Our Kids May Not Be As Well Off As We Are

My father was one of ten kids and grew up poor my most standards, but not hungry thanks to my grandfather who sometimes worked 3 jobs. My father was the first to go to college, initially against his parents’ wishes. They wanted him to work full time to help support the family.

My mother’s background was a little different. Born in the south, her family was about as WASP as you can get. Family stories include nannies and the governor coming over for my great grandmother’s infamous Sunday suppers. Girls were supposed to marry into proper families with the “right” last name. My grandfather had his own plane as a teenager in an era where most teens didn’t have their own cars.

But after being drafted and serving in combat, he became an alcoholic after he returned home. A brilliant man, he would start businesses that became very successful, and then start drinking again when they did and threw it all away. There was much more of a stigma attached to being an alcoholic at the time, so each time after they lost everything, he’d pack the family up and move to a new town to start over. My mother says her best memories were when they had nothing because he wasn’t drinking.

My mother was disowned for marrying my father who was Spanish (as in Spain Spanish), Catholic, and poor. When he was drafted into the military after he graduated, she converted to Catholicism, got on a train with one suitcase to meet him where he was stationed, and they married with a priest and 2 witnesses. No family and no wedding gifts. They literally started with nothing. But my father worked hard and became more successful than any of his (or my mother’s 3) siblings.

By my junior year in HS, between clubs, sports and an active social life, I was rarely home anymore and my mother went back to work, but realizing no one was going to take her seriously with nothing but “housewife and mother” on her resume since she got married, she took out a loan on the house and started her own business. Everyone thought she’d fail including their CPA who called my father to warn him they could lose everything, but we believed in her and within 5 years she not only paid off the loan, but paid off the mortgage, doubled her office space, hired more employees, and walked into a dealership and bought her dream car off the showroom floor. I have SO much respect for her for what she achieved. Such an amazing woman.

I went to what is considered a top college here on CC, but I didn’t look at college as a means of getting a job or how much money I could make. For me, it was all about gaining as much knowledge about anything and everything, and I assumed the rest would take care of itself. I did go on to law school, but only because I still didn’t know what I wanted to do by the time to apply early in my senior year, and it’s what adults had been telling me they thought I should do by the time I was in 8th grade because of the way thought, spoke, and reasoned. I knew before the end of my first year that I didn’t want to make a living arguing and fighting, but I stuck with it and graduated - for reasons I still question.

There was a recent post here about what qualified as “Hispanic” for college applications. With my father being Spanish, I could have checked that box, but I remember thinking about it and deciding that whatever advantages it might afford me, those advantages weren’t intended for people like me. With my father always gone working, I was raised mostly by my southern WASP mother, more affluent than even most of my classmates, never feeling disadvantaged or discriminated against, and had zero association with Hispanic culture, so I checked the “white” box and it was somewhat of a defining moment for me.

Many people assumed things were handed to me on a silver platter, but this was not the case. I worked in a factory during summers earning 3 times what typical retail jobs earned, and worked 6 to 7 days a week 10 to 12 hours a day earning 1.5 to 2X normal (union) wage for anything over 8 hours. All that money went toward my education to lift as much burden off my parents as possible. During law school, I worked as a live-in prefect at a college prep school where I was given free room and board and took out max loans to help pay for tuition.

After graduating, I decided I wanted to be a land developer and talked (begged) a developer into giving me a job, but after being tasked with attending $1K a plate dinners for politicians and kissing their behinds to get zoning approvals, I decided it wasn’t for me and ended up going into the IB/ VC business with my best friend from college. His father had been a Wall Street mogul who 60 Minutes had done a segment on, and he served as our figurehead giving us credibility at a young age. It afforded me a comfortable life where I was able to buy a house, drive a nice car, a membership to the yacht club, etc.

But we were killing ourselves. It was a pressure cooker, and I was constantly flying to NY and back within 24 hours. Most people I was dealing with were twice my age and after meeting many, they’d often say they were expecting someone much older. It was a constant battle to prove myself.

When my best friend was diagnosed with a rare form of cancer and lost the battle, it changed my life and perspective on everything. I had developed stress related auto-immune disorders and had zero social life. A funny thing happens when you always say no to invitations because you are too busy. The phone stops ringing and the invites stop. Outside of my work, I didn’t know who I was anymore. Toward the end of his life, he begged me to get out and save myself, so I did, but now I was alone, and as happens so often with men, I had allowed myself to be defined by what I did for a living and my success.

None of that mattered anymore, though, and I had to figure out who I was and what I wanted independent of that. So I gave it all up. I sold the house and moved to a much smaller condo in the heart of the city. I re-invented myself and figured out how I could make a living working for myself from the computer. No more travel. Been there, done that, and over it. All meetings were net meetings now.

When one client decided they wanted to hire me, I kept saying no until they made me an offer I couldn’t refuse and I accepted. Big mistake. They assumed they owned me after that and there were weeks when I didn’t step outside from Sunday night until the next Saturday morning, working until 3, 4, or 5 in the morning and waking up with the “dry heaves” from the stress. Always in great shape, I had suddenly gained a lot of weight. One day, I looked in the mirror and didn’t even recognize the person I was looking at, and said . . . enough, and quit.

I’m on my own again and master of my own destiny. I won’t get rich this way, but I don’t care. I’m happy and healthy. I can walk to the bank, multiple grocery stores, the gym, the best restaurants in the city, etc., and am back to being in great shape. I filled my car up in Feb and then again in Sept and it still has ¾ of a tank now. If I can’t walk, I Uber. I don’t care about “things” anymore. I have a social life again and live where I want to, not where job dictates I do. Life is too short.

I often read posts on CC that are so focused and “marketable majors,” starting salaries, what someone else will pay them, and wonder why they are leaving their destiny in someone else’s hands. Maybe that comes from two parent who started their own businesses and my feeling I could always do the same. My father also had a lot of clients who were immigrants who came to this country with nothing, started their own businesses and became very successful. Sometimes it seems that these people believe in the “American Dream” more than most Americans.

I was a lurker on here looking for info to help friends long before I joined, but I have been following some of you. To name a few, @doschicos, love your posts. @ChoatieMom, some of your posts have brought me to near tears with your pride in your son who sounds as stubbornly independent as I am/was, but your respect for that and belief in his ability to find his own way. @skieurope reminds of my younger self with parents mostly uninvolved for reasons that are perhaps different, but he seems like someone as fiercely independent as I was. I remember him posting about feeling lucky his parents gave him taxi money to get to the airport, and my saying I felt lucky my parents came out to the driveway to wave goodbye as I left for college.

@romanigypsyeyes, I have much respect for you and what you have overcome and achieved, but you said you can never start your own business because you need health insurance. With Obamacare, can’t you start your own business now that the pre-existing conditions have been eliminated? Or are you worried that the new administration will take that away? One of my stress related auto-immune disorders was classified as a pre-existing condition, but after a lot of on line research, I tried a holistic approach that freed me of any symptoms. That wouldn’t satisfy the insurance companies, but with Obamacare, I no longer have to worry about that – for now.

That is the problem facing many who are contemplating self-employment (or retirement before Medicare age). Most people expect ACA to be repealed, but are uncertain what will replace it. If nothing replaces it (a possibility since there seems to be no consensus on what should replace it), then going back to the pre-ACA situation where individual policies use medical underwriting to exclude those with pre-existing conditions will mean that those who have pre-existing conditions will not have the option of self-employment (or retirement before Medicare age) unless they are willing to self-insure the risks of their medical costs (such self-insurance may only be realistic for those with Wall Street plutocrat levels of wealth).

Here is a medical underwriting guide from one insurance company, presumably from before ACA required guaranteed issue and individual mandate: http://www.bcbstx.com/producer/pdf/tx_uw_guide.pdf

I do believe the ACA will be gutted if not repealed.

I have been uninsured before. I will not risk it again if at all possible. I will not survive with a gap in insurance.

Either way, I have another 4-5 years of my phd program so I’m pretty locked in :slight_smile:

@ucbalumnus . . . Ugh. I am of the belief that insuring all with pre-exisiting conditions is here to stay, and even the POTUS-elect has said he wants to keep it, but who knows? Such a mess. I’ll have to cross that bridge if/when I come to it.

@romanigypsyeyes , I understand. Wishing you all the best.

The problem is, keeping the guaranteed issue provision (which is quite popular) means getting everyone into the medical insurance pool, including the currently-healthy-but-not-wealthy who are more willing to risk going without due to the high prices. When many healthy people do not get into the medical insurance pool (adverse selection), the price of insurance rises because it then becomes just prepaying for sick people’s medical care.

Getting everyone into the pool means enacting unpopular things like a stronger individual mandate than ACA has (which is the part of the ACA that people do not like) or greater subsidies to help many people afford medical insurance (unlikely to be popular among those whose taxes go up to pay for it – ACA paid for some of its added subsidies with a net investment income tax on very high levels of investment income which is undoubtedly something that Wall Street plutocrats want to get rid of as soon as they can).

@ucbalumnus Yup, I understand the issues, but it’s difficult to understand why those who work for themselves can’t have the same benefits as those who have employer provided insurance simply because the insurance companies want to put them in a different pool. Employer provided insurance has been covering anyone and everyone with pre-existing conditions for decades. I could be an obese smoker with cancer and be covered by employer insurance paying the same rate as my healthy co-workers, but healthy and extremely fit self-employed me who takes no meds of any kind (but who has been classified with a pre-existing condition for insurance purposes) can be declined?

Not to get too off topic here, but perhaps the key is for employers to get out of the insurance business and for the insurance companies to put everyone in the same pool.

Yes, I’ve always thought that way too. It makes completely no sense. I suppose it has to do with the employer provided insurance being in a larger pool, but what if you work for a smallish business with many unhealthy employees, that can’t possibly work out. It seems ridiculous that people were being turned down for almost nothing whatsoever. I certainly hope that we don’t go back to that.

But in that case, I definitely think that romani or her husband absolutely need to get employer sponsored insurance after her program ends, no matter what. Even if they have to move, or one of them take a job that they don’t want. Many people stay at jobs that they don’t really want to work at, purely for the employer provided insurance. It is definitely not ideal, but if someone in the family has serious health issues and there is no decent other option, you have no other choice. Her health is the most important issue.

@1dreamer Thanks for share your story of you and your family. I think it would make a great movie script or, since its multi-generational, a series. What dashing hollywood actor would you like to portray you? :smiley:

Gee, almost like the rest of the industrialized world… 8->

(Ducking out again. If you’d like to stay “off topic,” you’re welcome to join us in the ACA thread. But we’re not allowed to talk about this. That’s a no-no on here.)

@doschicos Ha! And there’s so much I left out! Friends have told me I should write a book. :slight_smile:

But back to the original topic, my point in posting all of that was that my values changed over time. My parents spent most of their time and money building their businesses and accumulating things. I place less importance on accumulating things and more importance on living in the here and now - because you never know if you’ll have a chance later.

Yes, having a loved one die young like that or having a chronic illness strike definitely makes one re-examine priorities. Success can be quite subjective.

Employer pools can have guaranteed issue because the pools are not self-selected based on health status, so they include healthy as well as sick people, so that the costs of the sick people are spread out across the pool of healthy people.

An individual market of health insurance that has guaranteed issue but not either an individual mandate or subsidies that are enough to induce everyone (including healthy people) to join the insurance pool will eventually fail due to adverse selection, since many people will not buy insurance until they are diagnosed with something expensive. That is why, before ACA, the individual market used medical underwriting to avoid selling policies to people with pre-existing conditions. The ACA individual market is not doing that well either, since the individual mandate tax penalty and the subsidies are insufficient to get everyone into the insurance pool, so there is slower-moving adverse selection happening, at least in some states.

Getting back to the original subject: it won’t surprise me at all if my kids won’t be as comfortable as I and DH are.

Daughter is a scientist-in-training in America which is investing less and less in its science.

Son is interested in computer engineering… a field (I’ve been told) vulnerable to outsourcing.

Neither will be protected by a union. And while neither will graduate with debt, they will work in an America in which half the people barely saw their incomes budge in decades.

I think it’s safe to say – as much as it pains us to admit it – that MANY children of current parents on CC will have fewer opportunities, and more modest prospects than their parents’ generation.

I think a significant difference in income now is attributable to the loss of private unions, and the desire by many profitable companies not to use their money to expand, but to pump up stock buybacks so they can increase CEO compensation. They don’t have to increase salaries and benefits to keep their workers, so they won’t. Corporate responsibility is only to the shareholders and high level executives, with little sense of responsibility towards workers. Outsource, replace with automation, cut back and reorganize, and there’s no way to stop that. There are very few “forever companies” that people can stay with their entire careers and receive a pension.

The economy as a whole may grow, but if more than the gains go to Wall Street and the CEO class, that leaves less for everyone else to share or fight over.

Capital is already favored over labor in income tax, and such favoritism of capital is likely to increase. Also, the elimination of the estate tax will further entrench inherited wealth dynasties.

So the next generation should plan to live modestly and accumulate capital to invest, in order to get at least a few scraps of the outsize gains that will go to capital. Depending just on your labor probably means downward mobility and financial insecurity.

Agreed. Those days are over. One tidbit I left out above was that my father was laid off at one point when he was getting close to the minimum for a pension kicking in despite being a top producer. Newly promoted boss came in and laid off several others at at the same time and at a similar point in their tenure. The reason was obvious. Karma, the new boss was also laid off soon after he did the dirty work, but that’s when my father decided never to leave his fate in someone else’s hands again and started his own business.

One big difference in today’s job market is that if you changed jobs a frequently in past generations, you were seen as less stable. You might have even been seen as less stable if you were unmarried. But if I go on LinkedIn and look at the work history of most people I worked with in the job I mentioned I quit, most haven’t stayed anywhere beyond 3 or 4 years max. In that particular industry, you are almost considered unambitious if you do. People move around constantly. Some employers now even look at unmarried people as more desirable because they have fewer family commitments.

Everyone was working 12 to 15 hours a day plus weekends by the time I left that job. There were days when I worked 18 and rarely had a work-free weekend. When I started, the goal was to meet a minimum of 32 client-billable hours a week. There were enough mandatory net meetings and time consuming reports we had to submit weekly along with what seemed like constant new software they threw at us to learn (all unbillable) that we were already working long hours, but 32 billable was doable and anything beyond was bonusable. Then a new guy came in and increased it to 36 minimum billable, and then to 40, but we were told the expectation was 45 to 50 and if we didn’t meet the 40 minimum billable in any given week, they were considering classifying the shortage as vacation time. Motivation. :wink:

I had negotiated a “no travel” clause in my contract, but virtually everyone else had to travel on top of that, some internationally. If they spent an entire business day on a plane, they had to make up the billables somewhere. 70 to 80 hour weeks became more of a norm than an exception. We were paid well enough that some people were willing to put up with it. I wasn’t, but in a job like that, hiring single employees could be considered preferable.

If this is becoming the new norm (and I believe it is in at least some industries), the new generation of college graduates will have to figure out if it’s worth it in order to be better off than their parents.

True, if just on income comparisons.

However, it is possible to be better off in other aspects despite lower income.

One potential result of the perception that the economy (or the part that the “ordinary person” shares in) is getting smaller (negative sum game) is that politics may become nastier. Dividing up the gains in a positive sum game is likely to be relatively friendly compared to finding out whom to stick the losses on in a negative sum game. Think of the musical chairs game, but with (for example) jobs instead of chairs.

“politics may become nastier”

Can it get ANY nastier without blood being shed :open_mouth: ?