Wednesday, July 28, 2010

Coveting thy neighbor' card bills?

As I stare out my kitchen window, I've got my neighbor's 7-series BMW (sticker price: $80K) straight ahead. Down the street, we've got another neighbor who is not home; she and her husband and three kids are in Cancun...for 12 days! (seriously, who goes on a vacay for 12 days?) Got another neighbor getting ready to put her house on the market in order to move to a bigger, nicer one.

Have I mentioned this is NOT a fancy 'hood?

Moving farther afield, this friend is building an addition on her already large house and that one is off to Tuscany.

I could be jealous. I'm probably jealous. Although some years it is me installing the granite counters and jetting to Costa Rica. Not this year, though.

But it brings up the question: how does everyone afford these things?

Before you say "Duh, Snarkshelf. People are rich. You're not. Ha ha!" I say "That's my point."

Of course there are rich people around. I have friends who are doctors or whose husbands are law partners or where both spouses are big think-tank or defense contractor muckety-mucks. It is not them I don't understand. I get it. Those paychecks come with many, many more zeros than than the ones cobbled together by the pair of journalists at my house.

I am talking about the people who don't SEEM rich, meaning they live in my modest neighborhood or have civil service jobs or really don't seem to work at all. Maybe they are driving a 10-year-old car in order to afford the trip to Rio? Possibly. Perhaps frugal living means they can pay for the basement remodeling with spare change? Maybe.

It's more likely a more covert scenario. Which brings me to Northern Virginia's latest quiz show: "How'd You Afford That?!?!!?"

Here is the premise. Game show host (BFF Justine, who made up the concept and whose shoes would look fab on TV) has you match a family to a NoVa luxury item. Contestants have to guess the means to the end.

(Cue the game show music...)

The Choices:

Stock Option Buyout: NoVa is ripe with folks who, once upon a time, worked for an upstart startup and were paid in stock options. The company eventually was sold, making a paper millionaire (or thousandaire, anyway). Even if the company eventually went bankrupt, at one point in time, that person was eligible to cash in. So they did.

There are several families I know for whom this was such a good strategy that no one has really "worked" in the conventional sense for years. Would interfere with vacation plans and such. Yes, I am jealous, if not of the beach trips then of their investment advisor.

Rich grandma: Ask not who has a trust fund, because it's not you. But it might be six or seven of your friends. If it is not a formal trust fund, then it might be a sympathy fund. Grandma might feel strongly that the kids should be in private school, for instance. Out comes the checkbook. Grandma might want the whole family around for her 75th birthday; here are four tickets to Hawaii. Thanks! (and I say this humbly because Mr. Snarkshelf's mom is quite generous; from my own parents, I will be inheriting...unpaid bills).

Spy: Did you not read this in the Washington Post? Or this post from me months ago? NoVa is crawling with spies and adjunct spies and spy support. They are paid well. This also has a subcategory of Techie job that I don't understand. NoVa has lots of these people too.. You know them from parties, where the conversation goes like this:

Them: "What do you do?"
Me: "I'm a writer. How about you?"
Them: "I am the senior VP of government infrastructure software interface and satellite technology databases at XYZ Strategies."
Me (to myself): "You lost me at infrastructure."

In other words, since I don't know what in the hell that means, I don't know what in the hell that pays. But, guessing by your Lexus and Rolex, I am thinking "a lot" might be the right answer.

My house is an ATM: Remember the housing bubble around here? Yeah, I thought so. Remember when home "values" were rising 25 percent a year, and people were pulling money out? Some of that money went to "home improvements" like bathroom remodeling. But some it went for toys like boats and ski trips.

"Let's pull some money out and go to Disney World! By the time we get back, the values will have risen another 100 grand, right?"

Except home values stopped rising. And refinancing stopped being an option. And some of those people will be paying off that boat over the course of a 30-year mortgage. And they now owe more than the house is worth.

Have you seen my credit cards?: This is that part of the game where you go to Tysons Corner on a Saturday. The place is packed with people shopping. And when I say shopping I don't mean with one meager bag of something they needed. I am

talking family-sized family shopping, with bags and bags of stuff. It's a sport (that comes with Cinnabons).

Now, I might be naive, but I have trouble believing all that stuff is paid for in cash or all those people have credit cards they pay off each month. In fact, I don't believe it.

"So what if I will end up at community college? I've got cute stuff!"

I have racked up credit card debt and paid it off many, many times. When I was in my twenties, it was mostly the former. I couldn't very well be seen at Mr. Day's in the same outfit as last week. That would be crazy. Seriously, I remember once taking out a credit card cash advance - to go to happy hour.

Twenty years later, I still don't always pay the bill in full. But I don't borrow money for drinks, and I almost never let the bills get past my own personal comfort level where I couldn't pay it off in a month or two. I want to take a poll of the bulk shoppers (or the impulse vacationers). How much of it went on a credit card? And how much do you owe? I am guessing somewhere in the five figures.

So if you see me with something really nice or hear that I went someplace really cool, know that it probably won't fit into any one category. It's more a juggling act of frequent flyer miles, sale prices, careful planning, crafty borrowing and generous relatives.

Just try not to be too jealous of the Honda Accord, m'kay?

Exterior Photo of 2010 Honda Accord Sedan

Shhh. It has heated seats. I know you are crazy jealous, right?


  1. Nice post!

    Quick tip -- People don't "inherit bills." Once a person dies, their debt is written off & no longer needs to be paid. Bill collectors still do call their survivors, however, and ask to be paid. You can tell them that you know you don't have to pay that & they'll stop calling.

  2. "But it brings up the question: how does everyone afford these things?"
    Swear to god, I ask my husband that exact question no fewer than three times a month!

  3. Living below their means? Saving? Are those not possible? In middle class neighborhoods, I like to think that the "Millionaire Next Door" philosophy is in action. If you haven't read that book, you need to!

  4. This I a story of every country that in our neighborhood we are having persons of different categories also.