Housing and young people – why is this not a solution?

[Anonymous]

Anonymous wrote:

Anonymous wrote:We all hear about inflation, housing costs in the DC area, and the hardships that face young people. But is this really so dire?

Let’s say you have a young person who lives at home with their parents after graduating college, from age 22 to 30. And let’s say their income averages $100,000 per year over that time (starting at $80-90,000 and ending up at $110-120,000 at age 30).

Of their $100,000 income, they pay $25,000 in taxes and only need to spend another $10,000 per year since they are living at home. That means they can save on average $65,000 per year—or $520,000 over the eight years (ignoring any potential investment gains).

That’s enough for them to buy a $400,000 condo in cash (or use that amount as a huge down payment if they’re getting married and need to buy a house instead). On top of that, they have enough to buy a solid $25,000 car, furniture for their new place—and still have enough left over for an emergency fund and maybe even some investments. That sounds like a pretty darn good place to be in as a 30-year-old.

Obviously, that only works under certain conditions. First, the kid has to major in something marketable. And the parents have to live in the same area and be at least middle-class/upper middle-class—but that describes most of the DCUM demographic. Thoughts? Why isn’t this the solution?

Yeah, that person is doing great. Despite crying being poor, the top 1% always do great. For every one of them, there are 10s of people who graduate with 300k in student loans, are making 30k a year as interns and spending money they do not have trying to build a network that will never accept them. They of course cannot live with their parents since, the parents had to downsize in order to be able to retire before they are 80.

OP here. No, not top 1% - they have way more advantages than I suggested. What I laid out is a way for the children of the top 40% socioeconomically to get ahead despite the real challenges facing young people today.

[Anonymous]

This does not at all factor in student loans, which can be crippling. And many young people may not find jobs in their industries close to home.

[Anonymous]

Anonymous wrote:

Anonymous wrote:My friend’s daughter did this. She is a RN and made around 70k then, lived at home for 4 years, parents didn’t charge money for rent or food/utilities etc. The only condition was that she gets to have $1000 a month in spending money and save the rest. She ending up saving 100k, parents matched the 100k and she bought a 2 bedroom plus loft apartment for 450k at 2.75% interest in 2020.

Her apartment is worth 525k now and monthly payment is very manageable, now she is on her own and can live her life as she pleases. She is currently 27 and plans to have it fully paid by 35 ( she is doing travel nursing so she is making more money) then can have close to 600k for down payment on a SFH.

Most parents don’t have $100k sitting around to give to their kid for a down payment. Most don’t even have enough for their kid to go to college hence the student loans.

Or to buy another residence to rent out to their kid and roommates. Sometimes the best you can do is help with their education and allow them to live at home until they can afford to live on their own.

[Anonymous]

Anonymous wrote:This does not at all factor in student loans, which can be crippling. And many young people may not find jobs in their industries close to home.

Well first and foremost, kids need to stop taking massive loans for college. No school (not even Harvard) is worth going into massive debt. Find a school that wants you/will give you merit aid and that you can afford. Every state has several state schools, many that most decent students can get admitted to and that will give good students merit. (Not talking UVA, VaTech, W&M, UMD). Find those schools search for merit for your good student (anyone with a 3.5+ UW HS can easily find merit. Pick one that costs less than $30-35K---state school or private that gives you excellent merit. Then earn $10K+ per year (summer, all breaks, PT for 8-10 hours during the week), take the $5.5K/year for student loans (higher each year to total 27K over 4 years). Now you have 15K left. Hopefully the parent can assist with some via cash flow or savings. (that's 60K total over 4 years give or take). If parents cannot help, then find a school that costs even less. It can be done.

My 3.5UW/25 ACT/No AP kid had 2 private universities (ranked 80-100) that cost only $40K/year. They had another (ranked ~120) that cost only $30K. That was without any merit searching. Had 2 state schools that cost about $20K, after the merit awards (yes for even a kid with those stats). Had they gone to schools ranked 120+ they could have found several good schools that cost less than $20K. It is possible to do.

So stop taking massive loans, attend college that is affordable

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The solution is they get a bunch of roommates. It's part of life, or should be. Too many want to live alone.

Exactly. 20-somethings aren't entitled to live alone, nor remain at their parents house. Live with roommates and save.

For high caliber families, family is better than roommates.

Whatever that means.

[Anonymous]

Anonymous wrote:

Anonymous wrote:How does dating work though when you live at home? My parents were crazy and I had a 10pm curfew, midnight on weekends (I lived at my parent's home in the summer during my internships). I also would never have been allowed to bring someone home to stay the night, even a long term boyfriend.

I think it's much better to live with roommates. We split cheap apartments with 3-5 other people.

That is precisely why so many do NOT live at home. If you want your kid to live at home to save money post college, you must treat them like the adult they are. They should be allowed to have BF/GF stay over, they should be allowed to come and go as they wish. However, they should be respectful. Just like my husband doesn't just come home at 11pm when work is over at 6pm without telling me. If he has a dinner or event after work, he lets me know. I expect anyone living in my house to tell me if they wont be home by a reasonable time---and if a 25 yo is not coming home, then just tell us so we dont' worry. But also don't come in at3am on a Tuesday night and make major noise as we have to go to work at 8am. You can come in at 3am, just be quite and respectful, and tell us you are out late, so we don't worry.

Yes, Mom. Your house, your rules.

[Anonymous]

There is an alternative.

Kid gets a high paying job in a LCOL area. Live cheap and bank the money. Then move to one of the fancy cities after 30.

This approach also narrows the dating pool as you are likely living among the high school drop outs/ opioid addicts/Trumpers in your 20s, but you might get lucky.

[Anonymous]

Anonymous wrote:We all hear about inflation, housing costs in the DC area, and the hardships that face young people. But is this really so dire?

Let’s say you have a young person who lives at home with their parents after graduating college, from age 22 to 30. And let’s say their income averages $100,000 per year over that time (starting at $80-90,000 and ending up at $110-120,000 at age 30).

Of their $100,000 income, they pay $25,000 in taxes and only need to spend another $10,000 per year since they are living at home. That means they can save on average $65,000 per year—or $520,000 over the eight years (ignoring any potential investment gains).

That’s enough for them to buy a $400,000 condo in cash (or use that amount as a huge down payment if they’re getting married and need to buy a house instead). On top of that, they have enough to buy a solid $25,000 car, furniture for their new place—and still have enough left over for an emergency fund and maybe even some investments. That sounds like a pretty darn good place to be in as a 30-year-old.

Obviously, that only works under certain conditions. First, the kid has to major in something marketable. And the parents have to live in the same area and be at least middle-class/upper middle-class—but that describes most of the DCUM demographic. Thoughts? Why isn’t this the solution?

It’s not a solution because living in your parents basement as an adult is called failure.

[Anonymous]

Anonymous wrote:There is an alternative.

Kid gets a high paying job in a LCOL area. Live cheap and bank the money. Then move to one of the fancy cities after 30.

This approach also narrows the dating pool as you are likely living among the high school drop outs/ opioid addicts/Trumpers in your 20s, but you might get lucky.

Oh yeah, those are plentiful and totally an answer.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Who earns 100k straight out of college with just a bachelor’s degree? That sounds like fantasyland. Even people with business degrees aren’t bringing that much in two years after graduation typically.

+1 people are disconnected from reality. It's a very, very small segment of jobs that pay this much.

I’m 55 and still don’t make that much. 😂

[Anonymous]

This is the tragedy of late stage capitalism. If you think the “solution” is for young people who make six figures to scrimp and save for a decade in their parents basement only to be able to barely afford housing, then you don’t understand the definition of the word solution.

What you describe sounds like hell on earth. At that point what is the point of working hard at all? There’s no way to win.

Revolution becomes the only viable alternative to death.

[Anonymous]

Anonymous wrote:

Anonymous wrote:There is an alternative.

Kid gets a high paying job in a LCOL area. Live cheap and bank the money. Then move to one of the fancy cities after 30.

This approach also narrows the dating pool as you are likely living among the high school drop outs/ opioid addicts/Trumpers in your 20s, but you might get lucky.

Oh yeah, those are plentiful and totally an answer.

That’s how I did it. Got a stem degree at a top university and worked in Upstate NY for 10 years. I made bank and was able to buy a house right away when I moved down here.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How does dating work though when you live at home? My parents were crazy and I had a 10pm curfew, midnight on weekends (I lived at my parent's home in the summer during my internships). I also would never have been allowed to bring someone home to stay the night, even a long term boyfriend.

I think it's much better to live with roommates. We split cheap apartments with 3-5 other people.

That is precisely why so many do NOT live at home. If you want your kid to live at home to save money post college, you must treat them like the adult they are. They should be allowed to have BF/GF stay over, they should be allowed to come and go as they wish. However, they should be respectful. Just like my husband doesn't just come home at 11pm when work is over at 6pm without telling me. If he has a dinner or event after work, he lets me know. I expect anyone living in my house to tell me if they wont be home by a reasonable time---and if a 25 yo is not coming home, then just tell us so we dont' worry. But also don't come in at3am on a Tuesday night and make major noise as we have to go to work at 8am. You can come in at 3am, just be quite and respectful, and tell us you are out late, so we don't worry.

Yes, Mom. Your house, your rules.

Yeah basic rules of common courtesy. Did your parents not teach you basic common courtesy?

[Anonymous]

Anonymous wrote:There is an alternative.

Kid gets a high paying job in a LCOL area. Live cheap and bank the money. Then move to one of the fancy cities after 30.

This approach also narrows the dating pool as you are likely living among the high school drop outs/ opioid addicts/Trumpers in your 20s, but you might get lucky.

Most higher paying jobs are in HCOL areas. so good luck with your plan

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Who earns 100k straight out of college with just a bachelor’s degree? That sounds like fantasyland. Even people with business degrees aren’t bringing that much in two years after graduation typically.

+1 people are disconnected from reality. It's a very, very small segment of jobs that pay this much.

I’m 55 and still don’t make that much. 😂

I made that much at 28, and I'm 55 as well.