By the time you’re 30: Adventures in personal finance

By the time you’re 30 you should have the equivalent of your yearly salary saved up. You should have an emergency fund of six months’ wages at all times. You should be well on your way to saving for retirement, and if you have/plan to have kids to save for their educations as well. You should never acquire credit card debt or spend money frivolously, and you should certainly never depend on anyone to help you.

Sound familiar? Last year, everyone’s favourite new US Congresswoman, Alexandria Occasio-Cortez, was scolded by the media for not having enough money to rent an expensive DC apartment…in addition to the rent she paid in NYC…after running an expensive congressional campaign.  Because, don’t you know, at the age of almost 30 a bartender living in one of the most expensive cities in the would should have had some completely random and unrealistic amount of $$ saved up.

The internet had good fun about this for a while:

A screenshot of a tweet by @Kica333 with the text "By the time you turn 30 you should have at least one of the following: 1. A drawer full of random cords 2. Tupperware with half the lids missing 3. Anxiety 4. A collection of plastic bags full of other plastic bags 5. Sleep Deprivation - Work hard like me and you'll be able to check off this list by the time you're 25"

It’s funny because it’s true

But joking aside, it’s easy to feel your finances aren’t up to snuff, especially if you’re a young or young-ish person. It’s hard to listen to stereotypes about millenials wasting their money on Starbucks and avocado toast, then think about your own bank account and where your money goes (or doesn’t go). And hey, money is hard to talk about it. If you make or have a lot or it (or relatively more than your peers), talking about it seems like bragging. If you don’t, it seems like whining. We’re taught not to talk explicitly about money, that’s it’s not classy or appropriate. Moreover, feelings of anxiety, guilt, shame, and envy are mixed up in our financial situation. You feel shame for being unsuccessful/improvident/a normal weak human who likes frappuccinos and shopping and takeout; you envy those with more income/restraint/family money; you also resent them and project your own self-hatred onto them.

A screenshot of a tweet by @TechnicallyRon reading "I'm 30 and have enough money in my savings account to buy 1 greggs steak bake leave me alone" quoting a tweet by @JeanChatzky reading "By the time you're 30, aim to have 1x your annual income set aside for retirement. At 40, 3x; at 50, 6x; at 60, 8x; and by retirement, 10x.

Me too, Technically Ron, me too

Enter the personal finance industry.

Much like the fitness, meal box, and organization industries, there are lots of people out there who want to sell you a solution to these feelings, and one that you can access 24/7 on your smartphone to boot.

Young people have been quick to take these apps up on their offers. According to the Canadian Bankers Association, Millenials (age 24-38) are more likely to use personal finance apps than other demographic, with 36% using one at least some of the time vs 23% of uptake among other demographic groups. This is almost certainly due to the higher level of use and comfort younger people have with smartphones, but perhaps it also has something to do with the current dire financial situation facing this generation. With wages more or less stagnant since the 1970s, large increases in cost of living and important things like housing and education, youth are facing very difficult financial situations, and on top of it often feel judged by their elders, who came of age in more forgiving financial times.

There are 100s of apps for every platform and of every flavour, which promise to help you keep up with your bills, pay off your debts, increase your savings, or do whatever it is people do with bitcoin. While they vary in look, feel, and focus, all of them promise the same thing: with just a few taps of your index finger, you can fix your finances and, incidentally, your life.

This is probably true for some people. If you have a Starbucks habit, it might be helpful to have an app remind you that you’ve already spent $57 on unicorn frappuccinos this month and it’s only the 10th, so maybe switch to plain coffee for a bit. If you’re eating out every day, a reminder of where you are in your budget could help you remember to pack a lunch at least some of the time. (And does anyone else remember that episode of Sex and the City where Carrie Bradshaw realizes that she’s spent $40,000 on shoes, but can’t pay for her apartment? Carrie definitely needed a budget.) Anyway, it’s obvious that little economies can add up, but it’s also obvious that you can’t make $1 pay for $2 no matter how well organized you are. And what’s more, it seems that millenials are actually fairly good at managing money, or at least not worse than anyone else.

Even if the financial problems of today’s youth were caused by poor financial habits, there’s frustratingly little data on how effective these apps are. I found one study comparing personal finance apps with other financial literacy tools, which showed no significant effect except that users checked their balances more. But it’s a small study, and specifically on teens, so it doesn’t necessarily tell you much about the impact on the average user.

So why are we so drawn to using something that might not even do anything for a problem that probably doesn’t have a solution? What does this say about our attitude towards money and what it means to us?

Perhaps the most important thing it shows us is how strong the desire is to believe that there’s a simple technological solution to your money problems. It’s not inequality or the failures of capitalism or neoliberalism or consumerism. It’s not that you’re underemployed or underpaid. It’s that you’re spending too much on fancy coffee or just not organizing your money properly, and if you set up microsavings payments or, terrifyingly, allowed your debt repayment schedule to be monitored by an accountability partner (as the You Need a Budget app provides), or just learned how to balance your chequebook as you always thought you were supposed to*, you too could afford that great North American dream, a house and a yearly dream vacation and retirement.

A screenshot of a tweet by @OmanReagan reading "By the time you're 30, aim to have unionized your workplace. At 40, cooperatively owned; at 50, no bosses; by retirement, full communism." quoting the @JeanChatzy tweet referenced above.


This deep need and longing for a way to win in a rigged system is maybe a reflection of the lack of trust young people hold in institutions(Note: this is US data, as similar data is harder to come by in Canada.) We don’t trust that government OR private actors have our best interests in mind, or that they can solve the very real, large, and terrifying problems facing the world today; so perhaps it’s understandable that we hope that maybe, just maybe, if we do everything right, we can find a way to come out on top, or at least somewhere towards the middle.

By the time you’re 30, you might have some financial goals, and you might even have an amount of money saved up that would satisfy a stuffed shirt on MSNBC. But you should also understand that if you don’t, it isn’t something to feel bad about, and if nobody you know does, then maybe you can get together and do something about that.

* True story, in a fit of this type of anxiety, some years ago I bought and read a personal finance book (this was before finance apps were a thing), specifically because I realized I didn’t know how to balance a chequebook and felt that I should. Turns out, according to this book at least,  it’s a waste of time and you don’t have to unless you really want to, just take a squint at your bank statement every now and then. So that’s one thing to stop feeling inadequate about not knowing how to do.

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