Are you suggesting that the govt should legislate to prevent the current generation spending $$$ on cheap flights/iPhones and instead start saving to buy a roof over their head ?
I believe the "luxuries" of today are overseas travel and upgrading the car every so often. The things I think could be classed as luxuries (cable TV, mobile phones, new computer every two years) are not luxuries to my kids but things they would struggle to go without. But they could do without them if they really wanted to save hundreds per month to get into a house.They are all choices. My kids don't see these as luxuries. They are standard, but my kids also scoff at my $17 monthly phone plan. We each do what suits us, but someone with a $70 per month phone plan will get no sympathy from me when they could manage by using the home internet for rather than have both. They don't see it as discretionary. My kids will not do without cable TV either. Or a fancy car. More choices that take money every month that we didn't spend (didn't have a choice on cable TV, internet or mobile phones of course). They could downsize all that stuff or do without and save so much quicker, if they choose to. They don't.
It isn't just we baby boomers whinging. I believe this whinging thread was started by one of those younger folk? Yes?
The cost of airfares from decades ago is pertinent because compared to a flight to England today which can be bought for about $1.7K, the same flight would have cost me the equivalent "back in my day" of over $8K. I could buy a house or I could travel. I could NOT do both.
My 26 year old son has (within the space of five years) bought a unit, bought a house with his partner, done it up and sold it, and bought another house with his partner and they are looking at spending around $700K on a major renovation. It will be worth over $1.5M finished. They have been to New York on one trip (cheap airfares, stayed with friends most of the trip) and London and Paris. I say "good on them" but refuse to acknowledge when they whinge (and they do) about maybe not being able to afford a $40K kitchen. I say put on a cheap bench top until you can afford stone. They say "no".
They will not compromise on the quality of the finishes for the renovation no matter how much we try to hose it down a bit.
Aged 26, I had bought a quarter share in a house, half share in a unit (had to sell both when family members needed their money out) and my first "all mine" house for $46K. It was 7 squares (size of a smallish unit), hideous kitchen and bathroom. I couldn't afford to renovate anything.
So, you see the comparison of "extra" things like travel is very important because these days, many younger folk want both, and can do both because it is so much cheaper. And good on them. If I could have done so I would have renovated rather than travel, but I couldn't afford to do either. My friend's parents (now in their 70s) also could not afford a toaster and put it on hire purchase when they married in the 50s.
The comparison is not as a whinge, but to try to help younger people get some sort of understanding of how very different things were even 30 years ago. My kids are amazed that a toaster bought in Woolworths for $20 would one day have had to be bought on hire purchase with a signed contract.
I recall very clearly that once I had a mortgage, I had no discretionary spending money for many years. Then I married and had kids and it is really only when I hit my 40s that things freed up a little. Now I can pretty much do what I like, but it was the early hard work and sacrifice that has put us in this position, not luck.
I'm so over this boomer bashing. I wasn't even a boomer until they changed the dates. Now I feel old
So many things have changed, not just house prices, that to compare today with even the 1980s is like comparing apples and grapes. It was just as hard back then, just in different ways. I couldn't easily et a loan as a woman for starters in the 1980s.
Cable t.v is certainly a luxury as is a 2nd car. However, I'd argue that phones, computers, and internet are essential in this day and age. I'm on a $40 a month plan but I don't have a home phone but I need a phone so people can contact me. Same as I need a computer and internet for work/studying because it's impractical using a library or a community centre.
My point was though, that I use home internet wifi rather than pay twice. It is a saving I can easily make and pays for something else I want. I could save by ditching the landline, but for now I keep it though choice but one day will possibly drop it. I don't need to double up and have huge capacity on my phone and my home internet.
As for myself I've never travelled overseas and at 24 I don't plan to for a while. I don't have a 2nd car and the car I drive is a 2002 Falcon XR6 VCT that I paid 5k for in cash back in 2013. Before that I had a 1988 Magna that I picked up for $1000 back in 2009 but had to get rid of it because it was costing more in maintenance than it was worth. I don't have much discretionary income either. I get paid fortnightly. Out of that fortnightly wage 50% of it goes against my mortgage (which is my choice) and than I pay another $240 in rent for where I live now. That gives me $530 to live on for the fortnight.
Since this is an economics section of the forum I'll add another point-
The other factor that doesn't get mentioned here is the precarious employment situation my generation has. The labour market has been deregulated so unlike older generations there is no such thing as a 'job for life' (excluding defence and police but even they had their generous pension schemes rolled back). I've committed myself to a mortgage but I understand why a lot of other people wouldn't because they fear becoming retrenched etc. In a way that's a huge motivation for me though because as Robert Kiyoski put it a JOB is pretty much just over broke.
Congratulations for your son though. He sounds like he's got a nice income and a good head on his shoulders. Not everybody in our generation is like your son though. Most people I know (especially the males) are either unemployed, working in dead-end jobs, or just graduates working in unrelated fields. There's a few that are doing successful but most of them are older and graduated before 2009 or they did apprenticeships and scored jobs in the mines. In hindsight I should've done a trade but the apprentice wages put me off doing that now.
My son bought his first unit on a salary of $38K and paid $295K. He is paid about $70K now. I don't call that a great income (and I think it is less than the national average?), but it is enough for him to make good use of it
Since the GFC the economy has been stagnant so it's the youth, people with low skills, and people with no experience who end up taking the full brunt of it. I know that sounds funny to say with unemployment being only 6.2% (7.2% in my state), booming house prices (in Sydney). However, Australia's economy only looks that good because of population growth. According to the ABS Australia's population increased by 354,600 people between September 2013 and September 2014. The extra 350,000 or so people a year is the reason Australia has not had a recession for 24 years and it?s why GDP growth is now around 2.3 per cent. On a per capita basis, Australia?s economic growth is among the weakest in the world, and per capita consumption growth is close to zero.
Here's an article that explains it more in depth http://www.smh.com.au/business/comm...-to-surplus-not-credible-20150531-ghccty.html
Edit- To be fair unemployment was higher in the baby boomers time over the last 30 years but it's the conditions and casualisation of the workforce, which Gen Y now has to put up with.
Jeezus, I think I would have a heart attack if I got a bill that high.
I do. try explaining it to the three males I share the house with, though
Would still prefer a Celica over a Commodore or Falcon!
Me too
We pay over $1000 per quarter for 3 people.
