How young people manage finances when their dream jobs doesn’t pay well? Frugality? Wealthy parents? High earner spouse?
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They learn to live within their means!
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All of the above, depending on the person. I have known low earners who have been in each of these situations, but the vast majority have been frugal. I worked at an art school, and many of our graduates are studio artists. Very few were supported by parents, although some had spouses with better paying jobs. Most, though, just lived within their means.
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Yep. My husband and I are both engineers, but we graduated at a bad time and our starting salaries were ridiculously low. We had only one car and kept our thermostat at 45 degrees overnight. We borrowed furniture and didn’t buy a TV for a couple of years. We didn’t go on a vacation for three years after we were married. So when our kids look at our comfortable lifestyle now, I tell them we sure didn’t start out that way!
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My daughter started out with a budget, she then taught her CS sister to budget also. She also has a decent chunk in her retirement account. She has been a low earner for years. Only in the last 2 years has her career took off.
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I think people with rewarding, lesser paying jobs are generally low maintenance individuals by nature.
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Yes, I think a lot of young people today value time over money, too. They don’t mind a lower-paying job if they’re not working ridiculous numbers of hours a week. Although my daughter’s job doesn’t pay great, she’s been told she can leave at 2 or 3 if she has nothing to do! And her hours are flexible so she can take on a freelance assignment if she wants.
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I wouldn’t say they are low maintenance necessarily, they pay $100 for a hair cut, buy lots of make up. One year my daughter paid $5000 for lasik surgery. They do prioritize their spending. They cut out eating out and alcohol to make room for something else.
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LOL! As I guy that bought $100 electric clippers 15 years ago to shave my head, I can’t fathom paying $100 for a haircut. Those clippers are still going strong BTW, which means I’ve paid about $0.12 per haircut since then.
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I’m wondering if young people are managing their finances by a combination of parental support, higher debt and trying to be more frugal. I have read that credit card debt is at an all time high and I suspect there are large numbers of adult children living at home, particularly after the pandemic.
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Frugality, roommates, cooking at home, no vacations.
Honestly the one of my 3 who makes quite a lot of money seems to worry about finances the most!
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I think my kid with the lower income job works in a HIGH purpose profession.
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I doubt people who really value purpose over money would be able to live with themselves if they threw money on frivolous things.
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Of course, the definition of “frivolous” varies. Not long ago, I saw a comment on these forums about how cable TV was not a luxury (I.e. not something easily cut when trying to be frugal). But some people may consider any TV to be frivolous.
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Yup. Frivolous has varied and fluid definitions.
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My youngest (the Permaculture Farmer) has a spouse who earns more, plus shares his vision for a green planet (her job involves helping others), so they live frugally too. It matches what they want to be doing.
I also agree with directed spending. They have a solar powered car on order. I don’t think those are the cheapest money can buy… he hasn’t sent me the link yet.
ETA: Part of the reason they picked Puerto Rico to live in is the LCOL for what they want to be doing. DIL’s paycheck goes much further there. She could be earning the same thing and trying to live around DC.
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I have one who is getting a masters in history with a thesis on how Tibetan art is displayed in the western world. Think she’s going to make a lot of money???
She’s fine living in the basement of a student house, but her luxury is traveling. So far she’s been able to get grants to travel but I don’t know how much longer that will last. She’s spending 2 weeks in NYC but has found a place to stay for free. Her expenses will be transportation into the city, food, and museum admission fees for the museums she’s not visiting as a researcher. Oh, and I’m sure she’ll buy at least one new sweatshirt.
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I told my daughter, she can major in anything she wants, but she has to support herself with it. I want her to be happy in a career she enjoys, but it’s hard to be happy when you can’t make ends meet. I’ve been there. We’ll help wherever we can to get her started, but we want her to do the adulting.
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My D and her H work in the nonprofit world. They do amazingly good work, but they make amazingly little money.
They drove a 20 year old car that finally died. Borrowing from family and biking everywhere (trailer for kids) that they can. Saving for replacement.
Vacations are camping or visiting us.
D is a whiz at Buy Nothing, Curb Alert, etc. Almost every toy was free unless from grands. Little Tikes cars, climbing structure, playhouse, and myriad bikes, all free. Clothes are hand me downs.
They eat frugally. Homemade everything from scratch.
Etc. Etc.
I do wish they had just a bit more. And we help out when we can. But it’s only in minor ways–paying for a class for the kids because we want them to have the opportunity. Major income is theirs only.
But I’m proud of the work they do.
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Your kids may have some hope for a larger income even though that is never the reason someone works in the non-profit sector.
My Dad is getting ready to retire from his non-profit (he spent 20+ years working there as 1 of the 1st 3 employees) that works on college access for low income students and he has made a lot of money these last few years (200K+) as the 2nd in command. He spent years before that in another lower paying profession (social work), but always found ways to make a decent wage.
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