Millionaire tells millennials: if you want a house, stop buying avocado toast

[bilby]

Self discipline is the key. Instead of complaining the world isn't dedicating itself to making you happy (not that there isn't validity to having a level playing field) you've got to make your way the best you can while fighting the good fight.

People who look like they are wealthy usually aren't because they spent all their money trying to look like they're wealthy.

Totally agree! Most successful people that I know spend less than what they make, become the best in their field and diversify their cash flow (rental properties, second businesses, second jobs). Successful people rarely drive the nicest car in the parking lot.

Far more unsuccessful people don't drive the nicest car in the parking lot.

Survivorship bias is a bitch.

 

[TSwizzle]

I think there's a point to what he is saying. It might be clearer if phrased slightly different. {snip $2,987,796.98 worth of commentary}

It's a subtle shift in attitudes. But it's important.

Anyhoo... just my two cents.

Two cents ?!! FFS, that was way more than two cents.


Anyway, I think the gist of it is, people should expect to make sacrifices to attain other shit.

 

[beero1000]

Spending money on avocado toast or designer handbags or smartphones isn't the reason that people can't afford housing in Sydney when the median home price entails a mortgage payment that's nearly 100% of the median household income.

 

[funinspace]

Sure, there are people who could save to get ahead of wherever they are at, but blow it on cars and instant gratification. But there are far more that are struggling just to keep the lights on or pay the rent before the land lord yells at them again. Never mind the ever-present danger of medical bills for Americans. A few thoughts outside of the who can save for what, on what kind of income…regarding this Avacado head.

At age 18, he had a boss who could front the money to buy a $180k apartment to renovate, and dropped this oportunity upon him. At fucking 18? Sweet, but not very common place. Ok, sure he probably worked hard, and got a $12k profit. I guess he worked another job to live, or did he live off of mom & dad? What kind of bank loans a teenager, a $150k, with a private loan of $34k already hanging out there, with only $12k of his own in it? Or did the bank get first dibs if it fell apart on recooping their money? One would suspect that maybe the uncle was a co-signer on it, or he/they lied to the bank.

http://www.news.com.au/finance/real...s/news-story/3f1dab7c3c19a7ac5d126039a5803caf

“My first investment property was an apartment bought for $180k in St Kilda and I was fortunate enough to have my boss at the time approach me to renovate it while he fronted up the money.
“I spent every night on my hands and knees sanding back the floors, painting, renovating and working on the house. When we sold it, I used the small profits of $12,000 to purchase my next property and it all grew from there. The most important thing for me was just to get my foot in the door at the absolute base level, and work my way up from there.

“I sacrificed a huge amount through those years, working multiple jobs, seven days a week and I saved absolutely every penny that I could.”
After making $12,000 from his first investment property at 18, he took out a $150,000 loan using the $34,000 from his grandfather.

He said he approached his grandfather with a business proposal and used the $34,000 for equity so he could obtain the loan.
He bought a gym, renovated it, and sold it a year later to a competitor.

His tale does seem a little fishy. A couple years of studying commerce, getting bored, then going part time, then getting into property development...but did that at 18? Hum...maybe the uncle was friends with the company doin the loan? Almost sounds as if it wasn't a "bank"....
https://www.theurbandeveloper.com/developer-qa-tim-gurner-gurnertm-and-urban-inc/

What prompted you to enter the development game?

I’ve always had an absolute love for property. My dad was a structural and civil engineer, my uncle ran a lot of property trusts and I guess I always grew up with property in my blood. It just felt right, I’ve always been a big believer in the entrepreneurial spirit and it’s what I wanted to do.

How did you start in the industry?

I studied Commerce in Melbourne and after doing that for a couple of years I was absolutely bored. So I went part-time and did some work in property development.

Even with such help (assuming there isn’t a good helping of BS in this tale), what gets lost in the hype of grand success, is the number of people who try to pull risky stuff like this off and get burned. My dad had a friend who owned a furniture store. The building burned, and the guy took a chance with the insurance payout and bought a good-sized corner lot, and built a small shopping strip with his furniture store as an anchor. A year or so later the early 1980’s recessions hit and his little empire crumbled to bits. He ended up in his late 50’s to early 60’s working as a salesman in another furniture store. I’m not sure how well he separated saving for retirement from his business risk taking, but for every big millionaire, I’d guess there are a dozen of these stories.

 

[DrZoidberg]

I think there's a point to what he is saying. It might be clearer if phrased slightly different. {snip $2,987,796.98 worth of commentary}

It's a subtle shift in attitudes. But it's important.

Anyhoo... just my two cents.

Two cents ?!! FFS, that was way more than two cents.


Anyway, I think the gist of it is, people should expect to make sacrifices to attain other shit.

I don't think refraining from buying shit you didn't need to begin with is a sacrifice. The ultimate status symbol today is luxury. Ie pointless consumption, just for the sake of consumption. Luxury is wanting something because it is hard to get. Today everybody can afford everything, so we have invented the "limited edition". Ie, regular stuff, just less of it, for no apparent reason other than to make something cheap and mundane into a luxury. We truly live in a bizarre world.

For something to be a sacrifice there has to be some sort of cost attached. Not having a designer bag has no cost *

*Unless you're 15 and that shit is life or death.

 

[TSwizzle]

For something to be a sacrifice there has to be some sort of cost attached. Not having a designer bag has no cost

If "sacrifice" is too strong a word for you, then priorities and choices need to be made.

 

[Derec]

My kid is a millennial so I have had the opportunity to meet a lot 20 somethings. None of them, to my knowledge, are not spending $22 on toast and all of them are working 30+ hours a week, many are trying to get through school, even if it means 1 or 2 course a semester, and they are still having to have help from family. And yes, my kid goes to a local coffee where he usually buys a small house brew ($1.89) and I don't fault him for it. This is his big splurge of the week. woo hoo. And still he has to have three roommates to make rent on that little house they all live in and he works 2 jobs.

Then he wasn't talking about your kid and his friends, wasn't he?
He was specifically talking about people wasting money on fancy sandwiches and coffee drinks and then complaining that they can't afford a house.
He is not saying that that applies to everybody.

Some people need to shut the fuck up.

I agree. That TYT chick is super annoying.

 

[Derec]

Why do people have such a hard on for millennials?

Because baby boomers have gotten old and flabby?

 

[Derec]

The economy can only allow so many to be well off, so many to be in the middle, and most poor. It just can't be any other way.

Most people are poor? Really? What do you consider a poverty cutoff then?
Because the median household income in the US is about $51k. That means half of households make more, half make less. For "most" to be poor, you'd have to have poverty cutoff to be somewhere north of $51k, which I think is just silly.

 

[Derec]

If you are planning to buy a house in Sydney, then you need to become a millionaire; A modest income is not going to cut it.

He didn't mention Sydney. Sydney was mentioned in the article padodying his statement. The author probably chose Sydney because its real estate market is so extreme.
But nobody says you have to be buying in Sydney. Gurner himself is based in Melbourne, and that's where he presumably witnessed these millenials feasting on $20 smashed avocado sandwiches. And in Melbourne you can find real estate for less than $200,000 Australian.

 

[Derec]

"I will work harder", said Boxer the Horse of Animal Farm. But look what happened to him.

He ended up wasting all his money on avocado toast and Unicorn Frappucinos?

 

[EricB]

I agree, wasting money on fancy food isn't a good management of money. I don't spend money on wasteful food, and I'm still not a millionaire though. And I can't afford a BMW or even a knock off BWM. Did that millionaire have any other advice? Should my family stop eating? That'd save enough to get the BMW.

I realize it is not popular around some parts to point out that the lower-earning income classes spend a significantly higher percentage of their income on what would be considered luxury items.

 

[LordKiran]

"I will work harder", said Boxer the Horse of Animal Farm. But look what happened to him.

He ended up wasting all his money on avocado toast and Unicorn Frappucinos?

No he got axed and sold to the glue factory by a jealous pig who felt threatened by Boxer's work ethic. People say Animal Farm is an allegorical book about the evils of Stalinism or Communism, when in reality it equally serves as allegory for any system which sees people subjugated at the hands of a privileged few who rigged the game in their favor.

 

[LordKiran]

I agree, wasting money on fancy food isn't a good management of money. I don't spend money on wasteful food, and I'm still not a millionaire though. And I can't afford a BMW or even a knock off BWM. Did that millionaire have any other advice? Should my family stop eating? That'd save enough to get the BMW.

I realize it is not popular around some parts to point out that the lower-earning income classes spend a significantly higher percentage of their income on what would be considered luxury items.

Depends on what you conclude to be a 'luxury.'

Is a necessary piece of electronic equipment needed to gain access to the increasingly vital internet infrastructure a luxury?

How about an air conditioning unit when your old one craps out during high summer in Arizona?

 

[J842P]

I agree, wasting money on fancy food isn't a good management of money. I don't spend money on wasteful food, and I'm still not a millionaire though. And I can't afford a BMW or even a knock off BWM. Did that millionaire have any other advice? Should my family stop eating? That'd save enough to get the BMW.

I realize it is not popular around some parts to point out that the lower-earning income classes spend a significantly higher percentage of their income on what would be considered luxury items.

They probably spend a higher percentage of their income on things that are bare necessities too.

 

[AthenaAwakened]

Then he wasn't talking about your kid and his friends, wasn't he?
He was specifically talking about people wasting money on fancy sandwiches and coffee drinks and then complaining that they can't afford a house.
He is not saying that that applies to everybody.

And he is talking about the kids he sees. Rich kids who can buy $22 toast and have it not mean a damn because trustfund babies get cars and condos regardless. He has done some fucked up mashup in his empty head and giving advice to working kids about the extravagant practices of the wealthy

Some people need to shut the fuck up.

I agree. That TYT chick is super annoying.

Yeah, it must annoy the hell outta you to know she's right and you ain't. And that will most always be the case.

 

[Derec]

No he got axed and sold to the glue factory by a jealous pig who felt threatened by Boxer's work ethic. People say Animal Farm is an allegorical book about the evils of Stalinism or Communism, when in reality it equally serves as allegory for any system which sees people subjugated at the hands of a privileged few who rigged the game in their favor.

I know the Animal Farm. I was being facetious.

By the way, I stand by that quote. It is about advisability of running from and fighting with police, not about prosecuting cops for unjustified shootings. Even if a cop is convicted, it is not bringing you back to life.

 

[Derec]

Is a necessary piece of electronic equipment needed to gain access to the increasingly vital internet infrastructure a luxury?

Not as such.
There are very cheap smartphones. The latest iPhone is a luxury though. Also, get the cheaper data plan and rely on WiFi as much as possible. Unlimited data is not necessary.
Or just use home internet and free WiFi if even a cheap data plan is too much.

How about an air conditioning unit when your old one craps out during high summer in Arizona?

No. But look into the cheaper swamp coolers as an alternative, as they work pretty well in dry climates.

 

[bilby]

And he is talking about the kids he sees. Rich kids who can buy $22 toast and have it not mean a damn because trustfund babies get cars and condos regardless. He has done some fucked up mashup in his empty head and giving advice to working kids about the extravagant practices of the wealthy

This is a common and highly dangerous error - treating all members of any identifiable out-group as interchangeable

I see young people eating Smashed Avo
I see young people complaining that they can't afford to buy a house
Therefore the people eating Smashed Avo are the same people who complain about not being able to afford a house.

It's a logical fallacy, but that doesn't make it any less popular. And you can slot in any group you don't belong to in place of 'young people', and any pair of activities that some members of that group have done; to arrive at all manner of false and unpleasant conclusions.

In part, this kind of bad thinking comes from treating everyone except yourself, and your immediate family and friends, as Non-Player Characters - one dimensional extras playing the walk-on roles in life, but not a part of the central narrative. Some people really seem to be incapable of grasping that everyone has the lead role in their own life.

 

[Deepak]

The children now love luxury; they have bad manners, contempt for authority; they show disrespect for elders and love chatter in place of exercise.