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Millionaire to Millennials: Stop Buying Avocado Toast If You Want to Buy a Home

Forums - General Discussion - Millionaire to Millennials: Stop Buying Avocado Toast If You Want to Buy a Home

Well it is not just Avocado toast. Many spend frivolously on a daily basis. Sure you can afford it, but just think how much those 3-4 meals a day are costing you. As someone said, a loaf of bread is as little as .79 cents, add in some meat and cheese from a deli and you have 10 dollars of food for a week, instead of 10-30 a day on whatever you think of buying.

Last night I bought toilet paper from a gas station because I did not want to drive an extra mile to get it from the Grocery store. Cost me 4.99 for four small rolls, doubt they were even two ply.



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numberwang said:

I have done the avocado toast math, if you save an average 7$ a day and put it in an account with 3% interest over 45 years you will end up with 233K$ savings. (Inflation would increase a future house price and your necessary savings).

https://www.wellandgood.com/good-food/why-avocado-toast-costs-10-dollars/

https://www.investor.gov/additional-resources/free-financial-planning-tools/compound-interest-calculator

 

So, with 2% inflation... 96k equivalent dollars. After 45 years of continuous saving and waiting. Yeah... not impressed. I'd like a house before I enter retirement, and 96k will get you a shack, at best.



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I win if Emmanuel Macron wins the french presidential election May 7th 2017.

Old man wants kids to get off his lawn? Big surprise.

Signed, a Millennial Homeowner.



lel, in my home, there are avocados in the soil, that fell from our trees... I dont like it that much. They even go spoiled because no one on the hoouse wants to eat them for several days.



                          

"We all make choices, but in the end, our choices make us" - Andrew Ryan, Bioshock.

Home prices relative to incomes were low in the 1980s and the 1990s. Home prices boomed in the 2000s while incomes remained flat. Homes were cheap in the wake of the 2008 housing crash, but unemployment also went to double digits which made it hard for established millennials to buy homes. Home prices have essentially recovered now, and while jobs are easy to come by in 2018, wages are still low.

Those are the macro reasons why millennials can't afford houses when their parents could. It's not click-baity or sexy, but it is the truth.

https://www.economist.com/blogs/graphicdetail/2016/08/daily-chart-20



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specialk said:

Home prices relative to incomes were low in the 1980s and the 1990s. Home prices boomed in the 2000s while incomes remained flat. Homes were cheap in the wake of the 2008 housing crash, but unemployment also went to double digits which made it hard for established millennials to buy homes. Home prices have essentially recovered now, and while jobs are easy to come by in 2018, wages are still low.

Those are the macro reasons why millennials can't afford houses when their parents could. It's not click-baity or sexy, but it is the truth.

https://www.economist.com/blogs/graphicdetail/2016/08/daily-chart-20

Homes in metropolitan areas with tens of millions of immigrations have rising prices, but rural America is very affordable.

Millennials also do not start working at 16 or 18 like most of their parents did, so they delay their income too much into the later parts of life.



numberwang said:

Homes in metropolitan areas with tens of millions of immigrations have rising prices, but rural America is very affordable.

Millennials also do not start working at 16 or 18 like most of their parents did, so they delay their income too much into the later parts of life.

Rural America also isn't where the jobs are, though. By and large, anyway. Some decent income jobs can be found away from major metros, but some millennials own houses too.

I suppose a bunch of millennials could afford homes if they worked in the city and commuted from beyond the suburbs. But this isn't really empirically analogous to what our parents experienced. Not making a value judgement here on who "had it better", it just is what it is. If you want an explanation as to why millennials don't buy houses, it's wages, median home prices, the great recession, and probably that fewer of them want homes. We're also not having kids, so I hear.



mysteryman said:
OhNoYouDont said: 

Interesting is the wrong adjective. Terrifyingly irresponsible comes to mind.

What I mean to say is that average saving habits haven’t changed. So what is the driving factor behind a lower percentage millenials in the housing market?

It's all relative. Wages flat for 30 years means that 10% saved 30 years ago stretches volumes in comparison to today. I can't complain, but I'm not suffering. Were I making an average salary I'd feel pretty awful about my living situation.



Nymeria said:
Chrizum said:
What good is having money when you don't spend it?

1. Unexpected expenses could ruin you without savings.

2. Financial planning allows you greater options through life and especially for retirement.

3. Money makes money.  Saving and investing are the equivalent of having a second job you don't have to work at, but get the money.

We live in a consumer-based economy though. If everyone started saving their money we'd go into a recession.



pokoko said:
There is nothing wrong with splurging now and then but he's right about people spending far too much money on luxury items when they can't really afford it.

Absolutly. I like to treat myslef as much as I can, but I often find some of my friends in absolutly weird sittuations, where they still haven't payed their rents, yet they still go out clubbing, smoke a pack of cigarette per day and buy the latest DLC for Destiny 2. An avocado is an excelent analogy for things that we don't need, yet we most deffinatly buy and feel entitled to have.