I am often asked how we dare preach saving to young people living in debt. I am asked how it is possible that the young-and-broke generation, my generation, can be asked to make even further sacrifices by saving for their future.
What is the alternative? Only by telling the truth about the state of our future can we hope to comfortably live within it. The truth is that if we don't prepare for our own future who will?
Saving is an investment in our tomorrow. Saving is a case of today you gifting money to tomorrow you while accumulating debt is gifting today you with money from tomorrow you.
That's it. It really is that simple. It's our very own, personal, intergenerational money transfer.
My dentist says to me "you don't have to floss all your teeth, just the ones you want to keep". Likewise I say you don't have to invest in your future, unless you want one with minimal financial distress. Financial distress the media would have us believe it inevitable.
Sky recently showed a documentary about the "Born Bankrupt" generation. And yes they are talking about me and my cohorts. Jeff Randall spoke to a number of experts and all agreed that our generation has some tough times ahead. I don't think they are wrong, and I think my generation has a long and steep path to navigate, but I don't think it's as hopeless as they made out.
There is no question that our lot is not the same as the Boomers. The deposit for a mortgage used to be equivalent to 9 months salary and today it is 3 years. Jobs were more or less guaranteed while today only 80% of young people are in employment, their promise was of a defined pension which was tied to salary levels while the promise to us is you'll get what you save for yourself. Education used to be tax payer funded and today it's... Wait... It's tax payer funded (but now you need to pay the tax payer back after you start earning a salary). Yes, things have changed but are things so bad that we are a "victim" generation?
Really... Would you honestly prefer to be a boomer? We will live longer healthier and be blessed with a decade, or more, of life. We have technology and communication our parents can only dream of fully understanding, we have the ability to see the world first hand but can also learn whatever we wish from our living room. We have no concept of poverty or real want (we are not entitled to cable, holidays and the latest gadgets and not having them does not constitute poverty no matter what the think-tanks say). We have seen a democratisation of knowledge which is quite simply unprecedented and for those who wish it, and are prepared to work for it, the possibilities are boundless. Never in the history of the world has a generation had so much opportunity and has the world been as open.
I know I'm happy to be an Xer!
Opportunity is laid out before us. But money isn't as easy. If nothing can last forever it must by definition come to an end. So is it really so surprising that the unrelenting growth funded off the back of debt has come to an end?
The situation isn't fair, life isn't fair, but the real question is what do we do?
We have two options before us. We can conquer the situation we are presented with, or we can be conquered by it. Neither precludes the right to protest, lobby, vote and get involved in the process. In fact those are critical as is participation in the creation of a forward looking agenda. But while that battle is raging we need to handle the here and now.
Politicians and industry must tell the truth for no one benefits from lies. Living longer is a lot less appealing with no money. So we must all save more, invest more and prepare for the future for if we don't no one will. We must get financially educated and realise that this type of learning never ends, it evolves. We must become masters of our money or we will become slaves to our debt.
It's not our fault the carefree period of global economics came to an end but it did nonetheless. It happened at the end of "their" watch but soon we will become the vanguards of this nation's future and so it is time for new thinking about sharing the burden.
It would be wise for those in power, and those who lobby for power, to remember that we will hold the keys when they begin shopping for retirement homes. When boomers demands on health-care starts in earnest, the power to allocate national funds will be in our hands.
the adage remember to be kind to your children for they will choose your nursing home could prove true on a national level too.
A break in the intergenerational contract will benefit no-one. If boomers don't pick up some of the tab for the debt they played a large part in creating they may find that a cash starved generation makes cuts in places they find uncomfortable tomorrow.