Economy

Read this article.

Excerpt:

So that’s the trap. The real poverty line—the threshold where a family can afford housing, healthcare, childcare, and transportation without relying on means-tested benefits—isn’t $31,200. It’s ~$140,000.

Most of my readers will have cleared this threshold. My parents never really did, but I was born lucky — brains, beauty (in the eye of the beholder admittedly), height (it really does help), parents that encouraged and sacrificed for education (even as the stress of those sacrifices eventually drove my mother clinically insane), and an American citizenship. But most of my readers are now seeing this trap for their children.

And the system is designed to prevent them from escaping. Every dollar you earn climbing from $40,000 to $100,000 triggers benefit losses that exceed your income gains. You are literally poorer for working harder. The economists will tell you this is fine because you’re building wealth. Your 401(k) is growing. Your home equity is rising. You’re richer than you feel. Next week, I’ll show you why that’s wrong. And THEN we can start the discussion of how to rebuild. Because we can.

The wealth you’re counting on—the retirement accounts, the home equity, the “nest egg” that’s supposed to make this all worthwhile—is just as fake as the poverty line. But the humans behind that wealth are real. And they are amazing.