With stories like these, it's easy to blame the guy and say he should've known better than to get into debt. To an extent I agree, however there's probably a bigger picture takeaway. There is a mismatch between what people expect/want based on what ideas are sold to them by society, and what is financially possible. You could make the argument that in the past, the wage to living cost ratio was high enough that you wouldn't have to bust your ass so much to just barely get by. Could he have lived more financially optimally? Yes (you always can). But is it that crazy to get an education and then expect a decent life after? The guy works 60 hours a week yet cannot afford housing, proper food, a family, nor any life pleasures. Is that reasonable? Is this really the best society we can come up with?
This is how it works in France, you can teach your kids to drive from IIRC age 15.
This is a frightening experience for the parent in the front seat and the rest of the passengers. The drivers on the road in front of you are blissfully unaware, the ones behind see a specific sign and keep healthy distances :)
Parents are in a great position to really reach the kid by making the lessons real with actual consequences and rewards. The can give their kids financial advice where a school can only give information.
A finance class where kids have to memorize how bonds work to pass a test is just not the same.
Sure yeah, you can always find edge cases and arguments against a general position. I wrote a 3-line post, not an essay.
Let's try again... Generally speaking kids should be learning about finance at school, not from their parents, because generally speaking most schools will do a better job than parents in teaching generally accepted financial best practices.
I wondering isn't possible for that person to move temporarily to his parent's home?
Before attacking me - i live in Southern Europe and most of children's here still living with parents or grandparents. I even know a house nearby where there are living 4 generations in one house.
"...and my parents, who live nearby, would have gladly taken me in. But I wanted to treat this period as a challenge, to prove to myself that I could accomplish hard things. Around that time, I was following a YouTuber.."
I understand that experiment... but just wondering.
For example - we live 100 km. from mine parents, wife parents are 200 km from us.
Mine brother live with parents. Wife brother live near their parents - 10 km. and visit them almost daily.
In Southern Europe - it's OK. For Northern Europe it's not normal - there children leave home early.
An "influencer" inspired him to do something he could write about.
> and my parents, who live nearby, would have gladly taken me in.
> Around that time, I was following a YouTuber named Michael Hickey, who made videos showing how he lived frugally out of his car. I decided to do the same thing.
Moving in with your parents post college shouldn't be a badge of shame in this era of real estate shortage/inflation, college superinflation, health care costs, decades of wage suppression, lack of college-education jobs.
Europe is ahead of the US in terms of urbanization and postindustrial economic structures, where real estate has long been totally owned by the elites. The US is moving towards a similar state with the arrival of massive private equity buyups of real estate.
> The US is moving towards a similar state with the arrival of massive private equity buyups of real estate.
This feels a little untruthful. PE and other investment vehicles are of course investing in multi-unit buildings (apartments) and have been part of some of the new rental communities that have been built out but they represent a small blip in the SFH side of real estate. The biggest shift in my opinion has been the creation of rental SFH communities backed by investment vehicles but again these are being newly built so at worst they have possible short-term impact on builder supply. I am not sure how that impacts the landscape though, new builds are adding to the rental stock.
Private equity is a total red herring. Their impact is virtually zero. The issue here is that we restrict new housing from being built in thousands of ways - meaning the people who would be buying that housing (the ones buying houses today, to live in) are buying old stock instead, driving up the price of a supply constrained good.
This is entirely the fault of land use codes - setbacks, parking minimums, FAR limits, design review, height limits, years long permitting processes... we created this in our local governments.
> This is entirely the fault of land use codes - setbacks, parking minimums, FAR limits, design review, height limits, years long permitting processes... we created this in our local governments.
Yes. This and the massive switch to single-person households (Single Income No Kids).
That and Zoning are the 2 main reasons housing is expensive. Anything else is a rounding error.
Tell me more about this massive switch to single income no kids! I haven't heard about this, I thought it was always a generational change and tends to work itself out.
Agree but unfortunately when you point this out usually you get downvoted to oblivion.
It is a supply demand problem and I would even add to the point that the financial crisis helped set us up for the current environment we are in. We are still not even close to the historical level of housing starts pre 2007-08. We lost a number of builders in that process.
Even in places where home building is permissive, you never see a newly built home that is cheaper than the surrounding area's prices. I wouldn't chalk it up to a 100% supply issue. Nobody builds inexpensive apartments or small 1950's era single family homes. Every new home start is the same "luxury townhome" that's going to sell at or above prevailing home prices.
You're right that that is what gets built. And that's completely OK. Imagine one of those new big houses gets built. Someone buys it, they have the money to afford it. If you don't build that house, that person with their money still exists. But instead, they outbid you for one of the units that should be less expensive. That raises the price of existing housing and keeps you from buying something. That's the process that is the problem when you don't add new supply.
Hmmm not sure how to digest that comment. I absolutely see a lot more volume of "patio" homes with the total house ~800-1k sqft. Home builders are a bit of a laggard to demand but they are adapting to the new environment and smaller homes are in pretty significant volumes. This is happening in multiple states/markets. They very bare bones homes, sometimes a small backyard, sometimes just a patio. But they are incredibly cheap, you will get a 1,100 sqft 3bdr home for ~$200-220k. Thats a DFW price.
It shouldn’t be a badge of shame at all. Family is the closest circle you’ll ever have, even your SO doesn’t count as much until proven through years. Living apart only makes sense if the conditions are too scarce or characters too incompatible.
This ignores broken families ofc, but atomized living probably correlates with that.
Sadly we often start really valuing the family only after it thins out substantially.
If you want to do some interesting reading about car living, check out r/priusdwellers[1]. The Prius seems to be favored because it can idle for so long with battery support.
This is an exception.
It's in canada, Québec of all place where cost of living is lower.
1- he should have stayed at home with his parent.
2- his parent should have help him with his debt.
3- he should have worked while studying: this is super rare.
4- university is much cheaper there like 2000$ per semester.
Should I go on?
Pre-pandemic 100k$ is an insane amount.
10k is common, so is 20k, but above that? pretty rare, yet he claims most of his friends had a similar situation.
HEC is one of the best finance school in canada, guy stay there 8 years, seems to have zero knowledge of money.
Then uber eats? That's weird. Most hec diploma will land you a 100k/years, after a few years. 400/month is not that much. Don't quit your job and become homeless for that!
Apart from the "education shouldnt run you into huge debts", "Gig economy and working 70 hours/week should not be normalised", "social life while young is not as important as paying off the racked up debts", and "this is a TikTok experiment, X number of people are watching me live my life" arguments which I'm sure will be discussed heavily, I found the "hacking one's life expenses to see how one can save money to payoff their debts" part interesting.
A house/apartment/address comes with a lot of fixed costs - rent/mortgage, insurance, maintenance fees, gas, electricity, sewage, water, internet, Amazon impulse purchases because there is space, furniture, appliances etc. If one doesnt need the address to register themselves as a resident of the city/town/country for legal purposes, mobile home + shared utilities(toilets, laundry, occasional hotel stays) would make an effective temporary hack to save a lot of money.
In fact most of mentioned expenses are due as well, when living in a car. The biggest exception being Amazon impulse purchases. Maybe there's a hack to avoid them?
Yes, they may be due but certainly not to the same extent.
Anecdotally, I pay :
1. Water fees - Approx EUR 23/month
2. Electricity - EUR 73/month
3. Trash collection- EUR 40/month
4. Home insurance (and home contents insurance) - EUR 40/month
5. Gas connection- EUR 24/month
6. Home Internet - EUR 70/month
7. Sewage - EUR 12/month
8. Property taxes
9. Window cleaning - EUR 12/2 months.
Ofcourse, they’re are all in a way “quality of life” costs. But, if I were to optimise for money, I could imagine living in a motorhome, pay my EUR 42/month gym fees and use the gym daily in addition to other shared utilities and avoid all those micro costs.
Everything comes with trade-offs, but it is worthwhile to think about alternative options for alternative priorities.
From those numbers, I think you did very well already in optimization. In a lot of places rent is more than 1000 euros, so those costs are quite low in comparison. Everything is relative. My late mother used to say 'one can spend a lot, with very little one can get by'.
Well I actually think it's a good idea. A lot of people scoff at not having a real house/apartment or address, but I don't see why. As long as you can basically take care of yourself, living in a car should be totally feasible. We need to embrace more alternative living situations anyway such as tiny houses and minimalism because everyone owning big properties just isn't sustainable for our population.
Housing is much more expensive than it needs to be, and I'm saying that as a landlord.
But "a car" isn't the solution. I've seen some very nice looking van conversions that look merely cramped, but at least manage to fit in a proper bed, a food preparation area, and basic hygiene stuff like a toilet.
Likewise for actual houses, "sustainable" isn't the same thing as "small": The new house I live in in Berlin needs around half the power to stay warm as the apartment in the UK a third its size that I rent out.
This means the one I live in stays warm from (as an annual average) slightly less than the body heat of the two occupants.
Proper insulation and ventilation costs a lot as well... meaning more debt.
I think we're not tackling the root cause in this whole discussion. People having to bottom their lifestyle because of debt.
A lot of debt is avoidable, for example student debt, if you live in a country with a well built education system. Owning a house could also made be more affordable.
It's a pitty that in the US half op people still seem to be voting for the most capitalistic side.
There is a difference between 'totally feasable' and 'inhuman and stupid'.
Its totally feasable in an emergency situation or if you just want to live like this.
But otherwise? its not okay. Peple want save spaces. A toilet at night, a bed. And not random poeple looking into your car and not shitting on the side of a street.
Trying to receive mail or apply for public benefits can be difficult without a permanent address. There's a stigma associated with applying for jobs if you can't list an address.
Edit: I agree single-family homes are insane, the solution is affordable apartments close to transit, not the rugged individualism of people living in cars.
"Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control." [1]
Where do you want to draw the line between "everyone needs big properties" and "living off your car should be considered as adequate housing"?
Won't there be a bunch of empty houses in 2 or 3 generations anyway due to the fertility rates crashing down globally below fertility replacement levels?
The promise of WFH could have reduced this factor for many (most?) office workers. Unfortunately, we're dialing back hugely on that. So we're right back to people clustering in extremely HCOL areas while they're surrounded by ample space and housing.
Nobody wants to commute 3 hours to work. And nobody wants to build an office in the middle of nowhere. The end result is obvious.
Also, Americans as a whole are allergic to affordable housing. A commie block or two could solve this, but we're still making "luxury" two story apartments out of glorified popsicle sticks and vinyl.
Fertility rates crashing down globally is my quote - globally means I didn't forget anyone. Also fertility rates of immigrants are the same as their hosts after 1 generation.
I am skeptical that a lot stuffed with "tiny houses" is actually more resource-efficient than that same lot with apartment buildings.
And, uh, the only resource that "big properties" exhausts is density. If you don't mind having to drive half an hour to get to town, there's plenty of room.
This is unnatural and unhealthy. For the individual and the society alike.
Societies are obsessed with economic (amount of dollars) performance and the competition between and inside countries. Which on this level [1] is sick and unsustainable. The economy makes lots of money for the sake of making lots of money and for competition exploiting the livelihood of common people, sucking lots of surcharge in advance for the most basic necessities of a human being like knowledge and place to live (lack of those is social if not literal suicide), driving up competition and prices, that drives competition and payments in advance (debt) even further, in a sick downward loop. Exploiting people for extra profit for few that they have no idea how to spend so are panicing what to do with it calling investment, but more like a nervous jumping from here to there in haste, shaking the economy apart slowly in speculational rampage. People making up the society are getting to be a wreck this way or the other (as taking part of the nerve wrecking race or by left behind to rot). It is held together still somehow, but how long? Does not seem sustainable at all. It was better not being part of this humanity. This way. But what else? Could I be a magpie instead perhaps? That sounds much better idea that this high pace nervous struggling called human life. Especially when we had a better choice if we were not so damn competitive all, I mean all the time.
[1] Competition is unavoidable with our finite resources and is highly beneficial on a sustainable level
I was going to comment this but he actually mentions Michael Hickey in the article. He says he banked $60k towards building a tiny home in 146 days living in his car, doing Doordash etc., and posting/streaming a lot of social media. I believe there are many days where he says his income from views is higher than his delivery work but gotta have content to film.
Not only is part time work a financially good idea in the short term but it also looks good on a CV even if it's not strictly relevant to the area you want to work in after graduation.
So, is one of the lessons that perhaps we should all be as frugal as possible from as early a period as possible? I kinda learned that from my poor immigrant parents since i was a very young kid...Not to knock the experiences of the author there, but maybe this kind of thing is not as universally known? Then again, there is a lot of marketing in North america the likes of "You can do anything you want in life! Go to college, and then get a house, get married and you too will WIN!" ...which is of course misses the inclusion of all the gritty details for what happens along the way if things are not managed well, or misunderstood. I learned the lesson of college debt really early on, and have been resistant o take on any debt at all...which is not easy in North America; but possible. I don't say these things to downplay whatever journey the author is going through...And i hate to say, well, this happens because of capitalism...but, dang it, if things seem so shady everywhere now, and capitalism never seemed as horrible as it *feels* nowadays. Or, maybe i just need to drink some decaff. now? ;-)
So many of his decisions sound so stupid. Finishing your degree at 30 with no experience? What the hell is that? I started my first internship at the age of 19.
> Canada has a worse debt-to-income ratio than any other G7 country, with a total consumer debt of $2.5 trillion. That’s more than Canada’s GDP.
> Higher education was supposed to be an investment in my future. But now students like me are stuck paying off their debts over years or even decades. This is largely due to the mismatch between the high cost of education and low, stagnating starting wages
Meanwhile political campaigns at both provincial and federal levels are mostly ad hominem attacks and fear mongering ("it'll be the end of the world with the other guy").
The issue with some college programs is that they focus more on getting students to pay for degrees than on preparing them for the future. While I believe colleges can be extremely valuable, many of these programs are lacking.
Part of the problem might stem from how student loans are treated differently than other types of debt, without properly accounting for risk. It makes me wonder if there’s data on how many graduates from a given degree program actually enter a field related to their studies. With that kind of information, it might be possible to better assess the risk associated with student loans. Loans are just one part of the equation, but they’re a critical one.
Edit: In case it was not clear, I am arguing that the formula here is entities who are incentivized by churning students through programs and loans which are not being properly underwritten. Student loans should not be a special class of debt. We have gone over the line of improving upward mobility and created an industry that produces useless degrees with high debt loads. If student loan could be discharged easily via bankruptcy and the underwriting process could potentially reject applications based on risk, it might be easier to help funnel people through. Instead we allow young people to take on $30-50k for a masters degree that has little to no chance of being useful.
College has been that way for a long time. College gives you a fairly good knowledge about a subject. But very little in practical experience in using that knowledge. To get experience you have to do the job. College just gives you a short cut on the job in not having to look some things up and spend a few weeks figuring it out. But you are still inexperienced until you go thru it a few times and get it wrong, then right.
Another downside is the loan officers in the colleges are not showing these students the downsides to these loans. They are borderline predatory and selling to financially inexperienced people. When I did this in the mid 90s they are super happy to give me a loan that was 0% until I got out then went straight to 8.5%. I at the time had enough math to figure out 8.5% was a bad deal for the amount of income I was about to earn.
A collage degree is not a jobs training program, it is a is supposed to give you a deeper understanding of the fundamentals in a field of study.
Just because some employers require a degree(or equivalent experience) for some jobs, it does not guarantee that you will get that job.
An example would be Electrical Engineering, with this degree you could do work in a power plant or design cheap kids toys(or anything in between). What you want to do is up to you and you need to chart your own course.
If you want a program that trains you and then gives you a job that you have received training for, the military is famous for that. However, don't expect that the job training that you received will necessarily translate into jobs in the civilian world here either.
Hmmm not sure exactly what perspective you are sharing.
I don't disagree that its up to the individual to write their future but in the case of college programs I think we as a society oversell their value. College programs are just churning students out regardless of viability and part of that is being fueled by how educational loans are treated differently than most other forms of debt. So you have a young individual who might not know anything about the world, a college system that is just trying to churn degrees out, society who tells people that college degrees are important and loans which are not properly underwriting the loans. Its a recipe for disaster in my opinion and I believe the way loans work are a large part of it. Underwrite as many people as possible for whatever degree they want.
I was replying to this:
>The issue with some college programs is that they focus more on getting students to pay for degrees than on preparing them for the future.
I agree that we oversell the value of a collage degree. To me it feels like that some point in the 80's or 90's that everyone in the US decided that collage was "this one simple trick to get rich" that they had to have their children try out. I would note that this occurred at the same time that we decided that we needed to move to a service economy rather than a manufacturing economy.
I think trying to tie "the usefulness" to a loan that is being used to impart general knowledge on the basis of job prospects is going to be very hard.
For example, in the early 90's a degree in Network Engineering would be rated a a high risk as there would not be many jobs available for those with that skill set. Fast forward 10 years and the internet is the hottest thing on the market.
There are examples in the opposite direction as well, where there are fields that were booming and suddenly went bust. Mining Engineer for example when looking at coal mines.
You seem to be looking at things from a top down command point of view where our society is operating as more of a bottom push driven system.
To add to that point, universities piling on as many classes as they can to maximize the financial returns from those students. Classes they don’t need or want. The “well rounded” education umbrella is the size of a very expensive parachute.
Man, these misery porn stories seem to be almost uniquely American. Crazy to think that normal people live in their car / live as homeless people. It's one of those thing that is straight up unheard of in Europe.
I was curious so I picked a random European city (Athens) and compared its homeless population to my own random American city (Chicago) and the rates were similar.
I don’t think that’s an excuse for bad social policy around homelessness of course.
