Monday, August 4, 2014

Our standards of living are keeping us from prosperity

If you watch, read, or listen to the news you are bound to come across a report lamenting the "rising cost of living in America". Life isn't easy for millions of Americans who struggle to make ends meet throughout their lives while living paycheck to paycheck on a small salary. Millions of others create their own struggle by inflating their standard of living until they are also living paycheck to paycheck. One of the biggest culprits of our middle class excess is home ownership.

Many people blame the housing bubble as a reason for families that struggle to make ends meet. "Big banks" and "the 1%" become easy targets when we see news reports showing families kicked out of their homes. The unreported truth is that for many of us, it's a struggle we created for ourselves. Let's look at some graphs that will show us the facts inside the situation:
This first graph shows us a clear example of modern American excess. In 1970, the average American lived in a house a little over 1,600 square feet with three people in their house. Today, the average American lives in a nearly 2,700 square foot house with only 2.6 people in their house! We went from roughly 533 square feet per person in 1970 to 1,000 square feet per person today.
This second chart puts the pieces together. It shows the price per square foot for new houses over time. Adjusted for inflation we see that houses have actually decreased slightly in price today when compared with 1970. Obviously, when we demand a house nearly double the size...we should expect to pay nearly double the price.
The final graph shows what we've done to ourselves as a nation. In 1976, the median new home price was 3.6 times higher than the median U.S. household's income. At the peak of the housing boom, it was 5.2 times higher! Luckily, the recession has cooled our jets ... but we're still not where we were in the past.

For comparison, on average if you made $50,000 in 1976 you would buy a $180,000 house. $50,000 in 2005 would get you a $260,000 house and $50,000 in 2011 would get you a $215,000 house. If we spent the time to calculate the mortgage payments with each of those, it would show that we're leaving ourselves with less money to spend and save.

The Bible teaches us to stop looking at the mote in our brother's eye until we've removed the beam from our own. As a nation, we should consider fixing our own standard of living problem before we demand more help from corporations and the 1%.

Friday, December 27, 2013

Is the American Dream Dead?

In the past few years, we’ve been inundated with politicians and talk show hosts that tell us that the American dream is dead. It’s come from the left, where liberals have bemoaned the growing disparity between high and low incomes. It’s also come from the right, where red-blooded conservatives have pointed to the “socialist” policies of the Obama administration that are choking the innovation of the private sector. According to them, we are in a pretty dark place. But I’d like to revisit that conventional wisdom for a moment.

I don’t believe the American dream is dead. I believe it is alive and well, but it’s hidden behind the cloud of our popular culture that tells us we need and deserve things we can’t afford.

However, if you scour the internet with a quick google search of “The American Dream is dead” you’ll find all sorts of complaints about the current state of Americans. I’ll list the top two: 1) College costs too much, 2) It’s too expensive to move out of my parents’ house. Let’s examine those two…

College Costs Too Much
One of the most frequent complaints from parents, youth, and adults in their 20’s is that college just costs too darn much! Tuition at top private universities can be around $45,000 for undergraduates annually. How is the middle class to survive?

This may sound harsh to some, but you don’t need to go to Harvard or a private school to be successful. I graduated from James Madison University, whose 2013-2014 annual tuition is $9,000 for undergraduates. The tuition wasn’t all that bad. It was the costs of housing, food, and living costs that came from me moving two hours away from home. I turned down acceptance from a great public university in my home town because I thought it would be more fun to live away from home. The $30,000 in student loan debt I walked away with was almost all room & board costs, not tuition costs. My part-time employment could have fully paid for my college if I had chosen to live at home.
Another consideration is community college. Community college has a stigma, I get it. Most states, however, have a program much like Virginia’s, where you can get a two-year associates degree and then transfer without question to a university for specialized instruction. Annual tuition for a full-time student at NOVA Community College? $4,500. That’s half of what I paid at JMU. Considering how much I remember from my English literature and medieval history class, I think I could have benefitted from some additional cost reductions.

So yes, college does cost too much, if you attend a private school or are worried about your lifestyle throughout college. In Europe, it’s more standard for students to live at home during college. If you make wiser choices than I did, you can receive a college education, work part-time through college, and end up with some significant savings instead of debt before entering the post-graduate work force.

It’s Too Expensive To Move Out of my Parents’ House

This is a difficult discussion that varies widely based on where you live and your situation. Let’s start with renting and move to owning. Renting will be quick. Yes, we all would love to live without roommates, but think about how much you’ll save by keeping that low-cost bachelor pad for a few more years while you save to buy your first home.
Now let’s move to owning a home. It seems my generation has become hypnotized by HGTV. I don’t know how many times I’ve seen couples on the show complain that their budget couldn’t get them what they wanted. Well, what did they want? A walk-in closet, granite kitchen countertops, separate sinks for husband and wife in the bathroom, adequate space for entertaining, a yard, all within a 15 minute drive to work. Is there any wonder why those numbers don’t work when you’re a young couple? After unscientifically asking some from previous generations, I found that their first homes were usually older and lacked many of what were then modern amenities. I also found that more often than not, their first home wasn’t located anywhere near their desired neighborhood. But, after working for a few years, wouldn’t you know it, they moved to that neighborhood.

It seems that recent graduates in my generation expect to have their parents’ lifestyle without the 20-30 years of work their parents’ put in to get there. Is it any wonder it’s hard to find a house with those expectations?
Then there’s the question about saving up for down payment. Going back to issue #1, let’s first assume both you and your partner saved $5,000 between the first day you worked at age 16 and college graduation. Well, there’s $10,000 for a down payment right there! If you are in the market for a $100-200,000 home, you’ve got 5-10% right there, which qualifies you for most conventional loans within two years of full-time employment.

The American Dream is Alive

I recognize that these are very generic numbers and scenarios. Individuals are faced with challenges and obstacles as individual as they are. However, my point is not to solve the world’s problems, but rather to indicate that the American dream is alive and well.

Popular culture has done a great job telling us what we deserve, and most of those things put us into debt and convince us we need things we can’t afford. As soon as we break out of that cycle, the American dream starts to come back into focus. It is possible, even probable, for a college-educated graduate in their mid-20’s so survive and plant the foundations for thriving.

My belief is that even amid this recession, the American dream is strong for those who want it. The dream is not about high-paying jobs and get rich quick schemes. Those who succeed isn’t exclusive to those with the most high-paying jobs and genius-level intelligence. It will be those with the self-discipline to delay gratification, take small steps up the ladder of life, and eventually look down to see their dream has become a reality.

Saturday, June 29, 2013

Create - You Have Something To Offer

When you look at the world, we have a problem. We consume more than we produce. This isn't meant to be an economics lesson, just suffice it to say that we use more than we can afford.

I can't speak for you, but if you're like me (age 26), you rent a condo/townhouse/room. If you're lucky enough to "own" a house, the bank really owns it and you're paying them for the right to own it in 30 years. You probably have a car that is on lease or loan. If you're engaged or married (and male), you probably got your spouse a ring that needed 12-month interest-free financing. (She doesn't even own that pretty ring!?) Oh, don't forget those college loans. Do you sense an imbalance?

Now, I'm not preaching to anyone. I'm still a proud owner of debt. I'm not going to go all green-earth on you and tell you to live off the land and push away from modern society. That's a great plan if you want it, but it's not what I'm here to promote.

Now that I've painted a pretty gloomy picture, let's look at the positives. There are a lot more borrowers than there are lenders. Okay, scratch the economics lingo. There are more people buying things than there are people creating things. There is a whole world waiting to buy something that you create. You, yes you, have something to offer...if you create it. 

"[Sheer Ambrosia] is giving the entire
world (thanks to the internet) a chance
to have some of the best baklava around."
One example: Sheer Ambrosia International Bakery and Catering. While living in Draper, UT I had the pleasure of meeting the brains behind Sheer Ambrosia. Without giving a life story, let me tell you that she knows how to make baklava. In fact, it's the best baklava I've ever tasted. Now, with that kind of talent she could have provided great food to friends and family. But instead, she recognized her talent and is giving the entire world (thanks to the internet) a chance to have some of the best baklava around.

Do you have a talent worth sharing? Let me answer that for you: yes, you do! Not everybody cooks. Some people can quilt, sew, or make jewelry. Heck, an entire business was created simply by making accessories to Crocs! Your talent doesn't have to be something you can hold. People like Stephen Covey created a business sharing his ideas.

So think of who you are, what you're good at, and find a way to create it for others. You may be the next Stephen Covey. But even if you aren't, you'll feel better about yourself because you'll be giving yourself to the world and making it a better place.

Thursday, June 27, 2013

The Proposal: Making Sara and Kevin Official

Monday, June 24th was a night over two years in the making. To be honest, I think both Sara and I would have preferred this day to have happened a long time ago...but a mission in Utah prevented that from happening.

The buildup started during the middle of the previous week. After much discussion, we just decided to go ring shopping. I've learned that Sara is someone who prefers action/touch to discussion/theory. So we went shopping. Our second stop was Kay's. In the midst of trying on all of the rings, one just stood out. I should have known in that moment that we didn't need to shop anymore, but I wanted to be thorough. We continued ring shopping for two more days and finally made the BIG purchase. ("Big" may have different meanings to the men and women reading this)

You may be wondering why we went together to ring shop. After all, that takes a lot of the surprise out of the big question, right? Well, Sara is a wise girl. She knows my fashion sense is not a strength of mine. She might call it a weakness. Because of that I think she wasn't about to let me make such a big decision on my own. I'm grateful for her wisdom because I wouldn't have had the slightest clue what to look for!

Then came the big night. I doubt there was any surprise, but that didn't stop my game plan. Our first "real" date was to a small mid-scale restaurant in Vienna, VA called Maple Ave. We happened to return there for a reservation at the exact same table from two-plus years ago. Not only was it sentimental for Sara but I must say the food is just wonderful. I'd recommend it to anybody looking for a good, unique meal.

Then came part two. We got in the car and drove downtown to the tidal basin and monuments. Last time we made this drive it was our second date. All was the same except I was driving this time. Sara knew what I was doing. When we got there we made the same walk that we did before, only this time minus cherry blossoms. We walked through the FDR memorial, the Lincoln Memorial and the Jefferson Memorial. As we looped the tidal basin we took a seat near where we sat two years earlier. It was there that I told Sara I wanted to tell her how she had won my heart. Even though I was leaving on a mission I wanted to make sure she knew where I stood. I didn't plan on her waiting for fact, I told her not to! (That shows how well she listens to me) Nevertheless, that was the spot.

After our reunion at the tidal basin was over, we looked for a bench to sit on. It was on that bench that Sara first told me we would try this thing out. Unfortunately, I made a wrong turn and the bench I was looking for was a half mile farther than I thought. Whoops! Luckily, Sara was so excited that she didn't seem to mind the mishap. After we found our seat, we chatted for a bit, waited for a private moment, and asked the question. "Will you marry me?" I don't think there was much in question...but I still had to ask. She said yes! plan a wedding and a life.

Paula Deen: Is the standard too high?

There have been many noteworthy news stories over the past few days. One that doesn't sit well with me is the Paula Deen racism "controversy". Before I delve any further, let me put one thing out there. To use racial slurs is not acceptable by anyone under any circumstances. Nothing I will say changes that socially accepted truth.

What doesn't sit well is the idea that any person in the public light must walk in near perfection or else they will be cast aside like a cheap goldfish. Yes, it is inexcusable for Paula Deen, or anyone, to say the things that she said. But, if we're going to be honest, I believe almost all of us have said crude, vulgar, or inappropriate things at one time in their life. Many of the comments referenced are from many years before her television career. If all of us were judged on the misguided comments of our younger days then I don't think we'd have any public officials or well-respected celebrities.

There are many good things about our 24/7 new cycle that we have today. Information is easier to access than ever before. But we must be careful not to blow mistakes out of proportion. I'm no Paula Deen "lover", but she seems to know what she's talking about when it comes to food. Why, then, can we not accept her fault (or mistake) and allow her to share her expertise with the world? If we're not careful, we'll be out of experts before long.

Wednesday, June 26, 2013

Elevate Your Thoughts; Elevate Your Life

As I've reacclimated with life as a "normal" individual (that may be a stretch for most of us) I have realized one important lesson. The things that we put into our minds is critical. You might think I'm about to discuss the declining morality around us but I won't do that. Rather, it's important to keep ourselves focused on who we are, what we want to achieve, and who's been able to go there before us.

One of my personal goals is to find some way to improve life for those around me. A way I track that goal is to see if I can start my own business. Why? Well, a truly successful business person is somebody who improves the lives of others when you get down to basics. However, there are many subtle forces that keep me (or you) from achieving that goal or similar goals.

For one, much of the world around us encourages us to "go with the flow". We shouldn't leave the crowd, after all, because the crowd is a very safe place. Any attempt to break out of the typical mold is met with resistance and criticism. On top of that, new ideas are typically met with doubt until they've reached a certain critical mass of success. I remember a time when I told myself, "Kevin, you can't possibly get an iPod. Why would you want all of your songs on your computer? CD's are much more safe and reasonable." Now, I don't even have digital copies of my songs because I get all my music from cloud-based Spotify. The norm is to be critical of change.

This is why I believe it's necessary to put good information into your mind and soul. I'm not talking about statistics or techniques. I'm talking about a positive way of thinking. Enter Entrepreneur on Fire. This half-hour daily podcast interviews successful entrepreneurs. They rarely get into the technical aspects of the business but instead spend time discussing what obstacles were overcome to reach success. That kind of information is what fuels hope, optimism, and creativity. Without a mindset founded on those three things, flashes of brilliance will never come. So while I know everybody's dream is not to build a business, I believe everybody needs positive inputs that will elevate their thinking to what is possible rather than what is "normal".

Wednesday, May 8, 2013

Preparing For A Wedding

This week should be a fun week as we're preparing for a wedding for a couple we're meeting with. This will only be the second wedding on my mission I will get to participate in. Love is in the air!
This past week was very uneventful. My companion, Elder Hansen, had the flu. As a result, we spent three full days sitting in our apartment. As much as I love the scriptures, they can get a little stale after two hours plus per day. It was nice to get outside and move around.
This week we also have a mission conference with an Apostle likely coming to speak to us. That will be a special experience that we look forward to.
Elder Bolling