I've had this discussion with many of my friends and colleagues. It seems like most people live pay cheque to pay cheque which is why services like Afterpay are so popular.
Thoughts?
Do Most People Live Pay Cheque to Pay Cheque?
lightfoot on 11/06/2021 - 14:16
Last edited 11/06/2021 - 15:47 by 1 other user
Last edited 11/06/2021 - 15:47 by 1 other user
Comments
They asked what most people do. The answer to that question is not relative.
Probably OP's mum
Most people can't be grouped into a single demographic?
How I am supposed to be able advise on behalf of most people?
I'm my immediate friend/colleague circle (early 30's) many of us have mortgages and don't struggle.
So I can't relate and need to say it is relative, everyone has strings of different lengths.Wow insane the down votes on Xetrok. Insane, because they can pay their mortgage, they must be a rich monster. Wow.
Anyway, as I also can't conduct a large sample size poll and am instead just a participant. No, I'm not, I wouldn't be comfortable in that situation, so I've done my best to avoid it, others aren't so lucky. People talking about bringing it on themselves, sometimes you can do everything right and still not succeed.
@conza: When I saw the downvotes, I was like, why?
My statements were pure logic - I realised it's ok because people's emotions aren't logical and many are going through tough times.It's interesting because my upbringing was in the lower socio-enconomic demographic.
I lived at home until I was 26 saving, moved in with a friend and rented a room from him (continuing to save) until putting a deposit down on an apartment at 29.
I was able to attend university thanks to a CSP. I obtained a graduate job and progressed within the company (been there almost 10 years).
My entertainment is online gaming so I don't have massive weekend/entertainment expenses, I allow myself a holiday or 2 each year depending on how expensive it is.
My friends and I play boardgames, watch movies, group dinners etc rather than go and get shitfaced.It's like I said everyone's circumstances are different, I could very well live paycheck to paycheck if I lived some crazy party lifestyle, if I made different choices or had something occur that was outside of my control.
But pay cheque to pay cheque is relative. How big is your pay cheque / piece of string?
What's most?
5%, 50%, 95%
If you think it's 50%, so you think 50% of the people in Australia would immediately be behind on their payments as soon as they lose their job tomorrow?
What if they stop their gym, netflix, disney+, flagship model phone plan, etc lifestyle commitments?The point is, some people brought it on themselves.
But how many did that? How long is a piece of string?
I just checked, 34.3cm
A hard 34.3 or a soft 34.3?
So that's how long your piece of "string" is?
I'm not sure if I should be sad or happy for you.The fact that it's referred to as a 'piece of string' means you should be sad.
it's a poll
I live OzB deal to deal.
OzB people most likely don't live pay check to pay check.
Afterpay is like a credit line without credit checks so a lot of people who can't get credit can take it up also. It isn't new. Harvey Norman BNPL interest free have been going on for ages, except you need a credit check.
Afterpay makes money from the companies (8% or there abouts), the companies increase their sales (so that is the theory).
What value did your comment add to netjock's comment? "Absolutely nothing" is the answer.
Be your own boss, learn TA and WFH.
TA?
Tight-Arseness
T & A
Technical Analysis?
I had my tea leaves read last week. It was significantly more useful than Technical Analysis.
@kipps: If you want a real laugh, read the sites that do TA on crypto. They up them every hour with their new floor analysis….
@serpserpserp: most TA can be summarised as "can go up, but might come down. if it goes up a little bit it will go up a lot, but if it falls some more it'll fall a lot more. i also see this dinosaur pattern and i think we are about to hit the neck take off, but i'm not sure if it's going to be a long neck dinosaur or a pudgy one"
I live my life…
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1 quarter mile at a time.family
NOS
I need NOS
la familia
I forgot about my brother for 8 movies…
I'm waiting for the mother to show up now. Maybe she can explain how she raised a petrolhead criminal street gang. 🤔
@Skinnerr: followed by the sequel which explains it was all because their father abandoned them as kids and now, as a family they must track him down……. in space.
@dny: I'm glad I'm not the only one who the directors/producers of the show are taking the piss.
Let's hook parashoots to our cars and drive them off cliffs……family.
@jellykingdom: I was getting myself confused as I thought Helen Mirren was the mum.
It's a shame Betty White is getting too old. She would have been good in the role.
ohana
Doesn't matter if you save a cent or save a dollar. Saving is saving.
What's the retail on one of thse?
More than you can afford pal, Camry.
Granny buying, not double stacking like you're supposed to
Streets closed pizza boy, find another way home
Bullshit, (profanity). No one likes the tuna here!
I like how bullsh*t isn’t a profanity 👍 LoL
we are using metric system :-|
I live my life 402.336 metres at a time just doesn't have the same ring to it
It’s been a long day without you, my friend
And I’ll tell you all about it when I see you again
We’ve come a long way from where we began
Oh, I’ll tell you all about it when I see you again
When I see you againr/angryupvote
Truth be told, i've always wondered that myself. I'm not trying to brag, but for e.g it wasn't a monetary concern for us when my car got written off when someone smashed into the back of me, and we had to buy a replacement - obviously the insurance only pays for the market value of the old car, which meant we still had to fork out extra $15k for the new one. We simply went out on that weekend and bought the new car that we wanted/needed with cash. It was hardly a flashy car, and we don't want to be splurging $15k every weekend, but there was no worries about having money to buy food the week after.
But then i know friends who are similar positions/experience/occupations, and they still share a flat with people and have car loans etc. and i don't really quite understand where all their money goes. Maybe they just don't understand that paying off the car loan ASAP is a good idea? I doubt it, but maybe
I work with people who also anxiously await being paid every month. I think it's death by a thousand cuts. They buy lunch and coffees every day, $80/m phone plan, drinks and Ubers every weekend, never shop around for utility bills, brand name clothes etc. The worst hobby financially is definitely having a fancy car, with constant mods and upgrades.
I wish more people being like that. Those are the people who propel economy
And then take from it when they don't have a **** cent to their name one day, and need to be taken care of by the government right?
They will never be able to abolish the pension and support scheme [not in our lifetime anyway] as there will always be those, that know the government will have their backs, so its spend spend spend.
@TilacVIP: It’s a delusion to think that people “save” for pension. Always it’s the current generation that cares for both the previous and the next.
If it’s easier to digest, you are returning the debt you’ve taken in your first 15 - 20 years.@srr: As much as your opinion in that they don't. Numbers don't lie, but your opinion is your own, as mine is, but no one cares.
@srr: Well the act of 'saving' is more like deferring consumption to a later date, and paying fiat currency to the working generation at the time of your retirement to produce those goods and services that you deferred consumption of earlier. Hopefully they then use that fiat currency to build up a bank of deferred consumption for themselves when they retire.
@Dogsrule: Think of money as a promise. Every time someone promises to do something in the future money is created (very simplified). This is how economy grows. Consumption is the act of fulfilling promises. You can delay consumption, but someone in the future needs to still trust promises made long ago, and willing to fulfil them. If there many promises around, but too few people to fulfil them, promises tend to lose value.
Now think of one generation that produced promises to each other, but haven’t left any children. Their promises now worth nothing, because there’s no one to fulfil them. They probably need to start immigration and share their land.
Or another example where trust in promises was eroded by guarantor (state), but there’re still new generation. Through taxes state redistributes part of the promises towards older generation, that’s your pension.
Or in case of Australia, where everything is more or less stable, people have a luxury of choosing to delay consumption or not. If you’re not delaying consumption, you’re growing economy and deserve a share of that growth later in a form of pension. If you delay, you may have a better life later if there still be people around (maybe immigrants) to take your money. In any case, new generation will be providing goods or services to the older.
@TilacVIP: This is an incredibly simplistic and selfish view of government financial support. If you choose to believe the Current Affair type garbage that everyone is a dole bludger, that’s your own ignorance. I work with incredibly disadvantaged people who have no other option. The are the last in a line of intergenerational trauma and poverty, how tf are they going to get a job when there are far more people looking than jobs available? What happens to them when they’re old? We just say “nah f you, you’re poor, you can just go die in a gutter”? Get real mate. Can’t believe someone with this lack of intellect is even on ozb.
@TilacVIP: Wow, you called him dumb and backed it up by saying you think he's dumb, and used that circular logic to talk down their intellect? That's not as clever as it might have felt.
If you have actual reasons to disagree with the points they've made, you should be able to refute them.
These are also the people that tend to be tax negative to society after 'Social Transfers in Kind'.
I don't wish more people were like that.
constant mods and upgrades.
what sort of insurance companies cover these vehicles?
Most will if declared.
@Presence: Oh okay. didn’t know that :-)
Btw did you mean for cosmetic or including performance mods like engine tuning etc. (just curious)
I don't think coffee and Netflix is going to make you poor or hold you back financially. The biggest deciding factor to wealth and financial comfort seems to be living situation.
Where do you live? How high is your mortgage? Did you buy your home with every cent you had or did you save up a ton of cash first so you have a nice safety net?
These things tend to determine wealth. As an example, my co-worker is 9 years older than me, earns about $20k more than I do. She is struggling with a mortgage for a run-down apartment close to the city. The way she lives is a safety hazard. Her kitchen is older than I am and filled with asbestos. She needs to budget for every last $ she spends, even at the vending machine. Her car is barely road-worthy.
By comparison I'm much better off. I have a brand new home with all the latest and greatest. I own a nice car and can afford to eat out a few times a week. I have some savings in the bank.
The key difference? She moved out when she was 18, never got a chance to save, and chose to live in the most expensive areas of Sydney. I shared living expenses with my parents until I was 27, saves up throughout the years, and then built a home in an affordable area out in the suburbs, 40kms out from the CBD.
Granted not everyone has the chance to live with their parents for that long, but many do and refuse to take it. And their first venture into the property market is among the country's elite in one of the most expensive cities in the world. There are some better decisions to be made.
it's more so the mindset rather than any particular discretionary spending. some people gets into a habit of spending all they earn from young. it starts off as just coffee and netflix. then it's odd meal out because you're too busy working. and then a few nice dinners per week to reward yourself. before you know it you're paying off a 100pm newest greatest phone plan, car loan, credit card debt and the list goes on
@May4th: I agree, it starts with "Netflix is only $10" then "Spotify is only $10" and then "Disney+ is only $10" etc and it goes on (note I have no idea how much any of those services cost), it all adds up, but there is a lot of discretionary spending that these people live pay cheque to pay cheque could cut out and help build some savings.
@Nebargains: I think it's more of the addiction or lack of discipline that adds up. You're not far off the price of Netflix and Disney. They're cheap. Cutting them out of your budget will make a big difference to your lifestyle (if you watch TV) for minimal gain.
Netflix is like $200 a year.
I'm pretty eager on my paycheck every month too - but at the same time I budget and am able to save significantly.
First thing I do every paycheck is put aside my money for my savings and bills/recurring expenses. I know roughly what my standard expenses are and the rest of the money is my play money. Going out, spending on hobbies, buying clothes, coffees or anything really.
Sometimes there's a bit left over at the end of the month, sometimes there isn't. I'm technically not poor or broke at the end of the pay cycle, but because my money has already been allocated towards savings etc it can get a bit tight, so I tend to be a bit more frugal towards the end of the pay cycle.
Yeah, it's interesting to see. I have seen manager's of mine who would have been on $200k+ who are living pay cheque to pay cheque. I haven't ever done that since I started working part time at 17 on close minimum wage and am now 38.
My wife and I have had this conversation recently. We look at some other people our age and they have nicer houses and nicer cars and we wonder how the afford it. We can only assume that they're just not saving. We drive a Hyundai - which we did actually buy new - but we'll keep it for a decade until it's no longer reliable or financially sound to maintain. We have a small-ish free standing house - but it's paid off. When I say that we can't afford something I actually mean that we don't think it's worth the dispisable income - not that we literally don't have the money available.
Do most people live pay check to pay check?
Most people do, and most people don't.
A demographic may appear that way, but if that is all you see… then that is the impression you may infer many others within the demographic are like that too.
When I worked retail, lots of lifers were living paycheque to paycheque. If you're making award rate and live alone then your living expenses and rent will eat a substantial amount of your pay, so there's less to squirrel away. I personally use Afterpay, Zip, etc., for the promotions, not because I 'need' them, but I suspect a lot of people who do, tend to be younger, with less reliable income so it's easier to spread the cost over multiple payments.
I can understand Afterpay, But I am still stunned that people are sucked into Zip pay, a credit card has cheaper interest.
Zip Pay is actually better than AfterPay.
I don't use either, but I thought Afterpay didn't have the horrendous interests rates of Zip?
@gromit: Zip Pay has a fixed $6 monthly fee, it works out to be about 5% if you keep it close to the $1500 limit most of the time. If you don't, it obviously goes up. If you pay it off each month, you don't pay a fee (kind of like an interest-free CC). I find it much preferable to a CC, though I wouldn't mind a higher limit (not huge, but maybe 2.5-3k, sometimes I want to make purchases bigger than $1.5k on it (and I usually only use it for promo reason like cashback etc).
@barcer: exactly, it has a variable interest rate that is only reasonable if it is maxed out and you pay it off in full rather than over months like most people use it. If you do something dumb like buy a $1000 item and pay it off in $200 or $100 a month installments you are paying insane rates. They would not go for a higher limit without a fee increase as it would cut their huge profit margins.
@gromit: So when you get the deals on after pay can you pay it off all at once and avoid charges like a credit card?
@BluebirdV: yes you can. at least I could the only time I used it. I made all 4 payments the day I did the transaction.
Anecdotally, I think it depends a lot on the demographic and area you work in.
I know a lot of people who work at my local gym that live paycheck to paycheck. But it's hard not to - working casual with 3-4 shifts a week, you're not going to make a lot of money from that.
Friends who work for government though? They all seem to have a fair amount of savings, although they are also older and because they work for government they also tend to be more conservative.
Statistically - not sure what the answer is.
Do you really reckon older govie workers are more conservative? I thought we were all a little to the left, since it’s the tiny bit of socialism remaining that keeps us employed (and the public with services).
You can be left politically and conservative financially. I don't think socialists waste their money more often than capitalists?
Yeah, I’m not sure that the traditional left vs right, liberal vs conservative makes much sense anymore.
if you own apple products, use afterpay, and into 24months mobile phone contracts, then yes you willl
I use AfterPay purely to take advantage of promos. I wouldn't buy anything on AfterPay that I couldn't afford to pay cash for. Although I don't own any Apple products, and my current phone I bought for $200 outright.
I use AfterPay purely to take advantage of promos
what promos do you speak of?
I haven't seen any great promos from AP on ozbargain, other than ebay codes (which you of course use mainly gift cards to pay)
Check here:
https://www.ozbargain.com.au/deals/afterpay.comAlso the current eBay promo has removed the ability to pay partly with gift cards.
@barcer: I don’t know when ebay promos have removed the GC option coz nearly every single eBay deal I’ve gotten with the promos is fine, and I don’t have AP.
As for the other promos, they are mostly one off, first online purchase or referral bonus.
I’m not keen on signing up to everything just for one off referral only, or I’ll end up with a tonne of one of companies with my details just for a few bucks.
Latitude pay in the other hand has given $20 for catch, kogan, DS, Youfoodz Harvey normal and JB and continue to offer bonuses all the time. These recurrent offers is what attracts me.
I signed up for the $30 referral bonus. I've sent numerous referrals to friends + family.
Plus occasionally they have some decent store promos.
Gonna be a lot of smug "well I save all my pennies as I'm savvy, unlike those coffee-sipping plebs" here.
The truth of the matter is that it's a huge problem for many people, most of which aren't living some sort of bougie lifestyle well above their means. Underemployment, stagnant wages, increases in costs, rents, etc., all have an impact.
For me? I'm fine. But I also recognise that I am in many ways privileged, with my experiences, skills, choices, etc. I have never had to struggle fully, even though I've had barriers. This doesn't make me better than others. Just luckier in many ways.
A quick Google shows anywhere from 38%-50% of Australians living paycheque to paycheque. Pretty massive, and certainly worrying, no doubt adding all sorts of stresses and anxieties.
What a simple minded view of the world
Poor people are poor because they make poor financial decisions
This is a gross oversimplification. Most of life's outcomes, while seemingly self-deterministic, are biased before we're even born. In the same way wealthy families stay wealthy via inter-generational nepotism, education, or outright gifting money, being born into a poor family stacks the deck against you. If you grew up knowing more drug users than university graduates and went to a crap school (which hit you with HSC rankings), then your chance of success isn't great. Then there are subtler things, like the fact your parents probably didn't instil good financial lessons early, or teach you how to invest money because they didn't have any.
And for anyone who says 'yeah, but I grew up poor and bootstrapped myself into 17 properties!' look at the data. Your family is the single most significant determinant of success… and it's a dice roll. Ugandans aren't poor because of 'poor financial decisions,' Ugandans are poor because they were born in Uganda.
How long is a piece of string?
Everyone's circumstances are different.