want the answers? - Page 2

On June 24 2012 22:30 R_I wrote: What does amount of debt have anything to do with earning potential?

Well before having an actual earning, a debt must be paid. You can not have a real earning potential unless you either
a) lie to urself
or
b) have come out of the negative

On June 24 2012 22:30 R_I wrote: No doubt the bum's networth is going to be higher than the recent graduate for a few years but in terms of earning potential, you would expect the graduate to be able to get a job earning more than the bum could and to also have their wage go up. Don't think that's gonna happen for the bum. Doesnt matter if you don't like the way the graduate is going about it, chances are ...

I believe you are seeing what you want to see when it fits. You have concluded that all bums or people asking for help/donation have 0 earning potential. At the same time you are apparently expecting to see someone who is in debt not only paying off their debt but also getting a good job.
I disagree with these general assumptions. All I have to do is place myself in a bums shoes or a person in debts. Obviously for me, I would rather be the bum with no debt and then snap out of it and do what I want to do with no constraint(s) holding me down. I wonder if this made sense...

On June 24 2012 22:30 R_I wrote: ...that their earning potential is going to be quite a bit higher esp as time goes on.

If this was the case, student debt in the USA would not have recently climbed over one trill

On June 24 2012 22:30 R_I wrote: By being a beggar, the bum is generally guaranteed to not be able to build any networth because he is too busy trying to survive day to day.

As I see more and more people who are becoming broke or in debt, this assumption becomes less and less true for my own general conclusion pertaining to people & debt. People who are 'bums' or have no money but won't go in debt, learn to become quite frugal which actually helps somewhere if they snap out of the funk or get over it is whatever ails them

On June 24 2012 22:30 R_I wrote: Personally I'm happy that I got a student loan and that I have a decent paying job now reducing my loan and building up assets compared to being a bum on the street with a networth of $10 for life.

I am glad for you and how you managed yourself wisely. You should realize how special you are as generally most people do not have the same outcome as you have

Imma come back to this thread again at a later date
fun is calling =)

Oh hey, just noticed that you actually replied.

On July 04 2012 23:38 tloapc wrote: Show nested quote + On June 24 2012 22:30 R_I wrote: What does amount of debt have anything to do with earning potential? Well before having an actual earning, a debt must be paid. You can not have a real earning potential unless you either a) lie to urself or b) have come out of the negative

I think we should make a clear distinction between building and having a positive networth and earning money. Earning money is when you exchange your time and effort for currency. If a person has more earning potential it means that they have the potential to be a in position where they get more money in exchange for their time.

Even if you have 1 million in debt, the moment you spend an hour doing some work and receive $10 for your time, you have just earnt $10. You are then free to do what you like with it, including building your networth.

I've seen you pull out the dictionary and circle definitions in your latest posts so you are welcome to do so with the word "earn".

Show nested quote + On June 24 2012 22:30 R_I wrote: No doubt the bum's networth is going to be higher than the recent graduate for a few years but in terms of earning potential, you would expect the graduate to be able to get a job earning more than the bum could and to also have their wage go up. Don't think that's gonna happen for the bum. Doesnt matter if you don't like the way the graduate is going about it, chances are ... I believe you are seeing what you want to see when it fits. You have concluded that all bums or people asking for help/donation have 0 earning potential. At the same time you are apparently expecting to see someone who is in debt not only paying off their debt but also getting a good job. I disagree with these general assumptions. All I have to do is place myself in a bums shoes or a person in debts. Obviously for me, I would rather be the bum with no debt and then snap out of it and do what I want to do with no constraint(s) holding me down. I wonder if this made sense...

Well, I would say it's quite a bit of an assumption to assume the bum can just snap out of it and start making decent money, especially if they avoid going in debt for education.

Show nested quote + On June 24 2012 22:30 R_I wrote: ...that their earning potential is going to be quite a bit higher esp as time goes on. If this was the case, student debt in the USA would not have recently climbed over one trill

Again, i think there's a distinction between networth and earning potential/money. If say people earnt more but are neglecting to pay down their debt and are instead buying status symbols, that would still explain the student debt climbing up even if people are earning lots of money. The economy needs people to spend money on stuff like new cars and houses.

Show nested quote + On June 24 2012 22:30 R_I wrote: By being a beggar, the bum is generally guaranteed to not be able to build any networth because he is too busy trying to survive day to day. As I see more and more people who are becoming broke or in debt, this assumption becomes less and less true for my own general conclusion pertaining to people & debt. People who are 'bums' or have no money but won't go in debt, learn to become quite frugal which actually helps somewhere if they snap out of the funk or get over it is whatever ails them

Again with the assumption that bums just snap out of it and start building significant networth without taking on debt.

My whole point has been that over say 20 years, you have a lot better expected networth by taking on student loan debt and then getting a good paying job than if you're someone with no qualifications making near the minimum wage.

Maybe you could run some numbers for the discussion? You can pick numbers that you think are conservative and then calculate what the networths are looking in like 10 or 20 years time for the graduate and the bum in your graphic. Pick numbers for things like starting pay, average wage increases and the minimum wage. Also costs too if you like. I'd be happy to do the same but I'll let you pick what you think are reasonable numbers first.

Show nested quote + On June 24 2012 22:30 R_I wrote: Personally I'm happy that I got a student loan and that I have a decent paying job now reducing my loan and building up assets compared to being a bum on the street with a networth of $10 for life. I am glad for you and how you managed yourself wisely. You should realize how special you are as generally most people do not have the same outcome as you have

As poker players, we learn not to focus on outcome but on the expected value of actions right?

Here's a summary of my claim: In terms of building networth over the working life of a person (20 to 65), the expectation is a lot higher if they go into debt for education compared to not doing so. This is a comparison where factors like self management are equal. This is also discounting some huge overhaul of the current system. The old saying of playing your hand the best you can, even if it's shitty.

If you disagree, run some numbers and let's see. One outside case is someone forgoing education but starting a business but hey, they would need to go into a lot of debt as well.