Joneses http://www.wisebread.com/taxonomy/term/12289/all en-US How to Be Upwardly Mobile http://www.wisebread.com/how-to-be-upwardly-mobile <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-be-upwardly-mobile" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/2420762006_e65ee25e5d_z.jpg" alt="spiral staircase" title="spiral staircase" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>For those of us in our teens, twenties, and thirties, we like to believe the world is at our doorstep. While many of us appreciate the lifestyles our parents offered us while growing up, we are constantly striving for more.</p> <p>This is known as <em>upward mobility</em> &mdash; the ability to go beyond your parents&rsquo; social and/or economic class and potentially live the life you&rsquo;ve dreamed about.</p> <p>Unfortunately, as an <a href="http://www.startribune.com/nation/161873625.html">article in the Star Tribune points out</a>, the crushing reality of the situation is that only a third of American adults have moved beyond the income class of their parents. The study, done by the nonpartisan group Pew Charitable Trusts&rsquo; Economic Mobility Project, was quick to point out that 84% of individuals surveyed are indeed earning more than their parents. But the fact remains that moving up the economic class ladder is more difficult for this generation than it was for previous ones. (See also:&nbsp;<a href="http://www.wisebread.com/passing-for-middle-class">Passing for Middle Class</a>)</p> <p>So how could you attain the fading dream of upward mobility?</p> <h3>Go for Pay Over Passion</h3> <p>If you&rsquo;re about to enter college or currently undecided on a major, consider pursuing a career track that may not be your first choice but offers a higher income level than your &ldquo;dream job.&rdquo; For instance, you may be infatuated with a career in the film industry, but given the poor job prospects and comparatively low pay, you might think about majoring in something such as business or marketing and either leaving your <a href="http://www.wisebread.com/10-awesome-money-making-hobbies">passion as a hobby</a> or finding a way to incorporate it into your career (these are just examples).</p> <p>It comes down to what matters more to you &mdash; chasing your dream job (even if the future outlook on employment seems grim in comparison to other industries) or &ldquo;keeping up with the Joneses&rdquo; (or in this case, your parents) by moving up the income ladder with a high-paying job.</p> <h3>Remember:&nbsp;It's Not About Owning More &ldquo;Stuff&rdquo;</h3> <p>Speaking of the Joneses, upward mobility is not so much about the fact that your dad only drove Fords and you want to drive Porsches as much as it is about investing and saving for the future. The <a href="http://www.wisebread.com/investing-101-5-essential-steps">key to acquiring wealth is through investing</a>, and the more you sock away now, the more you&rsquo;ll have when you reach your parents&rsquo; current age. Exhibiting riches through the purchases of fancy homes and flashy sports cars will only take you so far up the socio-economic ladder; true wealth is displayed in your portfolio and, unlike a luxe car or extensive wine collection, the investments you make now can support you for the rest of your life.</p> <h3>Consider Relocation</h3> <p>A final consideration for members of Gen Y seeking upward mobility is to relocate to a place where the cost of living is substantially less. This could mean a state where income or property taxes are lower (or nonexistent at the state level when it comes to the income tax) or a location where the cost of basic living necessities is lower than where you grew up. For instance, if your parents raised you in California, perhaps you&rsquo;d consider moving to Florida, where the climate is still warm and there&rsquo;s no state income tax.</p> <p>Other considerations aside (such as distance from family, climate, job prospects, etc.), this could be an excellent option for those hoping to live a relatively affluent lifestyle without getting bogged down by things such as an unsustainable mortgage or the <a href="http://www.wisebread.com/how-to-grocery-shop-for-five-on-100-a-week">high cost of food</a> in an area.</p> <p>Upward mobility &mdash; is it foolish fantasy? For those willing to make the lifestyle changes required to attain it, moving past your parents on the income ladder is most certainly possible.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/kelly-kehoe">Kelly Kehoe</a> of <a href="http://www.wisebread.com/how-to-be-upwardly-mobile">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-steps-you-must-take-to-protect-your-family-financially">7 Steps You Must Take to Protect Your Family Financially</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-financial-principles-for-a-seismic-economy">5 Financial Principles for a Seismic Economy</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-finances-4-emotional-decisions-to-avoid">Your Finances: 4 Emotional Decisions to Avoid</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-habits-of-financially-happy-people">10 Habits of Financially Happy People</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/becoming-financially-secure-what-to-do-first">Becoming Financially Secure: What to Do First</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance financial security Joneses relocation upward mobility Wed, 08 Aug 2012 09:37:11 +0000 Kelly Kehoe 947012 at http://www.wisebread.com Passing for Middle Class http://www.wisebread.com/passing-for-middle-class <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/passing-for-middle-class" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/windowsill.jpg" alt="Bottles on a windowsill" title="Bottles on Windowsill" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>The most constant theme in my posts here at Wise Bread has been frugality. If you live cheaply enough, you can <em>spend your life doing what you want to do</em>. Even if you have to work for a living, you can chose your work based on what you most want to do, rather than what pays the most.</p> <p>The downside to simple living through frugality is that it's easy to find yourself dropping out of the middle class. (See also: <a href="http://www.wisebread.com/when-poor-folks-have-better-crap-than-you">When Poor Folks Have Better Crap Than You</a>)</p> <h2>A Class Without a Name</h2> <p>As far as I know, there's no name yet for this social and economic class &mdash; people who choose not to buy all the stuff that's required to stay in the middle class. (One subcategory would be <a href="http://www.wisebread.com/bohemians-then-and-now">bohemians</a>, but most of the frugal folks I know are not bohemians.)</p> <p>To live really cheaply, you have to economize almost everywhere &mdash; and almost all of those economizations will impact one marker or another of being middle class. Cheaper housing &mdash; a smaller house, or an apartment instead of a house, or a smaller apartment &mdash; are all steps away from the middle class. The same with fewer cars, or no cars.</p> <p>Every specific economization that I've recommended over the years, from <a href="http://www.wisebread.com/turn-off-your-air-conditioning">getting by without air conditioning</a> to <a href="http://www.wisebread.com/frugal-transport-bicycling">bicycling for transportation</a> to <a href="http://www.wisebread.com/less-or-cheaper">making smaller cocktails</a> has been criticized &mdash; and very often, the underlying reason for the criticism is that the economization would involving giving up something that's fundamental to being middle class.</p> <p>This is often cast as a <a href="http://www.wisebread.com/not-driving-your-less-frugal-friends-crazy">&quot;keeping up with the Joneses&quot; problem</a> &mdash; you can't cancel your lawn service when all your neighbors have perfect lawns, and you can't keep driving your old car when all your neighbors are buying new ones &mdash; but that's only part of it.</p> <p>If something is fundamental to being middle class, giving it up drops you out of the middle class.</p> <p>Then you have to decide &mdash; is staying in the middle class worth the cost?</p> <p>If you're up against that dilemma, here's a third option that's worth consideration &mdash; pass for middle class.</p> <h2>How to Pass</h2> <p>Passing for middle class requires that you identify the key trappings of middle-class life, and then make sure that your household has those trappings. And, of course, you want to do this as cheaply as possible.</p> <p>That's not as much of a disconnect as it might sound like. Most of the trappings of middle-class life are practical things like housing and transportation, which you're going to need anyway. So passing needn't involve buying stuff that you don't care about. Passing involves making your choices with an eye toward falling within certain bounds &mdash; the bounds that define middle-class living.</p> <p>Here are two tactics.</p> <p><strong>Lifestyle Clusters</strong></p> <p>Whether a lifestyle counts as middle class or not doesn't depend on a single marker, and whether any particular marker is required or not is context dependent. So, for example, a house in the suburbs is a middle-class marker &mdash; but if you have a house in the suburbs, you need a car. (You probably need two.)</p> <p>An urban apartment near culture and nightlife also qualifies as middle class &mdash; but an urban dweller is not required to have a car. (And <a href="http://www.wisebread.com/think-you-can-afford-more-house-in-the-exurbs-think-again">giving up a car will save you more than you probably realize</a>.)</p> <p>You can look at the clusters and choose one that's frugal. You can choose one where the things that you're required to have (to count as middle class) are the things that you want anyway. You can choose one where the things that you'd just as soon not pay for are not required. You can choose one where, even if you give things up that <em>are</em> required, their absence won't be obvious to your friends, neighbors, or coworkers.</p> <p>If you choose a lifestyle cluster that falls within the definition of middle class, you can pass for middle class, even if you make all sorts of deviations. You could have a roommate, for example, or take in borders, or rent a room instead of an apartment. You can do things that would mark you as probably not middle class &mdash; but you can pass for middle class, because your lifestyle cluster looks middle class.</p> <p><strong>Cost-Invariant Markers</strong></p> <p>Some of the trappings of middle class are available at many different price points, and yet the cheap ones are just as valid as the expensive ones.</p> <p>For example one marker for middle-class life is a college degree. You could spend six figures getting a degree &mdash; and the money might even be worth it. (It depends on what you want to do with the rest of your life.) But two years of community college plus two years at a state school will also get you a college degree, and as far as being a middle-class marker goes, that state school degree is every bit as good.</p> <p>There are a lot of middle-class markers that are available cheap, at least sometimes. A rusty old car that would normally not qualify as a middle-class marker might squeak by if it's an expensive brand. Second-hand clothes are very much not middle class, but if you choose classic styles, they can pass very easily.</p> <h2>Should You Care?</h2> <p>My starting point is always that you should live your life according to your own values.</p> <p>To the extent that your values are different from middle class values, your life <em>should</em> look different from a middle-class life. Even so, sometimes there are reasons to blend in with the dominant culture, rather than stand out. There are advantages to appearing middle class.</p> <p>Sometimes, even when your values aren't middle-class values, it's worth making some small adjustments to pass for middle class.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/philip-brewer">Philip Brewer</a> of <a href="http://www.wisebread.com/passing-for-middle-class">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-finances-4-emotional-decisions-to-avoid">Your Finances: 4 Emotional Decisions to Avoid</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-does-frugal-living-mean-to-you">What Does Frugal Living Mean to You?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-alternative-housing-options-you-can-afford">5 Alternative Housing Options You Can Afford</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-surprising-ways-summer-will-cost-you">7 Surprising Ways Summer Will Cost You</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/could-you-save-money-by-subscribing-to-an-addictive-game">Could you save money by subscribing to an addictive game?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Lifestyle Joneses middle class passing Thu, 12 Jul 2012 10:36:11 +0000 Philip Brewer 941429 at http://www.wisebread.com Your Finances: 4 Emotional Decisions to Avoid http://www.wisebread.com/your-finances-4-emotional-decisions-to-avoid <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/your-finances-4-emotional-decisions-to-avoid" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_deciding.jpg" alt="Woman making a decision" title="Woman making a decision" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Personal finance concepts are generally straightforward and simple, but some people struggle with building a solid financial foundation when emotions get involved. Here are four ways people often act emotionally instead of logically that you should watch out for. (See also: <a href="http://www.wisebread.com/knowing-your-triggers-can-prevent-stupid-spending">Knowing Your Triggers Can Prevent Emotional Spending</a>)</p> <h3>Changing Banks Because Everyone Else Is</h3> <p>The &quot;it&quot; thing to do these days seems to be changing your bank, but make sure that you are thinking things through before you act. Are you really paying anything for your account? You may not think that the banks are treating their customers fairly, but if you look at your statement and you never incur any fees, don't blindly go to a credit union and say &quot;sign me up&quot;.</p> <p>There are lots of reasons to jump ship, but make sure you know exactly how such a move is going to affect you.</p> <h3>Buying Stocks When&nbsp;They're High and Selling When They're Low</h3> <p>This is true even when we invest in index funds. Most people can't wait to deposit their money into their investment accounts when the market is doing well and dread the same process when market conditions seem tough. If you want to increase your return, why not put a bit more into the market on a down day and less when it's on an up day? Small differences like this may seem meaningless but will add up overtime.</p> <h3>Staying in a Bigger House Than You Need</h3> <p>During the housing bubble when home prices went up practically every day, many families decided to move into bigger and more expensive homes even if renting would have been the better choice. Whether they can or cannot afford the mortgage doesn't change the fact that the extra mortgage payment is coming out of money they could use for other things. Is that extra bedroom that you never use worth not being able to take a nice vacation with your family a few times a year?</p> <h3>Keeping Up With the Joneses</h3> <p>When a few of your neighbors change their cars, your car always seems a bit older. When a bunch of your friends shop for new clothes, it's seems natural that you would get something too. If all your friends get a <a href="http://www.wisebread.com/tips-for-eating-out-cheaply">drink during dinner</a>, it's much more likely that you will just automatically think of something to order.</p> <p>There are lots more examples. I highly encourage you to list your expenses to remind yourself how you end up spending emotionally, so you won't repeat the same mistakes again.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/david-ning">David Ning</a> of <a href="http://www.wisebread.com/your-finances-4-emotional-decisions-to-avoid">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/47-simple-ways-to-waste-money">47 Simple Ways To Waste Money</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/wisdom-from-my-favorite-frugal-tv-character-julius-rock">Wisdom from My Favorite Frugal TV Character - Julius Rock</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/do-not-buy-something-just-because-you-can-afford-it">Do not buy something just because you can afford it</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/oprah-asks-a-great-question-what-can-you-live-without">Oprah Asks A Great Question; What Can You Live Without?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/ten-tenets-for-arranging-your-rich-part-1-rich-is-relative">Ten Tenets for &quot;Arranging Your Rich&quot; - Part 1: Rich is Relative</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Budgeting Lifestyle emotional decisions emotional spending Joneses Thu, 08 Dec 2011 11:36:15 +0000 David Ning 794968 at http://www.wisebread.com What Does Frugal Living Mean to You? http://www.wisebread.com/what-does-frugal-living-mean-to-you <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-does-frugal-living-mean-to-you" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock_000011748597XSmall.jpg" alt="Woman holding two model houses" title="Woman holding two model houses" class="imagecache imagecache-250w" width="250" height="166" /></a> </div> </div> </div> <p>Let me ask you this. If your friend recently bought a $1 million dollar house, is that an act of frugality? What if she could actually buy a house worth $10 million but decided to spend only 1/10 of what she could really afford? Does that change your answer? A $500,000 house is VERY expensive amongst many social circles, but Warren Buffett, the billionaire investor, is always praised about his lack of desire to spend on luxury because he is still living in his house thought to be worth about $500,000.</p> <p>When you are the second richest person in the world, are you frugal if you opted for a million dollar home instead of buying a multimillion dollar mansion? I mean, a million dollars to Warren Buffett is like the cost of dinner to most of the general public! Shouldn't he be using a different scale when it comes to what is deemed frugal?</p> <h3>Frugality Is Relative</h3> <p>Most of the time, we judge others' financial habits by what we can see from the outside &mdash; the clothes they wear, the cars they drive, and the house they buy. We never realize how much money they make, and never compare what they spend as it relates to what they can actually afford. Keeping up with the Joneses? What if Mr. Jones is a billionaire?</p> <p>As you can see, the meaning of frugality is relative. What frugal living means to you may be totally different than what it means for someone else. Your neighbor could buy a $1,000 purse and she could still be frugal, while a $100 pair of shoes from another neighbor could mean that he spent too lavishly. So how can you compare? Your coworkers may have a large inheritance, your friends could have married rich, and your neighbors might be fortunate enough to run a successful business. <strong>You don't know other people's situation, and more importantly, why does it matter anyway?</strong></p> <ul> <li>Does your neighbor's BMW help <em>you</em> get to a comfortable retirement faster?</li> <li>Does your coworker's lavish vacation make <em>your</em> retirement more relaxing?</li> <li>Does your friend's purse hold more secrets to <em>your</em> financial independence?</li> </ul> <p>Take frugal living personally. In other words, stop minding other people's business like trying to keep up with the Joneses and be happy that you are frugal and that you are working towards your financial independence. In your own way of course.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/david-ning">David Ning</a> of <a href="http://www.wisebread.com/what-does-frugal-living-mean-to-you">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-11"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/chinese-money-habits-how-my-culture-influences-my-attitudes-toward-money">Chinese Money Habits - How My Culture Influences My Attitudes Toward Money</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-big-of-a-house-do-you-really-need">How Big of a House Do You Really Need?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/can-i-conquer-my-vanity-for-the-sake-of-my-sanity">Can I Conquer My Vanity for the Sake of My Sanity?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-living-on-one-income-a-status-symbol">Is living on one income a status symbol?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/25-frugal-changes-you-can-make-today">25 Frugal Changes You Can Make Today</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Lifestyle frugality house Joneses Mon, 28 Jun 2010 14:46:58 +0000 David Ning 154656 at http://www.wisebread.com