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Rich people during the downturn

I was reading an article today about rich people having a harder time during the downturn in the economy. What really struck me was the some of the comments.

1. It’s ridiculous to say you cannot sell your house (now that you can no longer afford to maintain it). You just can’t sell it for more than its market value. Doing so involves admitting that you overpaid when you bought it. You made a bad decision, accept the consequences. Staying in a house you can’t afford only worsens your loss.

2. People that make more money than you do do so because they made better decisions earlier in life, and took successful risks. With the exception of circumstances outside of your control (abusive parents, birth defects, traffic accidents) everyone in the US has a reasonably equal opportunity in life. Most disadvantages at the start can be overcome if you work harder.

3. College is only unaffordable if you make it so. Jr. college costs a few hundred per semester, and that’s for 2 years. Another 2 years of college at 2K per semester is 8K. Live with your parents, go to whatever is nearby, and get a degree. It only matters for your first job, and if you excel at your first job you’ll catch up quickly enough. If you’re too old to live with your parents now, that’s your own fault for screwing around when you had the chance. You’ll have to work harder to make it up.

4. Rich is relative. I make more than the person in the article, yet I’m only middle class. I can’t afford to buy a house. Federal income tax takes over 30%, state tax another 10%, Social security another 10K, sales tax is at 8.5%, and so on. My rent is $3000 a month and while I’m renting a house, it’s not a mansion by any means. Federal taxes do not take into account cost of living. You may make more, but you pay progressively more in taxes, and have to pay more to live.

5. For every business owner, there are 9 that failed. For every rich business owner, there are 9 that are not rich. And every business owner works 7 days a week 24 hours a day. Perhaps not directly in the office/shop/restaurant. But the business is always there, demanding your attention to make it successful. So successful people deserve the money they made, and if they play golf all day, it’s because they worked hard earlier. Are there rich people that don’t deserve it? Of course. But that’s the aberration, and sooner or later it’ll even out.

6. If you can’t save, look at your spending habits. There are very few people that cannot afford college were they to control their expenses to the true necessities. That is why foreigners get ahead. They really did have nothing where they came from, so they understand how to save and what is really a necessity.

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