How I Afford Both Avocado Toast and My House
You’ve probably heard about this millionaire saying that millennials can’t afford homes because they are too busy buying avocado toast and $4 lattes. I’m not going to go over the tired “poor people are poor because of their bad decisions” trope because I’m sure others are. I’m going to talk about how I got wealthy.
I am not “wealthy” like “one percenter with a monocle” wealthy or “buys first class airline tickets” wealthy. A quick and dirty look at the statistics would put me somewhere between the top 15–25% in household income in America, commensurate with a lot of people with my level of education. My “household,” by the way, consists of me and a small dog who does not provide a 2nd income. I have no student debt, no credit card debt that I don’t pay off every month — my only debt is my mortgage.
How did I get a house? I bought my home right after the market bottomed out after the 2008 bubble burst. The seller was motivated, and it was a good time to buy. My parents helped me with the down payment, which is no small thing. They had been accumulating a nest egg for me for some time. I probably would have bought that home or a different one even without their help, as the banks would have just given me a bigger mortgage because of their faith in my earning potential. But the down payment certainly had an impact on my purchasing power.
Well how did I get to that point? My earning potential and lack of student debt comes from the fact that the doctoral program I went to was fully funded. This was 6 years of education — what you could estimate as maybe a $250,000 investment — at $0 cost to me (more or less). I am proud of the fact that this program was at a public university which is able to have top-notch graduate programs and research institutions (part of the reason I cut them a check every year). As a public university, they are largely funded by the state directly, but also what keeps much of a research institution churning is grants from places like the National Science Foundation and the National Institutes of Health (both federally funded). Half the people in my program were on NSF fellowships. I was always frightened by the idea of not being able to find work after I graduated, so I spent a lot of extra time doing things that I knew would make me marketable — studying statistics in my free time, for example. What little debt I accrued during those 6 years was from a small Stafford Loan (federally subsidized by the government) I took out toward the end so I could devote more time to my dissertation rather than TAing a time-intensive course.
During graduate school, I suffered from a debilitating health problem. I’ll spare you the gory details, but to sum it up my doctors took a long while to actually figure out what I had, and it is something of a miracle that I graduated on time. Over the course of those 6 years, I probably had 6 MRIs, 7 or so ultrasounds, countless appointments with specialists, various trials with different medications, and an interventional radiology procedure (I saw the hospital bill — it was $30,000). Happily, my university had an amazing medical center where I received excellent treatment, and my fellowship included health insurance. I had to pay very little of those costs, but even then, a $200 copay for an MRI, maybe even 2 within the same month, is hefty when you are making $1400- $2,000 a month. My parents helped pay for some of the medical costs. In case you wonder, this health problem was not brought on by any lifestyle choice of my own; to this day, they do not know causes the disease I had — probably just bad genes in my case — which is one of the reasons I would love to see clinical trials and experimental research continue to be funded. You know, by places like NSF and NIH.
This graduate school education was priceless — but you might wonder how I got there. I worked my ass off when I was getting my BA — I had a high GPA and spent a lot of time developing research interests and working in a lab. I went to a mid-tier private college which cost $30,000 a year (the price is now 60k for the same school!). My parents paid for college, but I saved them 30k by finishing in 3 years, and another 20–25k because my school would knock of 10k if you made the Dean’s list. While I had the occasional part time job, it wasn’t for too many hours (I worked for free in the lab), and it was nothing like the 20–40 hour work weeks of some of the undergraduate students I would come to teach in graduate school. As school came to a close, I obsessed with what I would have to do to get into a good graduate program. My grades were fine, but I needed GRE scores above 1400 (math + verbal, out of 1600 back then.) I wasn’t quite there; my parents offered to pay for Princeton Review. I picked the cheaper online option which was a couple hundred dollars. But also, I studied obsessively. I carried around a little notebook and wrote down any vocabulary word I came across, studying them on the subway or when I was waiting for my bagel to toast. (this was before avocado toast). I got up early to take practice tests at the exact time they would be offered when I would take the real test. I did end up doing well on the GRE. Oh, one more thing —my college education came with health insurance.
How did I get into college? I mostly went to public schools for K-12th grade. I lived in the suburbs — there was very little crime, the trick-or-treating was good, and people left their doors unlocked. My hometown is a place where people literally own horses and ride them to get places. My state is consistently within the top 10 states in terms of spending per capita on education. The statistics I looked at were a bit dated, but to do a quick-and-dirty adjustment, it’s about $20,000 per pupil per year. Part of the reason my parents picked to live where they did was because of the schools, and they had the financial ability to move where they wanted. My public schools were very good, and after 10 years of post-secondary education and taking classes with people from all over, I can say they left me very prepared for college and beyond.
In all honesty, I did not try very hard in school until I got to college (someone told me I was smart then, at which point I thought, oh I should probably be applying myself). I was frequently bored and sometimes got bad grades. Every now and then I would have a fantastic teacher who could make certain topics exciting — literature, Spanish, chemistry, Greek mythology — and I would get really into it and apply myself. But the fact of the matter is that if you’re pretty smart, you can be pretty lazy and still float by with Bs and turn out okay— at least in a school that is very very good. I don’t think the smart-lazy thing works in schools that are terrible, because I still had to do enough to pass tests, to turn in essays, to learn just enough algebra. I would not have gotten Bs at these schools if I didn’t know how to read. So this education was some combination of great schools and intelligence. I had decent grades and my parents paid for SAT classes because college is important (as is the space-race between my parents and their friends to have the most academically advanced kids so they could directly compare SAT scores..) I did do well on my SATs, and applied to college knowing that my parents could pay for it, and while I had no idea at the time, I had 12 solid years of education supporting me.
By the way, where does intelligence come from? You’ll hear all sorts of things, but I would say it is some combination of genes (luck) and environment (fostered by my schools, community, and family, in addition to things like nutrition and freedom from a stressful environment). All of the following environmental factors benefited me: I was not growing up in the middle of a civil war or famine; my parents could afford any food they wanted and while they were stingy with the toys, I could have unlimited books; my neighborhoods and schools were safe; the water was clean and there were places to play.
If it hasn’t already been made clear, my parents wealth afforded me tons of advantages. But where did that come from? Well, back in the 60s and 70s, there was a shortage of doctors. The US offered my father and a bunch of other people from his med school visas to come to this country to fill that gap. He and my mother became citizens afterwards, but first they lived in a crowded apartment building with a bunch of other immigrants and lived off a tiny resident stipend. Your standard Ellis Island “I came to this country with nothing but two peanuts in my pocket!” . . . except not really. My father’s family was wealthy enough to send him to medical school. A medical degree is more than two peanuts. And back then, the immigration decision was about numbers — not enough doctors, ok let’s get some doctors. No one said no, these people are brown, they have accents, they are non-Christians who worhship outrageous gods with elephant trunks and too many arms.
I guess what I’m saying is, it would be ridiculous for me to claim that my wealth and success is due entirely to my own hard effort. This is not to say that I didn’t work really really hard. I did. I knew I was afforded opportunities that others weren’t, and I knew to exploit them, and I knew that there’s always the possibility that those very privileges could disappear overnight. Oftentimes people feel that their hard work is discounted when people point out their privilege. No one is saying you didn’t work hard. And I’ve seen plenty of people with the same advantages squander them, or just wander aimlessly through life, assuming that money they are entitled to will always be thrown at them. It would be ridiculous of me to pretend that some of my circumstances in life have nothing to do with dumb luck, whether it be being born into my family, the bad genes that made me sick in grad school, or the good genes that made me reasonably smart.
People nearly exploded back when Barack Obama said, “You didn’t build that” during a speech when he was President. Maybe that wasn’t the best way of wording it, but I 100% knew what he was talking about. I didn’t build me entirely. So many factors went into what put me into a position where I am financially doing okay. To do the rough math, the state paid for my public pre-college education (about $240,000 going by the 20k a year per capita), everyone but me paid for college ($90,000), then a government funded public university plus federally funded Stafford loans paid another $250,000 for me to get my doctorate. The state alone invested half a million dollars in me just for my education. God knows what my parents invested, overall, but I hope they are happy with the ROI.
Whenever I’m lifting a $4 latte to my mouth, I’m keenly aware and vaguely embarrassed about how much of a privilege that is. I am not thinking about how entitled I am to drink a $4 latte because of how hard I’ve worked in life, even though, at least since I was 18, I have worked hard. I am not entitled to this money, and no one had to give me those advantages. Hell, I am not even entitled to be alive, because I could have already dropped dead from cancer or some heart defect that was the result of a random genetic mutation.
This is why I continue to be a strong supporter of public schools, of funding people to go to college through things like Stafford loans and Pell grants, of the federal government funding grant-giving institutions like NSF and NIH. We are not living in some post-apocalyptic nightmare where we should turn to our neighbors and say, “If you can’t afford it yourself, fuck you!” We live in a country that has a larger GDP than the entire European Union. We as a country make investments in people. So before we jump to the “poor people are poor because of their bad decisions” — yes, people make decisions that affect their own lives, but we also make decisions about what investments to make in other people.