Comments on: The invidious reach of personal-finance snake oil http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: markydee http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45625 Wed, 23 Jan 2013 01:22:58 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45625 The revelation she’s saving money makes a mockery of the original article and this worthless retort. Opinion columns blustering about half truths. What a shock.

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By: realist50 http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45617 Mon, 21 Jan 2013 20:59:49 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45617 @igl – Thanks. A follow-up from The Billfold with real facts was linked in the 1/16 Counterparties. I will quote my prior comment – “If she manages to save some money after her baby-sitting and tutoring income, I might even say good for her working extra to indulge her expensive taste while still being financially responsible.” – and say good for her (and that her tastes aren’t really as expensive as stated in the NY Times piece). It was a terrible piece by the Times. The Times should correct it and apologize to Ms. Fredrick. Based on the writer’s response to The Billfold, however, that’s not going to happen.

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By: erott http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45612 Mon, 21 Jan 2013 16:06:43 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45612 I feel that this article oozes of immaturity.
To suggest that it’s OK to spend 1200.00 per month on restaurants and take out is simply irresponsible. It sounds like the author is one of the entitled ones – “I want it now” and – “there’s nothing I can do because the system screwed me”. Thought – pick up a cast iron skillet, head on over to the local butcher and get yourself a nice 20oz rib steak and cook that sucker up. Good eats for 1/3 the cost. Perhaps the next article could be a little more well rounded and less “silly”, while educating 20 somethings how to still enjoy the finer things without spending irresponsibly.

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By: AlkalineState http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45588 Wed, 16 Jan 2013 21:06:50 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45588 Too much is made of personal finance. If one person wastes their money, someone else is receiving it. A restaurant, a store, a ‘brothel in Madrid’ as the Pogues would say. Who cares?

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By: lgl http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45575 Wed, 16 Jan 2013 05:29:49 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45575 @felixsalmon @realist50 You might be interested in reading about her actual financial situation –

She’s already cleared her student loans, has no credit card debt, is contributing 7.5% of her two paycheques (outside of tutoring/babysitting) to a 401(k) and has two other savings accounts for emergencies and travel that she contributes to regularly. I’d certainly not call that ‘living paycheck to paycheck’ or in any way irresponsible. the 300$ a week is way overblown and inaccurate, too. As another 23 year-old with obsessive spreadsheets and savings accounts, Mr. Salmon’s first point really was the one that hit home: that piece was all bluster and judgement with no substance.

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By: AlkalineState http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45572 Tue, 15 Jan 2013 23:40:58 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45572 Financial advisors are a joke, in general. Having said that, all Americans…. not just young people and not just New Yorkers… spend far too much of their income going out to eat now. I think my family went out to eat a total of 12 times in my entire childhood. But I know many families and couples now who go out 12 times a MONTH (3 times a week or so). That’s not uncommon and it adds up to a lot of money. Not that I care, it’s their money. But listening to them bitch about being broke is hard to take seriously. You can make a burrito at home for about 70 cents. And it tastes like a burrito. Surprise!

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By: realist50 http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45571 Tue, 15 Jan 2013 23:14:25 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45571 P.S. – Yaffa Fredrick’s worst financial decision, though, might be discussing her tutoring and baby-sitting income in the New York Times. If she hasn’t been reporting that income on her tax returns, now would be a good time to start doing so.

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By: realist50 http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45569 Tue, 15 Jan 2013 23:10:38 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45569 I see a few good points from each of Felix and Bellafante, but also plenty with which I differ. I think several of the commenters – Chris08, TFF, y2kurtus, and Auros – make better points.

Bellafante’s example of saving 100% of food spending doesn’t make sense, an S&P 500 Index Fund is a poor investment choice for saving money that’s going to be spent in the next 5 years, and residential real estate is itself a durable consumption good/inflation hedge rather than an income-producing investment. Also, Bellafante hints at Ms. Fredrick’s total financial picture but omits a lot of meaningful information. Does she have any savings? Does she have credit card debt? Is she foregoing an opportunity to take advantage of a 401(k) match from her employer? If she manages to save some money after her baby-sitting and tutoring income, I might even say good for her working extra to indulge her expensive taste while still being financially responsible. Contra Felix’s assumptions, though, Ms. Fredrick could in fact earn a quite strong return on additional savings if she has credit card debt at double digit interest rates or could put money into a 401(k) with a 50% or more employer match on her contribution.

There’s also value to developing the habit of living within one’s income and saving something. Expanding on TFF’s point about “settling into a lifestyle that consumes less you earn”, I bet that we’ve all encountered people who spend 100% (or more) of their income and have a mindset such that they would probably do so for any level of income. To me the main message of Suze Orman and Dave Ramsey is to counter that mindset – “spend less than you earn, build up savings to fund emergencies or special events rather than incurring credit card debt, be frugal regarding large purchases like cars to avoid consumer debt when possible” – and get people in a mindset of saving at least part of their income. I understand that income and life circumstances make that extremely difficult for some people. In this case, though, we’re not talking about a single mom struggling to feed and clothe her kids. We’re talking about a 23 year old with apparently limited financial obligations, a modest income, and a taste for expensive meals. It is reasonable for her to save some money.

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By: RossSmith http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45568 Tue, 15 Jan 2013 22:48:01 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45568 I have compared myself to my parents many times. We had one phone, and no cable only an external antenna. Now I spend 140 on cable (including internet), 6 cell phones at 310. We eat out 2 or 3 times a week so 120 a month (we already have food at home). This is like 570 a month for stuff my parents didn’t pay for. There is a lot of truth here, we can pick on the examples but it’s still true.

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By: QCIC http://blogs.reuters.com/felix-salmon/2013/01/14/the-invidious-reach-of-personal-finance-snake-oil/comment-page-1/#comment-45567 Tue, 15 Jan 2013 22:14:46 +0000 http://blogs.reuters.com/felix-salmon/?p=20160#comment-45567 Good advice TFF. One great way to “mandatorily save” is to take a shorter mortgage than you need. Yes it might some dumb when rates are allow, but the way it eats into your cash-flow helps you maintain a lower level of spending than you might slip into anyway.

My wife and I have decent middle to upper middle class incomes for our age (~30), but we will be debt free by 40. Mostly because we bought 2/3s as much house as we could afford, and survive on one 13 year old car instead of 2 newish cars (which is what almost everyone with our jobs would normally be doing).

Sure we spend a little extra on food and movies and such, but a life with an extra $100/month on food will be just as enjoyable as a life with $600/month in car payments, and you will have way way more money on the back-end.

Splurge on the little things and be frugal on the big things.

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