March 21, 2014
AT THE END OF THE DAY, WHAT DO THEY HAVE....:
The 'wealthy poor' replace the middle class (Rick Newman, 3/21/14, Yahoo)
...besides cars, homes, retirement accounts, educated kids....Some new economic analysis helps quantify just how many people might be characterized as the "wealthy poor"-- and it's a surprisingly large chunk of the overall population. A new paper by economists Greg Kaplan and Justin Weidner of Princeton University, and Giovanni Violante of New York University, finds that about 70 million Americans may live in families they describe as "wealthy hand-to-mouth" households. These are families that own assets such as homes, cars, retirement plans and even boats, yet still spend virtually every dollar of their regular income because it's necessary to pay all the bills they've racked up.Many breadwinners may feel they have no choice but to live from paycheck to paycheck, especially if they have kids headed to college and other bills that come with the duties of raising a family. Plus, monthly expenses such as mortgage payments and tuition are a form of investing, since it's reasonable to expect some return from owning real estate or financing education (though not as much, perhaps, as we once thought).
Posted by Orrin Judd at March 21, 2014 4:38 PM