that much? Since when is welfare for people making $120k/year "leftist?"
You could just as well say that he could have let "reality" force him into a rant about alimony and the inability of women to control their spending, which honestly appears to be more relevant to his situation than "more social services."
Government can't magically create money here. The very rich people have a lot of money, but not enough that the US can comfortably subsidize even those making $120k/year.
"You also must not be very competative. For many guys, seeing another father being able to provide a much better life for his family than you can for yours is very difficult. On the other hand, some guys don't really care that they are poor providers. "
Or they realize that spending money on a child does not strictly define providing a better life. Would you rather take your child out for a medicore dinner at TGIF and spend $60, or spend some time with him, teach him how to make hamburgers, grill them together in the park and spend a weekend afternoon together for $15.
That's exactly the point that many of us should take from this recession. Our son decided he really likes to wear Ralph Lauren, Hollister and Tony Hawk brands. I said, OK, I'll get those for you, but I'm buying them on e-bay. He has the brands he likes and I'm spending $5 to $7 a shirt and $9 to $12 for jeans.
Does any rational person really believe he'd be happier or better cared for if I spent $75 for a new shirt? He could care less. And he's learned that he can have what he likes without breaking the budget.
In a world where way too many have way too little, there just seems to be something terribly wrong about putting a $75 shirt on a 13 year old's back.
Another good article about an endebted writer is http://www.meghandaum.com/articles_by/art_by_misspent_youth.html , by Meagan Daum. It doesn't involve the current financial crisis, but it illustrates the same downward spiral of credit card debt propping up a middle-class lifestyle that her income didn't support.
This doesn't seem to really be a case of a writer struggling on his meager salary. $120,000 a year doesn't exactly make you Croesus, but it's reasonable pay and anyone should be able to live comfortably on it, even in New York.
His problems don't stem from the low pay of his chosen profession, but from a combination of a hugely expensive divorce and falling for the mid-decade "house prices will always go up" hype. Both of which are interesting in their own right, of course.
For many guys, seeing another father being able to provide a much better life for his family than you can for yours is very difficult.
I don't know what more they could possibly want, frankly; they have too much for them to properly appreciate it all as it is, and I don't see raising spoiled brats as a sound goal.
(My wife once attempted to lecture my older son on his lack of gratitude, but got badly derailed when she said "Your father works hard to give you food to wear and clothes to eat.")
That's an overstatement, particularly for reporters who write about poor people (which has always been a staple at the NYT, even in good times).
Here's an idea: Why doesn't Peter apply for a job at Whole Foods? Then you both would get a 20% discount and you could afford to eat there.
The wealth of your interviewees depends on your beat. This guy was an econ writer meeting with CEOs...etc. Also, I thought he was in the DC bureau; I thought he said his wife had to move to Washington at some point in the story.
Peter is freelancing, and I personally hate Whole Foods; I'm a Safeway-and-Costco girl. But others feel differently.
Megan - if I weren't already happily married and and I guess 10-15 years your senior, and you weren't already involved, I'd propose right now. Not because I'm cheap, which I'm not, but you're the only one in your line of work that can say this and not make the reader feel like they are getting fed a load of BS.
Well, that's certainly not the only reason. But it's refreshing.
How could you hate Whole Foods? They just opened one up 5 minutes from me and my girlfriend and I go there for lunch or dinner a few times per week. I don't even like supermarkets, but the food court there has some great quality and variety. We're Costco members too, btw. Now that you're eating meat again, you ought to try Costco's new USDA Prime rib eyes.
reporters who write about poor people (which has always been a staple at the NYT, even in good times).
Only when the Republicans are in power. I don't recall much poor-mouthing in the Clinton years.
Ah... where does libertarianism end and conservatism begin?
First off, some math. If he's making 10,000/month (which is what a 120,000 base salary translates to), but is paying $4,000 of that as alimony and child support, how is he only netting $2,700 and change? The alimony part is is tax deductible. Perhaps he needs a better accountant? Also, since these payments come after a 21 year marriage, shouldn't most of the child care payments end soon? Once the children reach 21 years old, most courts end payments.
Secondly, libertarianism: he made his bed. Nobody told him to take what is represented as an uber-intellect and settle for the career path he has chosen (even though he is very well paid). His choice.
Nobody told him to get divorced after 21 years. Again, his choice.
Nobody told him to live in denial. His choice.
Different spin: conservatism. What was he thinking in getting divorced after 21 years? Your marriage isn't happy? Too bad. Welcome to life. What, you think our grandparents were all getting married for love "back in the day?" There are things like "duty," and "obligation," and "common sense" that used to mean something. If you choose (libertarianism again) to ignore them, you do so at your own peril.
If you enjoy freedom less than you enjoy penury, don't get a divorce.
Life's full of hard decisions, matey. Grow up.
Nobody told him to get divorced after 21 years. Again, his choice.
Odds are his wife wanted a divorce and he didn't have any choice. Most divorces are initiated by women.
when you are not in love with someone (whatever that actually means to the large percentage of people who don't run on Romance) and you see a state-sanctioned, legal means of bilking someone with whom you're already frustrated or emotionally distant from, and you have the ability to cry on command and get whatever the frak you want, wouldn't you go for free money for life?
Reading between the lines it's obvious he was having an affair with his now spendthrift wife, and convinced himself his only chance at True Happiness was to ditch the mother of his children and chase after someone who made him feel 17 again.
He reaped what he sowed.
While I know that this is fairly common, it does lead me to question his ability to write about economics.
Eh, I just hope he never attempts to give anyone relationship advice: that wife is a freakin' nightmare.
Why? Two people ran into money difficulties in a marriage, then reacted badly to the resulting stress. Where's the "nightmare" part?
Where is the "nightmare part?" Are you kidding?
How about when they realized they didn't have money for groceries?
How about creditors calling morning, noon, and night?
How about the strain on their marriage that might have led to another divorce?
Is buying crap you don't need worth it when it robs you of your piece of mind?
Becoming a professional writer does seem a lot like taking a vow of poverty. I'm just too venal for that myself, but I'm glad there are others who do write professionally (and perform music, make art, etc).
Until we're comfortable with talking publicly about the fact that we don't make much money and likely never will, that our lives are risky, and that this has obvious impacts on our ability to consume on the level of our educational peers, writers will keep getting into trouble.
Heh, I thought it was an an understood social contract that being a writer comes with unlimited mooching privileges. It's the "starving artist" clause.
I have a soon-to-be fifteen-year-old girl, and everything from her food to her clothes to her phone and outside activities cost at least three times what mine do. When she turns sixteen, she's expecting something like Cooper mini or Bug, done in metallic green or purple. She tells me that it's okay if it's 'used' - read one or two years old - because she knows that we don't have much money. Oh, and she wants to go to CUNY because they 'have the best Theater program'.
This sort of inflation of expectations seems to be a general thing, and I suspect it is fueled at least in part by how little the parents perceived they had growing up. So what do yours ask for? I'm curious, given that I'm raising a girl and you have at least one boy.
Sounds like she should get a job if she wants all that.
You must be my dad under an alter ego.
In fact, he did provide a car, although not right away, and it was grandpa's decade-old Chevy with an anemic engine, automatic tranny, and a coolness factor somewhere south of a summer cold. I had to share it with my sisters as they came of age. When the family was done with it, he sold it (still running, although with noticeably more rust) to the father of a 16yo.
My first car purchased for both pleasure and on my own dime didn't happen until some years later. Lo and behold, it was ten years old and didn't quite have a perfect body, since the alternate two-year-old car would have put my into a $390/mo payment and my budget said "No, thanks..."
My father's cure for this when I was a lad of 16 was to give me an MGB. I learned a lot about both personal finance and his particular sense of humor.
I join the others in questioning whether someone who makes 6-figures for years can really be called "struggling" because he doesn't match what his peers make. Perhaps he could be making millions but 120,000 a year is pretty far from middle class, it seems to me.
Rather, this fellow was a victim of bad choices. Divorced his wife and had to pay her 2/3's of his salary but decided not to let that impact his plans to marry his high-school friend. And b/c he was in love, he didn't notice that his new wife was terrible with money and apparently used to being married to a rich man who allowed her to spend freely and not work.
I can understand that times are tight in the McCardle/Suderman household, and that is unfortunate, but the fact that you apparently find it "obvious, unembarrassing, and uncontroversial" to cut back on expenses rather than living on escalating debt while pretending that you can live like two employed lawyers or something is precisely why you are much less likely to end up in the situation the NY Times fellow found himself in.
Frankly, even though I'm doing fine and have been on a savings binge for some time (yes, even making less than the author, yes even living in Manhattan and having a social life), just reading about that guy's wife refusing to cut back while he's watching them spend 3,000 per month more than they make month after month made me want to cut back on my own spending even more.
Perhaps I'm just a heartless prick, but I feel that at least part of the problem was that neither he nor his wife were apparently up to the task of being the adult who faces harsh realities and forces hard choices. She apparently didn't understand or care to learn that nice clothes and good food cost money and if you don't have it, you shouldn't buy those things. And he was apparently unwilling or unable to rein her in.
I thought this line was perhaps the epitome of the problem: "I wanted her to take me in her arms and reassure me that everything would be O.K. But that wasn’t happening." Well of course it wasn't happening! You already know that she doesn't understand your financial situation! You do but rather than be an adult (or a man) and laying down the necessary actions, you want to curl up in her lap like a child running to mommy and have her stroke your hair and tell you that it's all okay! Good grief.
All that aside, I do agree with Megan that it must have taken courage for him to come clean like this. On the other hand, maybe he's hoping that his forthcoming book on the subject will be his financial salvation.
I feel that at least part of the problem was that neither he nor his wife were apparently up to the task of being the adult who faces harsh realities and forces hard choices. She apparently didn't understand or care to learn that nice clothes and good food cost money and if you don't have it, you shouldn't buy those things. And he was apparently unwilling or unable to rein her in.
My sense is that the author would wholeheartedly agree with you. That was one of the main points of his article -- how easily he slipped into denial, how sensible judgment was clouded by other factors (desire, love, wanting to belong).
I'm moderately frugal, and have a very secure job, albeit one that pays much less than the authors. I really don't have to worry about losing my job, and I don't have the obligations the author has. Still, I found the article terrifying. I need to save more!
Whoops, that should read "McArdle/Suderman household", of course.
Sorry for the type in your name, Megan.
Good grief, what's wrong with me today?
"Typo" in your name, not "type".
Well written, but I have to take exception to one thing you wrote. Even without the divorce, $120,000 isn't far from middle class, it is middle class. If you're paying your mortgage, on a car or two, on a student loan or two, for insurance, for a child or two, and your taxes, of which there are plenty if you're married, then $120,000 isn't as expansive a number as it sounds. But it's all situational. Subtract a few things from my list and the disposable part of that number grows nicely, even accounting for some savings.
Thanks.
I agree that I was perhaps overstating the case by calling $120K "far from middle class", but given that the median income is something less than half that, it seems like $120,000 should at least be considered upper-middle class, no?
The wife and I are over $10k below that and we manage to save a little money (read: a few hundred) every month for unexpected expenses and items that don't fall in the normal budget. So, applying popular definitions, that "savings" does move us up a notch. And as much as I'd like to birdwalk into a discussion about tax brackets on median incomes, the marriage penalty, our celebrations of incomes that can't afford savings, etc., I won't.
Hold on a minute. I call baloney on this notion that 120K is middle class.
Wikipedia tells me that the lower limit on the top quintile of income distributions is 89K. The lower limit on the top 5% of income is 157K.
This guy is somewhere between the top 20% and the top 5% of income earners in the country. This ain't in the middle, not by a long shot.
Klug - You've almost forced my hand, but not quite. I'll venture this far: Middle class used to define a lifestyle. As you start moving down into the actual median incomes, the traditional middle class lifestyle is out of reach. In order to achieve that lifestyle (2 cars in the driveway, a little bit of savings, kids you can actually provide for, etc.), one has to be in the upper portion of the distribution curve. Personally, I blame politicians who have very successfully redefined what it means to be "rich" b/c many don't mind taxing "the rich," but that's another discussion.
I kind of agree, but look at that house in the article's picture: it costs HALF A MILLION DOLLARS. In Denver, the same house costs half as much. $120K/year is middle to upper-middle class in DC and no better, which is now the highest paid metro area in the USA.
In order to achieve that lifestyle (2 cars in the driveway, a little bit of savings, kids you can actually provide for, etc.), one has to be in the upper portion of the distribution curve.
Perhaps. But I suspect it is attempting to prove to other people that you have that lifestyle that is the thing that kills bank accounts, budgets and marriages.
Klug - "I call baloney on this notion that 120K is middle class.
Wikipedia tells me that the lower limit on the top quintile of income distributions is 89K. The lower limit on the top 5% of income is 157K.
This guy is somewhere between the top 20% and the top 5% of income earners in the country. This ain't in the middle, not by a long shot."
I think most people would classify being middle class and being a high income earner as two different things. You're very fortunate if you make $120k, and I think that qualifies you as a high income earner by most reasonable standards, but 120k is not going to put you into the upper class immediately. You can certainly become rich on $120k eventually, but you're going to be in the middle class for a while first, depending on where you live.
I don't know that there are two many people (if any) earning $120k that deserve a lot of sympathy for their financial condition, but the only people I know making 120k that could be considered upper class have been making $100k + for a good while, and I live in an area with a relatively low cost of living.
Middle class is in the middle. $120k per year is far above the middle.
some people have redefined "middle class" to mean a level of income and set of possessions and a lifestyle that far above what the real middle class can earn and own. At the same time they portray this standard of living as really being in the middle. But it is above the middle.
Hate to pile on, but...
"We were spending way more than we were earning."
"It was even more amazing how long we had avoided the screaming evidence of a train wreck in the making."
"...it seemed like an indulgence we could work off later... "
Classic.
I must confess to a certain amount of amusement every time I read one of these "How could it happen to me?" jeremiads. The irony of this guy being an ecnomics-beat reporter is just too delicious for words. To most of us living on less than $120K per year (many of us on a whole lot less), the truths of personal finance don't exactly come as a news flash.
Being poor means you don't summer in a beach house; it usually means you don't go on vacation, period. Being poor means that you shop at Safeway's, or at the dollar-store. It means eating ground beef instead of steak, store-brand bread instead of "artisan bread" from the bakery. It means buying wine with a cap instead of a cork, or doing without wine altogether. It means doing away with cable televsion and internet. It means making shoes and coats last for another year (or two, or three). It means no cell phones for the kids, and no new laptops for mom and dad. It means driving less because you can't afford the gas, and deferring new tires until next year.
None of this is news to people who've had to deal with it, and it's a real eye-roller coming from some pampered east-coast yupster working for the Times. Welcome to the life that people in burgs like Lincoln, NE and Akron, OH and Casper, WY have been living all along, pal. Only most of those folks didn't get into the mess they're in by being stupid.
"It means buying wine with a cap instead of a cork, or doing without wine altogether."
Hey, things aren't that rough, brother. Get thee to a Costco liquor store. They sell quite serviceable wines (e.g., Chilean Shiraz) for $3.99. They even come with corks.
I think you and a good many other posters in this thread are missing the purpose of the author's article. He doesn't appear to be asking for sympathy, or attempting to lay blame anywhere other than where it belongs. He isn't expressing any illusions on what his income could or could not buy in the area of the country where he has chosen to work.
The substance of the article is, "Here are the mistakes I made, here is how I made them, here is what I have worked through so far and here is what remains to be seen." It's a simple human interest peice drawn from personal experience, and for better or worse, it describes what a great many people in this country did over the past ten years. If that doesn't interest you, don't read the article.
Thinking with Johnson.
//maybe he's hoping that his forthcoming book on the subject will be his financial salvation.//
From what I've read about how book authors get paid, that is very unlikely. I assume he has already spent the advance, and even if the book takes off and ends up on the NYT best sellers list, he is probably 12-18 months from seeing his first royalty check.
There's no doubt that the book will be his financial salvation.
His scenario gives me the willies. I was married for 18 years, and then my wife decided she was a lesbian. People always raised their eyebrows when I told them she loved power tools and math, but I just shrugged.
And I make $130k a year. And I pay $3850 a month for child support, plus $150 for health care for the kids, plus $125 a month for life & disability insurance. So my court-mandated expenses are pretty similar.
On the other hand, I live in a $900/month apartment, and there's no way I would even consider buying a $500k home. Even if I was still married. 3x my yearly take home. Why is that such a hard rule to understand?
I live in Atlanta now, but I was working in Silver Springs, Md a year ago, earning $120k/year looking at houses with my then-hetero wife. We saw a bunch of houses in the $420+ category, and we both agreed that we couldn't afford them - that we had to look at houses under $350k.
The lesson I take away from this is that because Andrews didn't behave financially prudent at the beginning of the situation, it made it too easy to compromise and slip and fudge later on.
I guess that's the lesson I'll teach my kids: do not, under any circumstances, buy more house than you can afford. Almost everything else bad that happened resulted from that original mistake.
Another potential lesson might be to not get married if they are male.
Speaking as the token social conservative, my advice is slightly different. Go to church and find a woman who is internally motivated by her faith (if you live in a blue state this will be just about everyone, but it is a nightmare issue if you live in a red state and the social pressure favor church-going). You ought to be safe marrying and raising a family with her.
"translates to), but is paying $4,000 of that as alimony and child support, how is he only netting $2,700 and change? "
I know a bit too much about divorce, as my father in law has been through it twice. As a point of negotiation either the receiver of the alimony or the payer of the alimony can take the tax deduction. But not both
One way to think about it is a simple optimization. Whichever party can more effectively utilize the exemption will get it and then trade that off with some other asset.
You're confusing alimony with child support. Alimony is deductible and, I believe, taxable to the recipient. Child support is not deductible, but one of the parents is allowed to claim the exemptions for the kids
Rob,
"I don't know what more they could possibly want, frankly; they have too much for them to properly appreciate it all as it is"
How old are they? Did your daughter's best friend get a X3 for her 16th birthday? Did your son get invited to his friends parents condo in St. Martin (all you have to pay is the airfare). Do all your kids friends have iPhones and laptops and $5,500 wardrobes?
You will be dealing with parents where the dad is the CFO of a decent sized company and mom is an ED Dr. (working 12 days a month) and they are making 850k a year. They are saving 10x as much as your are and living a much grander lifestyle.
jmo,
And the CFO will have social interactions with the CEO, who's bringing home $2 million a year. And this CEO will probably know CEOs of bigger, more profitable companies who earn $9 million. Who will know some venture capitalist who made $70 million last year. And those people will know Bill Gates.
Very, very few people get to be the richest person they know, regardless of their position on the income spectrum.
I grew up in similar, though less extravagant, circumstances. Friends with the children of bank presidents and lawyers and doctors who were the children of bank presidents and lawyers and doctors. Old money that hadn't been reduced to no money yet.
My parents told me no. They explained why. They told me no some more. I frequently didn't understand, b/c I didn't understand money, and got mad. They still said no.
Surprisingly enough, I grew up to be a self-sufficient adult and not a moron with money. I made mistakes along the way, but never massive mistakes. Your kids will appreciate all those "no's" later in life.
You'll also be dealing with kids whose parents got laid off, or whose parents died of cancer.
Most people are kind of in the middle on most attributes, including money and stability. If you only ever compare up, you get into trouble. Sanity involves also comparing down, appreciating what you have, and having compassion for those who have less.
Unless they have less because they are complete idiots.
Your own position, MM, is well known in Briatin under the name genteel poverty. Don't Americans have a name for it?
Here, we call it "broke". Or, to be more specific, "middle-class broke".
This is a great post, Megan. I think you're far too easy on the guy, actually -- this isn't a 20-something making $30k as an associate editor at The Paris Review and making typical 20-something financial mistakes -- but I always enjoy your posts on consumerism and lifestyles.
Divorce is expensive - don't do it if you cannot afford it and affording it may mean relocating countrywise so that it doesn't cost you monetarily (and with the internet, location for writers is very elastic).
This guy's problem is not that's a poor, unappreciated ink-stained wretch. It's that he's got women burning up all his money.
Is it really fair that he pay his ex $4000 a month? I doubt it but part of the price of being a straight male who wants a family is that if your wife gets tired of you you get many years of financial hell.
Life is full of unpleasant surprises, and if you're a divorced NYT reporter with big alimony and child support payments living around DC you need to find a woman who makes big money who digs the fact you're a NYT reporter. (Don't tell me being an NYT reporter isn't socially very desirable in DC.) A divorcee with no current job skills and a taste for the finer things in life is trouble brewing.
Living the dream is a funny thing. I'm a pilot. Maybe I could have made more money doing someting else, or maybe I just would have been miserable, not done well at it, and made no more money than I do now. Actor Stephen Root once said "Don't go into acting because you want to, do it because you have to."
What the guy needed was a better divorce lawyer. $4,000/mo for alimony and child support is obscene.
Sorry, but I don't recall Andrews ever getting that specific about the reason behind his divorce. For all we know, he may have been having an affair during his marriage with the 'sexy, fiery' Patricia due to a mid-life crisis, but I'm sure nothing is ever the man's fault right? Heaven forbid he stay with a frumpy boring wife of 21 years. See, I can make the same kind of biased assumptions based on my life experiences, too.
The conservative side of me says that all signs point towards this NYT guy being a weenie who is incapable of taking true responsibility for all the poor choices he made. Throughout the story he tries to elicit sympathy subtley by pawning his problems off on his wife or mortgage broker. He's the victim; the moral of the story being that if it weren't for a woman, he would be in a-ok shape. How could he possibly know ahead of time that his 'regal' girlfriend would have expensive tastes? lol. She obviously tricked him into marrying her, and tricked him into living in NYC, and tricked him into taking out that huge mortgage, right? What a wimp.
We're speculating, but I can't say that I disagree...
So what do yours ask for? I'm curious, given that I'm raising a girl and you have at least one boy.
Mine are 4 and 1, so the requests run mostly for overpriced plastic toys. I know they want more than they can appreciate because of the speed with which boredom sets in, and also from the 6 months all our stuff was in storage and the older one was perfectly happy with one Lego Thomas train set for half a year.
I mostly buy my older one model rockets, which we then build together and launch on summer mornings. My wife gives him a budget for special occasions and book orders and lets him spend it as he wishes.
How old are they? Did your daughter's best friend get a X3 for her 16th birthday? Did your son get invited to his friends parents condo in St. Martin (all you have to pay is the airfare). Do all your kids friends have iPhones and laptops and $5,500 wardrobes?
Do their fathers take them hunting fall and spring? Teach them to identify and track animals by their scat? Teach them to repair a car or build a model airplane? Help them to grow food in the back yard and preserve it for the winter? Make chili with them from venison they shot and beans they grew? Let them borrow the gunsmithing tools to accurize a rifle or customize a pistol?
I went to middle and high school with the children of Microsoft VPs and wealthy small businessmen, so I've already had the opportunity to rub elbows with the people you're describing. If I was twice as rich as all of them, my children still wouldn't own the stuff you listed, but they will get to do the stuff I listed.
"Help them to grow food in the back yard and preserve it for the winter? Make chili with them from venison they shot and beans they grew? Let them borrow the gunsmithing tools to accurize a rifle or customize a pistol?"
No offense, Rob, but it sounds a bit like your children are growing up on a 19th century farm somewhere out in the frontier.
I did some hunting growing up and the requisite gun-care but customizing a pistol? Preserving food for winter? Making chili using only ingredients you harvested yourself? Really?
No, a ritzy subdivision with an aggressive HOA.
But yes, I think it's important that children understand where food comes from, and more broadly the logistical tail that underpins modern life. Besides, my older son gets a kick out of planting seeds and watching them grow.
As for the rest of it, I'm good with my hands and I like making/fixing/modifying useful, functional things. If I were a musician, I'd teach them that, but I can't give them something I don't have.
"I can't give them something I don't have."
C'mon Rob, what else is credit for! Isn't that what we've been talking about here? About this NY Times guy who lived the dream and gave his two families all kinds of things he didn't have?
I joke, I joke.
In seriousness, I share your desire to inculcate in children an understanding of where food comes from and the behind-the-scenes actions of the modern world. (On that note, my new favorite show is something called Modern Marvels; I fell in love with it after I happened upon an episode all about the canning industry. Talk about logistical underpinnings...)
I was merely poking fun because you seemed to be taking it to an absurd level. But one man's absurdity is another's hobby of fixing things. Que cera, cera.
I was merely poking fun because you seemed to be taking it to an absurd level.
As I believe I've pointed out before, that's another of my specialties. After all, I have an apple supply of canned ammunition sitting in my bedroom.
Rob if you're ever interested in adopting another kid let me know . . .
Word. My daughter wears off-brand clothes, but knows how to punch well and handle a rifle.
It's even more important for girls. Society mostly judges men by what they do, but it often judges women by how they look or who they sleep with. So girls really need their parents to provide an accomplishment/ability basis for confidence and positive self-image to keep them away from self-destructive behavior.
Rich,
"My parents told me no. They explained why."
How did they explain it?
Four words: We can't afford it. Sometimes they used five words: Money doesn't grow on trees. Another good five word phrase: You can get a job.
And that's about as much "why" as I got, but it was why. But my dad and Rob are apparently pretty similar, so they still would've said no even if they could've afforded more. They just would've had to come up with new reasons.
... until Peter finds a job, there are a lot of things our household can't afford to do.
Make sure you never marry a writer, unless you want your personal life aired in front of everyone.
Also, I'm not sure how "brave" the author was. For one thing, he spends a lot of time confessing his wife's shortcomings, which would not go over well in my household. Also, the article notes that it is an excerpt from a book coming out next month, “Busted: Life Inside the Great Mortgage Meltdown.” Looks like Andrews decided his "confession" would help him solve his financial problem. Good for him -- I doubt his wife would have agreed to pose for the photoshoot otherwise.
WE HAVE A WINNER!!!!
Yeah, exposing the lurid details of your private life for profit isn't what I would call "brave". It's only a step above people who talk about their sex life on Oprah so they can be on TV.
I'll second that!
Agreed. And even overlooking his vested interest in this act of alleged bravery -- I mean, yeah, it can be hard to admit you were a bonehead, but are we gonna start giving out Medals of Honor for it?
Rob,
Do their fathers take them hunting fall and spring? Teach them to identify and track animals by their scat? Teach them to repair a car or build a model airplane? Help them to grow food in the back yard and preserve it for the winter? Make chili with them from venison they shot and beans they grew? Let them borrow the gunsmithing tools to accurize a rifle or customize a pistol?
That's what you want to do - not what they want. Glad to see you're so selfish.
I have to mostly disagree.
Yes, this is what Rob wants to do - but they are also things that are worth doing, and arguably far more valuable to the children's development than simply buying them things. Had Rob chosen a completely different set of skills that he chose to show/teach his children, it would still be a valid argument.
Being involved with your kids is the point. If you were to ask most kids "what do you need most?" they would rattle off a list of things. It doesn't occur to them that what they really need is bonding with their parents.
This is also the root of why parents *should* stay together for the kids in all but the most dire of circumstances. How much evidence do we need showing that the kid from the divorced (or single parent) home who is showered with things is more dysfunctional than the kid from a two-parent home that go camping (or whatever) every summer?
Actually, there's more to it than being involved with one's kids.
The truth, often forgotten, is that children lack judgment.
Parents are needed to make judgments for them. This is why children's opinions are interesting, but not relevant. So it's not just that "Rob wants to do this, and him being involved is good." It's "What children want to do is not a good use of their time. Parents must shape their children and specifically pick activities designed to teach children important lessons and skills." So Rob had better pick things that matter, or he's not being a good parent. There is surely some variation there, but we'd be better off if most parents agreed on what that set of skills was.
But exactly right about divorce. The child needs the two parent family, because they need the structure. One-parent households cannot hold the line against their own exhaustion. They will fall into the trap of doing what the children WANT not what they need out of complete defeat. Step-parent households don't have the authority, and the remaining parent cannot hold the line for fear of losing their child's affection. The child is already sure of losing the parent's.
Judgmental is as judgmental does, and AFAICT you don't have one clue what his kids "want" to do. If they're like most kids, what they really want, even if they don't always understand it, is to spend lots of time doing new fun things with Dad. And it sounds like they're getting it.
Rob,
It reminds me of the kid who grew with his parents on a hippie commune in New Mexico. As a child all he wanted in the world is indoor plumbing and cable TV.
Your children will, in all likelyhood, not appreciate any of those things 1/10 as much as you do, and will probaly deeply resent you.
jmo3, you're being a first-rate a-hole. What are you trying to say? That saying "no" to a kid is a surefire way to ruin his character? Is it any surprise that what a parent buys for/does with the kids reflects his/her personal values? You think it would be smarter to base those decisions on the child's whims?
Did your daddy refuse to buy you a pony when you were 12 and have you refused to speak to him ever since? Get real man.
Agreed. jmo3 apparently believes in the sanctity of emotional blackmail: "Give me cable TV or I will resent you for life! How dare you take me hunting! I resent you! DEEPLY!"
jmo3,
Everyone in these comments already deeply resents you.
Is this about something else, buddy?
Seriously. It's like his wife mentioned how Rob was good looking or something.
Your children will, in all likelyhood, not appreciate any of those things 1/10 as much as you do, and will probaly deeply resent you.
Possibly, possibly. They're still not getting the latest BMW or regular dinners at Nobu. And hell, I'm not going to FORCE them to do anything; if they'd prefer to sit in their rooms all day and write bad adolescent poetry, that works for me.
Rob,
You sound like a great father. Any kid would be lucky to have someone who cares enough to spend time mentoring and sharing like you do.
You know what? Growing up, my brother and I didn't have much, and we were surrounded by people who were better off than we were. But I am so grateful that my parents taught me how to be frugal, and that I didn't need material possessions to be happy or fulfilled. And today, with all this crisis around, I am in a great position to buy a house for the very first time, after scrimping and saving for almost 20 years(I'm almost hitting 40!). I have literally no debt and have learned to take pleasure in many things that hardly cost any money at all...such as playing guitar and hiking in the mountains. My parents instilled this love in me by their own love of nature and lack of emphasis on material things. Believe me, your kids will be grateful someday.
More likely sit in their rooms all day and play video games.
Or post on social networking websites.
We didn't hunt, though I'm not opposed to it, but we camped, tracked animals, played music, read many books aloud, and said no to video games, cell phones, etc.
The younger, now 21, does have a BMW, but he bought it himself, maintains it himself. The older is the most frugal, cheapskate I know, still wears clothes from when he was a Freshman in high school, and doesn't spend a dime without researching it first. He's also a good investor.
That high school was a prep school, my husband taught music there, and they were surrounded by rich kids who's parents didn't give time except to point out how their offspring were not making the grade for the Ivy League track.
Both our children have repeatedly thanked us for our time; request frequent family dinners, and treat us with respect.
I'm very proud of them. I agree, time and skills are the best thing you can pass on to a child. They need to know how to cook, grow food, fix cars, balance accounts, wash laundry, clean a bathroom, and avoid unwanted pregnancy.
Another skill it's a parents job to teach a child: how to talk about money.
I wonder where they'll get the players and monitors for that?
The guy is an idiot. For one thing, he needs to have a serious and honest discussion with his wife about money. The fact that there's no communication about budgeting and planning is insanity. How is it that the first person he talks to about money troubles is his mortgage lender? How is it that he and the wife are not crunching numbers together and putting together a budget and a plan? How did he marry this woman without knowing the first thing about her attitude towards money? Money is one the most contentious issues in a marriage and is more likely to break one up than infidelity. Could this guy have been so naive as to marry a woman without being concerned about her spendthrift ways?
Second, the guy's spending is way out of alignment with his take-home income. A beach house? Cable TV? Is he insane? He should be eating rice and beans for the rest of the year. Other things reveal how his poor decision-making is sinking him. Speeding tickets? Massive electric bills? When I was unemployed I took incredible care not to get parking or speeding tickets. A $50 parking ticket would wipe out my weekly food budget. I turn off nonessential appliances and lights when I leave a room. $200/month in electric bills is... wow. That's a lot.
Finally, he hasn't paid his mortgage in the last 8 months. I hope he's paid off his other debts in the meantime. If he's still racking up the numbers, I honestly hope we start up debtors' prisons and put him first in line.
Do I feel sorry for the guy? Not at all. The guy's crisis is of his own making. He's just lucky that he can write and has column inches in the NYT. Compared to a family that goes bankrupt because of an unexpected medical emergency or matters truly outside of their control, this guy is a first class jackass.
Are you in the Pacific NW? Because for much of the country, a $200/mo electrical bill is not unreasonable for a family of four. (I've got an 1800 sf house in the South, and in the summer we hit $150-$200/mo.)
"Your children will, in all likelyhood, not appreciate any of those things 1/10 as much as you do, and will probaly deeply resent you."
Oh, come on. A lot of children resent their parents because they feel they aren't fair. Most of them grow up and get over it. And I really don't think it's a good idea to try to buy your child's heart so he won't resent not having the same material goods everyone else does.
I disagree with Rob a lot, but he seems like he's raising his kids the right way. A lot of kids are only so deeply materialistic because they weren't taught any better.
Also, I have to agree with all the conservatives/libertarians on this one. This guy's life is a mess, and though I guess I respect him for admitting that I mostly just want to slap some sense into him.
You never even talked about money before you married the woman? You can't bring yourself to have a sit-down with her about it now? How can you possibly have a lasting relationship that works like that?
I guess I'm so far out of the world of NYTimes writers as to just completely be baffled by Megan's logic. You feel travelling to Europe is a basic necessity? That's so far in your bubble as to look patently absurd from here. I mean yeah, if you make $120k, I can see wanting to shop at Whole Foods and farmers' markets. Hell, I do that now on half that. But I can't for the life of me see how one gets to that position without basic financial sense, like not spending $50 on dinner and wine every night if it's not in your budget for that. It's ok to only do it twice a week. Sell the damn beach house.
I love the compassion in the comments section.
Mcardle never made that argument that writers can't afford to live off their salaries. She merely argued that while writing is a great way to make a living, for the level of educational achievements most writers have, it poses some financial difficulties.
What are their educational achievements? Is there a Ph.D. requirement for writing for the New York Times I missed? $120k in NYC is the equivalent of $60k elsewhere. If you have a Masters degree (do most of them?), yeah, that's a bit low, but it's as much or more than teachers make with equivalent degrees. The "financial difficulties" come when people who intentionally go into what they know is a field that doesn't pay very well feel obligated to life a lifestyle they can't afford. This liberal doesn't have much sympathy for people who feel so obligated.
" A lot of kids are only so deeply materialistic because they weren't taught any better."
And a lot of kids are miserable because their parents taught that money isn't important and they find themselfs 30yo an unemployable with their Masters in Creative Writing - and they wonder where it all went wrong.
And what better way to demonstrate the importance of money than purchasing every little thing your kids want without argument, right?
Laura,
100% correct! I'm just arguing the other side of the issue. It's great to say money and things can't make you happy. Indeed, it's all well and good until you have your 32yo overeducated and unemployable son living in your basement.
Who's more likely to rack up several hundred grand in student loan debt with nothing to show for it? The kid who grew up in a frugal household where he learned life skills from his parents, or the kid whose parents bought everything he wanted and watched spongebob and anime all day?
The govt.- subsidized student debt problem is basically a replacement of one indulgent parent with another.
I just heard from the other side of the issue, and it told me to ask you to stop.
jmo3 - another example. Early in my independent life I couldn't afford to pay the bill for my gas heat. Wasn't really talking to the parents much at that point. Before they shut it off, in February, the gas co. called my mom and told her I was about to be without heat or a way to cook. Her reply: "He has a microwave and I'm pretty sure he still has a sleeping bag." The overeducated and unemployable son might find himself willing to become employable when you stop the gravy train.
My parents didn't teach me money wasn't important. They did teach me that we didn't have a ton of money and that I wasn't going to get everything I wanted as a kid, and if I did want something I was going to have to go mow some lawns and save up. In fact, I think it's more likely that the kids who have everything bought for them are the ones most likely to get the Creative Writing degree, because hey, daddy's paying for everything anyway. My experience with my in-demand degree was that many of my fellow classmates were also scraping through school themselves, and picked the field because of its good job prospects and high salaries.
The point I was trying to make is that when your kids get their happiness by comparing the material goods they have to their peers, they're going to end up like this writer who goes broke keeping up a lifestyle he can't afford because he feels he has to do that to live a successful, happy life. Kids who don't grow up like that learn to live within their means and not to buy adult toys they can't afford.
Cut me a break. Are you a troll?
I majored in English Lit and knew full well I wouldn't be making millions when I graduated. But since my parents didn't give me everything growing up, I learned how to get everything for myself, in spite of having limited means. I'm scrappy, persistent, and I've never been unemployed since graduating(20 years ago, knock on wood).
And you know what? I have a wonderful life, am self-sufficient, and yet I only make $50,000 a year. And somehow, I still manage to save enough money to go overseas at least once a year(yeah, I fly coach and take the crap connection flights to places like Colombia and Cambodia, not to pricey Europe). And I've had the most amazing life experiences, even though some of you probably consider me poor(although being poor in the US is something entirely different than being poor in someplace like, say, Brazil, let's get real). So, I just don't have much sympathy for those who can't manage their finances well, especially those who make much more than I do.
And a lot of kids are miserable because their parents taught that money isn't important and they find themselfs 30yo an unemployable with their Masters in Creative Writing - and they wonder where it all went wrong.
I agree that this happens, but I see it most often in families where the kids never have had to work for their things. I was taught the value of money precisely because my parents didn't buy me a bunch of things. They would tell me that it's too expensive, and if I really wanted it to get a job, make money and buy it. Once I was making my own money and realized how hard it was in high school, I figured if I ever was going to get the nice things I wanted I needed to work hard go to college and get a useful degree.
She merely argued that while writing is a great way to make a living, for the level of educational achievements most writers have, it poses some financial difficulties.
I'd bet I have as much education as most writers, and more than some. I make less than this guy, and I live quite well. I'm saving my compassion for people who don't go broke making more than me.
Even educated people in their 30s and 40s probably know someone with a background like theirs who died young, who went to jail, or who ended up hospitalized for schizophrenia. My point about comparing down as well as up applies to adults as well as children. If you only compare yourself to people in better circumstances, you'll drive yourself and everyone around you completely nuts.
Hehe. I just hear on CNN (HLN) "The Consumer Price Index was flat, indicating consumer confidence may be up."
Nope, it just means prices are up and existing demand isn't very elastic at the moment. That will change when the higher prices eventually lead to some job cuts.
I appreciate to an extent what Megan is saying, because the reality is that like anyone else, a writer can get a taste of the good life and find it all too easy to start going out for drinks and dinner every night, etc., etc., especially if they live in a big city. But, as is not infrequently the case with some of The Atlantic's writers, the tone of this post and some of the things she says (as well as the linked-to story) really bring home the point that many members of our Fourth Estate on the national level are just not living in the same reality as the rest of us.
Frustration that everyone you cover makes more than you is tough, but gosh, it could arguably also serve as a reminder to, y'know, afflict the comfortable.
On what grounds?
I'm not sure what you mean.
How about not afflicting the comfortable? I'm pretty comfortable and I don't think I deserve affliction. Frankly, I think Mr. Dunne was quite wrong about the purpose of a newspaper. If newspapers just reported facts, they wouldn't alienate 1/2 of the reading public.
Accountability journalism as practiced by the NY Times and AP are a big reason why I've dropped most of my subscriptions.
Yeah, I don't think so much of that is really what a disinterested party would call accountability journalism. And I think it's very easy to suggest in the abstract that newspapers should just report "facts," but that once you get into the frequently heady practice of translating human activity and ideas into writing, it becomes harder on an order of several magnitudes.
And I think "afflict the comfortable" doesn't mean "attack the well-off" but is a shorthand or epigram useful for reminding journalists that generally, if they're doing their job right -- that is, telling the truth in as fair and objective a manner as possible -- it's going to annoy people in power more than it annoys people who don't have power. There's a close correlation between power and information, and people in power tend to benefit from maintaining control of information. There's nothing wrong with that per se, but one function of a free press (I think) ought to be to ensure that an information imbalance doesn't become so great as to lead to a gross power imbalance.
I mean, inherent in the metaphor of the invisible hand of the marketplace is the idea that participants will be able to make informed choices. And when journalists hobnob with monied politicians and business leaders on a regular basis, I think that leads to them giving unfair preference to people who are already operating at an advantage.
(And again, it's OK there are people who are already operating at an advantage -- that's life. What's not OK is if they're doing something questionable and newsworthy and it doesn't get reported because they're a nice guy and you had a great conversation with him at the reception the other night.)
The thing that really hit home to me in this article was the description of the profligate second wife. I have the exact, same problem -- but, fortunately -- not quite as bad ... at least, not yet.
My wife is a wonderful person in many respects, but she just has no common sense whatsoever where money is concerned. With three kids, divorce is out of the question, and would probably end up costing me more in the long run anyhow.
For the first ten or so years that we were married, I was earning enough that it didn't matter too much, but then about 4 years ago my long-time employer downsized and I was out of work for 8 months which pretty much burned up all our reserves. Now, my new employer has warned all the employees that there is a high risk that the company may have to cut back payroll within the next year due to the economy --- but my wife just refuses to take it seriously! I'm at my wits' end.
Jay,
Not knowing you at all, I'll toss out some idea that you have probably already thought of - but free advice is worth the price (and you never know...)
Have you considered separate bank accounts? At least then you could shelter some of the funds. Or maybe open up some college savings funds that aren't easy to get at? Etc.
Have you done the Dave Ramsey thing? You can get his book at the library, and it gives all sorts of advice around how to handle situations much like you describe.
I'm praying for you,
Rob
Klug,
"Wikipedia tells me that the lower limit on the top quintile of income distributions is 89K. The lower limit on the top 5% of income is 157K.
This guy is somewhere between the top 20% and the top 5% of income earners in the country. This ain't in the middle, not by a long shot."
Think about it this way. If he was a DC cop and his wife was a nurse at GW they would be easily making 160k a year combined. Pulling a little overtime they could crack 200k without too much extra work.
I'd call a cop and a nurse middle class.
Dude, the reply function. Seriously. You're all over the place. It's not brain science. Learn it.
Give me an effin' break. Homeboy is a reporter for the New York Times -- that's still not middle class.
As for your larger point, yes, marriage is a powerful force multiplier for finances, both good and bad.
120k is still middle class. The article itself even points out the guy can't afford a half million dollar home. Truly rich people can afford to buy that home without needing a mortgage.
I must take issue with some of the comments about the wife, and her seeming misunderstanding of what money is and how to handle it. Sure, she seems stupid to me in this regard, but the husband is equally dumb (at a minimum!), in my opinion. These are two peas in a pod.
I went to high school with the richest kids in my city. About half of my class lived in the nearby wealthy neighborhood and the other half were more middle class whose parents spent all their money on school. I went to parties in huge mansions and went out with kids who drive fancy cars. While I wished I had as much money as they did, I didn't. I didn't try to keep up with them. Surprisingly, I guess, the rich kids didn't treat the non-rich kids badly for not having all their money. They probably would have been merciless if one of the non-rich kids had tried to pretend to be rich, though...
You'd think an adult would be able to differentiate between how other people seem to live based on their income and how he can live based on his income...
Same story here, but I STILL had the coolest car in school: a beat-up canary-yellow Karmann Ghia. Cost me $2,000 in 1994. You don't need money if you have taste.
That beats my 79 sky-blue Pinto.
Even if you're being tongue-in-cheek, you have a point. What would you rather have now, a classic 94 Accord? Oldsmobile Bravada? GMC Jimmy? Or the Karmann Ghia? I know which one I'd rather have.
Back to the kids -- thinking back to my own childhood, it's not either the "yes" answers or the "no" answers that stick out. It's the absence of any open discussion of how you make choices about what to spend on and what not to. The real question for anything above basic survival is "how much do you want it, and what will you give up to get it?" If a kid really wants to go to Europe, play an expensive sport, or take music lessons, then the trade-off might be to give up other purchases he also wants. Or it might be to give up free time and get a job.
If the parent decides without presenting such options, the kid may grow up not knowing how to think these things through. Some of us wise up eventually. The ones who don't end up in articles like this.
Obviously, the size of the decisions you discuss with kids should vary with the age of the kids. But I think you could poll a fair number of teenagers and find that many would prefer smaller, less elaborate houses and more activities. The massive houses that many people think they buy "for the family" are actually kind of dull for kids.
It's the absence of any open discussion of how you make choices about what to spend on and what not to.
No, it's not only the discussion about the spending of money but also the discussion of the making of money.
In DC area you might have a family where the parents left "Big Law" making 350k and working 100/hrs a week for 37.5/hr a week gov't jobs making 95k each. When the kids see the Smiths who's dad is a partner at a big firm making 850k and a mother who stays home - the parents don't want to admit that the reason the kids are in daycare and mom is so stressed about money is because dad is lazy - and couldn't hack a more demanding job.
Mom is welcome to take the BigLaw job herself.
Charming.
On the other hand, someone who made $350K at a law firm probably had the experience and negotiating skills to get more that $95K from the government... at least the federal government. And the DC career paths I've seen have usually gone the other way around. Private firms seem to like government-trained lawyers.
Yes, it is important to know what different kinds of jobs pay, both annually and by the hour. Adults also have to decide if they want the extra money or the extra time. The problems within families come about when one person wants the extra money but thinks that someone else should give up the time it takes to get it. Adults (women too) do have the responsibility of earning money for their families, but it doesn't follow that that's all they should do.
"the parents don't want to admit that the reason the kids are in daycare and mom is so stressed about money is because dad is lazy - and couldn't hack a more demanding job."
Dad's lazy? It's this attitude you seem to have that "real men" work 100 hour weeks so they can bring home 500k and make sure their family never has any financial issues (although many who make that much still do).
There are a lot of great parents out there that turned down the Big Law job because they think having several hours a day to spend with their children is better for the children than being upper class instead of upper-middle class. I happen to think they're right. It's not about whether you can hack the demanding job or not. It's about your priorities. For some parents their top priority is buying their children as many nice things as possible, no matter what other non-monetary costs incur. For some others the top priority is their childrens' development, which they feel is done by spending a lot of time with them even if it leads to a less consumption-based lifestyle. You're clearly the first one, and that's fine, but don't be judgmental of those who think differently.
There's a lot more to life than just money. 100/hrs a week at work doesn't leave a lot of time left over for family.
In my experience, it's the kids whose parents went for the ego boost of Big Law who were the most screwed up. Knowing you come second to mom and dad's career could do that to you.
"Dude, the reply function. Seriously. You're all over the place. It's not brain science. Learn it."
OK, can I just say I hate the reply function. It's impossible to keep track of all the new comments. Someone could offer a brilliant response to the second post, but how can you tell without rereading all the comments from the beginning? I'm a much bigger fan of cronological order.
Yeah...every time I refresh the thread I have to scroll up to any post of mine I think people might have replied to. It's pretty annoying.
I also hate the reply function.
Let's go back to linear. If you want to refer to a previous comment, either quote it or use the "@jmo3 3:54pm" reference.
OK, can I just say I hate the reply function.
At last, a point of total agreement.
jmo3, are you aware of the volumes of research showing that, beyond a poverty-level threshold, parental involvement -- not money or "Kelly bags" or skiing trip -- is the strongest predictor of a child's success with respect to almost every imaginable metric for success, from self-reported happiness level to academic success, even to future earnings?
This isn't the worst part of the story. What happens when either;
1) The NYT goes bankrupt
2) The writer gets laid off
3) The writer is asked to take a 25% pay cut
As an economics writer, the guy should realize that his industry is in secular decline and he should have been saving money and accumulating savings for what will surely be harder years going forward.
Or he could be counting on a federal bailout.
"There are a lot of great parents out there that turned down the Big Law job because they think having several hours a day to spend with their children is better for the children than being upper class instead of upper-middle class."
And that's great! But for some, "it's for the children" is just an excuse - the real reason is they want to be home in front of the TV by 6:30.
If the kids ask - why can't I go do X or go to Y - give them the real reason. "I put a high value on leisure time and don't feel the need to work extra to buy you those things. When you grow up you will have the chance to work as much or as little as you like to live the lifestyle you want."
You have got a really skewed perspective on life. My wife and I both have undergraduate and graduate degrees from high-end universities. We have also both chosen careers that provide very good incomes, but not maximal incomes. I mean, what is the difference between making $175,000 and $500,000 a year.
Taxes eat up a huge amount of the marginal revenue, and when I was working 100 hours a week, I literally had no time to sleep, exercise or even think about how to enjoy your cashflow.
Also if you are not a profligate spender, there is no reason you shouldn't be able to live a very good life, generate savings on $100,000 a year.
"If the kids ask - why can't I go do X or go to Y - give them the real reason. "I put a high value on leisure time and don't feel the need to work extra to buy you those things. When you grow up you will have the chance to work as much or as little as you like to live the lifestyle you want.""
Yeah, I'm favor of saying that. It instills in them that if they want to make a lot of money and buy the things they want, they need to work hard in life instead of expecting to live off your money after they turn 18. You could also add in a lesson in personal responsibility by asking them to contribute to toys they want but don't need: if your 11-year-old wants a new video game system, do you really think it's better to just work overtime and buy it for him instead of having him mow lawns and save up? I mean, I'm not getting where you're going with this. You seem to have some really perverse incentives.
And of course, you assume incorrectly that a lack of money is the "real reason" you don't buy them expensive toys. You may have the money but feel that's not something worth spending it on. Kids constantly ask for lots of things. Just because you make a good salary doesn't mean you have to indulge them. Use the money to take them to Europe or a nice summer camp, not to buy the $300 designer jeans they're begging for.
"jmo3, are you aware of the volumes of research showing that, beyond a poverty-level threshold, parental involvement -- not money or "Kelly bags" or skiing trip -- is the strongest predictor of a child's success "
No, not aware of that at all - care to provide some? I was told that the US has a low level of intergenerations imcome mobility as affluent parents tend to have affluent children.
"Our stately little house looked increasingly trashy: peeling paint and broken screens on the front windows, crumbling concrete on the front stoop, a lawn that was mostly crabgrass. The furniture that Patty salvaged from her first marriage was falling apart. The cotton slipcovers on the sofa and armchair were in shreds. The frosted-crystal shade on a beloved Italian floor lamp was cracked. The dog had gnawed the leg on her Biedermeier chair."
Ok, I get that these expenses are easy to defer vs. say, groceries.
BUT, one thing I discovered when I decided to grow up and pay off my credit cards, was that in not going out to dinner, bars, shows all the time, I had the time to give attention to all of those things. Seems counterintuitive, but with less money to spend, I took better care of the house. Painting, landscaping, fixing little things, making small improvements all cost far less, per hour, than going out.
This seems like a pretty basic time vs. money kind of thing, something that an economics writer should grasp.
I get the impression he wouldn't know which end of the brush to put into the paint can. Part of the problem with spending all your time networking in a big city is you end up with no useful skills outside your profession. On some level specialization makes a lot of sense. It makes more sense for me to put all my productive effort into my job, at which I'm an expert, and pay someone else to mow the lawn.
But you can take it to extremes. Most of knowing how to do things is not paying other people to do things you can do.
Rich,
"Four words: We can't afford it. Sometimes they used five words: Money doesn't grow on trees."
Did you ever ask them why they couldn't afford it?
A. We can't afford it.
Q. Why not?
A. Money doesn't grow on trees.
Q. Bobby's parents can afford it.
A. Well Bobby's rich.
Q. Why is Bobby rich.
A. His dad makes a lot of money.
Q. How?
A. He's an doctor.
Q. Why aren't you a doctor?
A. I didn't go to college.
Q. Why didn't you go to college?
A. I couldn't afford it.
Q. They didn't have student loans?
A. They did... but.... I didn't... it wasn't for me...
Q. Oh....
Four other words.
"You don't need it."
My father is a doctor, and growing up I didn't get all the fancy toys our neighbors had. And you know what, it didn't kill me and I don't in any way resent my father. I think a good sense of fiscal conservatism is much more valuable than the go-kart I didn't get as a kid.
In fact, whenever a birthday or holiday event comes up there is nothing that I have to have, because you know what. My life is pretty great. I have a great wife, and terrific young son, health, the Red Sox are playing well. What more does someone really need?
Or, alternatively:
A. We can't afford it.
Q. Why not?
A. Money doesn't grow on trees.
Q. Bobby's parents can afford it.
A. Well Bobby's rich.
Q. Why is Bobby rich.
A. His dad makes a lot of money.
Q. How?
A. He's an doctor.
Q. Why aren't you a doctor?
A. I didn't want to go medicine; that field didn't interest me. I went to college to study archaeology because I really liked it.
Q. But doctors make a lot more money than you.
A. That wasn't my primary concern in choosing a profession. Doing a job you enjoy can be far more rewarding than simply doing what pays the best.
Q. But we could afford better things if you had been a doctor.
A. That's true. If having the most things is what's going to truly make you happy in life, then when you grow up pick the highest-paying career you can find. For your mother and I, having the nicest things wasn't that big of a priority, and we're very happy with our lives because we love what we do. I hope you find happiness as well when you become an adult. Choose whatever path you think will lead you there.
That's pretty much how the conversations went, except my dad had a private-school business degree and chose to work for a railroad (not in management). And my mom had a degree but gave up teaching to be a stay-at-home mom.
I guess I'm missing your point. It sounds like you couldn't/can't buy your kids every material item they want. Unless your kids are exceptionally mature, you're not going to make them fully understand not matter how you explain the "why." The point is to not worry about the hormone-addled and unpredictable teenage mind and instead try to prepare it for life after the teenage years.
"Unless your kids are exceptionally mature, you're not going to make them fully understand not matter how you explain the "why."
Exactly. They're KIDS. They're always going to want more stuff unless you teach them otherwise. If you make 800k a year and can afford to buy them a lot of stuff, they're going to have friends at their exclusive private school whose dads are CEOs and have $20 mil mansions, and your kids are going to resent you anyway for just being a crummy lawyer who only spent 10k on their 16th birthday party.
Your comment reminded me of the South Park, or maybe SNL, that made fun of that wealthy kid birthday party show. "Dad this is a Land Rover, that's a poor person car. I wanted a Range
Rich: It's SNL. Scarlett Johannsson (sp?) doing the "Super Sweet 16" parody.
Rich,
Both of them did parodies of my super sweet 16, the South Park one had Satan's Halloween party where instead of a Lamborghini cake he got an Acura cake.
I actually am a student in an MD program, strictly middle-of-the-road, not Harvard, Yale or UCSF. 3800 applicants now routinely compete for 140 slots every year. The way to get here is the values of perseverance and deferral of gratification (especially deferral of leisure and materialism in lieu of study) that being indulged as a child with unearned EVERYTHING is sure to kill. No amount of "loans" is going to make you a doctor.
A. We can't afford it.
Q. Why not?
A. Because shut up, that's why.
Jeez, how hard is that?
Thank you for writing this, and for linking to the story. Good luck to you and Peter.
I must be missing something.
Meghan links to an article about a guy (who just happens to have a steady well paying writing gig) making $120,000+ per annum who makes some incredibly bad decisions and finds himself in a rather precarious financial position.
From this article Meghan waxes on about how tough this whole writing for a living gig can be...
WTF???
None of his predicament really has anything to do with his occupation - he could just as easily been an engineer, chiropractor, professor, firefighter, whatever.
Again...WTF am I missing here?
The point you missed was that being a writer for the NYTimes is a pretty prestigious position. Your social circle generally consists of people who make a lot more money than you. This particular columnist is in financial trouble in some part because he felt obligated to live the same kind of lifestyle his friends did, even if he couldn't afford it. Megan's complaint was that the prestige of such a position doesn't have anywhere near the salary an equally prestigious position does in other fields.
Presumably the firefighter and teacher family making 120k is solidly middle class, has middle class friends, and goes to Outback or Red Lobster once a week as their treat. They don't own a beach house.
Not that I have any respect for the author, as he clearly did some incredibly dumb things.
I think y'all misunderstood me, or maybe I wasn't clear. It's not a complaint--writers trade off a great job for less money. My complaint is that writers often don't acknowledge that fact, mentally--their definition of "basic expenses" tends to go higher than their basic income.
Adam,
I agree 100% with what you said! I'm just (much like you it seems) a big fan of being honest. If that's how the conversation went that's great - it allows the child to make an informed choice about the way he wants to live his life.
But, I fear, many parents habor some guilt about to being able to provide for their families as much as they might like because they made certain choices. In not discussing these choices; why they were made, what the reprecussions of those choices were, etc. they rob their children of a valuable learning experience.
"But, I fear, many parents habor some guilt about to being able to provide for their families as much as they might like because they made certain choices."
Yeah, I see where you're coming from there. I think that happens a lot more often in upper-middle-class places like the DC suburbs. It's a very much status-oriented culture there, and if your neighbors make more than you, have a bigger house/nicer car/etc, I can see how you might feel guilty if you've cut back on hours to go to your kid's baseball games.
My thinking is that the whole rat race, keeping-up-with-the-Joneses, status symbol culture is the problem there. It's the mistaken belief that if your kids don't have as nice things as other kids they'll grow up miserable and hate you their whole lives. You're doing a perfectly fine job of "providing for your family" if they have a decent house, healthy food, respectable clothing, and a good education. And you don't need to make six figures to provide that in most places. If you do, and you can give them some extras, great, but I'm not convinced it makes a real difference in how happy your kids are unless you raise them to think people who don't have tons of stuff should be unhappy. And that's a terrible way to raise your kid.
"Yet writers are, as a class, extraordinarily at risk. They spend their twenties, and often their thirties, living paycheck to paycheck."
So did I as a young professional supporting my family, thanks to student loan debt.
"They are extremely well educated, and all that education is not only expensive, but builds expensive habits."
Oh? It does? How did I avoid that when getting three college degrees?
"You end up with a lot of friends who make much more money than you--who don't even realize that a dinner with $10 entrees and a bottle of wine is an expensive treat, not a cheap outing to catch up on old times."
Don't got to dinner with such friends. I didn't.
"Our business is in crisis, and we lose jobs often. When we do, it's catastrophic"
Welcome to the club, dear, welcome to the club.
The phenomenon Megan was describing -- educated professional writer whose friends in other fields have greater disposable income -- is also pretty common for academics, especially those at universities near metro areas.
And academics can be worse because in some fields it's your students, not your non-academic peers, who are the ones making more than you (e.g., Executive MBA programs). The right way to deal with this is to think of non-academics as trolls and to be incredibly petty about money and privileges within the academic setting. Wouldn't surprise me if the journo-writers did the same.
As to the NY Times writer, if his new wife has kids etc. why isn't she receiving alimony and or child support? I think it took some balls on his part to reveal all this: lemons, lemonade etc.
I said this in reply upstream, but I'll say it again: I'm not asking for pity for writers. I'm saying that this mental accounting, where "necessities" outstrip your income, is particularly common among them, and connected to our societal sense of shame about money, or rather, not having it. I feel sorry for Andrews in the way I feel sorry for all people who have made bad decisions, not because I think writers get a raw deal for America. I think many of you are being too harsh--it's easier to make bad money decisions at certain points in your life than those who are not there realize, and a divorce is one of those times. But I'm not excusing what he did; he didn't have to get into that trouble. I don't really think he's excusing it either.
but he didn't make the worst of the decisions at the divorce. He did it when he fell in love again. Whether the divorce was cause or effect wasn't clear, but the irrational desire to please his new wife seems the source of this problems.
I find it hard to even feel sorry for him... I have an advanced degree and a professional job and a divorce and two kids and I see coworkers who probably make less than I do driving nicer cars and/or living in nicer houses. They are probably making better decisions with their money or are spending more than they should. Either way, I don't try to keep up with them.
This guy makes more money than I do and made much worse decisions than I did but may end up keeping his nice house in a nice neighborhood due to the bailout environment we are currently living in. Meanwhile, I live in an apartment because I knew I couldn't afford to borrow almost half a million dolloars. So I'm kind of annoyed that he may get away with his spendy ways...
Well, I feel sorry for him. It sounds like he's spent the last five years in a living hell of stress, embarassment and desperation and there's still no end in sight.
I'd rather live in a paid for mud shack than a half million dollar home that could be auctioned out from underneath me at any minute and I strongly suspect he would, too.
I'm saying that this mental accounting, where "necessities" outstrip your income, is particularly common among them...
And that is the leap I really really struggle to make. Whiny starving artists in all forms annoy me. Being a patent lawyer is an excellent job in many ways, but when you get right down to it, if I won the lottery I'd probably rather be a combat engineer, a gunsmith, a custom engine builder, or inventor/tinkerer designing offbeat tools for weird niche markets (say, autonomous micro-subs special forces could use for intelligence gathering, or long-range UAVs for hurricane hunting).
I choose to feed my family instead of pursuing the dream; hopefully I can retire or find spare time when the kids are older. That choice has its price, but also its benefits, such as regular income in amounts generous enough to keep the paint from peeling. I have great respect for people who sacrifice everything for their passion, and without them we'd all be poorer. But for heaven's sake, "passion" means "suffering", and if you don't want to suffer for your art (or your writing career), then get a (different) job.
"I can see how you might feel guilty if you've cut back on hours to go to your kid's baseball games."
Here is the part I have a hard time fathoming: Say you have a middle class couple - wife is a nurse husband is a cop - they make 150k total. Now, this kid is going to get screwed financial aid wise if his parents can't contribute. They are at that awkward "make too much for financial aid - make too little to pay cash" stage. Are there really kids out there who wouldn't rather have mom and dad pull an extra shift once or twice a month and miss a few t-ball games, if it meant not graduating 75k in debt?
"Are there really kids out there who wouldn't rather have mom and dad pull an extra shift once or twice a month and miss a few t-ball games, if it meant not graduating 75k in debt?"
jmo3, I'm starting to think that you are a 20-yr-old Harvard junior who's never had a real job in his life. If your kids expect you to work extra hours (when you're already earning 150k) just so they can miss out on the experience of borrowing for their own damn education, then your kids will have character issues that will cause them far more suffering than 75k in debt ever could.
People in that situation should call someone like me.
There are legal and safe ways to accumulate money for college that don't count against children for the purposes of the federal financial aid system. This is precisely the situation in which you would use those tools.
"But for heaven's sake, "passion" means "suffering", and if you don't want to suffer for your art (or your writing career), then get a (different) job."
Which poses and interesting question: For a New York Times economics reporter, what kind of Public Relations/ Investor Relation jobs does he have available to him and how much do they pay.
I would hate to find out that Fleishman-Hillard has a 250k a year public relations gig waiting for him - but he'd rather bitch about how hard life is.
I'm very familiar with the phenomenon Megan's referring to.
I was a personal finance reporter at the height of the Internet bubble, and for a few years later, and there I was, driving my Saturn SL1 into the Boca Raton Resort and Club (HA!) rubbing shoulders with people with amazing amounts of money, and household names in the finance/investment world.
At the time, I was making between 30k and 36k per year from that job. Sure, I supplemented it with National Guard income and playing music, But I was banking $500 per month or more... putting 15% in a 401k with a match and maxing a Roth. (That's the difference between being a personal finance writer and a finance beat reporter. We personal finance reporters have to stay grounded).
Now, the real dig is this: Someone working at a daily has to deliver scoops once in a while. Which means you've got to develop sources. Part of that means socializing with them to develop a relationship with them. Sometimes the editor is generous with the expense tab, and sometimes not. More often, not.
You quickly develop a social circle where NORMAL is very highly distorted. It didn't really happen to me working in a satellite bureau in Fort Lauderdale. I had to do my work by phone regardless but the mother ship people in NYC live in an expense account town. David Faber used to be famous for getting sources to chat him up over cocktails in Manhattan. Those are pricey. And if you live in NYC or DC, competition among journalists is ferocious, and you've GOT to be building your Rolodex constantly. If you're not Johnny-on-the-spot, with top-of-mind awareness on the part of your sources, someone else will be.
I think there's been some writing on young women trying to replicate Sex in the City lifestyle on working-stiff incomes as well.
The best book on status-income dissonance I've seen by FAR is The Millionaire Next Door. I regularly give the book away as a graduation present to young people or newlyweds.
My favorite book on financial stupidity on the part of a writer? American Sucker, by David Denby, the film critic for the New Yorker Imagine twice the stupidity, compounded by an addiction to pornography. By a much better writer.
Oh, another reason people buy way too much house: People will put up with almost anything to get kids into a good school district...including bidding 3 bedroom houses in good districts into the stratosphere.
Elizabeth Warren has written about this.
Which is a reason both to support vouchers and why middle and upper middle class people who have paid so much for their house in a good district oppose them.
The part of this that really stunned me was how unable they were to cut back on spending. I dont get that. Buying the house was a crazy idea that would never pencil out but I can almost understand how you do that. You are in love with the house and the woman and the new life and you really want that new life to be better than your old, or at least as good. But how do you not cut back on the daily spending until you get out of the woods? Do people really find it that hard to do? Is being this inept at home finances common?
And how do you just discover your bank account has only $192.00 in it? I went through an extended period (15+ months) of living off savings after the dot.com crash and I always knew exactly how much I had and how much I was spending and when it would run out. No biggie, it was post-dot.com, we were all masters at calculating burn rates.
Well said, I couldn't agree more.
I don't understand why some people reflexively entered judgmental prick mode. A large part of comments are versions of I live fine with less money than him, he dug his own grave, it was all his decisions, what's he complaining about, he made a lot for a writer, his wife spent too much money.
Jesus. You are allowed to sympathize with a person that has lived through a debt nightmare, even if you feel they were responsible for their problems. Andrews' description of the increasing obsession with bills he couldn't pay anymore, and waking up with a panic attack, is pretty horrid.
jmo3, I'm starting to think that you are a 20-yr-old Harvard junior who's never had a real job in his life. If your kids expect you to work extra hours (when you're already earning 150k) just so they can miss out on the experience of borrowing for their own damn education,
I don't know, having dad put in some extra hours down at the precinct and mom working a few extra shifts down at the hospital, so the kids can start out life debt free - that's love.
Dad taking the low pay low status job so he has time to enjoy his hobbies and maybe make it to your t-ball game now and again - that's not love - that's laziness.
Dad taking the low pay low status job so he has time to enjoy his hobbies and maybe make it to your t-ball game now and again - that's not love - that's laziness.
Laziness? No, that's a guy trying to live his life. The idea you should pour you entire youth and health into making sure you kids get into Harvard is stupid and self destructive.
I don't understand why some people reflexively entered judgmental prick mode.
Entered? No, I live there full time.
Sure, but you're a lawyer :)
Dave Nieporent makes a good point. We can't talk about the wisdom divorce without being labeled a right wingnut. Guess what? Too bad! Divorce is a major factor in the debt problems in this country. Why? Because lawyers and judges make too much money off of it. It's a $250 Billion industry for the legal industry. And, how much do other industries profit off of it like insurance, health, auto, real estate, taxes, etc.
Alimony is nothing more than a statist redistribution of wealth slavery program that harkens back to feudal times. It's time to eliminate alimony. If women want to live in luxury then they should earn it. I could pay for high-priced prostitutes for the amount of alimony many men pay, and they wouldn't come with all the baggage.
As for the debt problem in this country, you can thank the government and banks for creating it. Many people follow by example. "The government won't curb its spending; why should I"? Government created the monster and now everybody can't figure out what happened. Maybe it's time to go back to the roots and start looking at things that have meaning in life, rather than big screen TVs, $70,000 SUVs and 15,000 square foot homes.
I lived off welfare and paycheck to paycheck and was able to put away some money, until I got back on my feet. I went without all the ancillary nonsense after divorce, and got back to family, friends, and my health.
Hey Megan, Thanks for the great post. I was moved to the point where I almost sent you some money. :) Seriously, I really respect and appreciate your articles so I'm glad you keep writing.
I'm middle class in the DC area with a $500K mortgage. I bought a house in the same market as the author (except in NoVA). Fortunately I have good job and can afford to make my crazy payment. I chose a fixed rate mortgage and made sure I could afford it before I signed up for it. I'm careful to only charge on my credit card what I can pay off every month. I only buy cars when I can pay cash. I put money in a mutual fund every month. I max out my 401K (or should I say 201K?). I have an emergency savings account for 6 months of expenses.
I consider myself a responsible person when it comes to my finances, and I think I did it the right way. On the other hand, my brother's situation is more like the author's. He and his wife are about at the same point. I'm in a weird position where I feel guilty on one hand (because my brother's family is struggling along with many many other families), and anger on the other hand because I was responsible and made educated choices about my finances. Why should my tax dollars bail out people who weren't so responsible? I'm really torn on this one. Part of me says "F them". The other part of me wants to help them. Where do you draw the line?
Oh, gosh, we're fine! We've cut back, is all. Which is why we're fine. :)
To go back to an earlier observation, I lost my job in the dotcom bust too. Less than two years after I bought my house. Funny thing that, but in 1998, the bank wouldn't let me borrow all that much money. I pointed out that I had done everything right, that my payments would be well within the budgetary guidelines . . . but they were concerned as to my long-term earnings potential. This was my first 'real' job, you see, and a rather large jump over what I had been previously been earning. I didn't like that reasoning at the time - I was great risk as far as holding the same or comparable job, and it meant that without a lot of extra fancy wiggling I'd be in something a bit less than 3/4 the house I wanted.
Two years later, that extra $300/month mortgage payment made a rather large difference as to whether or not we were able to keep the house when I lost my job in the crash. Somehow, I doubt that this gentleman was facing the same sort of hard-nosed lender that I was when he bought. Or that his creditors will be quite so forgiving.
Somehow, I can't imagine Megan as having the brass or the gutsiness of someone like Studs Terkel or Mike Royko in his younger days. More of a Maureen Dowd without the scholarship or credentials.
The arcane art of preserving food for the winter is sometimes known as 'canning'. We also made our own ketchup - peeling the skins off the blanched tomatoes made our little fingers red, but the way the house smelled on those days was one of the best smells ever. In an odd bit of synchronicity, I was surprised last year when one of our neighbors very casually grew a mess of six or seven different kinds of chilis. I wouldn't have thought Missouri would have the climate or the soil, but . . . there you go. So one of my projects this year is to make my own salsa.
All of which I mean to illustrate the point that a)there was a time in the not too distant past when even suburban families routinely practiced these crafts, and b) they aren't that tough to learn or put to good use. Oh, and perhaps c) that those crazy white folk in the suburbs who don't really have to will do some pretty silly things in the name of being hip and trendy. What's next? Churning their own butter ;-)
I know this has been talked about already, but it's crazy to me to think that $120K is middle class. But in DC it is. I can attest. I make $126K a year and feel like I'm an average joe. I don't live in a mansion, I don't drive fancy cars, I don't splurge on material possessions, I don't wear fancy clothes, I don't employ domestic help, I don't belong to a country club....hell, I don't even take vacations. I'm not struggling to make ends meet, but I don't live an extravagant lifestyle either. In my book, that's the definition of middle class.
I find it incredibly irritating that folks who do quite well refuse to buy into the notion that well, you're doing a hell of a lot better than everyone else. If you live in Silver Springs, MD, according this pie chart (scroll down) and you make more than 75K but less than 150K, you're better off than 70% of households. I'm guessing that Mr. Andrews does better than 80% of households.
I have a challenge for folks here: how do you quantify middle class? (Stop snickering, SoV.) To me, if you're cracking the top income quintile in the country (more than 89K), face it: YOU ARE NOT IN THE MIDDLE ANYMORE. I don't give a crap about what beat-up junker you drive or how you eat other people's table scraps at Applebee's, your bank account is a hell of a lot bigger than most people's -- literally. Quit comparing yourself to your CFO neighbor who clearly cracks the top 5% of incomes and rides to work on a chariot pulled by a team of six Escalades.
This fudging of income distribution is how Obama got to define everyone below 250K as non-rich working families. Please. Suck it up, folks that are doing well -- you're doing well! Face it and enjoy!
I don't think income is the right way to measure middle class-ness. Where you live has an enormous effect on what you need to make to live a given lifestyle. I have no doubt I could move to small-town Pennsylvania and live far better on $75k than I could on $150k in Manhattan.
It depends on how you define "everyone else". You rank yourself by those you see around you, not on some numbers. If Americans really bought into numeric comparisons, our "poor" would realize they're in the top 5% or so of humanity, and everyone else is off the charts.
@tsotha: Yes, but I've actually compared Mr. Andrews to his neighbors in Silver Springs, MD. Do you mean the folks in his actual subdivision?!?
P.S. It appears that Manhattan is quite wealthy and 150K wouldn't get you anywhere... "The top 5th of earners in Manhattan now make 52 times what the lowest 5th make: $356,826, compared with $7,047." (From a 2005 NYT article) So Manhattan, it seems, is one of the places where this sort of relative comparison doesn't help the low six-figure income earner.
I know this is a pet peeve, but there's no such place as Silver Springs, Maryland. It's Silver Spring. Actually, I do live in the same neighborhood as the couple (I recognized both them and the house). Our income is almost the same, but a little lower. We don't have any child support or alimony payments, but we do have ridiculous child care expenses for our young kids that are not at all tax deductible for the most part (my wife and I love our jobs).
I know based on the tax brackets, etc., we are doing very well. But based on where we live, we certainly feel middle class. That's because we live within our means so as to save money and pay down our expensive mortgage. Unlike the couple, we saved up so we could put down a good down payment and get a 30-year fixed at a decent rate. We bought in our neighborhood for the schools and are very happy there. Things are great, but you definitely don't feel loaded. My old law school friends who took firm jobs (I work at DOJ) and don't have kids yet will invite us out to expensive dinners and bars but we don't often go except on special occasions because it's expensive and it feels frivolous to drop that kind of money on a night out when you could be putting the money away for the little ones' college tuition. Anyway, point is, you know you're better off than most, but you also don't feel wealthy when you're so consciously conserving money and $400k in debt on a house and another 50k on law school debt, haha
hugo: Sorry about the pet peeve -- now I know it's Silver Spring, MD. (And I understand, growing up in Oregon (pronounced Ory-gun, not Ara-gone.)
I get your point: you don't feel like you're rich, or upper middle class or affluent, especially compared to your firm job colleagues (who likely have cracked the top 5% of US incomes.)
All of this boils down to: what defines middle class? For me, it's primarily a function of income percentiles, where (again, for me) "the middle" falls somewhere between 40-65%. When I think about a bell curve and someone asks me to point to "the middle", that's where I'd point.
But apparently, I'm wrong. "The middle class" to most of the posters on this board, including you, Hugo, is essentially a set of consumption patterns: size of home, location of home, type of restaurants frequented, etc. It is also a "feeling", apparently.
And that's where I think the problem lies: you can't fake your way into an income percentile. You can (through debt) fake your way into a consumption pattern -- and that's exactly what Mr. Andrews did.
P.S. I used to judge folks' incomes by their consumption patterns: hey, that guy has a Lexus -- he must be loaded. But then I lived in Southern California.
I agree with tsotha on this one. You can't just compare income, you have to factor in cost of living. For example, I ran the numbers for Arlington, VA and Des Moines, IA on the first cost of living calculator that popped up on google. The result is that you can live on $57K in Des Moines as compared to $120K in Arlington. Housing is the biggest driver - 81% higher in Arlington. This is why $120K is middle class in the DC area. Reminds me of when I was house hunting back in 2005. My boss told me about a house on his street in Arlington (3 bedrooms, 2 1/2 baths, under 3,000 sq ft on 1/4 acre lot). He said it was a steal at just under a million. At the time, I couldn't believe he said "steal" and "just under a million" in the same sentence. That's reality in the DC area so you can't just do a blanket comparison of income without regard to cost of living. The President's $250K number has always bothered me for that reason.
Sorry, no dice.
According to this table, 120K in NoVA puts you in the 3rd income decile, i.e. between the 20th and 30th percentile. If you're better than 70% of your high school class, you're not in the middle. If you're better off than 70% of the people living around you, you're not in the middle either.
I think it's interesting that we're talking past each other because we're trying to compare two different things: income versus consumption. Isn't focusing on consumption the reason Mr. Andrews got into this mess to begin with?
@Klug: So three-quarters of the way up? High end of middle, but still entirely within a reasonable definition of "middle".
I don't think any of us are whining. I'm definitely satisfied with my life. I don't sweat the lack of vacations or the used cars or the old tube TV's. I could not have the station to even think about a vacation, I could not have a car, I could not have a TV. The point we're trying to make is that being able to pay one's bills and take care of one's family, with a little left over, should not qualify one as wealthy. I can't speak for the other posters, but personally I want more people to have this lifestyle. (I suspect they do too.) What's better for my kids, property values, property- a nice neighborhood with satisfied residents who have the time and pride to actively raise their kids, maintain their homes, and provide for themselves or the opposite of those things? Defining middle class down to an income level that barely,if at all, provides for basic sustenance and a roof of some kind in some level of repair doesn't do anyone any good.
No, Rich, I don't think you're whining at all and I believe that you're satisfied with your life.
The point we're trying to make is that being able to pay one's bills and take care of one's family, with a little left over, should not qualify one as wealthy.
No, it shouldn't qualify you as wealthy. Hell, it shouldn't qualify you as anything but prudent. Are you suggest that this behavior can't be done at any level below 120K? (Probably not, I would imagine.)
Let's get back to the numbers: the lower limits of household income quintiles in the US as as follows: 0, 18.5K, 34.7K, 55.3K and 88K. To crack the top 5% of income in the country, you need to make 157K.
Rich (and everyone), what's the lower income limit for leaving the middle class? 80th percentile? 90th? Or are we now going to use Obama's expansive definition of the 94th percentile of household incomes as "middle class"? If it doesn't get you labeled as rich, it sounds like all y'all are willing to squeeze yourselves into the "middle class".
Klug is right. I've got undergrad student loans for my wife and I, grad school bills, mortgage payment and a rent payment (long story) and I don't consider myself near middle class.
I wouldn't say I'm "wealthy" in the sense that I can buy first class tickets everywhere and not have it put a whole lot of hurt on my finances. But if I want to burn through my savings I could live for close to two (frugal) years with no job.
Seems to be a recurring theme at the Grey Lady - financial writers who talk the talk, but can't walk the walk. From eighteen months ago: "A Little Here, a Little There and It’s Gone" http://www.nytimes.com/2007/12/15/business/yourmoney/15instincts.html?ex=1355374800&en=723c36266676c675&ei=5088&partner=rssnyt&emc=rss
Revealing yourself as a putz too clueless to be writing as an expert for a national paper isn't "brave" - unless this is your public letter of resignation. This is not a case of "even smart people got fooled" or "this bad thing happened to us." This is simply the tale of someone who bought the fairy tale, and should have known better.
Wow. It's amazing how many perfect paragons of moral and fiscal virtue we have here. Seriously, the guy made mistakes, but they are common mistakes. That's why it's a good article. Probably a majority of the country have made at least one of his mistakes. Unfortunately, since he made all of them he's in trouble. Take the divorce. America has what a 40-50% or so divorce rate now. Obviously all of the fine commenters here had great maturity and picked a perfect match when they got married. But even so could you really predict 60 years into the future and predict for 100% that nothing would ever happen to cause a divorce. And even if you are so perfect, that you could; Is that a reasonable standard to expect everyone to meet. We don't know the details of why he was married for 21 years and then divorced, so we don't know how much of that was bad decisions or bad luck.
As for the fiscal side of things. Obviously he made bad choices, but they're the common ones that you see people making every day that get them into trouble. That's why the article is worthwhile. Clearly his wife and him both know that spending more than you earn is a problem. But there's a difference between knowing that abstractly and realizing that you are consistently spending more than you earn every month and then actually acting on it. That's what happens with most people who get into debt.Simply knowing that you must spend less than you earn doesn't really solve anyone's problems.
And so he and his wife have different financial habits and don't communicate well, so they're a terrbile match. I know a lot of couples who are in deep debt, because they don't communicate AT ALL. At least they're talking a little and they're both aware of the problem. The guy screwed up, but he could easily have done much, much worse as many people have, and now at least he recognizes the problem and is sharing it with the rest of us so it might help. Obviously its useless to the perfect people who read this site, but for the rest of the population that makes some bad and some good fiscal decisions it could possibly help them avoid a few mistakes.
In summary, none of us are angels, could we please have a little more sympathy for someone who made mistakes and is now freely admitting he was wrong. Thanks.
Pauli is reputed to have insulted a colleague's idea by saying it was "not even wrong." This is not even a "mistake," it is a fundamental mis-structuring of one's financial live.
Ideally, one's fiscal picture is robust against unexpected shocks. Failing to anticipate a shock--lacking insurance, or inadequate cash savings--is a mistake. Designing your life such that disaster was inevitable unless some sort of unlikely miracle occurred is something qualitatively different than a mistake.
I'm not perfect, and I certainly make mistakes. But my income exceeds my spending by a substantial margin.
What's next? Churning their own butter ;-)
I've come pretty close by over-whipping cream for pumpkin pie.
It reminds me of The Onion headline: "19th century drudgery is 21st century hobby" I have yet to make my own soap, but we did dip candles in elementary school.
My own take is Canning: no more of a waste of time than TV.
Interesting that most of the discussion focuses on his income, wife and alimony. What about the mortgage?? That was his critical mistake, and that is where his professional experience and common sense should have kicked in. He absolutely knew he could not qualify for a mortgage and decided to go for it it anyway. And then he went back to the same criminal AGAIN. If he were black or Hispanic I don't think the reaction would have been the same.
He states that he had planned on a much cheaper housing solution but his wife really wanted to house. Yes he decided to go for it but its all wrapped up in the fact that his second wife was completely clueless about money but very good at manipulating him.
Middle Class - Able to pay bills, but still needs to work for a living.
Upper Class - Can live the rest of their life comfortably without needing a job.
This used to be a common enough activity that you saw scenes of it in the kitchen when watching TV families. IIRC, "The Ghost and Mrs. Muir" even made it part of a comedy sketch, and Mrs. Cleaver mentioned more than once that she was making ketchup. You could see Uncle Charlie actually making it.
Another venerable practice from the 50's and 60's: antenna raising. Back in the day, there used to be something of a competition amongst the menfolk as to who had the best antenna, and as new ones came onto the market, somebody was always clambering up onto their roof to install the latest marvel. The menfolk would then drift over to drink beer and offer advice and tell stories of times past while the women would drink tea or gin and tell stories about how boyish and immature their husbands were and how utterly lost they would be if not for the direction of their wives.
Good times. But I doubt we'll see this particular ritual coming back any time soon. An odd thought occurs - these were not men who had been formally schooled much past high school or even jr. high. But they had a pretty good idea of how transistors and TV worked, and why FM was better than AM. I doubt Mr. Well-Educated Writer could tell you that.
Naveride, I have a hard time feeling sympathy with someone who admits to making the same mistake year after year. Unless he is misrepresenting his experience he had multiple times when if hit him that everything was going wrong. Yet he kept right on making the bad choices. He shows no remorse or contrition. Instead he seems to just say "what could I have done?"
On the other hand I have great sympathy for the panic attack situation. I've never encountered the same situation from money worries but I have from worries about work and its certainly not pleasent.
Just thought I'd share...
I'm 26, my wife is 27. I've worked hard and am currently a project manager. My wife is a teacher. Our combined takehome pay is ~$120k a year pre-everything (taxes, teacher union dues, her required pension plan, my 11% 401k contribution, etc.)
Our take home pay per month is about $6400 after all that....which is just phenomenal. 3 years ago, our combined income was about $60-65k before taxes.
We tithe about 6% of our post-tax money (steadily working towards 10%).
We paid cash for my wife's master's degree (she was required to get 24 post-grad credits). We paid cash for our kitchen remodel ($10k). And since September, we've socked $20k cash into vanguard money market, roth IRA for her, risky mutual fund....
And I still feel nowhere near stable or safe.
Stable and safe to us is maxing out my 401k, contributing $5k to a Roth IRA for each of us, having at least $80,000 in home equity or savings (because we'd like to get a 400k+ house one day and will need 20% home equity). And tithing 10% and having enough disposable income to go out to a nice dinner once a week.
I share this info for 2 reasons:
1. I can imagine the recklessness needed to take on massive debt (outside of a mortgage), but I can't fathom how someone can do it for years and complain about the situation they are in. One of my best friends has done exactly that, and it has driven us apart because I can't stand how he has risked the wellness of his wife and 2 kids out of sheer irresponsibility.
2. Because even without living in manhattan, I would define $120k a year as middle-class when carefully lived. You have some luxuries (a newish car, a decent house, savings), but it takes quite some time of wise living to be on a successful path.
Personally, I'd like to aim for 200-250k while still working 40-50 hours a week. To me, that's upper middle class income. That's the type of income where you can do lots of retirement investing, get a really nice house and be able to comfortably afford it, have one modestly expensive hobby (cars for me), and still take one or two exotic vacations a year.
And I guess I define that as a upper middle class :)
Joe
TreeJoe -- I commend you and your wisdom (and your tithing!). But sorry, buddy, unless you live in Manhattan or Marin County, you're doing much better than the median household.
Median household income does not equal middle class. If you have to work to keep from being evicted, you are not above middle class. You might be upper middle class if you can afford payments on a nice house or car. But you're nowhere near the folks who don't need to work for a living and only work if they enjoy it.
But sorry, buddy, unless you live in Manhattan or Marin County, you're doing much better than the median household.
True, but those median income numbers include everyone from immigrants fresh off the boat, to the mentally or physically handicaped, the drug addicts, the dropouts, etc.
When we think of the median I think we picture the median of those who "have their shit together." While I'm sure we could find, in Joe's community, some 27yo dropout/waitress/part time meth whore, with five kids the oldest of whom is 12. And, I'm sure we would all sgree that Joe is doing much better than her - among those who "have their shit together" the decently educated, the ones who paid attention in high school, managed to get through college, and don't have any substance abuse problems or personality disorders that keep them from holding a job - Joe is doing about average.
You mean if we take from the population people with below average income, the average goes up? That's brilliant, Holmes.
MC said
By the comment above, it's now pretty safe to rule out Harvard.
And I agree about the handicapped, retarded, dropouts and meth whore waitresses. These can be lumped together and filed in the "barely human" category. I would also expand the category to morons who write posts for shock value.
I remember a guy I knew who overspent his income like this. I told his squad leader to sit down with him and help him draft a household budget for my approval. Next week I've gotta dig into a subordinate's hellacious divorce and figure out if there's anything I can do to help.
I can feel sympathy for how this guy got himself into trouble. It's interesting to read about how you get to that point and not have it be my problem for a change.
Nimed,
Sorry, that was a badly written post. What I was trying to say is: When defining "middle class" it is only natural for people to narrow down the set of people they are comparing themselves to.
For example, is Joe or the NYTimes reporter "middle class" compared to the set of all people who have ever lived? Yes, compared to them they are fabulously rich. If we narrow it down to the set of all people born in the US, they are still doing well. However, it is only natural to go down another few levels. Are Joe and the NYtimes reporter doing well compared with the set of all people: born in the US, from functional families, who are not currently manifesting any major physical or psychiatric or substance abuse problem, who were able to avail themselves of an education? Compared to that group, I would argue, Joe and the NYTimes reporter are doing only slightly better than average.
It is not useful to define people making $120k as middle class. They might think of themselves as middle class. They might think their house isn't big enough and they aren't rich enough to be above middle class. But Wikipedia is instructive: "individuals over the age of 18 was $25,149[4] ($32,140 for those age 25 or above) in the year 2005.[5] The overall median income for all 155 million persons over the age of 15 who worked with earnings in 2005 was $28,567.[6]"
So $120k is way way above the middle class. Process this. Make your peace with this. If you think $120k is average you lack sufficient contact with the average person. Your intelligence brings you into contact mostly with smarter and better paid people. You do not understand the middle. You are not in the middle. You mislabel yourself if you place yourself in the middle with that sort of income.
But, but, but, what about the meth whores and the MFA-types?
Don't be a hater Randall. 120k is a great salary, but it's still middle class. No one thinks 120k is average. It's well above average. But it's still the same order of magnitude as a person making 30k, and thus still "Middle Class." Besides, it's not what you make, it's what you do with it. I'd gladly take 30k, a frugal wife and a small house in the boondocks over 120k, a spendthrift wife and large house in a high class neighborhood that I can't afford.
Also, on suggestions to make the comment section better:
1. Is WordPress an option for you? It has the ability to allow a commenter to edit a post after it was submitted. I have found it to be a very useful feature.
2. Again, the comments should run in chronological order.
Please... nested comments are very difficult to catch up.
The median annual income for a man with a masters degree is $62,000 per year, for a woman, it's $41,300. The median for a man with a professional degree is $88,500. The median household income for someone with a professional degree is $100,000.
Source? Wikipedia:
http://en.wikipedia.org/wiki/Household_income_in_the_United_States
Lots of good stats there. You can learn a thing or two.
Anybody in America making any kind of six-figure income is doing substantially better than most others who have college degrees, hold down steady jobs, don't engage in substance abuse, and aren't insane. That doesn't -- of course -- mean that they're outperforming their peer group, because they can define their peer group however they choose.
This guy, Andrews, has a five-fold problem:
1. He divorced his first wife, and incurred a huge financial burden.
2. He married a woman who appears unable or unwilling to hold a job.
3. He married a woman who has no inclination to limit herself to a budget.
4. He married a woman with kids, and took on their expenses (orthodontic work, flights back to LA, Christmas gifts, etc) as his own.
5. He bought a $460,000 house for said woman.
Actually, he doesn't have a five-fold problem. He has one big problem. And divorce number two is coming down the pike.
By the way, those figures I cited were from 2003, so adjust upward a little. One more thing, if the second Mrs. Adams had managed to hold onto her $60,000 editing job, their household income would have rocketed into the top 5% of all household incomes in America (lower limit: $157,156, as of 2004).
Like I said, anybody who's making six-figures in America is doing better than most, though poor choices or really bad luck can obviously render you broke. Just ask MC Hammer.
black sea, you get your "facts" and your "figures" outta here! We only want to talk about how that meth whore is dragging our average down!
The median annual income for a man with a masters degree is $62,000 per year, for a woman
Yes, but this includes all those with masters in Creative Writing/Fine Arts/French etc. who have "gone and over-educated themselves beyond all hope of employment."
Also, the Wiki figures come from the Census Bureau not the IRS. So, since they are self reported by the survey participants, I find them highly suspect.
Klug & black sea,
The median household income in 2007 according to the Census Bureau is $50,740. According to the IRS, the median tax return for 2007 was $61,500. That is a pretty wide discrepancy.
http://taxprof.typepad.com/taxprof_blog/2008/02/median-us-gross.html
Why would the median household income have to be the same as the median tax return?
While blog comments are perhaps not among the more reliable sources of information, it's been claimed elsewhere that Andrews and the current wife had a thing for each other for quite some time, and broke up their previous marriages in order to marry one another.
To Moff (5/15 @ 3:07PM) re: afflicting the comfortable.
Would that include afflicting those in academia who are lucky enough to have jobs, given that there is such a horrible jobs crisis? I bet not. I certainly haven't seen any evidence that even the most leftist newspaper is willing to do that.
I've been thinking about this, and perhaps one of the unconscious motivations here is not that he is hanging out with people who have a lot more than he has, but that they have a lot more and they manifestly don't deserve it. Please note, I'm not saying anything one way or the other as to the accuracy of these perceptions. But surely it is a bit . . . grating, shall we say, to have certain people toasting themselves and their superior qualities when everyone at the table damn well knows that everything they have they owe to family connections. One is quiet of course; usually it's their table that you're sitting at.
Reading between the lines, it sounds like this guy has gone a round or two with middle age and come up on the losing side. Perhaps his former wife didn't 'appreciate' him enough and all he'd done for her, and she was a bit of a frump. Perhaps he forgave himself for acquiring a second wife on the grounds that she wasn't a vapid twenty-something bimbo with unsprung upholstery. But this sort of thing isn't about the chassis, I've found. It's about the validation. I would imagine that having what is by his lights a clever, well-educated, desirable woman tell him that he's da Bomb is what this is all about. That and maybe that she was willing to bear his children; I get the impression that wife #1 was no longer amenable to that particular chore.[1]
Me, I'm aspiring to the Gandalf model of geezerhood - speak genteely and carry a whacking big staff :-)
[1]Just as I am not amenable to acquiring more pets. We currently have four dogs, three cats, and a rabbit, all of whom my daughter has said she will 'take care of' when 'we' made the decision to adopt them. Guess who's feeding and watering the animals, walking the dogs, playing with them, taking them to the vet, etc? I don't complain, but I've put my foot down about acquiring anything else on four legs that weighs more than a pound until the critters we have start dying. I have to walk the dogs in shifts as it is.
I'm just citing the stats, with the admission that those figures are a few years old. Still, they provide a pretty unambiguous picture. I also said that people will define their peer group as they see fit, so if you view yourself as a Master of the Universe, and by those standards expect to be making seven figures per year by the age of 40, and you're only making in the high sixes, then yeah, you're gonna hang your head in shame, or slide into a noose, or step out on a ledge, or something. Of course, don't blame the rest of us if we urge you on.
By the way, when I say "you" I'm not referring to jmo3 anybody else commenting here. I'm using "you" in the way that "one" is more formally used, i.e. in reference to an unspecified person.
Scent,
The median income listed in wikipedia is based off of the answers to the census questionaire so the number are likely to err on the low side. The IRS numbers are more accurat but still understate the true income picture.
As for your "family connections" comment... I don't think it has as much to do with connections as it has to do with comming from a family that understands money - how to make it, how to spend it and how to make it grow.
For example I wasn't taught that W-2 is the worst way to make money. Someone who came from a more entreprenurial family might be taught that valuable lesson.
Late to this, but a little reality check about what is and isn't possible for writers and other creative-types living in Manhattan.
I am a filmmaker. My wife is a graphic designer. We have a 1BR apartment in the city and a house in East Hampton. We have health insurance. We put money away for retirement. We put money away in case of emergencies. We have to children, and we spend a lot of time with them. We don't shop at Whole Foods, but my wife buys mostly organic meat, produce, and dairy.
And together we make about half of this "brave" reporter's base salary.
"Status-income disequilibrium?" Get the fuck over it.
1. Megan's theory is something of a Rorschach projection with little explicit support in the article. Andrews claims to be a scrimper who won't spend fifty cents on the Metro, not someone who has to keep up with his investment banker friends.
2. With the token exception of the "embarrassing" $1600 beach house rental, Andrews doesn't admit to much really extravagant spending. Instead he repeatedly blames groceries, gasoline, and shirts from J. Crew.
Groceries, gasoline, and the replacement of frayed shirts cannot explain his credit card bills. There were other significant purchases which are not described in the article.
3. His "take-home pay of $2,777" seems a bit low even after accounting for taxes and alimony. Probably he is not including 401(K) contributions in his take-home pay. Maybe he is excluding other items.
4. Supposedly, he calls up his mortgage broker to say that his inclination is to draw on his 401(K). Surprisingly, his mortgage broker makes a different suggestion: instead of drawing on his retirement savings, he should refinance his mortgage!
5. Points 2-4 together remind us that Andrews may not be a 100% reliable narrator.
6. Let me suggest the possibility that this New York Times finance reporter, who had written articles about the dangers of reckless mortgage lending, knew exactly what he was doing all along, and knew from the first day that defaulting on the mortgage was an option he might exercise.
So far he has been living in the house for eight months rent-free.
I heard him say on NPR that he feels no need to apologize for his actions, since the sins of the financial industry as a whole were greater than his own.
Oh, #4 certainly testifies to his reliability as a narrator. I'd be much more worried about his story if the broker agreed that he should raid his 401(k).
You misunderstand: why do you think these are measuring the same thing? Would you be surprised that there is a difference between reported personal income and reported household income? Or that median personal income is lower than median household income?
Again, look at what I actually wrote: Please note, I'm not saying anything one way or the other as to the accuracy of these perceptions. The observer could be dead-on accurate or 180 degrees off base for all I care. What's important are the perceptions, because those are what determines his behaviour, regardless of their accuracy.
It's only May, but it looks like Andrews is the sure-fire winner of Roissy's infamous Beta of the Year contest.
Scent,
What I'm saying is the Census numbers everyone is quoting are wrong.
That may(or may not) be the case. However, citing the differences between median income as reported on income tax returns and median income as reported by the census bureau in no way proof that this is the case. In fact they could exactly match, and the figures, per your contention, could still be wrong.
Scent,
What are you arguing?
I'll give another example:
In Greenwich, Connecticut: "The median income for a household in the town is $99,086, and the median income for a family is $122,719 (these figures had risen to $117,857 and $168,779 respectively as of a 2007 estimate[16])"
Now with a median home price of $1.7 million, how many people here think that half the families in Greenwich bring in less than 168k a year? A cop and a nurse in NYC can easily make more than 168k a year - do you find a lot of nurse/cop couples living in Greenwich?
The census income numbers are wrong and anyone here drawing conclusions about what is or is not middle class based on those numbers, is wrong as well.
rjmason - your last point is why I fail to feel sorry for him. Seems like he made a gamble and "lost" but is avoiding the consequences of the loss. So his upside was the nice house and lifestyle and his downside seems to be a nice house and lifestyle...
I'll give another example:
In Greenwich, Connecticut: "The median income for a household in the town is $99,086, and the median income for a family is $122,719 (these figures had risen to $117,857 and $168,779 respectively as of a 2007 estimate[16])"
....
The census income numbers are wrong and anyone here drawing conclusions about what is or is not middle class based on those numbers, is wrong as well.
Sigh. I've asked this, what? Three times now? You've claimed that because the median income from tax returns is different from the median income reported by the Census bureau that the given figure for this number must be wrong. Why do you think this?
Please. Indulge me. Explain your logic as to why this must be so. This isn't a hard question, and to me it looks as if you're trying to actively avoid answering it. Which is, as House would say, 'Interesting' in and of itself, but I'll pursue that angle another time.
Sigh. I've asked this, what? Three times now? You've claimed that because the median income from tax returns is different from the median income reported by the Census bureau that the given figure for this number must be wrong. Why do you think this?
Please. Indulge me. Explain your logic as to why this must be so. This isn't a hard question, and to me it looks as if you're trying to actively avoid answering it. Which is, as House would say, 'Interesting' in and of itself, but I'll pursue that angle another time.
I'm arguing that the census numbers are wrong because people aren't being accurate when they fill out the census forms.
You've claimed that because the median income from tax returns is different from the median income reported by the Census bureau that the given figure for this number must be wrong. Why do you think this?
Because while there are substantial penalties for misrepresenting your income to the IRS - there are few penalties for misrepresenting your income to the Census Bureau.
To be even more clear for you:
Explain your logic as to why this must be so.
While there are substantial penalties for misrepresenting your income to the IRS - there are few penalties for misrepresenting your income to the Census Bureau. This would tend to make the IRS number more reliable than the Census Bureau numbers.
Scent,
Indeed there is an entire paper discussing how much the Census data under-reports income:
http://www.google.com/url?sa=t&source=web&ct=res&cd=4&url=http%3A%2F%2Fctsdc.uconn.edu%2FReports%2FCtSDC_CT_TownIncome_OP2006-01.pdf&ei=8ZoQSv3UEZiG8gSD4pyhBg&usg=AFQjCNENhiRrQwWJJoR-aDyeG95AAPp6VQ&sig2=14c9QJw3qKyZtoORnXLDYw
Those who used the Census data to define middle class really need to read that paper.
Scent,
Do you need more of an explanation - or have I answered your question?
So . . . then it is your contention that this has nothing to do with the fact that low-income filers are underrepresented? That in fact, people who owe no money to the government are much more likely to not file a return at all?
Let's go to that liberal org, The Tax Foundation:
. . .
Conclusion
In 2004, a record 42.5 million tax returns – one-third of all returns filed – had no income tax liability because of the available credits and deductions in the tax code. This is a 42 percent increase in the number of zero-tax filers in just four years. In addition to these zero-tax filers are the 15 million individuals or households who do not earn enough to file a tax return. Overall, nearly 58 million taxable households are outside of the income tax system.
You don't think that, just possibly, this might account for at least some of the difference, and that the set of people who file returns is not the same as the set of people reporting an income to the Census Bureau?
"and that the set of people who file returns is not the same as the set of people reporting an income to the Census Bureau?"
Who ever said they would be the same people?
Scent,
I also see that the study referenced at 7:20 addresses the issue you mentioned. So I ask you - do you have any evidence that I'm wrong and that the Census numbers are accurate?
The figures you quoted are not directly related to the issue of the census numbers being inaccurate - my statistics were. Please, try and quote sources directly related to the issue at hand.
I'm trying very hard to be patient with you, but you're making this rather difficult. You initially claimed that because the Census and IRS numbers differed, that the Census numbers must be wrong. Hopefully, you've been disabused of this notion - or should be. Note also that I never claimed one way or the other that these numbers were accurate:
So, no, I'm agnostic on your claim that the Census bureau as erred. I just have opinions as to how carefully you researched your claim and the logic you have employed. Note again that reported income to the Census bureau is not the same as income reported to the IRS, that is, the two types are different in kind, an apples and oranges comparison as it were.
Finally, please go back and read your own cite.
Scent,
I asked for evidence - you failed to provide any, other than quoting your own comments.
I win. You loose.
Have a good evening.
loose = lose - grr.
Sigh. No need to be oppositional. Since I haven't made any claims, I don't have to provide any evidence.
In fact, asking me for evidence for claims I haven't made is rather, um, silly, isn't it?
What has happened here is that you made a claim that you failed to back up. To quote your own language back at you, "You loose." Why you have this attitude I don't know. But I suggest that if you want to be taken seriously that you drop it. I get the definite sense that a lot of people are already fairly disgusted with your performance.
When kids ask for things costing thousands and thousands of dollar, "we can't afford it" is a perfectly good answer. But before you give that answer for something that costs $250, though, be sure to know why the kid is asking. Some parents will spend a fortune on sports and not one thin dime on music lessons, for example. Or vice versa. I've seen parents use the "we can't afford it" line to discourage actual preferences that the parents don't approve of. This isn't fair to kids, who very often do know what their real interests are.
That's why it's often good to ask the kids how much they want something. Enough to give up soccer for? To get it for Christmas instead of toys? To do extra chores (or get a part-time job) for?
That way, if the kid grows up to pursue something risky like acting or writing, he or she will already know about trade-offs. The joys of in-state tuition over snob-appeal degrees, for example.
A writer's life?
How about the life of a man overextended, burdened by alimony and child support that absorbs 75% of his take-home pay, making more bad choices, Hail Mary passes and risky investments?
Bravery? Already, on page one, he's shifting moral blame to the mortgage broker!
It seems to me not so much a problem of income and status/income disequilibrium as his having really bad taste in women. $120K/yr is a lot of money, especially for a writer. A large fraction of that got wiped out in the divorce settlement, and he remarried a woman who spent him into the poor house. If the argument is that writers ought to be paid more than that, well, good luck with that.
this is not a kid - it is a 48 year old man who got in over his head not because of the mortgage crisis, but because he and his wife (and probably his first wife) and their 6-child recombinant family all had spending addictions.
he claims that they re-fied to pay off their credit card bills in June and October of 2006 . . . raising their mortgage payment from 2500 to 4500 . . . then, his wife lost her job in October 06 and he writes "By any measure, the loss of Patty’s job was a financial catastrophe. We hadn’t yet gone more than 30 days delinquent on the mortgage, thanks, in part, to $15,000 I had borrowed shamefacedly from my mother after Patty stopped working. But we were behind on everything else. Bill collectors were calling six days a week, starting promptly at 8 a.m."
How can that be? He claimed that they just paid off all their debts in the re-fi, but now the bill collectors are calling all day long? He is lying about something. And now, he has his book coming out, presumably with a healthy advance, and he apparently hasn't lifted a finger toward coming current on his mortgage.
Read his entire story, and the problem isn't his mortgage. He and his wife and their combined 6 kids (and probably his first wife, too) are a bunch of over-spending douchebags. Their massive spending habits pre-dated their foray into home ownership, but he is eager to hide his own failings as a man, a husband and a provider behind the boogeyman of the mortgage industry.
I don't say this about many people, but if I ever meet this clown in person, I will punch him in the face.
Thief.
Not sure how many folks will read down this far. I didn't. But FWIW, I stopped delivery on the NYT after the dot.com bust because of just these sort of stories (I'll read the occasional article online for free though). The kicker being a good length feature about a family that had been earning 250K+ for 10 years (but hadn't managed to save a nickel). The dad had to stoop to managing a Gap store, poor dear, and the mom was so appreciative of her friends pitching in so the kids could keep their karate and ballet lessons and their swim club membership. It was appalling and it was one of several articles in that vein at the time. So I expect more of the same now. And though I think there's some admission of guilt from this fellow the fact that he hasn't paid his mortgage in 8 months is pretty shameful. I hope he at least paid his mom back with the money he's "saving" each month.
Agreed with BertF (18May 8:17) on the ridiculousness of Times coverage during the 01-02 recession.
I disagree with Megan; this article is neither brave nor original. First, it's derivative of New Yorker film critic David Denby, who wrote a similar tale of divorce and manic dot-com stock speculation that left him wiped out by late 2000. I wouldn't be surprised if the Times guy got the idea from Denby's book.
Second, it's a crass attempt via Oprah-esque soul-baring to capitalize (desperately, via his forthcoming memoir) on execrable decision-making over many years.
As a financial economist I marvel at how dense and illogical some financial and economic journalists are in their reporting. This guy, however, takes the cake. I'm tempted to say that only an NYT reporter could be this clueless.
There is a pattern here, from top to bottom. Andrews, an economics writer for the New York Times, reveals he is unable to manage his own life, spending money he doesn't have on things he doesn't need. Andrews and many writers for the NYT feel perfectly confident telling Americans how to manage an economy, elections, wars and international relations. Meanwhile the owners of the NYT are bankrupting the business just as Andrews bankrupted himself.
And they all feel endless confidence in Obama and the Congressional Democrats who have spent several trillion dollars we don't have. The Democrats are bankrupting the USA in the same ways Pinch is bankrupting the Times and Andrews has bankrupted himself.
Andrews children will spend their lives paying for the debts created by Obama and Congressional Democrats, either in taxes or inflation or a devalued dollar. People who have never earned even half as much as Andrews will spend the rest of their lives paying for the corruption and incompetence of Democrats.
"People who have never earned even half as much as Andrews will spend the rest of their lives paying for the corruption and incompetence of Democrats."
Not if I can help it. I'll just work less. I haven't been stupid like this 'Brooks' fool. Other people who are as enslaved to debt as he is and have to keep working can help bail him out, not me.