Irish Economy & Spending habbits

Cute hoor 2017

Good afternoon,

Bit of a stupid question but really curious as to how there are so many millenials (people in their 20's & 30's) living such lavish lifestyles these days. Wages and savings can't be that good these days to sustain such a standard of living. With the cost of living and inflation rising rapidly since 2015, one would wonder how these can afford new houses, weddings, new cars (full of new and modern cars and SUV's on the roads these days), holidays, wining & dining, socialising, etc. with the cost of such in 2018.
Weren't most of these unemployed/ in college and broke only a few years back??

My own circumstance is I'm a 32 year old construction engineer/supervisor (working since 2002) on what I would reckon would be a good gross income but even with my own basic living (don't drink, smoke, go on one 7 day holiday to continental Europe every year, drive a 2005 VW golf) struggle to pay bills and basic living standards and cant save anything really.

Just wondering does anyone else share my opinon and thoughts on this?
Thanks for reading, looking forward to any feedback

amcalester

Maybe they're just better at budgeting that you?

New cars can be bought on PCP, many still live at home or house share.

I wouldn't be so sure that as many as you think are actually buying property, there's not that much out there to buy.

And, as you say many would have been unemployed a few years ago so maybe they are just enjoying having money to spend.

I'd be curious what bills you have that you struggle to pay if you have a good income.

Are you sure you have a good income, have you looked around to see jobs are available out there?

Two good incomes adds up quickly especially if there are no childcare costs.

Cute hoor 2017

Yes I have done a bit of research into this and asked a few like minded people. Theres varied opinions on this.

For purchasing new cars you would need a good deposit up front, also morgages require 10% up to €220k and 20% above (this does not include stamp duty/furnishings/legal/etc.) <€220 is a very basic house in todays market. Also back in the early 2000's-2008 I believed that it was mostly loans and credit all this was bought in, but nowdays you wouldnt get anything off the banks without a good deposit/ credit history, etc. Yes there is property selling these days and new houses being built. Also the rental market is at an all time high (and quite unsustainable at this rate especially in Dublin area).

Well I know what different rates are for incomes. I know there are people earning minimum wage and just above in many areas (retail, hospitality, service, some admin jobs, etc.) however my income would be much higher that that of the minimum wage and still couldn't live a lifestyle like most my age are these days. So just wondering what incomes some would earn, inheritance, etc. as there seems to be a lot of disposable income in the economy overnight as opposed to 5 years ago.

amcalester

It's hardly overnight if you're comparing it to 5 years ago.

The unemployment rate in January 2013 was 13.9%, in January 2018 it was 6.2%.

christy02

I often wonder this as well. I expect we are getting back to the stage where people are living outside their means.....and we know where that got us last time.

I work full time and earn close to 6 figures. Wife is a homemaker so no income directly, however her tax credits are worth a good bit and we have no childcare.
We have no loans at all and still while we are not struggling, are not exactly living the high life..

The thought of paying 400 or 500 a month for a new car doesn't appeal at all, hence why I buy older cars that I save for.

I definitely reckon certain families sacrifice a lot for the status of a new car etc.

Cute hoor 2017

Well 5 years isn't a long time to go from rags to riches overall especially when most of these people living the lavish lifestyle are my age and younger.

Back 10 years ago when people were living beyond their means it was predominantly on credit and loans. As we all know it's impossible to get loans now with nothing to back it up (between deposits, credit history, steady affordable income with a good job, years of service to the employer, etc. the amount of hoops to jump through to get loans and morgages is unreal)

Up until recently I assumed that we were heading to another crash for our economy but from doing some research into consumer spending/economy/personal finance and statistics I realise that there is a lot of disposable income in the domestic economy.

I'm just trying to get to the bottom of it as it's very puzzling as to how they are all managing to live the high life at such a young age.

amcalester

That’s it though, these people have gone from next to no income to starting their careers to having 5 years experience.

That’s a fairly huge increase in salary, much more so than will happen between the ages of say 45-50.

I’m about the same age as you and have doubled my gross salary in the last 3.5 years while my essential outgoings; rent, insurance etc have pretty much stayed the same.

I don’t think that would be too unusual for people of our age.

CIP4

I would say there is plenty of younger people on fairly good salaries early on out of college not sure where you are getting the idea that all millennials are on minimum wage. I am 23 not even a full two years working after finishing college and already on a fairly good wage my wage is now 67% higher than my starting grad salary but even my starting grad salary was fairly decent. My point is there are loads of grads straight out of college landing fairly decent jobs and that’s what’s fueling new cars, holidays and buying houses early enough on. I am hoping to buy a house around 25-26 but the fact I live well outside Dublin means I would get something fairly decent for around 200k.

It’s not that uncommon these days for graduate starting salaries to be in the 30-40k range before you ever get a pay rise. I don’t really see it being that difficult to get finance either fairly handy to get a car loan up to 90% cost, credit cards if you want one banks seem to be happy enough to give them out same with loans. Fair enough mortgages you need to jump through a few hoops alright.

Ohmeha

Cute hoor 2017 wrote: »

Bit of a stupid question but really curious as to how there are so many millenials (people in their 20's & 30's) living such lavish lifestyles these days.

Really? The majority of my peers late 20s/early 30s here in Dublin are still suffering recession hangover struggling to save or afford mortgages/rent/buy cars/have babies, economic 'recovery' largely passing us by. Maybe the ones still living at home not handing up any rent or paying their own bills are probably having a ball but they still look like the minority to me

Wages are definitely lower for millennials than the same age group 10+ years ago and I'm not seeing much evidence of lavish excessive lifestyles today, the opposite in my view. The experiences of the past 10 years has made alot of young adults cop onto themselves seeing too many people a decade older drowned in debt and seeing lots of separations and divorces as a result.

Unfortunately the current government's insane policy to re-inflate the property market back to the unsustainable levels of 2007 will ensure any financial discipline developed by young people since the crash will evaporate soon enough

blindside88

OP, you’re talking about an age demographic that tends to see a massive increase in salary as they gain experience. For example myself and my wife are 29, in the past 5 years we’ve gotten married, bought a house, bought 1 new car (for her, I’ve a company car). We’ve seen our incomes more than double. Our mortgage payment is 9% of our take home pay and we’ve no childcare costs. This would not be unusual within my circle of friends. We therefore have a large amount of our income as disposable which allows us to live a comfortable lifestyle, although we don’t tend to live the highlife we can go out for dinner or a few drinks when ever we feel like it. I don’t expect that jump in income again in my lifetime however and can see it slowly going up year on year. As/when children come along we will obviously have to cut back also. I tend to live by a 50/30/20 model to budget, spend 50% on what I need, spend 30% on what I want and save/invest 20%