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Some financial problems are not personal

When Atlanta resident Jeff Swope learned this year that the rent for his apartment complex could jump 30%, he voiced his concern in a private Facebook group of more than 20,000 members called No One Wants to Work.

Time magazine picked up Swope’s story about how he, a teacher, and his wife, a nurse, wouldn’t be able to afford the $2,075 rent for their two-bedroom apartment with a combined annual income. $125,000 and would still cover student loans, car payments, utility bills and other expenses to support their family of three.

Their plight has garnered little sympathy online.

Some of the people who commented criticized Swope for not being able to manage their money well. They couldn’t understand how a couple with a six-figure household income could struggle.

I shook my head at the thought of someone suggesting that personal finance courses would solve problems that had been going on for decades – soaring student debt, sluggish income growth and rapidly rising housing costs, health care and just about every commodity. we need to live.

In April, Georgia lawmakers made financial literacy education mandatory for high school students starting in the 2024-25 school year. Students in grades 11 and 12 must take at least one half-credit course in financial literacy to graduate. In December 2021, the State Board of Education changed the title of the economics course currently required for graduation to “Personal Finance and Economics” to be implemented in the next school year. The course covers 10 standards categorized as “personal finance”.

I’m not opposed to students learning personal finance, but I’m opposed to blaming 42-year-old adults like Swope for problems they didn’t create by telling them they need better skills in money management.

I know what it’s like to budget carefully, live modestly, and always feel like you’re not going anywhere financially. After selling my condo – the first home I ever owned – I bought my current home in 2017. If I hadn’t then, I might not be a homeowner today. . The fact that I can even claim ownership puts me financially ahead of so many people who don’t have that opportunity.

I have friends in their 40s who are earning six figures and praying that President Joe Biden will keep his promises of debt cancellation on federal student loans. They don’t want to live the high life. They just don’t want to feel like they’re barely making it each month. I know of others, also in six-figure households, who have been financially destroyed by a health crisis despite having employer-provided health insurance.

These are not problems caused by a single economic event or by a person’s lack of financial knowledge. They are the result of broken systems that desperately need fixing.

The very concept of upward mobility rests on the shoulders of a middle class that for years has been clinging to a rapidly descending rung of the social ladder. Unfortunately, this struggle has also become the basis of division as everyone fights to maintain a socio-economic position that they believe is slipping away or just remaining out of reach.

The slide of the middle class does not only affect the middle class. A 2013 study on social mobility from the Center for American Progress found that the size of a region’s middle class is strongly correlated with the likelihood of upward mobility for a child born poor in that region.

From 1971 to 2021, the number of adults living in middle-class households has fallen from 61% to 50%. In Metro Atlanta, 53% of households are middle class, while 23% are upper class and 29% lower class.

Among this middle-class majority, there are plenty of families like the Swopes who don’t feel like they’re thriving financially.

In May, home prices in the Atlanta metro area were up 11.2% from a year earlier. Homes are selling for a median price of $456,000, according to real estate broker Redfin.

Rents are also on the rise, having increased by 15.33% in May compared to the previous year. The average rent for a one-bedroom apartment is $1,862, according to data from ApartmentList.com.

The rapidly rising cost of housing would be concerning enough, but we have also seen our purchasing power steadily decline.

The consumer price index for metro Atlanta rose 1.9% from February to April, up 10.8% from a year earlier.

At the same time, workers’ wages and salaries have not kept pace with inflation. Metro Atlanta saw the lowest increase in wages and salaries (3.4%) from March 2021 to March 2022 compared to other metro areas (the national average is 5%), according to data from the Bureau of Labor Statistics.

With nearly all living costs outweighing wages and salaries, it’s no surprise that Swope told Time magazine he was considering taking a part-time job.

So if we absolutely must ensure that young people are made aware of personal finances, we must also stop blaming the victims.

The financial problems facing middle- and low-income residents go far beyond personal issues. To better enable upward mobility, lawmakers must enact policies that address the broader economic issues we face as a nation.

By Nedra Rhone

Nedra Rhone is a columnist for The Atlanta Journal-Constitution.

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