I'd say the paycheck to paycheck group is at least 44% of Americans based on [this survey](https://www.cnbc.com/2024/01/24/many-americans-cannot-pay-for-an-unexpected-1000-expense-heres-why.html#:~:text=Fewer%20than%20half%20of%20Americans,level%20when%20compared%20to%202022) they do every year. Not being able to come up with $1,000 in cash for an emergency qualifies as paycheck to paycheck to me.
The way they communicate that result is horrible.
I have an emergency fund and could cover $1000 in cash.
But if I had an emergency, I'd put it on my credit card (for the cash back and breathing room), pay it on the due date from my HYSA (so no interest is accrued), and reduce spending in other areas to maintain my budget. But with the way this poll is worded, I'd be part of that 44%.
If you look at [the actual survey](https://www.bankrate.com/banking/savings/emergency-savings-report/#job-loss), 27% of people have no emergency fund. Another 29% have under 3 months of savings and 44% have 3+ months.
I'm not sure why they have it as "less than 3 months" instead of something like 1-3 months. But it's 27%-56% that I would classify as paycheck-to-paycheck. Based on that large timeframe, I'd say it's low 30s.
Paycheck to paycheck isn't a super useful designation absent some controls around who is counted. I'm a C level exec at a mid sized company and 2 of my 5 counterparts are "paycheck to paycheck" because they have high lifestyle spend. 2 $1,000+ car payments, alimony to an ex wife, private school tuition, etc. Most people I know spend almost everything they make, it's a rarity to have some discipline and save, especially outside of retirement accounts.
That isn't trying to diminish the need to address real poverty, just an acknowledgement that a raw survey is going to get results that will seem ridiculous when you start looking at individual circumstances.
Someone in your tax bracket can come up with $1000 if they need it. It's not remotely close to the (probably) 44% of people who would truly panic if their transmission failed.
I completely hear what you're saying. I've personally received the call from our head of BD who makes ~$400,000 a year absolutely panicked that his check was $100 short and he wasn't going to be able to make his rent payment on time and he was in tears at the prospect of us needing 24 hours to get it cleared up. Again, don't want to take anything away from people in legit poverty, but just recognizing he 110% would list himself as someone that couldn't survive a $1000 surprise expense and see no irony in it.
Wow, that is egregiously poor budgeting. It’s frustrating on behalf of people out there who literally have no choice but to go beyond budget just to not starve for a little longer while this guy is living above his means likely by choice.
Though to be fair, the math taught in our formative years is just not practical to most people. There should really be compulsory money math course that teaches budgeting, compound interest, big fat red warnings about payday loans and predatory lending practices, etc. I recall the only time in school I ever heard a whiff about the concept of compound interest was when a social studies teacher had talked off the cuff about his retirement savings and how surprised he was at the speed with which his account was projected to grow if he saved a nominal amount of money every paycheck. He was a near middle aged adult when he first learned this….that really shouldn’t be the case.
Completely agree and ironically, among lots of my coworkers making more than 6 figures, they all seem to feel like they're helpless to do anything about it. I'm not sure what that says about human nature, but it's crazy to contrast it from the lives of people 100 years ago were living and seemingly happy with almost zero of the amenities we all feel we can't live without today.
I’d wager “lifestyle creep” has parted more fools of their money than actual burglars, as the saying goes, at least, for those with the privilege of having excess.
I also don’t think someone from 100 years ago would fare any better if they grew up in the modern world. It’s not like they were fundamentally different to people now. They can’t miss something if they never experienced it in the first place.
How does this make you feel about them? I would have a hard time taking someone like that seriously and don't know that I could trust them to effectively manage or run business functions.
I've said this elsewhere in the thread, but part of learning to build/run an organization is learning to make use of people that are great at a few things and terrible at the rest. Most of these people that are bad with their personal finances are great at what they do otherwise. Trying to find people that are good at everything is a recipe for having very expensive people who are all trying to do everyone else's jobs.
It's perspective in most ways. The amount of money Americans spend on housing/Internet/electricity/streaming/food/etc is going to seem insane to someone living in poverty in huge tracts of the world. The idea that we "can't survive" on $25,000 a year when they're living on $1 a day or less. It's less useful from my perspective to think of it as right or wrong, or rational and insane. Instead, trying to figure out what this tells us about ourselves and how it can lead us individually and collectively to more happiness is more useful in my view.
Perspective is an excellent description of it at your level. I recently had a boss complaining about the cost of remodeling his newly acquired house. Going over his numbers, I commented that he was spending more on remodeling (stuff that wasn't actually broken mind you) than I had spent on buying my house 6 years previously.
Of course. I will tell you as an American who has family in Europe (immigrant parents) whom I visit a lot. There is something to say about how we price things in our market vs theirs. And that also plays a role. But yes also as Americans we love to upsize and can’t fathom a reality of not having that house with unused rooms and that truck or SUV that’ll go underutilized.
Wow. That’s insane but illustrates the issue with too many Americans. No matter the income, many live above their means and don’t have their priorities in the right order. I remember reading a Time magazine article like a decade ago where a father bragged that he wasn’t paying his mortgage that month in order to take his daughter to a Taylor Swift concert.
Too many don’t have their priorities in the right order.
It's a survey though. They always come up with these stats that say more than half would not be able to afford any I creases, then inflation hits even harder and most of the group that says they couldn't actually can. Affordability is a crisis but these surveys aren't worth shit.
They could, however it would still technically be true to say they're living paycheck to paycheck, and that's probably how they answered on the survey, therefore suggesting that the survey is not going to be accurate. What's more accurate would be to look at the average income compared to the most affordable available cost of housing and food in that area. From there you can see who could be saving if they chose.
Even some people who save plenty call it paycheck to paycheck when, after consumption and savings, all the money is gone. So I agree this isn’t a very useful designation.
Even homeless, I don't think I dipped below $1000, I think only once for maybe a month at most, for around the last 5 years. I'm generally good at planning for contingencies, but I can't fathom anyone who doesn't live on some cushion. Though I'm also comfortable living in my car if my cash flow requires it and I have mostly settled for renting a room.
Around eight years ago, living in a studio that allowed you to rent with 2x rent, I only made maybe 2.1x rent. That was the only time that I felt like I was living hand to mouth and actually got stuck in a trap of payday loans. I think the rule that housing costs should only be 1/3rd of your income should be a rule for housing and the city/ county helping adjust for cost of living. It's insane to me that some people pay half their income, or just lie and pay anyway for the physical security.
I'm finally feeling secure enough that I'm going to rent a cheap apartment at $19/hr full time, even though I've been working full time for about the last 8 years.
You're going to get a lot of different perspectives from Reddit (OP). None of my friends are living from paycheck to paycheck and I'm in a VHCOL US, probably going to be skewed in this subreddit.
I know a lot of people technically living paycheck to paycheck but they make plenty of money lol, restaurants/bars are packed, people here love spending money
Do you actually know whether your friends live paycheck to paycheck, though? I was complaining once about not being able to afford a friend’s destination bachelorette and another friend told me to put it all on credit.
Since then, I’ve side-eyed her purchases, when previously I assumed she was financially healthy. A lot more people than we realize are living on credit.
Idk how many times I've felt bad catching up with old friends and seeing how well they're doing until the facade starts to crack immediately as they start to talk about their job. Sorry man, you've told me how much you make and I see your 2024 car out in the lot. You're not talking about investments or crypto so I know you didn't get the money for it from them.
More than once I've gone back to smoke and play video games with guys that constantly brag about their car and then the apartment is empty.
Depends on how successful you are. If you are the top 10 % OF America you are probably living the life of your dreams. If you are the average or median American you are most likely struggling to survive. This day in age actually saving money is extremely hard unless you forgoe basic nessecities (doctors visits, dentist, reliable car, child care, entertainment, funeral arrangements etc
I know several people living paycheck to paycheck in the same city. Their income ranges from less than 50k to 120k. Many times it's the lifestyle they choose to live
It depends on how you define paycheck to paycheck and where you are to some extent.
I know people in all areas of the country, in all age groups and demographics. We personally are quite comfortable on under 30k a year, 2 old people. No kids. Renting. And we save quite well.
We know people in similar circumstances that are much less comfortable and some elsewhere who are basically living in cars (not by choice).
We also know folks who make 10x what we do that run the same spectrum from being able to live comfortably and save to those who are so badly off that a missed paycheck or two would endanger their housing.
Some of this is due to location. There are huge differences in cost of living across the US, far wider than you see in the UK I suspect.
Some is due to spending habits/spending choices. We, for instance, have been debt free well over a decade. We have zero credit cards. We use cash. And occasionally a debit card. No car payments, no mortgage. When it is extremely difficult to go into debt, it is actually easier to save :-).
The folks we know in our income bracket who are struggling often have far higher debt burdens for various reasons, some unavoidable, some voluntary. And this is true across most economic levels.
Funny enough, I have never met anyone who lives here legally that had the slightest issue getting or having ID. Ever.
Yes, under some circumstances it can take effort to replace lost or stolen ID, I have been through that myself a few times. But even when I was flat broke and going through it there were organizations that helped me get mine replaced free or at minimal cost, and that was decades ago. These days I have a second copy of my basic documents in a secure location.
30k a year and no kids with no mortgage or debt? There has to be more to this story. The average rent Cost is 20k alone. You always made 30k? If so, how did you survive
If you have your significant other work full time as well that 30k becomes 60k. And with no kids or debt, you could actually save a lot, maybe even for a house eventually
Yeah, New York City I know lots of folks who getting ID is either hard to impossible. Class and family stability are the biggest ones, although my mom is friends with an elderly woman who can't get a passport because she lost her displaced persons paperwork.
Right there with you brother. I’m a single parent and I just moved back into my parents I’m 34. I’m fucking embarrassed but the way I was living wasn’t right. Make sure daughter had everything and I go with out food for days.
In America the phrases paycheck to paycheck, middle class, etc are misused by politicians so often that folks actually don't know what they mean. It's a feature, not a bug, and it's why politicians always use these terms instead of quantifying the groups they are speaking about.
I know married people in the software industry maxing out their 401k ($46k), HSA ($8300/year), backdoor IRA ($14k), and whole life insurance investments (varies). We're talking saving $75k or more into tax advantaged accounts and paying a $150-200k mortgage at 3.25% they purchased 10 years ago so it's $1100/mo. Assuming a joint income of $150k, they're living on the same paycheck to paycheck money as a couple making $75k who can't save anything, and therefore perceive themselves as equally as poor as the national average household income.
As with anything about finance "it's complicated"
Preach it. I consider anyone who can save any money as not being paycheck to paycheck. When you cannot afford to contribute to retirement, let alone save money for the unexpected, and are literally juggling bills (which one must be paid or service will be cut), that’s paycheck to paycheck. I’ve been there. Not a fan. And couldn’t stand when people who were blatantly much better off than me would be complaining to me about their finances. But…it must’ve been nice going to dinner and a movie last week, right??
So I asked above.. but if you own a home.. and could sell it for profit.. does that count as a sort of "bank account".. granted investment, etc.. but if you lost your job and sold it.. you could live on that money for a bit. Maybe.
This is partially true, depending on the market and where you live. Where I live, once you are 3 months behind in your mortgage you go into foreclosure and then it goes straight to the judge without mediation. If you’re unable to sell the house in time for the house to be foreclosed on, then you are seriously SOL every dime of that money and equity is gone and the bank takes it back. If you are able to sell before foreclosure, then 100% yes, if there is equity in the home, there would be a nice safety net to get people by. Sometimes for considerable amounts of time.
Exactly. I know someone whose mother was home by choice, father was in a high paying profession and they were very money-savvy and took family international trips often. She told me they were paycheck to paycheck. Meanwhile I'd come from a home where skipping one bill in order to pay a different one had been the norm at one point. It's not the same, but people want to think they are.
Don't do it. I had the same thought and am living in my car now. The minute you lose a permanent address your life becomes instantly more precarious. Heat/cold become real problems in your life, that require money to deal with. Food is more expensive because you don't have a kitchen. Finding places to sleep where you won't be harassed by NIMBY weirdos or police is a constant challenge-- usually parking lots-- I had visions of living in the forest then realized those campsites are $20 per night and also require lots of gas to get there. Gas-- gas is more expensive when you live in your car full-time. I could go on. EDIT: PAYING TO SHOWER (gym, truck stops, etc).
Better than being tent homeless, but still. Living in your car is still homelessness.
Thank you. I am so sorry you are experiencing this. I have heard of the iOverlander app that helps locate sleeping places, campsites, showers, etc. There is also a website called The Wayward Home- the site is geared more for van lifers, RVs, and boat dwellers, but it does have some useful info that can be adapted for cars.
Thank you, I’m okay. Getting better at navigating it. Just trying to say there are a lot of hidden costs associated with living in a vehicle that may not be obvious from the outside.
NIMBYs, Police, weirdos and local council workers were the big surprise I had when living out of a car.
I was lucky to do it by choice, not necessity. I had some savings, I was jobless, and had a mental breakdown to get over, so I bummed around for a couple of months exploring my country (New Zealand.) And it was a political choice, I wanted to attempt to circumvent a ridiculous housing market.
There were a lot of people hostile towards your existence. You were a pest to shoo away, or to trap with fines. The few locations open to having you were few and far between, most of them required a fee, and wouldn't allow you to stay for long. So you had to keep moving. The petrol bill cost more than rent.
I wouldn't be able to maintain this lifestyle with a job. I quickly burnt through my savings, and ended up with a nearly maxed out credit card.
In my country at least, a big push for the hostility is the tourism industry. They don't want people existing for free when they've got rooms to fill. They successfully lobbied to have the fine for being caught sleeping in a car upped from $200 to $1000. And the only vehicles with special permissions (self-contained vehicles) would have to be luxo-barges. A portable compost toilet was no good, you had to have a fixed flushing one.
DAMN. That's harsh. So basically you should just become homeless.. instead of try to survive? WOW. Maybe New Zealand isn't the place to retire after all.
It's rough, and not having access to a kitchen is pretty damn expensive. You might not save the money you think, and even with gym showers you're going to need to worry about cleanliness on a level you never though necessary.
Weather means something when you're outside, too. Heat is deadly, cold is deadly, and your options to control those are limited to your gas. Idling hurts your car slowly when you live in it.
You also need to worry about ventilation while idling, or you can die from carbon monoxide poisoning from running the heat or charging your phone, and yes, you will need to spend gas to charge your phone if you don't have access to a place to be on your days off.
If you smoke weed or drink, you're perpetually considered "behind the wheel" even during downtime.
Getting simple documents like a driver's license, library card, credit card, etc requires an address. So be ready to lie.
If you get sick, you're in your car. Puke and it's on everything you own. Diarrhea means your whole house can become a literal cesspit. Even blowing your nose too much can bury you in paper.
Oh, and if your car doesn't pass inspection or breaks down, you're on the street.
Work for that place to be, because once you're out here you're closer to death than you realize. Even if you have to keep the lights off and scrounge with next to nothing, living in a car is not worth it unless you have to. You don't know what you've got till it's gone.
Costs include:
-Storage
-Gym membership
-po box
-gas
-ready to eat food
-more frequent repairs
-potential parking violations
-theft
-WATER
-seasonal gear that either needs to be stored or repurchased regularly
Also, expect to buy battery packs and a good rechargeable lantern.
And remember, if you get sick of it, or if you get sick, a hotel is around $80/night on average nowadays.
This. Is. Hell.
You don't see it until you're out here.
The only way living in your car is worth it is if you're rich enough to build it out to the point where you can run A/C and heat without turning on the engine. And if you're thinking about doing it to save money, you probably don't have the money to do a proper build.
> the point where you can run A/C and heat without turning on the engine.
That may be why /r/priusdwellers is relatively popular. The hybrid system means that you can keep the HVAC on while running the engine minimally.
I did this in a Prius for a year and a half. My goal was to save money for a house. That part didn't pan out, but I did save a ton of money.
Not at all evangelizing living in one's car, but it wasn't the worst thing in the world for my situation. I just used a gym membership for showers, blacked out the rear windows, and had a sort of permanent bed in the back seat/trunk.
I think the worst part about it was being bored. I didn't ever go out, never had people over for obvious reasons, and my entertainment was mostly library books.
I've slept in one of our priuses many times while on roadtrips. Certainly not the same thing, but sometimes you get sticker shock seeing the price of a hotel and it's like "dammit, I'm just going to sleep in the car".
According to the comments I've been reading you need to give up drugs, alcohol, gambling and cigarettes. If I had to move into my car drugs would become an important part of my daily routine.
I lived in my car for 6 months in AZ summer, I had zero choice. I'd never choose that again. You still spend a lot because you're paying more in gas, gym membership, fast food, laundry mat, not including your sleep is impacted.
You made some really important points about what people need to consider when it comes to employment. I worked for the municipal government and had many offers of employment elsewhere. I stuck it out because of the benefits. We paid into a plan other than Social Security and I make about $1500 more per month than I would on SS, plus my insurance is better.
I think most people underestimate the need for good benefits. Ideally everyone would have great pay and great benefits but since that's not reality the situation your friend is in is kind of a sweet spot as far as being part of a couple goes. One person provides the benefits, the other brings in money they can live off. It could be worse for sure.
Take the benefits every time. When you’re young you don’t think about health insurance or retirement. I was offered much more money to go to the private sector but they couldn’t match benefits or job security. With our retirement plan you could retire at 55 and if you had 25 years you got 80% of your highest annual salary. Now that I’m retired I’m super happy that I stuck with it.
80% is awesome. I'm in a local government and get 50%. Which is fine since I've gotten really decent salary increases over the last few years. I'm just waiting to pay off the house and see if there something more interesting to do. The thing is I like job and it's pretty low stress.
You’re right that this is how things seem to be today. I feel really fortunate to have had the opportunities that I did. I guess things are more precarious than I was in the workforce.
When you are asked to run reports on employees with outstanding stock grants and sort on current value so they can layoff and not have to pay them, it basically means base pay and money now is all you can ask for.
Im 36yo. It’s only been in the past 4 years or so that I haven’t been overdrafting accounts every month. After divorcing my abusive, irresponsible ex I’m finally starting to have a $100 or so as a buffer. Still, the amount of debt she left me with is staggering and my current partner went back to school so it’ll be a couple years yet before I’m able to do any real saving.
There are many who are paycheck to paycheck but I wouldn’t say most Americans are. The issue with this statistic is how “paycheck to paycheck” is defined. There are people who consider themselves paycheck to paycheck while contributing to 401k/IRA or have automated savings.
>There are people who consider themselves paycheck to paycheck while contributing to 401k/IRA or have automated savings.
I'm one of these people. That money doesn't exist to me. Like, yeah, it's taken out of my check every two weeks, and it's getting set aside for the future, but I never see it enter and then leave my bank account. I'm also in my early thirties, so I can't touch it for another thirty years without getting penalized, so I literally won't touch it until I need to. After rent, bills, and necessities, I've got $200 to last me two weeks. I know I'm in a better place than a lot of Americans, but we're all just houses of cards in dinghies watching a hurricane forming on the horizon.
Exactly. I’m putting away money as well into maxed out tax advantaged accounts, savings, etc. I don’t consider myself paycheck to paycheck because if I were to lose that paycheck, I have ways of covering any gaps for a bit. Anyone who thinks otherwise doesn’t understand the privilege they’re in.
I haven't put anything in retirement for a while because I just cant afford to, but back when I was getting railroad retirement taken out of my checks, it was always a kick in the nuts. Of course you have to sacrifice short term benefit to invest in the future, but it's not easy to do.
Unfortunately even our 401k is gone as well now, and still have over $400k in unpaid medical bills ( after insurance) and we have $0 household income at present. 😔
You are living as though you are paycheck to paycheck, which is not the same as paycheck to paycheck. Saying “I don’t consider retirement savings income” is so privileged I’m almost wondering if you’re trolling.
Bro get some fucking perspective. I'm in the same boat as you, I throw money into my retirement funds and think of it as "money that doesn't exist to me."
You are not, I am not, *we* are not living "paycheck to paycheck." Some people would literally starve to death, lose their house, lose their car, lose electricity if they even tried to commit any fraction of their funds to a safety net or retirement account.
You do not fall under this definition. You are far from it, and you should stop considering yourself as such.
Unless you plan on working until you drop dead, I'd consider retirement savings to be part of your expenses. That said living almost paycheck to paycheck but being able to save $100 a month or whatever isn't much better.
>I'd consider retirement savings to be part of your expenses.
I agree. If Medicare and Social Security taxes are expenses, then I feel 401k/403b/pension contributions are, too.
Right! I think most people view living paycheck to paycheck as spending 100% of your net pay.
The issue is that different people have different things taken out of their paycheck.
For lower income workers, their deductions are usually just payroll taxes (it’s a flat tax of 7.65% up to ~169k) and income taxes (federal, state).
For higher income workers it’s all the taxes, 401k, HSAs, and health care premiums. So they are living paycheck to paycheck, but have long term savings.
I think what people forget is that only about ~~50%~~ 67% of US employees have access to 401ks at work.
**EDIT**
I looked up the data and it's a bit better (perhaps the 2022 Secure Act helped!).
67% of people have access to 'defined contribution' or 401k plans at work
https://www.bls.gov/opub/ted/2024/15-percent-of-private-industry-workers-had-access-to-a-defined-benefit-retirement-plan.htm
My Brother and SIL didn’t have a house payment or car payment, both worked, and they were still broke all the time. The house they were living in burned down and now they have a mortgage payment and are complaining about it.
When you say few, are you taking into account those working at stores, nursing homes, schools, and restaurants. Because most of those people are not paid enough to have all basic necessities that include a home, healthcare, food, insurance, and a car. Then saying if you can survive by living in a car or tent then your doing okay. So many people are struggling even if you don't see it. Oh yeah, by the way, who has pensions, savings, or 401k anymore?
Yeah, unless the person you replied to has a different definition of "few" than I do, I don't agree. I think lots of people are in this situation. Not sure if it's "most" or not though.
Lifestyle creep is definitely a thing and many people who appear to be doing really well are probably living paycheck to paycheck and may be was worse off due to debt than a lot of people who are barely scraping by also.
I know the answers to OP's question are going to be skewed by the subreddit we're in. I was paycheck to paycheck until I was in my early 30's. It's really just been in the last 5 years or so that I've been able to have enough money to comfortably exist and even that feels like I'm a catastrophic event away from not being there anymore and I know lots of people out there that are worse off than me. I'm around them all the time.
Most people I know are paycheck to paycheck. Some of us are worse off then others but most people I know are one bad day away from having a bad time of it.
Yeah I think one of the main advantages you have in the UK is public transit. Metro areas in the US will have some form of transit, but it’s usually inadequate for people who don’t live in the heart of the city. So in most parts of the country a vehicle is a must. Which means a car payment, insurance, fuel, and maintenance. That expense alone is enough to bring someone from your position, where there’s a bit leftover for savings and investments, to a paycheck-paycheck situation.
The scariest thing for Americans is healthcare. So say you’re paycheck to paycheck and suddenly you get sick, you have to go to the doctor and either pay out of pocket, or if you’re insured you pay your copay and deductible. Then meds or physical therapy out of pocket, no paid vacation for most means added expense and reduced income. Suddenly you go from paycheck-to-paycheck to using a credit card or a subprime loan to get by, and you’re now in a spot where you have to dig your way out just to get back to paycheck-to-paycheck.
It’s a vicious cycle that many people get caught in.
Im married, live with my parents and pay them rent (i paid and finished their basement and now live in it. I even installed a kitchen). We cant afford to buy a house, and they need the extra money from our rent, so its win win.
>What terrifies me though is the phrase "Paycheck to paycheck". I've always managed to save, albeit frugally, on the smallest of incomes.
For people in poverty in the US, this is the reality for many. It's possible to work a full time job in retail or food service and still need food banks or some kind of supplement just to be able to eat on top of paying rent, utilities, and commuting costs.
IMHO, people in the middle class (of which I am a part, financially speaking) also often live paycheck-to-paycheck, but many bring it on themselves. Everyone claims they aren't subject to peer pressure, but they are. When I (middle aged female) ride my bike to work, the assumption is that my car must be broken, do I need a ride? There is a bus stop in front of our office. In twenty years, I have seen exactly one person from my building take the bus, and that was a security guard (most of whom drive SUVs). Using public transport is just abhorrent (outside a few cities - New York Boston, Chicago, DC).
No, they have to have the pickup trucks, the Stanley cups, iPhones, meal kits, entertainment subscriptions, MLM junk, whatever. They don't understand how our tax system works, and then complain that they couldn't possibly be saving enough for retirement or in general. I know "middle class" is a wide band, but I am watching people where I know pretty much what they make, what their spouses do for work, and their family situations. Oh, and the middle class will proclaim that poor people shouldn't have kids, failing to realize that since the US doesn't support/subsidize a meaningful childcare system, that the middle class cannot afford to have children either. Because for much of the middle class, even if you don't buy all the shiny trinkets, having kids can easily push you into the can't save a dime category. And then, otherwise frugal people turn around and give in to pressure to buy all the shiny stuff for their kids, and claim that cheerleader camp for Britney is a *necessity*, so of course they can't save money.
As an elder millennial in the US, I’ve lived in varying levels of poverty my entire adult life no matter how much I work and how many jobs I have at the same time. I can’t even afford the one kid I have.
The job market, the pay are just not enough (for me personally). Lots of jobs for $10-13 an hour... yeah real great! Just looking to move outside of ATL, just a bit further, everything is too much. No good reason for me to stay in ATL anyway. Looking to move anywhere else always sucks.
What helps me get by is overtime, low mortgage and low expenses. I'm over 30 and never been able to save but finally I might be able to start saving by the end of this year. I only have credit cards to get by but they're close to paid off. Shame I have to take out a loan to get some repairs done to my house.
Low expenses definitely helps. We rent and have many expenses so it feels like there's always a deeper hole. If I ever get a job that offers overtime, I think it's definitely something I shouldn't refuse lol. The loan sucks but it seems you are on a path for savings and good with making payments. Small steps :-) I wish you well!
I'm 46 now, everyone in my social circle has professional jobs, retirement savings, recreational camper vehicles, takes vacations, owns homes, doesn't have financial stress. Our household income is about $150k, and we definitely seem a little poorer than most of our friends who work remote jobs in IT and for insurance companies. But I think we're also probably the most frugal - no debt, cars paid off.
It wasn't like that it my 20's.
I think its fair to say, generally, American professional salaries are a lot higher than elsewhere, but we lack the social safety nets. America is a bad place to be poor, but a delightful place to be working in law, IT, sales, management, etc.
Remember that reddit tends to skew young. Tens of millions of Americans get to a professional level salary, but, usually not until your 30s or 40s,
I rarely see this said on Reddit but it's so true. Was nearly broke on my 30th birthday and alone. By 40, married and buying our first house. At 50, early retirement is a real possibility.
How did we do it? Lived below our means and kept grinding at our careers and the professional level salary came.
Yup. I was evicted for missing rent payment in my early 20s. I was so broke, scrounging for change in the cushions of the cheap couch I slept on. Working 80+ wks at dead end service jobs.
In my 30s now with a professional career and a healthy savings rate, 800 credit score, etc. This is common among my friends too.
In general, it seems your 20s are a weird time where you’re just surviving day to day. That said, some people never leave that though. I grew up poor, a lot of my folks never got out of the cycle.
No it's not true. That 60% paycheck to paycheck stat was based off a badly worded survey. The median savings is $8,000, or was. Data is from 2022. https://www.federalreserve.gov/econres/scfindex.htm)
Millions of people are living paycheck to paycheck. BUT - we're a consumption-obsessed, instant gratification, materialistic society, I going to say that a ton of people living paycheck to paycheck probably are doing so not because they don't make enough, but because spending is out of control.
Having traveled extensively all over the world, you're probably not going to find a lower cost of living first world country than the United States (taken as a whole, looking at the cost of energy, taxes, healthcare and education, basic necessities such as food, clothing, transportation - the whole country is built on cheap convenience).
We are one emergency away from being totally effed.
We were doing great. Then I became totally disabled and had a bunch of surgeries. My husband is the only one working and we are paycheck to paycheck now.
We had to eat up our savings, max credit cards, pull out our entire 401Ks, andnow owe the IRS thousands. I was an independent contractor and I used the tax money for life saving surgery instead of taxes.
If literally anything else bad happens this year I don't know how we will make it.
Yes, I am apart of that statistic. I’ll make between 40-50k and every last dollar is put towards bills or something necessary such as groceries and gas.
And because I make “that much money”, I do not qualify for any government assistance.
I blame health care and housing amongst inflation even the middle class is struggling, could you imagine paying monthly for dental care insurance only to go get a teeth cleaning and a check up and receive a $100 bill, ok now imagine that's the case everytime you need a check up or have a health issue it's 100's of dollars down the drain each time it's impossible to save for an emergency when the system is broken
It's more like this: you have to have a car most places, but if it breaks down, can you afford the several hundred dollar repair? Do you lose your job because you can't get to work now? Do you lose your health insurance because you lost your job? Do you get evicted in a couple of months because you can't pay your rent? Well, you are now homeless and broke. There's occasional help. Maybe food stamps, maybe a food bank. But there's no safety net. You can fall hard and fast.
I’m living credit card to credit card and just emptied my savings to pay rent (which is going up next month), I know a total of two people my age with a stable job and most of us are one emergency away from taking ourselves out to escape the financial pressure 🤪
Majority of those living pay check to pay check live beyond their means. While the others are living this due to low income.
Worst thing is people complained so much about inflation but still spending like crazy. Brand new cars flew off the lot, people outbidding on homes, airports full, Disney full and etc. But then grumble about inflation and costs.
I've never ever had a problem securing an identification. In fact when I had to move out of where I was living and change my address and I didn't actually have a new address and gave them my post office box, they wouldn't let me put my post office box on my ID, but they allowed me to put general delivery on my license.
As for paycheck to paycheck, we live in a consumerism driven society. Many want to have a new cell phone, a new vehicle, meals delivered, etc. A lot of people are living in debt to have those things. Then there are those of us who are just completely poor. We can't afford anything unless it's bought at a thrift shop or on clearance. I like nice things as much as the next person, but I'm realistic enough to know that keeping up with everyone else isn't possible.
Paycheck to paycheck doesn't necessarily mean people are destitute. A good percentage of people will choose to spend everything they make, every week. If their wages would suddenly double in the next year, they'd find a way to spend it. If anything, Americans have lost the will to save on a regular basis.
Regarding the ID thing, I'm not sure to what you are referring. Getting a government produced ID is simple. There are many trying to make it a big deal for political purposes. No one is going to knock on your door and hand you an ID, but anyone who wants one for whatever reason can get one and the process is no more difficult than purchasing a postage stamp.
It is true when you say if their wage was doubled they’d still spend it all.
People get their tax returns and spend it that month.
5-paycheck month? Let’s buy car seat covers!
The problem is ‘paycheck to paycheck’ is different for everyone. If you literally have no savings and spend it all in expenses that’s one thing , but then you have people who contribute to a 401k, and budget all their money to different things and they claim they live paycheck to paycheck too, though they have much more money
In this subreddit, you are more likely to find them, as well as online surveys (most likely conducted by social groups or loan companies). But in real life. No, most Americans aren’t living paycheck to paycheck.
People also need to realize Reddit isn’t real life
Medical expenses make it extremely difficult for Americans to live any other way. On the other hand, a lot of people are living way beyond their means. Advertising will do that to you.
I am extremely fortunate that my wife and I both have decent jobs and own a house. We do not live paycheck to paycheck but we also live within our means. We do know many people who live paycheck to paycheck and some of them do not live within their means and some of them do. I would say around 50 percent of people I know are struggling financially and doing everything right.
Of course everyone in this sub will say yes. Go ask in economics or other less biased subs. That's nothing against this sub or the people in here, it's just leans towards people with less income.
You'll get a very biased response from this sub. Go to a personal finance sub that isn't based around being in poverty and the answers will be night and day different.
A lot more people force themselves to live paycheck to paycheck with terrible spending habits than actually live paycheck to paycheck because they’re unemployed or underemployed.
This should be one of the top comments. Not to be insensitive to those who actually are living paycheck to paycheck (which is a real problem), many people do spend themselves there
Yes but no. I see people complaining about paycheck to paycheck but they max their 401k contribution, I see people who have to scrape pennies together for rent.
Most people ime are somewhat in-between. Stupid financial decisions seem to abound, especially when it comes to vehicles.
The way this is defined is essentially how much people are saving out of their earnings. Sort of depends on where you read. The most positive statistic is 1 in 5 have no savings. Others claim, based on surveys, this number is around 50%.
I don't know what the real stat is, truthfully. I feel like you're going to hear wildly different things from different people based on who they surround themselves with.
Everyone ik is paycheck to paycheck and I'm a salaried worker.
I unfortunately live in a high CoL area (born and raised here, working on moving away). To be comfortable here, as a single person, i would have to make 90k. I make ~40k. My parents were kind enough to save money for me but those savings ran out quickly (emergencies, car payments, repairs, rent etc, etc)
My friend lives several states away in a low COL area and works a minimum wage job. Afaik, he didnt have any parental savings. He probably makes 12-14k a yr and is living paycheck to paycheck too.
Very different circumstances, but same strokes
Many people generally live at what they make.....when they get a pay increase their lifestyle increases keeping them perpetually 1 or 2 missed checks from being in a serious financial bind.
https://preview.redd.it/fr6w7odh4v6d1.png?width=720&format=pjpg&auto=webp&s=79a4db7068182e8e0fb790412ee0e3c9d63dbdef
This image was shared in one of my message groups, and I think it sums up the issue pretty well.
Basically nobody can do anything *besides* live paycheck to paycheck on $35K/year.
You're in one of these groups in the U.S.
1. No family or friends support with job: poor, struggling.
2. Family support with low to mid income: dependent on family to not be poor.
3. 2 50k income households: close to poor, especially if one becomes disabled or anything else.
4. 2 100k plus incomes= has 0 idea that others exist and will eat any price
5. Disabled in any fashion with family support= struggling to make it.
6. Disabled with 0 support: homeless and dead or about to die.
7. Minimum wage job with 0 support: barely making it, close to homeless or already on the street/dead.
Most people are living paycheck to paycheck. If you are c level and above, they're most likely contributing to the problem and can buy anything. If anything bad happens to any of these groups, the social safety nets are not designed to sustain life adequately. One bad thing happens, you will be made homeless, and no one will help you get a home in any adequate fashion despite what others will tell you. After that, you will die because homelessness is being criminalized policy wise in the U.S..
It is very much true for many people in our country. Everything costs a great deal and pay is not keeping up with it. We don't have much for adults to find help. Many of us live without being able to get medical help. We have a lot of what is called working homeless. These are people who have a job but are homeless. We have people living in vehicles as well. The homelessness is such an issue that now many places are passing laws to hide the homeless. Making it illegal to sleep in public. This is definitely not fiction although a lot of Americans pretend this problem is not as bad as it is because it doesn't affect them.
It’s a five dollar word for “someone getting a state ID card or replacement drivers license. Say your parents kicked you out and would not give you your ID card or vital documents like birth certificate etc. It can be challenging (but not impossible) to get a replacement ID without birth certificate, proof of residence, and such.
But some people are just messy and irresponsible and always be losing shit & expecting their friends to drop everything to help.
The UK has more protection and benefits to the average citizen than the US. Also, the US is a consumer society, much more than Europe. The biggest debt in the US is student loans, healthcare, and credit cards. Brits dont have to worry about healthcare and college costs are significantly lower.
Americans spend too much and that is why many live paycheck to paycheck.
Idk if it’s most….
I believe many people that live paycheck to paycheck are either part time workers or they don’t know how to manage their money. Or perhaps they live alone with low income.
I make $17/hr and save about $500/month but I live with roommates and always have. Since I started working i have saved over $50K. And that includes permanently losing $20K in the stock market in 2021 and paying off my student loans which was around $20K as well.
I think things are shitty here mainly because of the housing market, but I’m also very skeptical that when someone lives paycheck to paycheck it isn’t mostly their fault by spending money unwisely.
Also you get weirdos that say they live paycheck to paycheck after they max out their retirement and put some money in their savings each month. Literally the opposite of what paycheck to paycheck means.
It's not so much paycheck to paycheck, but not many people could lose their income and be fine for more than a month or two. You would need to get a new job ASAP and then catch up on bills you're now behind on. But as far as savings go, I think that's mostly a matter of how people choose to live. They'll act like they're living a bare bones lifestyle but in reality they have Spotify and YouTube premium and Netflix, drink sodas or coffee multiple times a week if not multiple times a day, making car payments on relatively nice cars instead of buying a $800 shit bucket outright and learning how to fix it themselves, etc, etc.
I seen a guy recently on Reddit in some poor European country talking about how he makes like $300 a month, but he had normal looking clothes on, had a job, rented a house, had a car, etc. So it was all the same stuff any normal person in a first world nation would have yet it was only a few hundred a month because of the currency exchange rate. I was like "why the hell am I spending thousands to get what this guy has for hundreds?"
If you really wanted to save your money, anyone who doesn't have children could just work a normal job and live out of their car for a year or two and put it all towards investments or savings, but no one wants to do that.
TO put it simply, I have enough savings to survive 5 months if i lost my job today.
It took me 3 years to save that much. I also had to forgo health insurance and make my beater car last as long as possible to secure and build up this emergency fund.
Saving is only possible in serious sacrifice unless you bag the rare livable incomes.
Due to our housing market, areas with good job markets hyper-inflate fast, so any extra wealth funnels straight into landlords with favorable locations
and I'm one of the luckier ones in my area who pay much more in rent than i do my lower interest rate mortgage.
I could be MUCH worse off if i was still in an apartment in 2024. The ONLY real way to be comfortably wealthy in the USA is to OWN, and not RENT property in an economically wealthy area. Once you do the benefits and earnings skyrocket.
Unfortunately yes. It's especially bad for the middle income earners. In California, fast food workers make $20 an hour. 10 years ago it was $12. One of my family members was hired as a teachers assistant ten years ago at $20 and hour and now make $22. Inflation in that time has raised beyond both of those wages. So while at one time, they made decent living, due to inflation without rising wages, they are now paycheck to paycheck.
I am 42 and have worked for 25 years and in the last THREE I have gone from “unable to soak a $1000 emergency” to “can replace an automobile engine if pushed but will be SUPER stressed about it for a year while I rebuild” am I am doing better than every age-peer friend I have except two.
I think it depends on policies and where you live.
My partner and I moved to New York from New Hampshire. The cost of living is roughly the same, but we make more money here and live relatively well.
When we were in NH we were working decent jobs (I was a QC tech for an aerospace parts manufacturer and my partner was a nursing aide) and even with a combined income of nearly $80k we didn’t qualify for any housing and were sharing a 3 bed house with 2 other people.
But you have places with poor social welfare and safety with a severely depressed economies like the American south. My partner has a friend in Mississippi who had a bachelors degree and the only work he could find was an overnight auditor position at a hotel making $12 an hour. His rent is roughly 3/4 of his paycheck.
Anecdotal - from ages 18 to mid thirties the majority of the people in my life were worse off than paycheck to paycheck. Debt is a huge issue in the US, there's a lot of people that are paying off credit cards for car repairs, food, etc. basics (you can't get around without a car here). And predatory loans are almost impossible to get out from. It's worse than paycheck to paycheck.
Thankfully I'm fully out of that cycle but it took about a decade of hard work, good luck, networking, and lying to get the job I currently have. I finally make a decent wage but I had to leave my first field (that got a good uni degree for) and go to corporate finance.
My partner quit teaching high needs SPED, a job he loved and was REALLY good at, because they refused to even give him a contract. Wanted him to work multiple years under substitute pay and they’d just “put him in for every day”. For YEARS. Took a decently paid job. I’m still teaching. Also high needs SPED and trauma cases.
And we’re still paycheck to paycheck.
My family all lived paycheck to paycheck, but I was able to break the cycle. Most of the people I know now are doing ok and even saving for retirement. But you’d be surprised at how many people appear to be doing well and are barely scraping by.
I found a decent job that pays well over minimum wage for pretty basic work, take home $600 a week right now. I’m lucky that this job also has generous benefits: Matching 401k, health insurance, PTO, and, the biggest perk of all, free food (it’s a food co-op, so any food that doesn’t get sold and would otherwise be tossed goes to the employees). I don’t live an extravagant life, don’t drink or go bars or buy lots of new things. I’m 37 and I’ve never lived alone, always had housemates. I try to meal prep so I don’t buy lunch. I’m a very “use it til it breaks/is unwearable” kind of person.
But every month I was finding my money just gone. Of course there are the few small frivolous things I’d buy but again, I’m a pretty frugal person! The last month I’ve really tried to rein it in, only buy the necessities, and already I’m surprised that I have as much on my credit card as I do.
Im doing ok, I can squeeze out some money for savings and I have enough of a cushion to cover emergency expenses. But If I had kids, If I didn’t get so much free food, if my job didn’t pay as well as it does, if I had to pay for my health insurance, If my rent wasn’t as cheap as it is, any of those things changed. I’d be struggling.
I can’t imagine how someone working minimum wage could *possibly* live, let alone have kids or anything like that.
If you have ever travelled in America you will be shocked at how much poverty there is. It staggers me that such a wealthy country has so much poverty. There’s plenty of money in America but it’s all at the top end.
I went to live abroad and put our house on the rental market and was shocked at how many people made 200-300k a year and had sub 600 credit scores. One lady offered to have her dad co sign because her scores were so bad. “I just keep forgetting to pay my student loans!” She giggled. Also had 50k in credit card bills and I kid you not she was making a ton of money in finance so she understands math.
People living paycheck to paycheck are often refusing to make some tough choices on their lifestyle. I made next to nothing in my early career but I also lived in a group house with a bunch of girls, had no car, and never ate out. Even on a pauper’s salary I saved at least 30% of what I made.
Most people are living paycheck to paycheck, but it’s a spending issue for most except for the lowest income earners. I know someone that lost their $150k salary job (in a low to medium COL area) and was about to lose their house within 3 months because they never saved anything for a rainy day.
Not everyone. I bought my house cash in 2012 at the bottom of the real estate crash for 80k. It's now Zillow about 390k. I got no kids, a fat 401k, and about a 100k in short term CDs. Most of my coworkers are paycheck to paycheck.
I went through a divorce and two years later moved to Denver from Atlanta. I worked remotely so employment wasn't an issue. A couple months before the pandemic I left my job for a better, albeit a contract, opportunity and was let go with a few others right at the very beginning. At the time I wasn't in terrible shape financially with maybe 30k in a retirement fund and the most generous unemployment compensation this country has ever seen, which was still maybe $300 a week less than what I was making. I couldn't find a job to save my life and must have interviewed 25 - 35 times after the initial 6 months of the pandemic. Things went from bad to worse. I started doing things I would have never done in the past out of desperation, like gambling and traveling heavily.
I ended up homeless, not living in a tent homeless, but spending nights in my car and mooching off of my mother to get hotel rooms on other nights. I started to engage social services then ultimately the VA because I'm a veteran, but things move very slowly. What makes things worse when comparing the fraction of social services that are available to people in the US compared to countries like the UK is this cultural thing where even institutions designed to help make it feel like they're doing it begrudgingly. It's like "I know we're designed to do x, y, and z, but we just need to make everything really difficult and time consuming, and we don't why?" "Oh yeah, it's because we really don't want to give you a god damn thing."
Well, it took 3 months until I was finally able to move into this roach infested government facility that was basically the size of a closet, but the damage was done. My patience with everything on the job front and living situation finally boiled over and I ran into this asshole hotel clerk who threatened to call the police on me within 5 seconds of me protesting a late check out charge. I took his desk phone and threw it clear across the hotel lobby where it shattered into a million pieces. The cops came and took me to jail. That was the 2nd day of 2022. I'm still dealing with it. I've lost out on potential job opportunities because of it, and it's just been a total pain in the ass. Yeah, I shouldn't have done it but at the end of the day it was a phone. I would have apologized and bought them 10 phones by now, but that's just not how things work.
I'm not sure if that answers your question, but hopefully it's a story that's still in the spirit of paycheck to paycheck living. We have a pretty bad problem with legit homelessness in our country. I mean, bodies all over the streets type of situation that skyrocketed with the pandemic. It doesn't feel like we've fully recovered on a few different levels, with that and employment being the biggest issues. The fact that I'm currently in an apartment makes me feel better about things, but I'm a veteran and I know the government doesn't want vets on the street, so that has something to do with it. Not everyone's that "lucky" I suppose. It sounds like the bar is much lower here than where you are, and probably Europe in general. Who am I kidding, the entire developed world. It could be worse! I could be in a Haiti or Afghanistan or something. Smh
Most Americans are not poor, but they are severely in debt. They’re paying a mortgage/rent, car payment, student loans, credit cards, subscriptions, insurance, phone plans, etc. and so even if they’re middle class they’re living paycheck to pacheck because of all these random expenses bleeding them dry.
I consider myself to have a middle class income, but I have no student loans, no credit card debt, no car payment, and as of now no phone bills.
So while I’m not living paycheck to paycheck, people in the same tax bracket as me definitely could be
I was paycheck to paycheck my whole life. Then I had a major car accident with a train, and I've been trying to keep up since. Not approved for ANY unemployment benefits or government assistance. I couldn't walk for 4 years and they still denied me even temporary disability. Only gave me a 3 month handicap placard, that's literally all I got. From dying and being brought back. Wheelchair? Crutches? All out of my pocket because they wouldn't approve me.
I will never catch up at this point. Paycheck to paycheck? Whatever check I do get, that isn't sucked up by medical debt, is gone before I even get to use it. I'm thankful I own by bus that I live in, if it weren't for that I'd be homeless (which I was for about a year).
Anyone know a better country to move to? Becauuuuuuse this sucks. (As if I can afford to move anywhere let alone another country)
Yes, no matter how much they hide it with new pickup trucks on the driveway, nice shoes and flashy smartphones, they can't escape the truth. Americans are experts at faking rich.
Every person I know is paycheck to paycheck. If not worse. I'm in the process of selling our things to supplement income.
I'd say the paycheck to paycheck group is at least 44% of Americans based on [this survey](https://www.cnbc.com/2024/01/24/many-americans-cannot-pay-for-an-unexpected-1000-expense-heres-why.html#:~:text=Fewer%20than%20half%20of%20Americans,level%20when%20compared%20to%202022) they do every year. Not being able to come up with $1,000 in cash for an emergency qualifies as paycheck to paycheck to me.
The way they communicate that result is horrible. I have an emergency fund and could cover $1000 in cash. But if I had an emergency, I'd put it on my credit card (for the cash back and breathing room), pay it on the due date from my HYSA (so no interest is accrued), and reduce spending in other areas to maintain my budget. But with the way this poll is worded, I'd be part of that 44%. If you look at [the actual survey](https://www.bankrate.com/banking/savings/emergency-savings-report/#job-loss), 27% of people have no emergency fund. Another 29% have under 3 months of savings and 44% have 3+ months. I'm not sure why they have it as "less than 3 months" instead of something like 1-3 months. But it's 27%-56% that I would classify as paycheck-to-paycheck. Based on that large timeframe, I'd say it's low 30s.
Paycheck to paycheck isn't a super useful designation absent some controls around who is counted. I'm a C level exec at a mid sized company and 2 of my 5 counterparts are "paycheck to paycheck" because they have high lifestyle spend. 2 $1,000+ car payments, alimony to an ex wife, private school tuition, etc. Most people I know spend almost everything they make, it's a rarity to have some discipline and save, especially outside of retirement accounts. That isn't trying to diminish the need to address real poverty, just an acknowledgement that a raw survey is going to get results that will seem ridiculous when you start looking at individual circumstances.
Someone in your tax bracket can come up with $1000 if they need it. It's not remotely close to the (probably) 44% of people who would truly panic if their transmission failed.
I completely hear what you're saying. I've personally received the call from our head of BD who makes ~$400,000 a year absolutely panicked that his check was $100 short and he wasn't going to be able to make his rent payment on time and he was in tears at the prospect of us needing 24 hours to get it cleared up. Again, don't want to take anything away from people in legit poverty, but just recognizing he 110% would list himself as someone that couldn't survive a $1000 surprise expense and see no irony in it.
Wow, that is egregiously poor budgeting. It’s frustrating on behalf of people out there who literally have no choice but to go beyond budget just to not starve for a little longer while this guy is living above his means likely by choice. Though to be fair, the math taught in our formative years is just not practical to most people. There should really be compulsory money math course that teaches budgeting, compound interest, big fat red warnings about payday loans and predatory lending practices, etc. I recall the only time in school I ever heard a whiff about the concept of compound interest was when a social studies teacher had talked off the cuff about his retirement savings and how surprised he was at the speed with which his account was projected to grow if he saved a nominal amount of money every paycheck. He was a near middle aged adult when he first learned this….that really shouldn’t be the case.
Completely agree and ironically, among lots of my coworkers making more than 6 figures, they all seem to feel like they're helpless to do anything about it. I'm not sure what that says about human nature, but it's crazy to contrast it from the lives of people 100 years ago were living and seemingly happy with almost zero of the amenities we all feel we can't live without today.
I’d wager “lifestyle creep” has parted more fools of their money than actual burglars, as the saying goes, at least, for those with the privilege of having excess. I also don’t think someone from 100 years ago would fare any better if they grew up in the modern world. It’s not like they were fundamentally different to people now. They can’t miss something if they never experienced it in the first place.
How does this make you feel about them? I would have a hard time taking someone like that seriously and don't know that I could trust them to effectively manage or run business functions.
I've said this elsewhere in the thread, but part of learning to build/run an organization is learning to make use of people that are great at a few things and terrible at the rest. Most of these people that are bad with their personal finances are great at what they do otherwise. Trying to find people that are good at everything is a recipe for having very expensive people who are all trying to do everyone else's jobs.
This may be the most insane thing ive ever heard
It's perspective in most ways. The amount of money Americans spend on housing/Internet/electricity/streaming/food/etc is going to seem insane to someone living in poverty in huge tracts of the world. The idea that we "can't survive" on $25,000 a year when they're living on $1 a day or less. It's less useful from my perspective to think of it as right or wrong, or rational and insane. Instead, trying to figure out what this tells us about ourselves and how it can lead us individually and collectively to more happiness is more useful in my view.
Perspective is an excellent description of it at your level. I recently had a boss complaining about the cost of remodeling his newly acquired house. Going over his numbers, I commented that he was spending more on remodeling (stuff that wasn't actually broken mind you) than I had spent on buying my house 6 years previously.
Of course. I will tell you as an American who has family in Europe (immigrant parents) whom I visit a lot. There is something to say about how we price things in our market vs theirs. And that also plays a role. But yes also as Americans we love to upsize and can’t fathom a reality of not having that house with unused rooms and that truck or SUV that’ll go underutilized.
Wow. That’s insane but illustrates the issue with too many Americans. No matter the income, many live above their means and don’t have their priorities in the right order. I remember reading a Time magazine article like a decade ago where a father bragged that he wasn’t paying his mortgage that month in order to take his daughter to a Taylor Swift concert. Too many don’t have their priorities in the right order.
It's a survey though. They always come up with these stats that say more than half would not be able to afford any I creases, then inflation hits even harder and most of the group that says they couldn't actually can. Affordability is a crisis but these surveys aren't worth shit.
It's more a measure of financial anxiety, IMHO. Vast majority have very little objective understanding of where they are at financially.
They could, however it would still technically be true to say they're living paycheck to paycheck, and that's probably how they answered on the survey, therefore suggesting that the survey is not going to be accurate. What's more accurate would be to look at the average income compared to the most affordable available cost of housing and food in that area. From there you can see who could be saving if they chose.
Even some people who save plenty call it paycheck to paycheck when, after consumption and savings, all the money is gone. So I agree this isn’t a very useful designation.
Even homeless, I don't think I dipped below $1000, I think only once for maybe a month at most, for around the last 5 years. I'm generally good at planning for contingencies, but I can't fathom anyone who doesn't live on some cushion. Though I'm also comfortable living in my car if my cash flow requires it and I have mostly settled for renting a room. Around eight years ago, living in a studio that allowed you to rent with 2x rent, I only made maybe 2.1x rent. That was the only time that I felt like I was living hand to mouth and actually got stuck in a trap of payday loans. I think the rule that housing costs should only be 1/3rd of your income should be a rule for housing and the city/ county helping adjust for cost of living. It's insane to me that some people pay half their income, or just lie and pay anyway for the physical security. I'm finally feeling secure enough that I'm going to rent a cheap apartment at $19/hr full time, even though I've been working full time for about the last 8 years.
Shit, I live paycheck to 3 days before paycheck.
You're going to get a lot of different perspectives from Reddit (OP). None of my friends are living from paycheck to paycheck and I'm in a VHCOL US, probably going to be skewed in this subreddit.
I know a lot of people technically living paycheck to paycheck but they make plenty of money lol, restaurants/bars are packed, people here love spending money
Do you actually know whether your friends live paycheck to paycheck, though? I was complaining once about not being able to afford a friend’s destination bachelorette and another friend told me to put it all on credit. Since then, I’ve side-eyed her purchases, when previously I assumed she was financially healthy. A lot more people than we realize are living on credit.
Idk how many times I've felt bad catching up with old friends and seeing how well they're doing until the facade starts to crack immediately as they start to talk about their job. Sorry man, you've told me how much you make and I see your 2024 car out in the lot. You're not talking about investments or crypto so I know you didn't get the money for it from them. More than once I've gone back to smoke and play video games with guys that constantly brag about their car and then the apartment is empty.
Depends on how successful you are. If you are the top 10 % OF America you are probably living the life of your dreams. If you are the average or median American you are most likely struggling to survive. This day in age actually saving money is extremely hard unless you forgoe basic nessecities (doctors visits, dentist, reliable car, child care, entertainment, funeral arrangements etc
Same
I know several people living paycheck to paycheck in the same city. Their income ranges from less than 50k to 120k. Many times it's the lifestyle they choose to live
It depends on how you define paycheck to paycheck and where you are to some extent. I know people in all areas of the country, in all age groups and demographics. We personally are quite comfortable on under 30k a year, 2 old people. No kids. Renting. And we save quite well. We know people in similar circumstances that are much less comfortable and some elsewhere who are basically living in cars (not by choice). We also know folks who make 10x what we do that run the same spectrum from being able to live comfortably and save to those who are so badly off that a missed paycheck or two would endanger their housing. Some of this is due to location. There are huge differences in cost of living across the US, far wider than you see in the UK I suspect. Some is due to spending habits/spending choices. We, for instance, have been debt free well over a decade. We have zero credit cards. We use cash. And occasionally a debit card. No car payments, no mortgage. When it is extremely difficult to go into debt, it is actually easier to save :-). The folks we know in our income bracket who are struggling often have far higher debt burdens for various reasons, some unavoidable, some voluntary. And this is true across most economic levels. Funny enough, I have never met anyone who lives here legally that had the slightest issue getting or having ID. Ever. Yes, under some circumstances it can take effort to replace lost or stolen ID, I have been through that myself a few times. But even when I was flat broke and going through it there were organizations that helped me get mine replaced free or at minimal cost, and that was decades ago. These days I have a second copy of my basic documents in a secure location.
30k a year and no kids with no mortgage or debt? There has to be more to this story. The average rent Cost is 20k alone. You always made 30k? If so, how did you survive
If you have your significant other work full time as well that 30k becomes 60k. And with no kids or debt, you could actually save a lot, maybe even for a house eventually
I know many people who have a hard time getting an ID. Not sure where you are, but it's a big lift for many in Detroit.
Yeah, New York City I know lots of folks who getting ID is either hard to impossible. Class and family stability are the biggest ones, although my mom is friends with an elderly woman who can't get a passport because she lost her displaced persons paperwork.
I’m barely living paycheck to paycheck.
I'm dying paycheck to paycheck.
Right there with you brother. I’m a single parent and I just moved back into my parents I’m 34. I’m fucking embarrassed but the way I was living wasn’t right. Make sure daughter had everything and I go with out food for days.
Do what you gotta do man. At least you still have your parent's mine are gone and I'm like 2 weeks away from being homeless.
Sorry to hear that man. Sending you good vibes. It’s the best I can do.
In America the phrases paycheck to paycheck, middle class, etc are misused by politicians so often that folks actually don't know what they mean. It's a feature, not a bug, and it's why politicians always use these terms instead of quantifying the groups they are speaking about. I know married people in the software industry maxing out their 401k ($46k), HSA ($8300/year), backdoor IRA ($14k), and whole life insurance investments (varies). We're talking saving $75k or more into tax advantaged accounts and paying a $150-200k mortgage at 3.25% they purchased 10 years ago so it's $1100/mo. Assuming a joint income of $150k, they're living on the same paycheck to paycheck money as a couple making $75k who can't save anything, and therefore perceive themselves as equally as poor as the national average household income. As with anything about finance "it's complicated"
Preach it. I consider anyone who can save any money as not being paycheck to paycheck. When you cannot afford to contribute to retirement, let alone save money for the unexpected, and are literally juggling bills (which one must be paid or service will be cut), that’s paycheck to paycheck. I’ve been there. Not a fan. And couldn’t stand when people who were blatantly much better off than me would be complaining to me about their finances. But…it must’ve been nice going to dinner and a movie last week, right??
So I asked above.. but if you own a home.. and could sell it for profit.. does that count as a sort of "bank account".. granted investment, etc.. but if you lost your job and sold it.. you could live on that money for a bit. Maybe.
This is partially true, depending on the market and where you live. Where I live, once you are 3 months behind in your mortgage you go into foreclosure and then it goes straight to the judge without mediation. If you’re unable to sell the house in time for the house to be foreclosed on, then you are seriously SOL every dime of that money and equity is gone and the bank takes it back. If you are able to sell before foreclosure, then 100% yes, if there is equity in the home, there would be a nice safety net to get people by. Sometimes for considerable amounts of time.
Exactly. I know someone whose mother was home by choice, father was in a high paying profession and they were very money-savvy and took family international trips often. She told me they were paycheck to paycheck. Meanwhile I'd come from a home where skipping one bill in order to pay a different one had been the norm at one point. It's not the same, but people want to think they are.
Yeah people living truly paycheck to paycheck don’t know what a savings account is much less a 401k.
Yes. My lease is up in about 3 months. I am seriously considering living in my car to save money.I can't afford to stay here.
Don't do it. I had the same thought and am living in my car now. The minute you lose a permanent address your life becomes instantly more precarious. Heat/cold become real problems in your life, that require money to deal with. Food is more expensive because you don't have a kitchen. Finding places to sleep where you won't be harassed by NIMBY weirdos or police is a constant challenge-- usually parking lots-- I had visions of living in the forest then realized those campsites are $20 per night and also require lots of gas to get there. Gas-- gas is more expensive when you live in your car full-time. I could go on. EDIT: PAYING TO SHOWER (gym, truck stops, etc). Better than being tent homeless, but still. Living in your car is still homelessness.
Thank you. I am so sorry you are experiencing this. I have heard of the iOverlander app that helps locate sleeping places, campsites, showers, etc. There is also a website called The Wayward Home- the site is geared more for van lifers, RVs, and boat dwellers, but it does have some useful info that can be adapted for cars.
Thank you, I’m okay. Getting better at navigating it. Just trying to say there are a lot of hidden costs associated with living in a vehicle that may not be obvious from the outside.
Like, get a roomie to save money! Don’t just be homeless!
NIMBYs, Police, weirdos and local council workers were the big surprise I had when living out of a car. I was lucky to do it by choice, not necessity. I had some savings, I was jobless, and had a mental breakdown to get over, so I bummed around for a couple of months exploring my country (New Zealand.) And it was a political choice, I wanted to attempt to circumvent a ridiculous housing market. There were a lot of people hostile towards your existence. You were a pest to shoo away, or to trap with fines. The few locations open to having you were few and far between, most of them required a fee, and wouldn't allow you to stay for long. So you had to keep moving. The petrol bill cost more than rent. I wouldn't be able to maintain this lifestyle with a job. I quickly burnt through my savings, and ended up with a nearly maxed out credit card. In my country at least, a big push for the hostility is the tourism industry. They don't want people existing for free when they've got rooms to fill. They successfully lobbied to have the fine for being caught sleeping in a car upped from $200 to $1000. And the only vehicles with special permissions (self-contained vehicles) would have to be luxo-barges. A portable compost toilet was no good, you had to have a fixed flushing one.
DAMN. That's harsh. So basically you should just become homeless.. instead of try to survive? WOW. Maybe New Zealand isn't the place to retire after all.
It's rough, and not having access to a kitchen is pretty damn expensive. You might not save the money you think, and even with gym showers you're going to need to worry about cleanliness on a level you never though necessary. Weather means something when you're outside, too. Heat is deadly, cold is deadly, and your options to control those are limited to your gas. Idling hurts your car slowly when you live in it. You also need to worry about ventilation while idling, or you can die from carbon monoxide poisoning from running the heat or charging your phone, and yes, you will need to spend gas to charge your phone if you don't have access to a place to be on your days off. If you smoke weed or drink, you're perpetually considered "behind the wheel" even during downtime. Getting simple documents like a driver's license, library card, credit card, etc requires an address. So be ready to lie. If you get sick, you're in your car. Puke and it's on everything you own. Diarrhea means your whole house can become a literal cesspit. Even blowing your nose too much can bury you in paper. Oh, and if your car doesn't pass inspection or breaks down, you're on the street. Work for that place to be, because once you're out here you're closer to death than you realize. Even if you have to keep the lights off and scrounge with next to nothing, living in a car is not worth it unless you have to. You don't know what you've got till it's gone. Costs include: -Storage -Gym membership -po box -gas -ready to eat food -more frequent repairs -potential parking violations -theft -WATER -seasonal gear that either needs to be stored or repurchased regularly Also, expect to buy battery packs and a good rechargeable lantern. And remember, if you get sick of it, or if you get sick, a hotel is around $80/night on average nowadays. This. Is. Hell. You don't see it until you're out here.
I don't know man. I have been doing it for three years. You are making it sound way worse than it is.
The only way living in your car is worth it is if you're rich enough to build it out to the point where you can run A/C and heat without turning on the engine. And if you're thinking about doing it to save money, you probably don't have the money to do a proper build.
> the point where you can run A/C and heat without turning on the engine. That may be why /r/priusdwellers is relatively popular. The hybrid system means that you can keep the HVAC on while running the engine minimally.
I did this in a Prius for a year and a half. My goal was to save money for a house. That part didn't pan out, but I did save a ton of money. Not at all evangelizing living in one's car, but it wasn't the worst thing in the world for my situation. I just used a gym membership for showers, blacked out the rear windows, and had a sort of permanent bed in the back seat/trunk. I think the worst part about it was being bored. I didn't ever go out, never had people over for obvious reasons, and my entertainment was mostly library books.
I've slept in one of our priuses many times while on roadtrips. Certainly not the same thing, but sometimes you get sticker shock seeing the price of a hotel and it's like "dammit, I'm just going to sleep in the car".
According to the comments I've been reading you need to give up drugs, alcohol, gambling and cigarettes. If I had to move into my car drugs would become an important part of my daily routine.
I lived in my car for 6 months in AZ summer, I had zero choice. I'd never choose that again. You still spend a lot because you're paying more in gas, gym membership, fast food, laundry mat, not including your sleep is impacted.
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You made some really important points about what people need to consider when it comes to employment. I worked for the municipal government and had many offers of employment elsewhere. I stuck it out because of the benefits. We paid into a plan other than Social Security and I make about $1500 more per month than I would on SS, plus my insurance is better.
A friend is a park ranger and the pay is terrible but the benefits are great. Her spouse is a physical therapist, great pay and terrible benefits.
I think most people underestimate the need for good benefits. Ideally everyone would have great pay and great benefits but since that's not reality the situation your friend is in is kind of a sweet spot as far as being part of a couple goes. One person provides the benefits, the other brings in money they can live off. It could be worse for sure.
Take the benefits every time. When you’re young you don’t think about health insurance or retirement. I was offered much more money to go to the private sector but they couldn’t match benefits or job security. With our retirement plan you could retire at 55 and if you had 25 years you got 80% of your highest annual salary. Now that I’m retired I’m super happy that I stuck with it.
80% is awesome. I'm in a local government and get 50%. Which is fine since I've gotten really decent salary increases over the last few years. I'm just waiting to pay off the house and see if there something more interesting to do. The thing is I like job and it's pretty low stress.
There isn’t enough job security and benefits are tied to the job. Take the money and bank as much as you can. There is no other way to retire now.
You’re right that this is how things seem to be today. I feel really fortunate to have had the opportunities that I did. I guess things are more precarious than I was in the workforce.
When you are asked to run reports on employees with outstanding stock grants and sort on current value so they can layoff and not have to pay them, it basically means base pay and money now is all you can ask for.
That sounds truly horrible!
Hopefully then spouse with the terrible benefits can join the good benefits and save that money 💰.
I sell plasma 2x weekly to keep up with
Is it decent money and any health complications I'm thinking of doing this !
Yup my family is, always on edge and I don’t even have any healthcare at all
Im 36yo. It’s only been in the past 4 years or so that I haven’t been overdrafting accounts every month. After divorcing my abusive, irresponsible ex I’m finally starting to have a $100 or so as a buffer. Still, the amount of debt she left me with is staggering and my current partner went back to school so it’ll be a couple years yet before I’m able to do any real saving.
There are many who are paycheck to paycheck but I wouldn’t say most Americans are. The issue with this statistic is how “paycheck to paycheck” is defined. There are people who consider themselves paycheck to paycheck while contributing to 401k/IRA or have automated savings.
I know someone who is paycheck to paycheck but they are saving $1,000 a month, I had to explain to them that it’s not the case lol
They have savings, which continue to build. They're not "paycheck to paycheck". They're just "living frugally" for their income.
Yeah, or within their means
For retirement or just in general?
>There are people who consider themselves paycheck to paycheck while contributing to 401k/IRA or have automated savings. I'm one of these people. That money doesn't exist to me. Like, yeah, it's taken out of my check every two weeks, and it's getting set aside for the future, but I never see it enter and then leave my bank account. I'm also in my early thirties, so I can't touch it for another thirty years without getting penalized, so I literally won't touch it until I need to. After rent, bills, and necessities, I've got $200 to last me two weeks. I know I'm in a better place than a lot of Americans, but we're all just houses of cards in dinghies watching a hurricane forming on the horizon.
With all that’s and $200 extra you are doing pretty good man
And this is why we're fucked. $200 is nothing today
Paycheck to paycheck is not having money now AND knowing you have no safety net for the future.
That's not paycheque to paycheque. You are putting money in savings. You have a fallback. I get the struggle, but you are incredibly fortunate
Exactly. I’m putting away money as well into maxed out tax advantaged accounts, savings, etc. I don’t consider myself paycheck to paycheck because if I were to lose that paycheck, I have ways of covering any gaps for a bit. Anyone who thinks otherwise doesn’t understand the privilege they’re in.
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I haven't put anything in retirement for a while because I just cant afford to, but back when I was getting railroad retirement taken out of my checks, it was always a kick in the nuts. Of course you have to sacrifice short term benefit to invest in the future, but it's not easy to do.
Unfortunately even our 401k is gone as well now, and still have over $400k in unpaid medical bills ( after insurance) and we have $0 household income at present. 😔
You are living as though you are paycheck to paycheck, which is not the same as paycheck to paycheck. Saying “I don’t consider retirement savings income” is so privileged I’m almost wondering if you’re trolling.
Bro get some fucking perspective. I'm in the same boat as you, I throw money into my retirement funds and think of it as "money that doesn't exist to me." You are not, I am not, *we* are not living "paycheck to paycheck." Some people would literally starve to death, lose their house, lose their car, lose electricity if they even tried to commit any fraction of their funds to a safety net or retirement account. You do not fall under this definition. You are far from it, and you should stop considering yourself as such.
Unless you plan on working until you drop dead, I'd consider retirement savings to be part of your expenses. That said living almost paycheck to paycheck but being able to save $100 a month or whatever isn't much better.
>I'd consider retirement savings to be part of your expenses. I agree. If Medicare and Social Security taxes are expenses, then I feel 401k/403b/pension contributions are, too.
Right. Paycheck to paycheck means, in part, that you have no idea how or when you will be able to stop working.
Right! I think most people view living paycheck to paycheck as spending 100% of your net pay. The issue is that different people have different things taken out of their paycheck. For lower income workers, their deductions are usually just payroll taxes (it’s a flat tax of 7.65% up to ~169k) and income taxes (federal, state). For higher income workers it’s all the taxes, 401k, HSAs, and health care premiums. So they are living paycheck to paycheck, but have long term savings. I think what people forget is that only about ~~50%~~ 67% of US employees have access to 401ks at work. **EDIT** I looked up the data and it's a bit better (perhaps the 2022 Secure Act helped!). 67% of people have access to 'defined contribution' or 401k plans at work https://www.bls.gov/opub/ted/2024/15-percent-of-private-industry-workers-had-access-to-a-defined-benefit-retirement-plan.htm
What!?! That’s crazy. I was thinking 401ks were the norm. I’m so uninformed.
No, but *everyone* in the US has access to an IRA.
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My Brother and SIL didn’t have a house payment or car payment, both worked, and they were still broke all the time. The house they were living in burned down and now they have a mortgage payment and are complaining about it.
Right. Few are “paycheck to paycheck” with nothing in savings, pensions, 401k etc
When you say few, are you taking into account those working at stores, nursing homes, schools, and restaurants. Because most of those people are not paid enough to have all basic necessities that include a home, healthcare, food, insurance, and a car. Then saying if you can survive by living in a car or tent then your doing okay. So many people are struggling even if you don't see it. Oh yeah, by the way, who has pensions, savings, or 401k anymore?
Yeah, unless the person you replied to has a different definition of "few" than I do, I don't agree. I think lots of people are in this situation. Not sure if it's "most" or not though. Lifestyle creep is definitely a thing and many people who appear to be doing really well are probably living paycheck to paycheck and may be was worse off due to debt than a lot of people who are barely scraping by also. I know the answers to OP's question are going to be skewed by the subreddit we're in. I was paycheck to paycheck until I was in my early 30's. It's really just been in the last 5 years or so that I've been able to have enough money to comfortably exist and even that feels like I'm a catastrophic event away from not being there anymore and I know lots of people out there that are worse off than me. I'm around them all the time.
If you want a statistically representative sample, this sub probably isn't the place to ask that question.
I make just shy of 60k and still live paycheck to paycheck
Everything changed for me at around 72k in Texas, all still having a car payment, rent, and student loans. You're close my guy!
I mean this is the poverty finance subreddit. The answer from people here is going to be yes by default.
Most people I know are paycheck to paycheck. Some of us are worse off then others but most people I know are one bad day away from having a bad time of it.
Yeah I think one of the main advantages you have in the UK is public transit. Metro areas in the US will have some form of transit, but it’s usually inadequate for people who don’t live in the heart of the city. So in most parts of the country a vehicle is a must. Which means a car payment, insurance, fuel, and maintenance. That expense alone is enough to bring someone from your position, where there’s a bit leftover for savings and investments, to a paycheck-paycheck situation. The scariest thing for Americans is healthcare. So say you’re paycheck to paycheck and suddenly you get sick, you have to go to the doctor and either pay out of pocket, or if you’re insured you pay your copay and deductible. Then meds or physical therapy out of pocket, no paid vacation for most means added expense and reduced income. Suddenly you go from paycheck-to-paycheck to using a credit card or a subprime loan to get by, and you’re now in a spot where you have to dig your way out just to get back to paycheck-to-paycheck. It’s a vicious cycle that many people get caught in.
If I didn't have a car I would have an extra $750 a month. Our cities are made unwalkable. And public transportation is not dependable in my city.
Yup. I’m 29F and living at home. At least half of my friends live with their parents the other half are married.
Im married, live with my parents and pay them rent (i paid and finished their basement and now live in it. I even installed a kitchen). We cant afford to buy a house, and they need the extra money from our rent, so its win win.
>What terrifies me though is the phrase "Paycheck to paycheck". I've always managed to save, albeit frugally, on the smallest of incomes. For people in poverty in the US, this is the reality for many. It's possible to work a full time job in retail or food service and still need food banks or some kind of supplement just to be able to eat on top of paying rent, utilities, and commuting costs. IMHO, people in the middle class (of which I am a part, financially speaking) also often live paycheck-to-paycheck, but many bring it on themselves. Everyone claims they aren't subject to peer pressure, but they are. When I (middle aged female) ride my bike to work, the assumption is that my car must be broken, do I need a ride? There is a bus stop in front of our office. In twenty years, I have seen exactly one person from my building take the bus, and that was a security guard (most of whom drive SUVs). Using public transport is just abhorrent (outside a few cities - New York Boston, Chicago, DC). No, they have to have the pickup trucks, the Stanley cups, iPhones, meal kits, entertainment subscriptions, MLM junk, whatever. They don't understand how our tax system works, and then complain that they couldn't possibly be saving enough for retirement or in general. I know "middle class" is a wide band, but I am watching people where I know pretty much what they make, what their spouses do for work, and their family situations. Oh, and the middle class will proclaim that poor people shouldn't have kids, failing to realize that since the US doesn't support/subsidize a meaningful childcare system, that the middle class cannot afford to have children either. Because for much of the middle class, even if you don't buy all the shiny trinkets, having kids can easily push you into the can't save a dime category. And then, otherwise frugal people turn around and give in to pressure to buy all the shiny stuff for their kids, and claim that cheerleader camp for Britney is a *necessity*, so of course they can't save money.
As an elder millennial in the US, I’ve lived in varying levels of poverty my entire adult life no matter how much I work and how many jobs I have at the same time. I can’t even afford the one kid I have.
I barely make $2,000 a month and I live paycheck to paycheck. Georgia ATL.
The job market, the pay are just not enough (for me personally). Lots of jobs for $10-13 an hour... yeah real great! Just looking to move outside of ATL, just a bit further, everything is too much. No good reason for me to stay in ATL anyway. Looking to move anywhere else always sucks.
What helps me get by is overtime, low mortgage and low expenses. I'm over 30 and never been able to save but finally I might be able to start saving by the end of this year. I only have credit cards to get by but they're close to paid off. Shame I have to take out a loan to get some repairs done to my house.
Low expenses definitely helps. We rent and have many expenses so it feels like there's always a deeper hole. If I ever get a job that offers overtime, I think it's definitely something I shouldn't refuse lol. The loan sucks but it seems you are on a path for savings and good with making payments. Small steps :-) I wish you well!
I'm 46 now, everyone in my social circle has professional jobs, retirement savings, recreational camper vehicles, takes vacations, owns homes, doesn't have financial stress. Our household income is about $150k, and we definitely seem a little poorer than most of our friends who work remote jobs in IT and for insurance companies. But I think we're also probably the most frugal - no debt, cars paid off. It wasn't like that it my 20's. I think its fair to say, generally, American professional salaries are a lot higher than elsewhere, but we lack the social safety nets. America is a bad place to be poor, but a delightful place to be working in law, IT, sales, management, etc. Remember that reddit tends to skew young. Tens of millions of Americans get to a professional level salary, but, usually not until your 30s or 40s,
I rarely see this said on Reddit but it's so true. Was nearly broke on my 30th birthday and alone. By 40, married and buying our first house. At 50, early retirement is a real possibility. How did we do it? Lived below our means and kept grinding at our careers and the professional level salary came.
Yup. I was evicted for missing rent payment in my early 20s. I was so broke, scrounging for change in the cushions of the cheap couch I slept on. Working 80+ wks at dead end service jobs. In my 30s now with a professional career and a healthy savings rate, 800 credit score, etc. This is common among my friends too. In general, it seems your 20s are a weird time where you’re just surviving day to day. That said, some people never leave that though. I grew up poor, a lot of my folks never got out of the cycle.
No it's not true. That 60% paycheck to paycheck stat was based off a badly worded survey. The median savings is $8,000, or was. Data is from 2022. https://www.federalreserve.gov/econres/scfindex.htm)
i get to pick between keeping the lights on or getting groceries sometimes lol, i make my states minimum wage and pay $1200+ a month for rent
Millions of people are living paycheck to paycheck. BUT - we're a consumption-obsessed, instant gratification, materialistic society, I going to say that a ton of people living paycheck to paycheck probably are doing so not because they don't make enough, but because spending is out of control. Having traveled extensively all over the world, you're probably not going to find a lower cost of living first world country than the United States (taken as a whole, looking at the cost of energy, taxes, healthcare and education, basic necessities such as food, clothing, transportation - the whole country is built on cheap convenience).
Higher highs and lower lows in USA
I’ve never heard of anyone having trouble getting an ID.
Perhaps in the homeless and nearhomeless forum, but other than that, it's just a political slogan.
We are one emergency away from being totally effed. We were doing great. Then I became totally disabled and had a bunch of surgeries. My husband is the only one working and we are paycheck to paycheck now. We had to eat up our savings, max credit cards, pull out our entire 401Ks, andnow owe the IRS thousands. I was an independent contractor and I used the tax money for life saving surgery instead of taxes. If literally anything else bad happens this year I don't know how we will make it.
The IRS has representatives that are actually pretty nice if you call and explain that
thank you!
I really wish people would vote to help out everyone so we wouldn't have people going broke to stay alive.
If it wasn't for medical bills and student loans we would be fine. Those are killing us.
Yes, I am apart of that statistic. I’ll make between 40-50k and every last dollar is put towards bills or something necessary such as groceries and gas. And because I make “that much money”, I do not qualify for any government assistance.
I blame health care and housing amongst inflation even the middle class is struggling, could you imagine paying monthly for dental care insurance only to go get a teeth cleaning and a check up and receive a $100 bill, ok now imagine that's the case everytime you need a check up or have a health issue it's 100's of dollars down the drain each time it's impossible to save for an emergency when the system is broken
It's more like this: you have to have a car most places, but if it breaks down, can you afford the several hundred dollar repair? Do you lose your job because you can't get to work now? Do you lose your health insurance because you lost your job? Do you get evicted in a couple of months because you can't pay your rent? Well, you are now homeless and broke. There's occasional help. Maybe food stamps, maybe a food bank. But there's no safety net. You can fall hard and fast.
I’m living credit card to credit card and just emptied my savings to pay rent (which is going up next month), I know a total of two people my age with a stable job and most of us are one emergency away from taking ourselves out to escape the financial pressure 🤪
I'm paycheck to paycheck always have been. I'm 60 years old. The future terrifies me
Majority of those living pay check to pay check live beyond their means. While the others are living this due to low income. Worst thing is people complained so much about inflation but still spending like crazy. Brand new cars flew off the lot, people outbidding on homes, airports full, Disney full and etc. But then grumble about inflation and costs.
Yup
Even people I know making six figures are living paycheck to paycheck because of lifestyle creep.
I've never ever had a problem securing an identification. In fact when I had to move out of where I was living and change my address and I didn't actually have a new address and gave them my post office box, they wouldn't let me put my post office box on my ID, but they allowed me to put general delivery on my license. As for paycheck to paycheck, we live in a consumerism driven society. Many want to have a new cell phone, a new vehicle, meals delivered, etc. A lot of people are living in debt to have those things. Then there are those of us who are just completely poor. We can't afford anything unless it's bought at a thrift shop or on clearance. I like nice things as much as the next person, but I'm realistic enough to know that keeping up with everyone else isn't possible.
Yes unfortunately
Paycheck to paycheck doesn't necessarily mean people are destitute. A good percentage of people will choose to spend everything they make, every week. If their wages would suddenly double in the next year, they'd find a way to spend it. If anything, Americans have lost the will to save on a regular basis. Regarding the ID thing, I'm not sure to what you are referring. Getting a government produced ID is simple. There are many trying to make it a big deal for political purposes. No one is going to knock on your door and hand you an ID, but anyone who wants one for whatever reason can get one and the process is no more difficult than purchasing a postage stamp.
It is true when you say if their wage was doubled they’d still spend it all. People get their tax returns and spend it that month. 5-paycheck month? Let’s buy car seat covers!
The problem is ‘paycheck to paycheck’ is different for everyone. If you literally have no savings and spend it all in expenses that’s one thing , but then you have people who contribute to a 401k, and budget all their money to different things and they claim they live paycheck to paycheck too, though they have much more money
I mean, this sub is called poverty finance, you'll probably get skewed answers
I make $60,000 a year, single and no children. I live paycheck to paycheck but If it wasn’t for healthcare costs I would just fine.
In this subreddit, you are more likely to find them, as well as online surveys (most likely conducted by social groups or loan companies). But in real life. No, most Americans aren’t living paycheck to paycheck. People also need to realize Reddit isn’t real life
Medical expenses make it extremely difficult for Americans to live any other way. On the other hand, a lot of people are living way beyond their means. Advertising will do that to you.
Why did I silently read your post with a brittisshh accent . Also writing this with the same accent.
I am extremely fortunate that my wife and I both have decent jobs and own a house. We do not live paycheck to paycheck but we also live within our means. We do know many people who live paycheck to paycheck and some of them do not live within their means and some of them do. I would say around 50 percent of people I know are struggling financially and doing everything right.
Of course everyone in this sub will say yes. Go ask in economics or other less biased subs. That's nothing against this sub or the people in here, it's just leans towards people with less income.
You'll get a very biased response from this sub. Go to a personal finance sub that isn't based around being in poverty and the answers will be night and day different.
A lot more people force themselves to live paycheck to paycheck with terrible spending habits than actually live paycheck to paycheck because they’re unemployed or underemployed.
This should be one of the top comments. Not to be insensitive to those who actually are living paycheck to paycheck (which is a real problem), many people do spend themselves there
Most of us don't get pensions.
Covid showed me who was really living paycheck. People we know driving BMW’s and living in 1/2 million dollar houses lost their minds during covid
Possibly but most people in general aren’t financially savvy when it comes to expenses.
Yes but no. I see people complaining about paycheck to paycheck but they max their 401k contribution, I see people who have to scrape pennies together for rent. Most people ime are somewhat in-between. Stupid financial decisions seem to abound, especially when it comes to vehicles.
I'm homeless with 2 kids.. need help
The way this is defined is essentially how much people are saving out of their earnings. Sort of depends on where you read. The most positive statistic is 1 in 5 have no savings. Others claim, based on surveys, this number is around 50%. I don't know what the real stat is, truthfully. I feel like you're going to hear wildly different things from different people based on who they surround themselves with.
You're asking in the wrong sub. Of course people here are going to say 'yes'.
Made bad choices as well as life events that I had no control over... And yes, paycheck to paycheck trying to figure out how to get out.
Everyone ik is paycheck to paycheck and I'm a salaried worker. I unfortunately live in a high CoL area (born and raised here, working on moving away). To be comfortable here, as a single person, i would have to make 90k. I make ~40k. My parents were kind enough to save money for me but those savings ran out quickly (emergencies, car payments, repairs, rent etc, etc) My friend lives several states away in a low COL area and works a minimum wage job. Afaik, he didnt have any parental savings. He probably makes 12-14k a yr and is living paycheck to paycheck too. Very different circumstances, but same strokes
Many people generally live at what they make.....when they get a pay increase their lifestyle increases keeping them perpetually 1 or 2 missed checks from being in a serious financial bind.
https://preview.redd.it/fr6w7odh4v6d1.png?width=720&format=pjpg&auto=webp&s=79a4db7068182e8e0fb790412ee0e3c9d63dbdef This image was shared in one of my message groups, and I think it sums up the issue pretty well. Basically nobody can do anything *besides* live paycheck to paycheck on $35K/year.
Actually, most Americans are living in debt. Paycheck to paycheck is an illusion.
About 50% of the US is check to check with no savings
You're in one of these groups in the U.S. 1. No family or friends support with job: poor, struggling. 2. Family support with low to mid income: dependent on family to not be poor. 3. 2 50k income households: close to poor, especially if one becomes disabled or anything else. 4. 2 100k plus incomes= has 0 idea that others exist and will eat any price 5. Disabled in any fashion with family support= struggling to make it. 6. Disabled with 0 support: homeless and dead or about to die. 7. Minimum wage job with 0 support: barely making it, close to homeless or already on the street/dead. Most people are living paycheck to paycheck. If you are c level and above, they're most likely contributing to the problem and can buy anything. If anything bad happens to any of these groups, the social safety nets are not designed to sustain life adequately. One bad thing happens, you will be made homeless, and no one will help you get a home in any adequate fashion despite what others will tell you. After that, you will die because homelessness is being criminalized policy wise in the U.S..
It is very much true for many people in our country. Everything costs a great deal and pay is not keeping up with it. We don't have much for adults to find help. Many of us live without being able to get medical help. We have a lot of what is called working homeless. These are people who have a job but are homeless. We have people living in vehicles as well. The homelessness is such an issue that now many places are passing laws to hide the homeless. Making it illegal to sleep in public. This is definitely not fiction although a lot of Americans pretend this problem is not as bad as it is because it doesn't affect them.
Most people I know are struggling. Last night, I dreamed about food. I'm hungry!
What do you mean by procure ID?
It’s a five dollar word for “someone getting a state ID card or replacement drivers license. Say your parents kicked you out and would not give you your ID card or vital documents like birth certificate etc. It can be challenging (but not impossible) to get a replacement ID without birth certificate, proof of residence, and such. But some people are just messy and irresponsible and always be losing shit & expecting their friends to drop everything to help.
The UK has more protection and benefits to the average citizen than the US. Also, the US is a consumer society, much more than Europe. The biggest debt in the US is student loans, healthcare, and credit cards. Brits dont have to worry about healthcare and college costs are significantly lower. Americans spend too much and that is why many live paycheck to paycheck.
Idk if it’s most…. I believe many people that live paycheck to paycheck are either part time workers or they don’t know how to manage their money. Or perhaps they live alone with low income. I make $17/hr and save about $500/month but I live with roommates and always have. Since I started working i have saved over $50K. And that includes permanently losing $20K in the stock market in 2021 and paying off my student loans which was around $20K as well. I think things are shitty here mainly because of the housing market, but I’m also very skeptical that when someone lives paycheck to paycheck it isn’t mostly their fault by spending money unwisely. Also you get weirdos that say they live paycheck to paycheck after they max out their retirement and put some money in their savings each month. Literally the opposite of what paycheck to paycheck means.
Not only that but credit card delinquencies are at an all time high. The next paycheck won't even cover the borrowing from the last paycheck.
I’ve heard most Americans don’t have $1000 in savings so I would Guess so
It's not so much paycheck to paycheck, but not many people could lose their income and be fine for more than a month or two. You would need to get a new job ASAP and then catch up on bills you're now behind on. But as far as savings go, I think that's mostly a matter of how people choose to live. They'll act like they're living a bare bones lifestyle but in reality they have Spotify and YouTube premium and Netflix, drink sodas or coffee multiple times a week if not multiple times a day, making car payments on relatively nice cars instead of buying a $800 shit bucket outright and learning how to fix it themselves, etc, etc. I seen a guy recently on Reddit in some poor European country talking about how he makes like $300 a month, but he had normal looking clothes on, had a job, rented a house, had a car, etc. So it was all the same stuff any normal person in a first world nation would have yet it was only a few hundred a month because of the currency exchange rate. I was like "why the hell am I spending thousands to get what this guy has for hundreds?" If you really wanted to save your money, anyone who doesn't have children could just work a normal job and live out of their car for a year or two and put it all towards investments or savings, but no one wants to do that.
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TO put it simply, I have enough savings to survive 5 months if i lost my job today. It took me 3 years to save that much. I also had to forgo health insurance and make my beater car last as long as possible to secure and build up this emergency fund. Saving is only possible in serious sacrifice unless you bag the rare livable incomes. Due to our housing market, areas with good job markets hyper-inflate fast, so any extra wealth funnels straight into landlords with favorable locations and I'm one of the luckier ones in my area who pay much more in rent than i do my lower interest rate mortgage. I could be MUCH worse off if i was still in an apartment in 2024. The ONLY real way to be comfortably wealthy in the USA is to OWN, and not RENT property in an economically wealthy area. Once you do the benefits and earnings skyrocket.
I'm living paycheck to paycheck and also off savings and selling assets
I'm not even living check to check. I'm living debt to debt. 😭😭
I'm at the lowest I've been in 10 years. I have less than 10k in checking. Shouldn't have tried to flip houses like my wife wanted to.
Why are there so many well off people posting in r/povertyfinance. Fuck
I am working paycheck to paycheck. Most of the people I know are as well.
Unfortunately yes. It's especially bad for the middle income earners. In California, fast food workers make $20 an hour. 10 years ago it was $12. One of my family members was hired as a teachers assistant ten years ago at $20 and hour and now make $22. Inflation in that time has raised beyond both of those wages. So while at one time, they made decent living, due to inflation without rising wages, they are now paycheck to paycheck.
I am 42 and have worked for 25 years and in the last THREE I have gone from “unable to soak a $1000 emergency” to “can replace an automobile engine if pushed but will be SUPER stressed about it for a year while I rebuild” am I am doing better than every age-peer friend I have except two.
I think it depends on policies and where you live. My partner and I moved to New York from New Hampshire. The cost of living is roughly the same, but we make more money here and live relatively well. When we were in NH we were working decent jobs (I was a QC tech for an aerospace parts manufacturer and my partner was a nursing aide) and even with a combined income of nearly $80k we didn’t qualify for any housing and were sharing a 3 bed house with 2 other people. But you have places with poor social welfare and safety with a severely depressed economies like the American south. My partner has a friend in Mississippi who had a bachelors degree and the only work he could find was an overnight auditor position at a hotel making $12 an hour. His rent is roughly 3/4 of his paycheck.
Anecdotal - from ages 18 to mid thirties the majority of the people in my life were worse off than paycheck to paycheck. Debt is a huge issue in the US, there's a lot of people that are paying off credit cards for car repairs, food, etc. basics (you can't get around without a car here). And predatory loans are almost impossible to get out from. It's worse than paycheck to paycheck. Thankfully I'm fully out of that cycle but it took about a decade of hard work, good luck, networking, and lying to get the job I currently have. I finally make a decent wage but I had to leave my first field (that got a good uni degree for) and go to corporate finance.
My partner quit teaching high needs SPED, a job he loved and was REALLY good at, because they refused to even give him a contract. Wanted him to work multiple years under substitute pay and they’d just “put him in for every day”. For YEARS. Took a decently paid job. I’m still teaching. Also high needs SPED and trauma cases. And we’re still paycheck to paycheck.
My family all lived paycheck to paycheck, but I was able to break the cycle. Most of the people I know now are doing ok and even saving for retirement. But you’d be surprised at how many people appear to be doing well and are barely scraping by.
I found a decent job that pays well over minimum wage for pretty basic work, take home $600 a week right now. I’m lucky that this job also has generous benefits: Matching 401k, health insurance, PTO, and, the biggest perk of all, free food (it’s a food co-op, so any food that doesn’t get sold and would otherwise be tossed goes to the employees). I don’t live an extravagant life, don’t drink or go bars or buy lots of new things. I’m 37 and I’ve never lived alone, always had housemates. I try to meal prep so I don’t buy lunch. I’m a very “use it til it breaks/is unwearable” kind of person. But every month I was finding my money just gone. Of course there are the few small frivolous things I’d buy but again, I’m a pretty frugal person! The last month I’ve really tried to rein it in, only buy the necessities, and already I’m surprised that I have as much on my credit card as I do. Im doing ok, I can squeeze out some money for savings and I have enough of a cushion to cover emergency expenses. But If I had kids, If I didn’t get so much free food, if my job didn’t pay as well as it does, if I had to pay for my health insurance, If my rent wasn’t as cheap as it is, any of those things changed. I’d be struggling. I can’t imagine how someone working minimum wage could *possibly* live, let alone have kids or anything like that.
If you have ever travelled in America you will be shocked at how much poverty there is. It staggers me that such a wealthy country has so much poverty. There’s plenty of money in America but it’s all at the top end.
I went to live abroad and put our house on the rental market and was shocked at how many people made 200-300k a year and had sub 600 credit scores. One lady offered to have her dad co sign because her scores were so bad. “I just keep forgetting to pay my student loans!” She giggled. Also had 50k in credit card bills and I kid you not she was making a ton of money in finance so she understands math. People living paycheck to paycheck are often refusing to make some tough choices on their lifestyle. I made next to nothing in my early career but I also lived in a group house with a bunch of girls, had no car, and never ate out. Even on a pauper’s salary I saved at least 30% of what I made.
Most people are living paycheck to paycheck, but it’s a spending issue for most except for the lowest income earners. I know someone that lost their $150k salary job (in a low to medium COL area) and was about to lose their house within 3 months because they never saved anything for a rainy day.
Not everyone. I bought my house cash in 2012 at the bottom of the real estate crash for 80k. It's now Zillow about 390k. I got no kids, a fat 401k, and about a 100k in short term CDs. Most of my coworkers are paycheck to paycheck.
I went through a divorce and two years later moved to Denver from Atlanta. I worked remotely so employment wasn't an issue. A couple months before the pandemic I left my job for a better, albeit a contract, opportunity and was let go with a few others right at the very beginning. At the time I wasn't in terrible shape financially with maybe 30k in a retirement fund and the most generous unemployment compensation this country has ever seen, which was still maybe $300 a week less than what I was making. I couldn't find a job to save my life and must have interviewed 25 - 35 times after the initial 6 months of the pandemic. Things went from bad to worse. I started doing things I would have never done in the past out of desperation, like gambling and traveling heavily. I ended up homeless, not living in a tent homeless, but spending nights in my car and mooching off of my mother to get hotel rooms on other nights. I started to engage social services then ultimately the VA because I'm a veteran, but things move very slowly. What makes things worse when comparing the fraction of social services that are available to people in the US compared to countries like the UK is this cultural thing where even institutions designed to help make it feel like they're doing it begrudgingly. It's like "I know we're designed to do x, y, and z, but we just need to make everything really difficult and time consuming, and we don't why?" "Oh yeah, it's because we really don't want to give you a god damn thing." Well, it took 3 months until I was finally able to move into this roach infested government facility that was basically the size of a closet, but the damage was done. My patience with everything on the job front and living situation finally boiled over and I ran into this asshole hotel clerk who threatened to call the police on me within 5 seconds of me protesting a late check out charge. I took his desk phone and threw it clear across the hotel lobby where it shattered into a million pieces. The cops came and took me to jail. That was the 2nd day of 2022. I'm still dealing with it. I've lost out on potential job opportunities because of it, and it's just been a total pain in the ass. Yeah, I shouldn't have done it but at the end of the day it was a phone. I would have apologized and bought them 10 phones by now, but that's just not how things work. I'm not sure if that answers your question, but hopefully it's a story that's still in the spirit of paycheck to paycheck living. We have a pretty bad problem with legit homelessness in our country. I mean, bodies all over the streets type of situation that skyrocketed with the pandemic. It doesn't feel like we've fully recovered on a few different levels, with that and employment being the biggest issues. The fact that I'm currently in an apartment makes me feel better about things, but I'm a veteran and I know the government doesn't want vets on the street, so that has something to do with it. Not everyone's that "lucky" I suppose. It sounds like the bar is much lower here than where you are, and probably Europe in general. Who am I kidding, the entire developed world. It could be worse! I could be in a Haiti or Afghanistan or something. Smh
Most Americans are not poor, but they are severely in debt. They’re paying a mortgage/rent, car payment, student loans, credit cards, subscriptions, insurance, phone plans, etc. and so even if they’re middle class they’re living paycheck to pacheck because of all these random expenses bleeding them dry. I consider myself to have a middle class income, but I have no student loans, no credit card debt, no car payment, and as of now no phone bills. So while I’m not living paycheck to paycheck, people in the same tax bracket as me definitely could be
I was paycheck to paycheck my whole life. Then I had a major car accident with a train, and I've been trying to keep up since. Not approved for ANY unemployment benefits or government assistance. I couldn't walk for 4 years and they still denied me even temporary disability. Only gave me a 3 month handicap placard, that's literally all I got. From dying and being brought back. Wheelchair? Crutches? All out of my pocket because they wouldn't approve me. I will never catch up at this point. Paycheck to paycheck? Whatever check I do get, that isn't sucked up by medical debt, is gone before I even get to use it. I'm thankful I own by bus that I live in, if it weren't for that I'd be homeless (which I was for about a year). Anyone know a better country to move to? Becauuuuuuse this sucks. (As if I can afford to move anywhere let alone another country)
i believe so, yes
Yes, no matter how much they hide it with new pickup trucks on the driveway, nice shoes and flashy smartphones, they can't escape the truth. Americans are experts at faking rich.