Almost Everyone Feels Dead-Ass Broke

I don’t love CNN, and a lot of Bankrate studies are small sample size and tedious to get clickbait headlines, but I’ll bite on this particular Friday! Here’s one with 2,500 U.S. adults.

Here’s the main section you need to understand:

More than 2,500 US adults said they would need to earn, on average, $233,000 a year to feel financially secure and $483,000 annually to feel rich or to attain financial freedom, according to a new survey from Bankrate.

For context, in 2021 the median for a full-time U.S. worker was $56,473, so most people are apparently 4x off what they need to feel “secure.”

Obviously that’s going to scale stress, without a doubt.

However, there’s a ton of nuance around these types of studies and discussions that I think we need to quickly touch on:

1. The number for “happiness” for each person and family is entirely different. Some people live well without material things; some people cannot. Some people need a country club so their wife can take the kids to the pool in the summer; some don’t. Some people rent in cheap areas for a decade; some buy in expensive subdivisions. Each story is different.
2. People are very rarely truthful about anything that has to do with money.
3. When people are generally stressed by other things, they tend to assume that certain problems would go away if they had more money or more resources. While indeed some problems go away, I think we also all know the upper middle-class can be its own little prison.
4. There have been studies in the past — 2010 or so — that $76,000 was the number for happiness. I could still see that for some people, i.e. DINKs or people starting out. When you factor in 13-year inflation and the rise of cost of living in urban areas, I would assume that number is probably $115,000 or so for a lot of people now. I’ve seen studies to that effect, actually. Then you get the clickbait headlines of “If you make $193,000 in San Francisco, you’re below the poverty line.” That’s actually probably true, but a lot of this stuff is created to stir emotions and not capture reality.

We’re in this little perfect storm now, though, where we have a few narratives happening at once:

• Automation is arriving quickly.
• A belief that younger people “don’t want to work anymore.”
• Lower fertility rates / women having less children than they wanted.
• Tax bases getting eroded because of commercial real estate collapsing in urban cores.
• RTO vs. WFH discussions tied to where you can live, which employers will use a blunt force hammer on and just pay you less if you choose Missoula over Seattle.
• Inflation.
• Possible recession? "Soft landing?"

So, yes, shit is stressful. Do I think everyone, or couples, need to make $233,000 to live? No. My wife and I maybe skirt the edge of that collectively, and I could probably live on less — although some months when an excess amount of bills hit, it’s definitely harder. And do I save a ton? No. Somewhat, although admittedly I’ve spent $28,000 on IVF in the last 16 months, to no avail. So that does color my savings. I also went to Fiji, though, which was cool!

But if people honestly think their level of “security” is 4x away from where they might be, then yes, obviously we’re going to have mental health concerns and increased stress in a populace of that nature.

I think one of the most dangerous things for modern society is the pervasive belief in what are essentially myths around higher compensation. Higher compensation has to do with intelligence and work ethic in, at best, 8–10% of cases. In reality it’s often tied to: luck, knowing the right people, kissing the right ass, people who are more valued than you taking another job at the right time, Peter Principle, valuation or growth of a company you decided to stick with, your Etsy shop blowing up because of an algorithmic tweak, or a bunch of other essentially random things.

We’re also not discussing “wealth” vs. “income,” with the former being way more important long-term.

We ascribe a lot of narratives to people around “work hard and things will work out.” That’s mostly true in that if you work hard and have a generally OK attitude, you won’t be destitute or living in a meth tent. (You might.) But to think you’ll thrive just off work ethic? That would require a ton of self-aware bosses who see your potential and don’t spend their entire week in meetings. Good luck finding more than 2–3 of those in a decade.

In reality, money is very important to day-to-day societal functioning and your stress level. I was broke for pockets of 2017 (also the year I got divorced), 2019, and November-December of 2022. It’s stressful. That’s all you can think about. In my case, to break my brain of thinking about money, I wisely took whatever money I did earn and went to get drunk.

I probably would not recommend that one.

When we look around at the mental health picture and people believing in pedophilia cabals and people snapping and shooting on street corners, or zombie drug havens, or anything else … don’t we realize some of that is tied back to day-to-day financial stressors?