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Is everybody in debt?

116,052 Views | 681 Replies | Last: 3 mo ago by Captain Winky
jja79
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It's way more common than you think.
AggiEE
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topher06 said:

Biglaw attorneys make $500k+ in their thirties. Dated a doctor who made a little under a million a year for a bit, early 30s. Think it's completely reasonable that people in their 30s make mid six figures


Sure, it happens, but isn't exactly common.

Those that are doctors and lawyers make up a very small percentage of the population. Even less are those that manage to make it to big law (or a selective specialty) and stay with it long enough.
AggiEE
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jja79 said:

It's way more common than you think.


We must have different definitions of common, but <1% of the population isn't common in my view
techno-ag
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$30,000 Millionaire said:

techno-ag said:

$30,000 Millionaire said:

YouBet said:

jja79 said:

I talked to a 30 something year old Friday that is straight salary. $50,000/month but couldn't qualify him for a mortgage because his debt to income ratio is too high and he doesn't have any money for a down payment.


$600k a year?


Don't be shocked. I have seen it happen.
He needs to do a Dave Ramsey snowball and knock out that debt.

It's not how much you make, it's how much you save.


I hear this a lot and that's just not true. A teacher can save 100% of their income their entire career and probably have less than $1.5M in principal. They won't crush it unless they learn to invest
You hear it a lot because it is true. The average person has no savings and lives paycheck to paycheck.

As for investing, the teacher in your hypothetical needs to save before investing. Or save by investing. Either way, investing involves building wealth. But if you spend that wealth... You see where we're going. It's not how much you make that's important, it's how much you save. THEN you can invest in the stock market, put a down payment on a house, etc.
YouBet
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jja79 said:

It's way more common than you think.
Well, it's not but I'm not sure there is any point in arguing about it.
jja79
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I'm not arguing this. I was opininng that it's more common than most people think. I review people's financials daily and I'm astounded how frequently that's the income level.
Ghost of Bisbee
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% self made vs. inheritance/trust fund annuities?
752bro4
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YouBet said:

jja79 said:

It's way more common than you think.
Well, it's not but I'm not sure there is any point in arguing about it.

My wife did it for a decade in her 30, albeit as an owner of her business as well as a practicing DVM before she burned out and retired.

I work fortune 100 finance, and all MDs are north of that too, but the structure of payment isn't just a $50k monthly salary. The bonus and rsu structure keeps you stuck to the corporate teet waiting on that next vesting period.
YouBet
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752bro4 said:

YouBet said:

jja79 said:

It's way more common than you think.
Well, it's not but I'm not sure there is any point in arguing about it.

My wife did it for a decade in her 30, albeit as an owner of her business as well as a practicing DVM before she burned out and retired.

I work fortune 100 finance, and all MDs are north of that too, but the structure of payment isn't just a $50k monthly salary. The bonus and rsu structure keeps you stuck to the corporate teet waiting on that next vesting period.
Full comp package beyond just salary makes it more common, yes. My wife is about there once you factor bonus and RSU's on top of her salary. Maybe that's what some on here were saying. She's also an executive.

A straight salary of $600K per year is not common though which is what I was specifically talking about.
jja79
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I haven't dealt with many trust fund types. More than half the people I deal with at that level are Texags posters.
Out in Left Field
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Damn, inflation be crazy. Now the average TexAgs salary is $600k.
YouBet
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Out in Left Field said:

Damn, inflation be crazy. Now the average TexAgs salary is $600k.


If it makes you feel any better, I've only made about $3k this year so I'm single-handedly killing the average of this board.

I probably shouldn't be allowed to post here.
Baron von Bulsh
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You're still allowed to post here, because you're the smartest of us all.


You got yourself a Sugar Mama.
billikenag
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Quote:

I talked to a 30 something year old Friday that is straight salary. $50,000/month but couldn't qualify him for a mortgage because his debt to income ratio is too high and he doesn't have any money for a down payment.


Context is important. No this is not common for the overall US population, but it's pretty common for physicians in procedure-heavy specialties with long training periods.

Graduate medical school at 27 with $200,000 in debt (the median debt for US medical school graduates). Complete a neurosurgery residency and neurotrauma fellowship (8 years of training and likely 1 move across country from residency to fellowship). At 6.28% interest on the loan (current Direct Plus loan interest rate) and a salary during training ranging from 60-75k (meaning less ammunition to make a dent in loans), the physician leaves training with ~$330,000 debt.

Let's say this physician just finished his training this July (the medical academic year ends in June) and signed on as a neurosurgery/neurotrauma staff physician with annual salary of $600,000 (totally believable at a large urban hospital with a level I trauma center that needs a new neurosurgeon to maintain their trauma certification). He has 1 month's salary under his belt with no cash and a high debt to income ratio.

This scenarios is so common, that First Republic advertises doctor debt consolidation loans and mortgages to lock these individuals into their banking ecosystem long term. If it's not a doctor though, I got nothin' for ya.

A noble spirit embiggens the smallest man.
jja79
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Out in Left Field said:

Damn, inflation be crazy. Now the average TexAgs salary is $600k.
I don't think anyone said that. I'm in banking and see lots of people's financials. It astounds me how many high 6 figure and 7 figure earners there are. I never said it was typical. I said it's more common that what people think, or so I believe. And yes many of those I talk to and do business with in that income range are on this site.
jja79
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AggiEE said:

jja79 said:

It's way more common than you think.


We must have different definitions of common, but <1% of the population isn't common in my view
More common than you think and common are two different things.
capital markets
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jja79 said:

Out in Left Field said:

Damn, inflation be crazy. Now the average TexAgs salary is $600k.
I don't think anyone said that. I'm in banking and see lots of people's financials. It astounds me how many high 6 figure and 7 figure earners there are. I never said it was typical. I said it's more common that what people think, or so I believe. And yes many of those I talk to and do business with in that income range are on this site.


Selection bias. These figures are for less than 1% of the population so they definitely aren't common in the overall population.

But as a banker you likely deal with ppl that are more well off, so you likely see income levels like these more than 1% of the time.
Diggity
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Quote:

"it's more common than you think!"

"how do you know how common I think it is?"

"I don't, but it's more common than whatever that is"

"don't you ****ing tell me how common I think something is!"


never change TexAgs.
jja79
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I never said it was common in the general population. I said it was more common than most people think. Those are two entirely different things.
Hungry Ojos
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I've been a licensed attorney for nineteen years. I know many, many other attorneys across the state in all different practice areas. The average salary for a person with my experience is like $170k a year. I have never come across a single lawyer in their 30's making $600 or even $500k a year. Are there exceptions? Sure. But the reality for most attorneys is that they don't make NEAR what the public thinks they make.
CC09LawAg
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Yeah, that ain't happening on salary. And even if you're making that on contingency or as a rainmaker, there is no guarantee you can do it year in year out.
evestor1
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They took all true incentives out of my business b/c commission structures were making too much.


So here I am, a nearly 40 year old low level exec making not enough to be happy.

...just giving them 50% at work and putting overtime into developing - building cheap houses for fat people and their pit bulls to move into and pay me 1500 / month.

gig em 02
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Hungry Ojos said:

I've been a licensed attorney for nineteen years. I know many, many other attorneys across the state in all different practice areas. The average salary for a person with my experience is like $170k a year. I have never come across a single lawyer in their 30's making $600 or even $500k a year. Are there exceptions? Sure. But the reality for most attorneys is that they don't make NEAR what the public thinks they make.


To be fair, that's in line with big law salary expectations, but that is certainly a minority of attorneys.
mwp02ag
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My wife was a RN in the OR prior to becoming a Realtor. She works with lots of highly paid surgeons. She has always said they are just highly paid technicians, trading thier time for money just like most of the population. The real moral of this story is human psychology is pretty damn consistent. Robert Kiyosaki explains it best in his Cash Flow Quadrant book by saying most people spend the same percentage of income no matter how much they make. It's just like how we will allow work to expand to the time allotted for it.

Becoming wealthy takes a different approach all together where you invest earned income and live off the cashflow.
techno-ag
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Hungry Ojos said:

I've been a licensed attorney for nineteen years. I know many, many other attorneys across the state in all different practice areas. The average salary for a person with my experience is like $170k a year. I have never come across a single lawyer in their 30's making $600 or even $500k a year. Are there exceptions? Sure. But the reality for most attorneys is that they don't make NEAR what the public thinks they make.
Come on, man. We've all read The Firm.

Duncan Idaho
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gig em 02 said:

Hungry Ojos said:

I've been a licensed attorney for nineteen years. I know many, many other attorneys across the state in all different practice areas. The average salary for a person with my experience is like $170k a year. I have never come across a single lawyer in their 30's making $600 or even $500k a year. Are there exceptions? Sure. But the reality for most attorneys is that they don't make NEAR what the public thinks they make.


To be fair, that's in line with big law salary expectations, but that is certainly a minority of attorneys.


The binomial distribution of lawyer salaries is a very real thing.

https://www.biglawinvestor.com/bimodal-salary-distribution-curve/
Proposition Joe
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Don't "salaries" get significantly skewed with lawyers though? I assume the ones making the big bucks are getting a % of the settlement.
Dan Scott
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This countries tax code and economic system benefits investors and entrepreneurs. You can't make it big working for somebody. You can have a nice middle class life but that's it.

Buy some land and develop it into office/warehouse. You should be able to collect more than enough monthly to service the debt. In a few year it's all paid off. In the meantime, you borrow against it and go build another one. Eventually you'll be making 6 figures doing nothing. It's not like a house where you have to find a tenant every year. You get to expense everything for tax purposes.
coastalAg
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Dan Scott said:

This countries tax code and economic system benefits investors and entrepreneurs. You can't make it big working for somebody. You can have a nice middle class life but that's it.

Buy some land and develop it into office/warehouse. You should be able to collect more than enough monthly to service the debt. In a few year it's all paid off. In the meantime, you borrow against it and go build another one. Eventually you'll be making 6 figures doing nothing. It's not like a house where you have to find a tenant every year. You get to expense everything for tax purposes.
This is some TikTok ass financial advice. In theory, you can make the above work, but there are a lot of risks and caveats that go along with it.
Troglodyte
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techno-ag said:

Hungry Ojos said:

I've been a licensed attorney for nineteen years. I know many, many other attorneys across the state in all different practice areas. The average salary for a person with my experience is like $170k a year. I have never come across a single lawyer in their 30's making $600 or even $500k a year. Are there exceptions? Sure. But the reality for most attorneys is that they don't make NEAR what the public thinks they make.
Come on, man. We've all read The Firm.


Well - we at least watched the movie.
AggiEE
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mwp02ag said:

My wife was a RN in the OR prior to becoming a Realtor. She works with lots of highly paid surgeons. She has always said they are just highly paid technicians, trading thier time for money just like most of the population. The real moral of this story is human psychology is pretty damn consistent. Robert Kiyosaki explains it best in his Cash Flow Quadrant book by saying most people spend the same percentage of income no matter how much they make. It's just like how we will allow work to expand to the time allotted for it.

Becoming wealthy takes a different approach all together where you invest earned income and live off the cashflow.


If doctors are just "glorified technicians" according to your realtor wife

What does that make realtors? Glorified swindlers?
mwp02ag
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BURN....lol dude you didn't even quote me accurately.
oragator
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At,least for me, and probably others on this board. I have a relatively decent net worth because I am a saver, I don't spend a ton, which makes having the money kind of pointless, other than security/freedom, which for me is the real value of it - if I want to quit a job, or if I were to get laid off, or even if I chose to retire (though I would have to be fairly frugal as of now), I am safe from bad outcomes for the most part. And not having that worry is worth what I give up, then it becomes a lifestyle.
As far as the general population, 64 percent of all Americans, and 48 percent of those making over 100k live paycheck to paycheck right now. Some of that can't be helped much for working class or even some middle class folks. but a lot of it is just bad decisions when you get to the higher brackets. One of the things that was fascinating in 2020 was how many luxury cars were driving into food banks when the crisis hit. We aren't a particularly financially literate country,
schwack schwack
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Quote:

I have a relatively decent net worth because I am a saver

Same. We have no debt & I think a lot of my mindset has to do with my parents. They worked hard - I doubt either of them ever made over $40K a year. They saved to pay cash for big purchases - no new car until they could pay for it & they kept those cars for 10+ years. Typically all they had was a mortgage at first but later in life, they paid cash on nice houses that were not over the top & smaller at each step of their transition. All of their kids are college graduates (granted - it was a lot less money in the old days, but they paid for each of us so we would not have debt) and all 3 of us are doing fine financially - none of us are in major debt.

Different times for sure, but I still live with the same values.

oragator
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I got there the opposite way, outwardly we had an upper middle class life but we were money insecure for much of my childhood. I was a few years out of school with little net worth before the light bulb went on and decided it as time to break the pattern. I had always been a decent saver, but not always wise on spending which I started to fix. And got more serious career wise to move up and facilitate it. I tripled my salary in about 6 years I think to get on the right path.
Now it's all fun to me, as weird as that sounds. The game of seeing how much I can save and use to compound my way to real money is enjoyable.
 
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