When Atlanta resident Jeff Swope learned earlier this year that the rent in his apartment complex could jump 30%, he expressed his concern in a private Facebook group with more than 20,000 members called No One Wants to Work.
Time magazine picked up Swope’s story of how he, a teacher, and his wife, a nurse, would not be able to afford the $2,075 rent for their two-bedroom apartment on a combined annual income of $125,000 and still cover student loans, car payments, utility bills, and other expenses to support their family of three.
Their plight was met with little sympathy online.
Some of the people who commented blamed Swope for not being able to manage his money well. They couldn’t understand how a couple with a six figure household income could be struggling.
I shook my head at the idea of anyone suggesting that lessons in personal finance would solve problems that have been decades in the making — runaway student loan debt, slow income growth, and the rapidly rising costs of housing, healthcare and just about every commodity we need to live.
In April, Georgia lawmakers mandated financial literacy education for high school students beginning in the 2024-25 school year. Students in 11th and 12th grades must take a minimum of a half-credit course in financial literacy to graduate. In Dec. 2021, the state Board of Education changed the title of the economics course currently required for graduation to “Personal Finance and Economics” that is to be implemented in the coming school year. The course covers 10 standards classified as “personal finance.”
I’m not opposed to students learning about personal finance, but I am opposed to blaming 42-year-old adults like Swope for problems they didn’t create by telling them they need better money management skills.
I know what it is like to carefully budget, live modestly and still feel as if you are getting nowhere financially. After selling my condo — the first home I ever owned — I purchased my current home in 2017. If I hadn’t done it then, I might not be a homeowner today. The fact that I can even claim homeownership puts me financially ahead of so many people who don’t have that opportunity.
I have friends in their mid-40s who make six figures and are praying for President Biden to come through with his promises of debt forgiveness on federal student loans. They don’t want to live the high life. They just don’t want to feel as if they are barely getting by every month. I know of other locals, also in six-figure households, who have been financially wrecked by a health crisis despite having employer-provided health insurance.
These are not problems driven by a single economic event or by one person’s lack of financial knowledge. They are the result of broken systems in desperate need of repair.
The very concept of upward mobility has rested on the shoulders of a middle class which, for years, has been grasping to hold on to a rapidly lowering rung of the social ladder. Unfortunately, that struggle has also become the basis for division as everyone fights to maintain a socioeconomic position they feel is either slipping away or remaining just out of reach.
The middle class slide doesn’t just impact 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 strongly correlates with the probability of upward mobility for a child born poor in that region.
From 1971 to 2021, the number of adults who live in middle-class households fell from 61% to 50%. In metro Atlanta, 53% of households are middle class while 23% fall in the upper class and 29% are considered in the lower class.
Among that middle class majority, there are many families like the Swopes who don’t feel as if they are thriving financially.
As of May, home prices in metro Atlanta were up 11.2% compared to the previous year. Homes are selling at a median price of $456,000, according to real estate brokerage Redfin.
Rents are also on the rise, having increased 15.33% in May compared to the previous year. The average rent for a one-bedroom apartment is $1,862, based on data from ApartmentList.com.
The rapidly rising cost of housing would be enough cause for concern, but we’ve also watched our buying power steadily decline.
The consumer price index for metro Atlanta increased 1.9% from February to April for an increase of 10.8% from the previous year.
At the same time, wages and salaries for workers have not kept pace with inflation. Metro Atlanta had the smallest increase in salaries and wages (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 almost every cost of living outpacing salary and wages, it’s no surprise Swope told Time magazine he was considering picking up a part-time job.
So while we should absolutely make sure we are educating young people about personal finance, we should also stop blaming victims.
The financial issues facing middle- and low-income residents are far beyond personal. To better enable upward mobility, lawmakers need to enact policies that address the larger economic issues we face as a nation.
Read more on the Real Life blog (www.ajc.com/opinion/real-life-blog/) and find Nedra on Facebook (www.facebook.com/AJCRealLifeColumn) and Twitter (@nrhoneajc) or email her at nedra.rhone@ajc.com.
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