Why young people are worse off than their parents — and what to do about it

[captainspoke]

Here's something I came across in a wapo article:

In 1966, Sears sold customers a 21-cubic-foot capacity, self-defrosting, side-by-side refrigerator for as little as $545. Today, the store’s cheapest equivalent model is more than $1,000. The bigger difference is that, in 1966, the U.S. median family income was $7,500, while in 2022 it was $97,750. If the price of fridges had held constant as a percentage of family income, that new one would cost more than $7,000.

https://www.washingtonpost.com/opinions ... 48ef5f3b9d

[beanhead]

Here's something I came across in a wapo article:

In 1966, Sears sold customers a 21-cubic-foot capacity, self-defrosting, side-by-side refrigerator for as little as $545. Today, the store’s cheapest equivalent model is more than $1,000. The bigger difference is that, in 1966, the U.S. median family income was $7,500, while in 2022 it was $97,750. If the price of fridges had held constant as a percentage of family income, that new one would cost more than $7,000.

https://www.washingtonpost.com/opinions ... 48ef5f3b9d

Good one. There are numerous other similar examples where new technology is priced out of reach of the masses. Early PCs, perhaps, or Ford Model T cars.

The key purchase that has not become more affordable in recent years is property. This is one of the things that Prof Galloway talks about. The pricing of young people out of home-buying.

[Moneymatters]

The key purchase that has not become more affordable in recent years is property. This is one of the things that Prof Galloway talks about. The pricing of young people out of home-buying.

These “never had it so good” generational discussions can quickly get quite heated but I guess the demographics of this forum make that unlikely

Being Gen X I’ve only ever been told to be quiet by both the generation above and the one beneath me! An outlet such as this is a godsend.

Anyway. All I wanted to say/echo was. The change in cost of housing in relation to income is undeniable. It encourages people to take other routes in life. Less likely to have kids etc.
I’m pretty sure Marlow might have something to say about Shelter being a purchase decision. He’s got that on the base level of his pyramid.. Being forced to rent into retirement without a final salary pension whilst lining landlords pockets can’t be fun. Although. If they didn’t have kids.. hmmm

Oh. This is a common line among gen z.

“Buy a house, have kids, save and retire early.

Choose none.”

Gotta admire their sense of humour at least..

[RetireJapan]

Japan is pretty good for that I think. Housing is affordable. It's the other stuff. We spend a lot more money on wants now, and if someone were willing to do without for a few years they should be able to get enough of a foundation to get ahead.

The grouch in me says that if people put a fraction of the effort they put into complaining into improving their situtation, they would have a lot less to complain about...

[beanhead]

Japan is pretty good for that I think. Housing is affordable.

Yep, agreed. This problem is a very real one in the UK, and some parts of the US.
Fortunately not an issue in Japan, nor likely to become one...

[Tsumitate Wrestler]

There may be a lot of affordable housing *in Japan* but, people need to live where there are abundant jobs and services. Home ownsership in Tokyo, for example, is out of reach for many.

When the average person in Japan complains about not being able to *make it*, what they are saying is that the Hiroshi Nohara (野原ひろし) stereotype, which was once an everyman, is now a dream for many within greater Tokyo.

https://crayonshinchan.fandom.com/wiki/Hiroshi_Nohara

The average purchase price of a custom-built house with land in the Tokyo metropolitan area is ¥49.93 million.
The average Tokyo base land price in 2020 was 600,100 yen/m2 in all 23 wards and 378,100 yen/m2 in the whole of Tokyo.
The cost of building a detached house of average size is 58,515,500 yen for the whole of Tokyo and 73,725,500 yen for the 23 wards.
When calculating the annual income required, the guideline is ‘over 8.6 million yen’ for the whole of Tokyo, and ‘over 10.4 million yen’ for the 23 wards.
Household data from the Housing Index is useful if you want to find out the average annual income of each city and ward.

首都圏の土地付き注文住宅購入平均額は「4,993万円」
令和2年度東京都基準地価格の平均地価は23区全域で「60万100円/m2」、東京都全域で「37万8,100円/m2」
平均的な広さの一戸建てを建てる費用を計算すると、東京都全域で「5,851万5,500円」、23区では「7,372万5,500円」
必要な年収を計算すると東京都全域なら「860万円以上」、23区では「1,040万円以上」が目安
市や区ごとの平均年収を調べるなら「住まいインデックス」の家計データが便利
https://www.homes.co.jp/cont/buy_kodate ... ate_00792/

[Furancisuko]

IMHO the problem goes far beyond "unaffordable housing" and "young people are just lazy" (despite both assertions are true, specially the first one)

- Chronic fiscal deficit around the globe.Massive increase in public debt
- Continuous currency debasement, all around the globe
- Reported inflation totally disconnected from real inflation (minimum twice the reported inflation)
- Economy of gov friendly privileged companies "too big to fall"that get confident their mistakes will be bailed out by govt (by printing more money/issuing more debt/raising taxes
- Raising taxes
- Ever increasing regulations, making difficult any innovation/competence

I'll stop there, I understand that this train of thought is not easy to digest, yet.

[beanhead]

- social security (and therefore state pensions, nenkin) should be means-tested, NOT based on what you have paid in

This is my biggest fear for the UK national insurance funded pension system.

There have been (unsubstantiated) rumours that the new Labour government will do this, apparently.
Covered in this article:

https://www.thisismoney.co.uk/money/pen ... nsion.html

[Deep Blue]

- social security (and therefore state pensions, nenkin) should be means-tested, NOT based on what you have paid in

This is my biggest fear for the UK national insurance funded pension system.

There have been (unsubstantiated) rumours that the new Labour government will do this, apparently.
Covered in this article:

https://www.thisismoney.co.uk/money/pen ... nsion.html

Just rumours, not based on anything they've actually said. If it happens, I guess it would be phased in so that those who have made all the contributions continue to get the full pension, and means testing will kick in gradually over a couple of decades or so. This would seem fairish and give plenty of time for those affected (probably those in their 30's now) to start planning.

I also think they'd have to bin the triple lock if they start means testing for future pensioners. It's already deeply deeply unfair to those whose contributions are paying for the generation aboves current pensions.

[Wales4rugbyWC23]

This is my biggest fear for the UK national insurance funded pension system.

There have been (unsubstantiated) rumours that the new Labour government will do this, apparently.
Covered in this article:

https://www.thisismoney.co.uk/money/pen ... nsion.html

Just rumours, not based on anything they've actually said. If it happens, I guess it would be phased in so that those who have made all the contributions continue to get the full pension, and means testing will kick in gradually over a couple of decades or so. This would seem fairish and give plenty of time for those affected (probably those in their 30's now) to start planning.

I also think they'd have to bin the triple lock if they start means testing for future pensioners. It's already deeply deeply unfair to those whose contributions are paying for the generation aboves current pensions.

Although the Australians have done this with their state pension- it is means tested, they have set up one of the most comprehensive private pension systems in the world, they did this over 30 years ago before all the baby boomers starting retiring. The sheer cost and bureaucratic nightmare this would involve would make it impossible. The state pension is the largest cost of UK government expenditure but after America, Brits have the second largest amount of pension reserves in the world. The state and private pension complement each other well, and in terms of pension provision I think we are well ahead of Japan.