The Millennial generation: Entitled or just different?

The Millennial generation: Entitled or just different?

You can hardly peruse Facebook or news sites these days without finding some commentary on Millennials. Some articles insinuate that Gen-Y is entitled and lazy, while others delve a little deeper to look into the challenges many in this generation face.

I recently read an article about how Millennials spend their money titled “Pets, debts and e-cigarettes: how millennials spend their paychecks”. Now I wouldn’t consider myself part of this so-called Me Me Me Generation but according to Wikipedia’s age range I am smack in the middle of it. (Okay, so maybe being born in 1986 puts me about 1/4 of the way in, but I look younger than I am… Right? Right?!?) In case you don’t have time to read the article, here is an overview:

  • A non-scientific case study of six Millennials ranging in age from 23 to 29 was completed to see how they spend their money and how much they earn.
  • Salaries ranged from $0 (one young lady was unemployed) to $130,000 annually, with a median income range of $30,000-$33,000 a year.
  • Each person spent their money in different ways, but both income and spending were self-reported. Their expenses were then broken down into the top five categories.
  • The highest reported expenses were typically rent, food, and student loans, closely followed by things like medications, daycare, and car payments.
  • Of their top expense categories only one person listed hair appointments, one listed cigarettes, two listed gym memberships, and one listed travel.

The question I’m left with after reading this article is:

If we’re spending money on the same things as other generations, why are we being labeled as entitled?

Now let me jump to my own life; if I were to be included in that article, what would my “Top 5” look like?

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Now let’s see how my income stacks up:

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Assuming everyone in the article works an average of 40 hours per week, the average hourly rate would be $21.31. In comparison mine is $20.24. With my second job and working about 65 hours per week, my income per hour drops to $19.55.

It looks like I am right in line with others in my generation. I know there are a few in the higher echelon and many more making less than I am, but for ease let’s just go with the numbers we have here. With the average monthly rent payment of $790 and a mean net income of $2,770.83 per month (if we are all in the 25% tax bracket), this means that Millennials, on average, are spending about 28.5% of their income on rent. Completing the same calculation for student loans, Millennials spend an additional  24% on college debt each month.

When other generations describe Millennials as being lazy or extravagant spenders I get a little riled up. In fact, one of the issues my own parents have when it comes to my spending is that they “don’t know where all my money goes”. Even when I break everything down, showing them my budget, they don’t believe me. It seems like a lot of people from Generation X are wearing the same blinders. After all, they paid rent (or a mortgage) and made much less money than we’re making now. So why can’t we save like they did?

There are a myriad of possible answers to this question, not the least of which is inflation, but I’m not going to get into that right now. What I’d like to focus on is student debt. This 2013 article featured in The Huffington Post goes over some of the numbers haunting Millennials. The most relevant point to me is that the average student loan debt of Millennials graduating with a 4-year degree is around $26,600. The article points out:

This can be contrasted to 1993, when less than half of students graduated with debt, and those who did had an average of $9,350 in loans. Maybe we are just bad with our money?

This writer echoes what I’ve heard so many Baby Boomers say: “You’re just bad with your money.” I think all Millennials everywhere throw our hands up and retort right back with me: “Fuck off.” Because it’s not just the fact that we have student loans. It’s the inflation of the cost of a college education that’s really killing us.

I started college in 2004; the tuition there at that time was about $34,000. The tuition at that same school today, 12 years after I started, is just under $55,000. The same education now costs 62% than it did when I started college.

You read that correctly – 62% percent.

In comparison, let’s look at U.S. inflation over the same period of time:

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Calculated by http://www.usinflationcalculator.com

 

I’ll just come right out and say it. $42,700 is nowhere near $55,000, and 25.5% is nowhere near 61%.

So the added burden of student loan payments, is it any wonder why Millennials can’t save for a mortgage, pay for a new car with hard-earned cash, or deposit more into their 401k each month?

I think this is part of the reason people my age (or younger) get excited when they hear me talk about buying a Tiny House. They struggle with the same financial burdens that I do. Even if they can’t see themselves living in a Tiny House, it inspires them to think outside the box in terms of living situations and expenses. The people that balk at this idea are primarily members of older generations who do not understand the weight that is student loan debt.

We can’t buy huge houses then pay them off in 10 years (like you did) because we’re paying the amount of your mortgage in student loan debt every month.

I can’t keep banging my head against the wall to conform to what one group of people thinks of as “normal”. My circumstances are different than yours were at my age. My priorities, therefore, must be different.

It’s time for our parents and grandparents to look at us in a new light. It’s time for Generation X to give Generation Y a little break. It’s time for us to look at our futures differently. Because we are different. And like you taught us Mom and Dad,  different just ain’t so bad.

Let us become the swans you always said we could be.

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It was all going well until…

It was all going well until…

..there were some major setbacks this weekend.

Most importantly, my builder had some unexpected things come up and he was not able to deliver my THOW shell on Sunday. We are rescheduled for this coming weekend, on Easter Sunday to be exact. And that turned out to be all well and good considering what happened Saturday night…

As most of you know I have been working two jobs since November to try to save for my Tiny House. As some of you know, I have been working 70-80 hours/week to save as much as possible before the THOW arrives. As a few of you know, 80 hours/week is my cut-off for losing my mind. I need at least one day off a week to rest and recoup.

There was no resting or recouping this Sunday. Only anger, a sense of betrayal, and the ensuing depression.

My car was broken into at some point Saturday night. All of my tips from Friday were stolen. The money was hidden in my car as I was going to deposit it that night after work. I checked it between 4:00-5:00PM when there was a slight lull in my shift.

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When I came out after midnight (after having been there since 9:30AM), I went in my car to change my shirt and have one post-shift drink. That’s when I noticed the glass in the back of my car. Nothing else was stolen even though my purse was in my car. All of my debit cards, credit cards, and keys were still there. The only thing missing was my cash.

We called the police and they say they’re going to pull the camera footage from neighboring businesses. They say they’re going to look for this guy. They say with any luck they’ll find something in the footage. They say, they say, they say. I’ve had my car broken into before. I know how this works. I’m out the money the thief stole as well as the money to fix the broken window. The person won’t get caught and, since I think it someone I work with at the restaurant, I have to either quit or feel uncomfortable for the rest of my time there.

Now I usually work Monday thru Friday (8:00-4:30) at my day job. I then work Wednesday, Thursday, and Friday nights and all day Saturday. I have one bank account where my main job’s paycheck is deposited and another just for my tips and other income. This helps me to keep things straight and not spend what I’m making at either job.

As of Thursday when I updated my budget, I only needed about $65 to hit my income goal for the restaurant this month. Then I made $315 on Friday night, which is a very large amount of money for 7 hours or so of work. One of my regulars gave me a very generous tip for which I was beyond grateful, and all because he sees me working hard and wants to help me achieve my goals. He tells me this every time he sees me. It is encouraging.

Not only has this thief robbed me, but he has robbed others of their good intentions toward me and my life. He has robbed me of my sense of security and made me more than a little vexed with my car. He’s robbed me of the $315 in hard-earned tips and the $300+ it will cost to fix the window he broke.

For the record, if you ever have to break into your SUV, the vent window is the most expensive window to break. This isn’t a picture of my car but another one similar to it, and I’ve circled the vent window in red:

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Even though it is the smallest window, it is permanent and considered part of the door, so it must be sealed differently. For my SUV with the privacy tint, I got quotes ranging from $305-$499 for this window alone. Never break this window if you can avoid it.

Now I’ve said before that I don’t want to ask anyone for money for my Tiny House project because I am fully capable of doing this alone. I can work hard for this and wear my body out every week until I have everything paid for. I can do whatever it takes. But this was such a blow, both mentally and financially.

For this reason, I’ve decided for the first time to ask for a little bit of help. I have to write two very big checks in the next week (one for the down payment on my land the other for the remaining balance for my THOW shell) and this $600+ swing is coming at exactly the wrong time. If you can, please considering sending just a few dollars to help me recoup this loss. It would be more appreciated than you know.

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Go to: http://www.gofundme.com/rachelsbrokenjeep to help me recoup my THOW money. Anything is appreciated!

Here is my GoFundMe link. Click here: Bum Thief Broke My Jeep Window fund or go to: https://www.gofundme.com/rachelsbrokenjeep. PLEASE share it as well. I am not asking for more than I lost in this fiasco. Thank you all for your continued love and support.

 

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An extra special thank you to those who have already helped me deal with all of this over the past weekend. Thank you to those who drank with me afterward to numb myself, let me crash with you, taped my window up like surgeons, and continued to text me to make sure I was okay. You are wonderful friends and you know who you are. I won’t embarrass you by calling you out by name, but I owe you more than you know. Thank you.

Giant Leaps

Giant Leaps

I mentioned in my last post that I put an offer in on a piece of land. Yes – it was the land that I’d mentioned previously. (If you missed it, read about it here.) I have good news to share and bad news to share.

The good news is that the sellers accepted my offer!

The bad news is that the sellers accepted my offer…

So I now have the very interesting task of tearing down the structure that is on the property. I wanted to share a few pictures before I begin the process. I will try and get to the property soon to take some more pictures since I don’t have any of the view, which is the best part.

WARNING: They are not pretty!

I also went to the bank to set up my loan and payments, and since I’m documenting my process I will share with you the strange way I’ve had to go about my financing.

First I got a personal loan to pay my builder, Tiny House Squared, and pay for some immediate upgrades to the property. I paid my builder a down payment, plus paid for the order of building materials. (He chose the materials but we worked collaboratively on the layout of windows, the door, walls, etc.) In lieu of a traditional personal loan, I went the route of refinancing my car. This made it a secured auto loan, which gave me a much lower interest rate. I highly recommend it if this is an option for you.

I knew if I bought this property that I would need to pay for some things immediately, like fixing the driveway and renting a dumpster to haul away the trash. (I also need to hire a company to haul away a car that is on the property, but I have to get a abandonment title first since I don’t know who owned it.) Additionally I’ll need to buy some tools I don’t currently have, like a reciprocating saw. I don’t think I’ll need the entire amount of the loan I took out, but I figured it was better to be safe than sorry in this situation.

My next step was to find a bank that would lend on a piece of land. The trouble I ran into was twofold. First, most banks will not give you a mortgage for less than $50,000; the risk-reward is just not in their favor on these loans, I’m told. Second, few banks will give a land loan, which is what I need. The suggestion I ran into again and again was to take out an additional personal loan. With a 4-5% difference between a personal loan and a land loan, I continued to pursue the latter. I was finally referred to a small bank about an hour away from where I live for my land loan. To save yourself a lot of time and a migraine or two, I suggest starting with smaller banks and credit unions if you need this type of loan.

Now that the loan is in process, I have to focus on tedious tasks, such as getting the aforementioned abandonment title and calling electricians to get a quote on temporary electric service. I am also getting a quote from a demolition company just to see if it would be worth my money for someone else to tear the modular home down. I’m currently doubling my income with my second job, so I think about one month of my second income is my cut-off amount for the demolition. I’ve also left messages for the Fire Marshall to see if the volunteer fire department would come and do a controlled burn. That would be ideal!

Either way, once the structure is down I will need to get someone to take the I-beams that the house is resting on. They are very long and obviously heavy, but I have a few options.

The most exciting part so far is that my trailer is finished and my build has begun! Here are some pictures of that as well!

Thank you for continuing to follow my journey! More exciting updates to come!

Financing My (Tiny) Dream

Financing My (Tiny) Dream

In my last post I talked a little bit about my personal budget. Since then I’ve been trying to figure out where I’m going to get the money for each step of this process. I have had to figure out:

  • The Trailer – How will I pay for the physical trailer that the Tiny House shell will be built on?
  • The Shell – Banks do not lend money for Tiny Houses, especially in the form of a traditional mortgage.
  • The Interior Build – This will all be done as I can afford it, but how long will it take to save the money to pay for everything I need/want?
  • The Land – Since my parents are not on board, where will I put my Tiny House? Once I find the land, how will I pay for it?

I’m going to try and address these one by one, with some extra emphasis on land since that’s what I’ve been focused on the last few days.

The Trailer

I decided to take a fairly unique approach to financing my trailer. Rather than lump this in with a personal loan, I qualified for a new credit card with 0% interest for 12 months. Since I am working two jobs right now (and I intend to continue working both jobs until I’m done financing my build), I feel I can pay this off well before the 12-month timeframe. I will put the entire trailer cost on one credit card.

The Shell

I will have to get a personal loan for the financing of my shell build. I had been planning to save all the money for this before beginning this process, but fate stepped in and I was able to get a great deal with my builder if we started sooner. While the loan will cost me some interest, I intend to get a secured loan by putting my car title up for collateral. This will give me a lower interest rate and save me money. In addition, the money I save by not paying rent for an extra 12-18 months while saving will actually be far less than the money I spend in interest.

The Interior Build

I’m not at this stage yet, but my plan will be to recycle, reuse, and refurbish as much as possible. For example, one piece of land I’m looking at has a modular home on it that is in rough condition. However, I would be able to save some kitchen cabinets, wood siding, decking, cinder blocks, etc. Reusing these materials would save me a lot in the long run. I also plan to use craigslist and local auctions to find interesting pieces, which will be cheaper than I can buy them at the big box stores. I will use the cash I make from my waitressing job to pay for things I find online, at auctions, or at flea markets. I am particularly excited about reusing items that might otherwise be tossed or used for kindling; this is part of the whole Tiny House movement for me. Waste not, want not!

Which brings us to…

The Land

Also known as: the bane of my existence over the last couple of weeks. I am struggling to find what will be the best fit for me. For example…

Should I buy a fresh piece of land with nothing on it? I would be free to put the utilities and my Tiny House anywhere I want on the property. I can look at the blank canvas of grass and mud and figure out what kind of neighbor I want to be, what direction my Tiny House should face, and how many cherry trees to plant. I’d only be hindered by my imagination (and, of course, my property lines).

Should I buy land with a modular or trailer home already on it? This would save me the hassle and expense of putting in new utilities. I don’t know exactly how much it would cost to dig out sewage from the street to my Tiny House, but I can tell you I don’t want to spend it! Having a modular or trailer home already on the property, especially one I could harvest materials from (then subsequently destroy), makes sense because I’d save on all those expenses. It’s also likely that there would already be a clear, level space for my Tiny House to rest, and maybe even a driveway.

Should I buy land with a larger house on it, rent it out, and put my Tiny House somewhere else on the property? This option is a stretch for me, but it does exist. This would make financial sense because I’d then have an income property, but it could also help me navigate the shark-filled waters that are “zoning issues”. As I’ve mentioned, each borough typically has their own zoning laws that govern home size, land use, and mobile homes. One piece of land I’ve fallen in love with does not allow mobile homes or any home under 700 square feet. But I could get around this if there was a house on the property already and I would just be “storing” my Tiny House there (wink, wink).

I always figured that once I found land, I’d apply for the mortgage and follow the normal procedure. One of the rudest awakenings for me in this process has been that most banks will not lend on a mortgage lower than $50,000. Since I don’t intend to spend nearly that much on a piece of land, I’m forced to figure out another option.

This is where I am today. Looking for another option. Suggestions are welcome!