Cost of living in nyc-poverty culture

staten islander

Mon, Dec 26 2016, 9:36 am

This is sort of a spin off from the financial assistance thread. Are the people giving advice residents of NYC? DO they realize that life here is incredibly expensive? Things like housing,tuition for a few kids,healthcare can easily add up to 100k and that's before any food has been bought. Advice like buying less disposables or less meat is not really practical. If someone is earning less then X,no amount of coupon use will make their salary higher. Budgeting advice is really for people that have a lot of disposable income-they are the ones that are more likely to spend money recklessly. A struggling family-not so much. The solution is parents being realistic with their children about the cost of life and being helpful in assisting them with choosing a career that will support a family long term. So many parents allow/push their children to get married without a career path or a plan.They are setting them up for a life of poverty. You need at least $150K to pay tuition,healthcare and rent in NY and you need more then that to be able to fund 401k, retirement,make weddings,etc. In our family, we tell our kids all the time- you must have a plan for a job that leads to financial independence.Of course you should live within your means, but you need to make sure that your "means" are livable

seeker

Mon, Dec 26 2016, 11:56 am

I disagree with this attitude. Every drop in the bucket helps at every level. If you're in a bad financial situation and in need of a big solution, when you do come up with the solution it will be helpful to have a few thousand less to pay off due to living frugally. You'll also pay it off faster if you continue to live frugally. It's not true that people with more available income are the ones spending recklessly, and for exactly this reason - and I've done it myself at times - you say "I'm never going to make it anyway, if I'm going to be $x in debt then another $.0x for the unnecessary thing I want isn't going to make a difference."

I'm not disagreeing with planning for a career, just with the part where you seem to be saying that in-the-moment tips are pointless.

zaq

Mon, Dec 26 2016, 10:15 pm

[quote="staten islander]Budgeting advice is really for people that have a lot of disposable income-they are the ones that are more likely to spend money recklessly[/quote]. That's where you're wrong. The less you have the more important a budget is. Sadly, the less people have the less likely they are to have one. That's why in Israel Paamonim teaches people to budget and live within their means.

So many people are poor because they have no money management skills. I have seen this . I see a single mom making minimum wage going thru a supermarket and throwing stuff in the shopping cart
without even looking at the price. Why does she buy name brand bottled water when store brand is half the price? Why does she buy bottled water at all when the tap water in her city is quite good? Why does she buy the most expensive name-brand table napkins when she could buy generic for less than half the price? Does she really need to buy the super expensive perfect walnut halves, when walnut pieces are considerably cheaper and she's only going to eat them out of hand or bake them in a cake anyway?

She does this because no one taught her to comparison shop. No one taught her that when you make minimum wage you have to think before you buy. No one taught her that when you put things on a credit card, there has to be money in the bank to back up that credit card or you will eventually find yourself in deep doodooo as a former President once (in)famously said.

My mom told me when I was no bigger than a sneeze that the reason rich people are rich is that they don't waste their money. If they waste their money they don't stay rich very long.

Fox

Mon, Dec 26 2016, 11:01 pm

staten islander wrote:

You need at least $150K to pay tuition,healthcare and rent in NY and you need more then that to be able to fund 401k, retirement,make weddings,etc.

The problem is that we've developed a situation in which everyone must be above average -- quite a bit above average in many cases.

All the planning in the world can't obfuscate the statistical reality that not everyone can be at the top of the heap in income. Even if we don't address the problem at the communal level, we are forced to address it at the family level.

So does an extended family with a particular member family who is closer to the average subsidize them in order to enable them to live in the geographical area of the extended family and participate in their activities? Or do they consider each nuclear family its own financial entity?

There's no right or wrong, but people have to think through the realities on both sides of the equation.

amother

Blue

Mon, Dec 26 2016, 11:45 pm

zaq wrote:

. That's where you're wrong. The less you have the more important a budget is. Sadly, the less people have the less likely they are to have one. That's why in Israel Paamonim teaches people to budget and live within their means.

So many people are poor because they have no money management skills. I have seen this . I see a single mom making minimum wage going thru a supermarket and throwing stuff in the shopping cart
without even looking at the price. Why does she buy name brand bottled water when store brand is half the price? Why does she buy bottled water at all when the tap water in her city is quite good? Why does she buy the most expensive name-brand table napkins when she could buy generic for less than half the price? Does she really need to buy the super expensive perfect walnut halves, when walnut pieces are considerably cheaper and she's only going to eat them out of hand or bake them in a cake anyway?

She does this because no one taught her to comparison shop. No one taught her that when you make minimum wage you have to think before you buy. No one taught her that when you put things on a credit card, there has to be money in the bank to back up that credit card or you will eventually find yourself in deep doodooo as a former President once (in)famously said.

My mom told me when I was no bigger than a sneeze that the reason rich people are rich is that they don't waste their money. If they waste their money they don't stay rich very long.

I'm guessing you're not trying to raise a family in nyc. Sure it's a good idea to drink tap and not buy expensive napkins, but to suggest that living frugally solves the financial issues of the many families that earn less than 125k a year (and that's the low end) is naive. The cost of housing, tuition and insurance, is way expensive to suggest that if I water down my apple juice I'll be able to save 100k for a down-payment on a house. At the end of the day families that are affording housing and tuitions are either making big money or getting help from others making real money. And as far as the rich being rich because they don't waste money.....it's a nice line but again, the reality is that the rich people in my neighborhood live in big fancy houses, take expensive vacations and drive fancy cars. They got there because they earn high salaries. The ideas your talking about are nice but let's not confuse them as tools to get rich.

Laiya

Mon, Dec 26 2016, 11:53 pm

zaq wrote:

Clipping coupons, making sprice comparisons and running to different stores for sales takes a LOT of time.

If the single mom you saw was paying for childcare on an hourly basis, and put in long hours at work, she may not be able to afford the necessary time expenditure to do those things.

amother

Brunette

Tue, Dec 27 2016, 12:03 am

I live in brooklyn and agree with what all the other nyc posters said. A small three bedroom house is not going to cost less than 750k. Im going to need at least 150 in cash ti even think of buying a house. The fact that I like thicker toliet paper is making no difference in my lack of funds for a down payment...If I switched to a cheaper brand of things here and there Id save a few hundred a year but thats not even a drop in the bucket...due to the fact that neither side is helping us and neither of us are making bucks my only.answer to buying a.house is to leave brooklyn.

seeker

Tue, Dec 27 2016, 12:03 am

Laiya wrote:

Not to nitpick, but she didn't say anything about clipping coupons and running to different stores. Price comparing can be name brand vs store brand, either brand vs a different product, or cost of buying vs cost of not having. I don't clip coupons or run to different stores, but I do get a hold of the weekly sale flyers so I can choose which ONE store will get me the most savings in one trip.

No, it's not going to make the difference between poor and rich. But it WILL make a difference to how much money is available for other things, and it COULD make the difference between surplus and deficit.

amother

Denim

Tue, Dec 27 2016, 12:08 am

Laiya wrote:

Going to different stores takes a lot of time, but choosing the generic brand doesn't. True, the small savings that you get from buying the supermarket brand won't add up to a down payment in an expensive neighborhood or even one full tuition, but saving a few hundred dollars a year means that you won't be wiped out by a single car repair.

You need a high income to live in an expensive neighborhood and pay tuition. So if you want to live someplace expensive, you need to have earning potential. That usually means a college degree - at least - and a serious work ethic, along with some luck.

You also need a culture of responsible spending. Frum life doesn't require expensive strollers or shoes or wigs or whatever is the latest must have item. Those are social expectations. They won't make up for housing and tuition costs, but take away those small to medium expenses and you have a good chunk of savings.

ETA: I see I cross posted about shopping habits. Seeker makes the point very well.

Teomima

Tue, Dec 27 2016, 12:11 am

staten islander wrote:

Are the people giving advice residents of NYC? DO they realize that life here is incredibly expensive? Things like housing,tuition for a few kids,healthcare can easily add up to 100k and that's before any food has been bought...Budgeting advice is really for people that have a lot of disposable income... You need at least $150K to pay tuition,healthcare and rent in NY and you need more then that to be able to fund 401k, retirement,make weddings,etc....

But, don't you see, saying you need that money to cover those expenses is exactly the opposite of proper budgeting. You budget housing by saying you have X amount to spend on rent/mortgage every month, then you find a home that fits that budget. People don't like this attitude because it means making hard decisions. You can't just say life in NYC costs this much, because if you don't have that money, then maybe you just can't live in NYC.
Proper budgeting means living within your means, living in a town you can afford, sending your kids to schools you can afford, etc. If you haven't got the funds for tuition, you simply can't afford that school. If where you live is too expensive for you, you move. Plain and simple.

nylon

Tue, Dec 27 2016, 12:46 am

I left the NYC area for somewhere cheaper, so this isn't personal, but advising people to leave New York if they can't afford it is well intentioned but often bad advice.

If someone is actually making a decent income, but is overwhelmed by housing costs and the like, then unless they are cashing out on a house, the move may not pay off because salaries drop, or their profession is specialized. Tuition may not be much cheaper elsewhere depending on what kind of school you send to.

Regardless of salary, someone may have help that can't be measured in monetary terms, such as family who will help with the kids.

For people poor enough to qualify for help, the loss of that help may outweigh any benefit from moving.

Everytime anyone (religious or not) complains about the cost of living in the city, people say "just move!" It's very individual as to whether that's actually worthwhile.

saw50st8

Tue, Dec 27 2016, 7:49 am

I do always laugh at the articles talking about "start bringing your lunch to work" and "stop buying coffee out!" as budget ideas. At least, those things aren't even on my radar.

The problem is that NYC is expensive to live in. Add in private school tuition, and it puts most people over the top. Private school tuition is a luxury item, so it's kind of hard to appeal to the masses and then include a HUGE luxury in frugal. I pay $65,000/year between tuition, aftercare and full time summer camp (necessary to work). So cutting that out, I've already made my life liveable/easier.

Laiya

Tue, Dec 27 2016, 9:56 am

seeker wrote:

Sure, everyone should have their own budgets and save where they can. My point was more about jumping to conclusions regarding other people's choices.

zaq

Tue, Dec 27 2016, 10:43 am

amother wrote:

I don't know about you, but when I look at a weekly shopping basket that totals $400 for one adult and two kids for Ms. Clueless -and -Cant -Be -Bothered vs. another that totals $200 for Ms. Price-Checks-and-Buys-Only-On-Sale, well, a difference of $200 a week sounds like quite a lot to me. It won't make Ms. Clueless rich any time soon but it might mean the difference between making rent and not making rent. Or the difference between making ends meet on her own or appealing--AGAIN--to her parents or siblings to help her out.

gp2.0

Tue, Dec 27 2016, 10:53 am

I agree. Sometimes you just need to increase your income instead of - or in conjunction with - cutting your expenses.

But it absolutely does help to pinch pennies here and there - not because pennies always make a difference but because it's a way of life and develops good habits.

The person who pinches pennies with a 75k income will have a few hundred dollars extra per year. The person who pinches pennies with 150k income will have a few thousand dollars extra per year. The person with 300k income will have tens of thousands dollars extra per year.

People who spend money without thinking twice exist at every income level. The way you become rich is by increasing your income. But the way you STAY rich is watching how you spend that income.

Billionaires like Warren Buffet and Trump are notoriously careful with their spending money.

amother

Coffee

Tue, Dec 27 2016, 11:03 am

I wonder if more people price compared, budgeted, shopped with sales etc would we need so many tomchei shabbos and similar organizations? I wonder. I work for one chessed type organization (trying hard not to be specific or identifying) and I see there are always the same families asking for extra help, if we can procure diapers for them, if we have anything extra. But then I see the way they shop and spend money.
Why do you need bottled water when you can't afford diapers?
Why do you buy lunch when you complain about affording basics?

amother

Denim

Tue, Dec 27 2016, 11:17 am

amother wrote:

When you have problems, you have even more problems. The person who did poorly in school and couldn't get a higher education might also have trouble thinking through a budget and understanding long-term consequences. The person who's not organized doesn't remember to pack lunch and ends up buying it. Etc.

See my earlier posts - I'm all for saving and budgeting. I think that sometimes people need help with the problems that make them poor in the first place. Compassionate giving means not just tomchei shabbos but guidance about planning and budgeting.