No. People have varying skill levels and ability to learn. The "average" person is probably low-middle to middle class and is doing a decent job managing their finances and their life. But they are not interested in starting and running their own business.
Look I phrased it in an extreme way but this is basically what you're saying. The quite a few people can barely take care of themselves.
That's what I did. And when I lost my job right after the dot-com bust and was working for near minimum wage for a couple of years, I managed. I'm now back at a professional level job, making less perhaps that I should but more than enough to live comfortably and save and invest the remainder. The lack of stress is nice.
See, you were conservative and survived ok. Nobody said life is easy. I've certainly had some hardcore downtimes and things can change quickly with a run of bad luck.
As for living below your means, good advice for most people. But when you're making only $10/hr, it's really difficult to live below that. And in a recession, there are an uncomfortably large number of $10/hr jobs and not too many $25/hr jobs.
I've lived on that kind of money before. If you have any dependents it's going to be insane. More than likely you can't afford to live in your own place on that kind of money and have to split or live with relatives. However, if you are getting paid $10 an hour you are not really working a skilled job. So if I was in that bracket I would be spending all of my time learning a useful skill and networking into that field. Everyone has to start somewhere.
I'm not sure how to answer the question "When does a person's responsibility to take care of themselves end?" Most people in North America are taking care of themselves, but with wildly varying degrees of success. Also, I don't see "running your own company" as an essential life skill as you implied earlier in this thread.
Everyone is responsible for themselves. Parents are responsible for their children. Society should be setup to promote the greater good which to me includes not letting people starve in the streets.
Running your own company isn't an essential life skill. It's just IMHO the easiest way to build wealth. If people are having financial problems why not bring out the bazooka instead of a .22?
I know that. An awful lot of people don't, and it seems like a lot of North American society is heavily weighted against teaching people that. Credit is often all to easy to come by, while the knowledge and information needed to manage that credit isn't. And there's also the lament that life is a cruel teacher: it gives you the test first, followed by the lesson.
Credit card companies prey on people IMHO. Bogus fees and associated other bs. Now I do use cards both for business and personal but I consider them dangerous so I don't keep a revolving balance. If you don't have the disicipline to do that cut the damn thing up.
I made some really decent money when I was young (like 21). I pretty much pissed it away and learned some really good lessons in doing that.
Does that also include the single mom retail clerk making $10.00/hr and all her income goes to supporting herself and that kid? It's going to take a very long time to save up money when you don't have any at the end of every month.
She may have to find a way to cut expenses or increase her income. Someone with a dependent and a $10 an hour job has a problem. To me that's not a sustainable situation and one that a person should be planning to solve asap. Again this is the same type of advice Dave Ramsey would give out. He's very conservative in his recommendations to make sure that people don't get burned when Mr Murphy shows up.
So yes, I do think a person in that situation can fix their situation and get to the point of being able to put away some money. Again they need to seek out counseling if they don't have the necessary skills.
I agree that a lot of people don't seem to understand that paying yourself first (saving and tax deferral) is a good idea.
And people at many income levels use the same excuse (that they don't have any extra money to save). That's bull unless you are, as previously stated, the prototypical single mother. Everyone should be saving into retirement accounts once you've paid off your debts. And don't have debts (this includes car loans).
Especially people who don't live in the United States
Yes, I understand you used a local term; I expect most countries have tax deferral plans for saving up for retirement.
You get the idea. I think in Canada they call them RRSP's. You would be shocked at how many of our employees don't contribute to their 401k. It was bad enough that I decided to make our plan a safe harbor plan and we automatically kick in 3% above and beyond salary for everyone so people have *something*.
Like don't go into a marriage only to see it break up in seven years, leaving you with either a kid or child support payments?
Honestly my recommendation would be to not get married before you've established your career.
Don't take a job at a company that is going to close its plant ten years down the road?
I've always been skittish about working for others, especially big companies. So you know my solution. Honestly I wouldn't ever take that kind of job.
Don't buy a house just before your company decides to lay you off in a downsizing move?
At least 20% down on a 15 year mortgage that is no more than 1/4 of your take home pay. 6 months of living expenses in an emergency fund. Now, go ahead and lay me off because I'm not stretched to the limit already.
Face it, stuff happens. Companies big and small fail all the time. I don't know how much of that is bad management and how much of that is bad times.
Which is why it's insane that so many people live paycheck to paycheck.
I encourage you to read Slingblade's, Remie V's or Roadtoad's threads. Th
ese appear to be smart people who just can't seem to find decent employment. Roadtoad, for example, has driven for a bunch of companies over the last three years. He quit quite a few because the owners were asses who treated their drivers like crap and didn't respect the law. He really wants to start his own hauling company, but a string of bad times over the last five years has wiped out his financial position.
I would rather avoid butting heads with more people and these are anecdotes anyway. Let me be clear and state that all of this is just conjecture and opinion and I don't have any peer reviewed studies on this stuff. This is watercooler stuff.
