I was reared to believe that discussing money with anyone outside of family is gauche. For this reason, I have never asked anyone -- not even a significant other -- how much money he makes. I don’t discuss student loans, car payments or investments with friends. And despite living in San Francisco, a city where the high rent is always a conversation topic, I don’t ask my friends how much they pay each month for their home.
However, for one article only, I’m going to break my own rules and talk about finances. Specifically, the fact that according to a recent article in The Fiscal Times titled "Millennials: Young, Broke, and Spending on Luxury," my generation “represents the fastest-growing segment of luxury goods and services purchases.” Despite the fact that many of us are also burdened with large student loans and unemployment.
Of course, who cares about not having a job as long as she can tweet about it from her brand new iPad? Am I right?
I am not financially savvy. No one ever warned me of the danger of credit cards or taught me the importance of budgeting. I learned those lessons the hard way when my first credit card arrived in the mail at the age of 20. Thousands of dollars on terrible J.Crew outfits later, I decided my best option for dealing with credit collectors was just to never answer my phone. I found out the hard way that it would take seven years to recover from that bad decision. And I can promise that I was not still wearing those ugly suede clogs or high-waist jeans when my bad credit finally disappeared.
Today, I no longer use credit cards and I only buy what I can “afford.” Of course, I do so while also not planning for the future in any way, shape or form. I’m a freelance writer/editor, so I don’t have a 401K. My savings account is in decent shape, but the only thing I want to do with it when it gets large enough is buy a home. In Tahoe. That’s right: I want my first home to be my “second” home. I have no plan for retirement, no safety net should I be unable to find work. I don’t want children, but even if I did, I couldn’t afford them.
Oh, and did I mention that I still have thousands and thousands of dollars in student loans from graduate school?
That being said, I fall firmly into the camp of young professionals “willing to splurge on discretionary items without thinking about the long-term consequences.” (OK fine, maybe I don’t fall firmly into the “young” part of that, but you know what I mean.)
Unlike many Millennials, I am not putting my purchases on credit cards. I also don’t receive financial support from my parents. I do, however, buy things without any regard for my future. (I justify this based on the fact that the world is going to end in December. Seriously.)
As a freelancer, I am making less money than ever before.* However, here’s just a sampling of some of my bigger purchases in the past year:
49ers Season & Playoff Tickets
iPhone 4S, iPad 3, Kindle (and I’m buying a MacBook when the new ones come out in the fall)
Tahoe Ski Lease & Season Pass
Restoration Hardware couch
The list could go on and doesn’t even include vacations, clothing, makeup, equipment, dinners out and all of the rest of it, but I think you get the picture. I pretty much buy what I want because, well, I’m the only person I have to take care of and why shouldn’t I get what I want? After all, technically: I earned it.
Listen, I get that many will look upon this “confession” and think of me as wasteful or frivolous. Perhaps I am. Where as older generations at my age were concerned with things like buying a home, providing for children and building a savings portfolio, I’m more concerned with having the most fun I can possibly have. I choose dinners out and fun vacations over an IRA because those are things I can enjoy right now. Will I regret my decisions when I’m older? Perhaps. But based on the world we live in, I just have a hard time planning for a future that’s so unpredictable.
My mother didn’t rear me to speak publicly about money. She also didn’t rear me to be wasteful. “A penny saved is a penny earned,” she taught me when I was a child. She’s one of the savviest businesswomen I know, and I’m sure it concerns her that I have no plans for the future. After all, this is a woman who reuses a stamp when a letter arrives without a postmark.
But she had three children. Children she sent to private school, tennis lessons, music lessons and very expensive psychiatrists. I just have me. And I plan to enjoy my life the best way I know how: by snowboarding, going to football games, drinking great wine and spending $850 on a Thai food delivery ordering device. Otherwise known as my iPad.
So what about you? Are you “young, broke, and spending on luxury” or do you budget your money wisely? Which of your bigger purchases are “necessities” and are they actually or is that just how you rationalize them? Let’s talk finances in the comments. No judgments, I promise!
*Freedom is priceless.