“OK boomer” began as a response to older people who either refuse to acknowledge modern problems in society or the economy, failing to understand how things have changed, or make negative comments about younger generations doing things differently and having different interests. It is a condescending retort to a group that frequently misrepresents or ignores concerns younger generations raise.
Millennials tried for so long to explain using facts and evidence that they don't actually have it that easy and they aren't just lazy, but it became very clear that boomers don't care about facts, evidence, or reality for that matter. So this is what has resulted. We've given up. I feel like "ok boomer" is kind of the equivalent of "wow, you're so horribly wrong, but I don't have the time or the energy to repeatedly explain something to you that you're not going listen to anyway.
These traits can be summed up as "boomer mentality," which is a mentality that also includes assuming how life worked well for you should still work for everyone else today. People hate this because reality isn't the same as it was for you in bygone days and your opinions and attitude are inapplicable, outdated, and/or incorrect. "Boomer mentality" is refusing to comprehend how things have changed and/or failing to understand the reality of what many people live and experience and why the simple solutions that worked for you, don't work for everyone else.
"OK Boomer" is also often used as a criticism from people believing that many of todays problems were created or exacerbated by boomer leadership such as climate change, high housing costs from bad zoning, NIMBY actions, and other factors, the massive federal deficit from Boomer politicians, increasing college costs under boomer administrations, and job market complications when applying for jobs, especially entry level positions.
Here is what I think started this trend: the middle class is shrinking because of high college and housing costs being up dramatically compared to what they used to be, childcare is unaffordable for many, meaning someone HAS to stay home with the kids even though they need more income to live comfortably, insurance rates increase, wages are not high enough in general to keep up with these rising costs of living, and the amount of disposable income the middle class have is shrinking and killing consumer demand, leading to further consolidation as businesses have less customers. People don't have the spending money to shop like we used to. It's all going to just living expenses and one nice thing. Comparing the cost of living to 50 years ago, life is much more financially difficult. People aren't starting as many businesses either because the startup costs and real estate costs are prohibitively high.
Even the poverty line hasn't kept up with inflation. One of the biggest problems with solving poverty in America is how poverty is calculated. When poverty was first calculated, economists discovered that the average American spends 1/3 of their budget on food. So they took the amount required to pay for basic food, tripled it, and said "this is the line where you feasibly can't live on". The problem is that food prices have not increased nearly as much as everything else, such as housing. Nowadays, the average American's food is 1/8 of their budget, but the poverty line is still calculated by tripling the food budget. It's been a few years since I looked, but I think the poverty line for a family of 4 is something like low to mid $20,000s per year. But if you correct for the price change of food and housing, the real poverty line is closer to $60,000s for a family of 4. If you look at the distribution of income, there are a LOT of people who consider themselves middle or lower middle class who would have been under the poverty line back in the 50s if the cost of living was compared.
Some say our quality of life is still much better today though because of the advancements in technology. For things like healthcare and some other developments, yeah I'm pleased with that; but for everything else the costs and stress are difficult. Instead of being able to take it easy, we have to work to be able to afford and upkeep the new technology. We're running on a treadmill that is now faster, but with a show to watch on screen or virtual reality and fan as it gets faster. There's also the fact that you need more stuff to function today than before, things like internet, cell service, and a computer are almost mandatory to get by. The only thing i can think of that's cheaper now is some clothing and some consumer electronics due to outsourcing.
Now let's look at some comparisons of how costs have changed a lot over the years:
Median Price of a home in 1980: $47,200 vs 2020: $391,900 source
Median Family income 1980: $21,020 2020: $71,456 source1, source2
Home price as percentage of income 1980: 225% 2020: 548%
Median tuition cost of Boise State University resident 1980: $239 2020: $4,030 source1, source2
Tuition price as percentage of income 1980: 1.14% 2020: 5.64%
THIS is what's making people mad. THIS is what makes so many turn from capitalism to government involvement and "socialism" policies. They're frustrated with how much it costs to live compared to what it used to be. This is also a major reason for the hate for Boomers and those that think people just aren't trying hard if they aren't financially succeeding like they did. In their younger days, it seems like you really did have to just lift a finger anywhere and it could provide a comfortable life and career pathway. They seemed to have it so easy by comparison! Now, I do understand that there's never NOT been a poor class or people, even in those days, so I don't truly know how it was, but there was definitely a much bigger middle class group of society that thrived back then.
This picture was shared online titled, "My Dad Found This In An Old Locker At His Work." It's a monthly pay schedule from 1951, most likely from a union electrician worker according to the original poster, and commenters ran wild with it by first comparing the dollar amounts to what today's equivalent would be. Taking it a step further, people started commenting about what those wages would get you back then. The pay was determined to be the equivalent of about $27/hr today. An average house back then ranged from $8k to $15k ($91,600-$171,750 toady), cars typically cost around $1,500-$3,000 ($17,175-$34,400 today), and food items averaged around 25-60 cents ($3.09-$6.69 today). That monthly salary went MUUUCH farther than the equivalent does today.
To further dig into this point that the cost of living differences are humongous, I found a reddit post titled, "Boomer success stories that no one would believe if they happened today." Some of the stories shared here and others I found elsewhere can still be applied to random success stories today, but they seemed to be much more common 50 years ago. Here's a few quick examples of stories shared:
Sometimes the sentiments dig in really far into the despising of boomers, like this rant I found online titled, "BOOMERS ARE SPOILED BRATS." Love it, hate it, here is the dramatic presentation:
The names we collectively chose for the generations really sum it all up. The Silent Generation bore enormous suffering without complaint, the Greatest Generation bled and toiled for the world's freedom, but the Baby Boomers are named for the mere fact that there is an almighty swarm of them. They never earned a better name for themselves. The Silent Generation and the Greatest Generation had to deal with problems that were greater than themselves. They had to put aside their petty desires and squabbles because of events that were too forceful and lengthy to simply ignore.
Boomers have had a seat at the great table of plenty and peace for their entire lives. They don't know any other situation. Their parents’ generation fought WWII for them, the single most factor that made the US a world superpower when the rest of the world was destroyed or developing. Their children’s generation provided the cheap labors when they become managers themselves. The worst things that ever happened to them in their lives were things that DIDN'T happen. The Cuban Missile Crisis was a few paltry days of terror that COULD have ended the world, but didn't. Nobody had to work extra hard, nobody had to go hungry, nobody had to sacrifice a fucking thing. They all just waited around and it turned out nobody got nuked. Compared to their parents' and grandparents' woes, it was no crisis at all. Even taking Vietnam into account, less than 4% of the boomer population served there. The other 96% didn't.
Boomers of the US are the luckiest, richest generation of any people in human history.
Boomers are the last generation to be able to pay for their own college by washing dishes as a part time job. After that, they graduated and became presidents/provosts themselves and made college super expensive to profit off millennials.
Boomers are the last generation to be able to support a whole family by having one working adult. Boomers are the last generation to have all the jobs in the US and not get their jobs outsourced to other countries.
Boomers are the last generation that you can just “walk in and get a job”. Now we have wonderful AIs that can decide to ghost your resume for reasons you’ll never know and you’d count yourself lucky if you could get 3 interviews after sending out 300 applications.
Boomers are the first generation to have the mindset to spend whatever they make during their lifetime, and not seriously consider leaving anything behind for their children. Bye bye generational American homes and estates. Hello suburb cookie cutters!
Boomers will probably be the last generation to have reasonable retirement and healthcare. The whole social security system and 401k will be bust after they’re gone. Now, for each struggling millennial couple looking to get a starter home, there’s some boomer “investor” who offers 50k to 200k more in cash just to get another property on his/her portfolio.
With all the wealth they accumulated during their lifetime, it’ll be at least a saving grace that they pass it down when they’re gone, right? Wrong. They’ll lose everything on reverse mortgages and healthcare on their deathbed, hoping to extend their boomer experience for a little longer. Not only are they leaving their kids/grandkids nothing, but they are heading to their graves flipping us the bird the entire way. They are the locusts of humanity, eating the prosperity of the world and complaining as they do it.
"I had to walk up a hill in the snow both ways," really pales in comparison to not being able to buy a home, build a family, or obtain healthcare. The most stereotypical complaint of the Boomers, was walking to school in nasty weather.
In a debate on inequality and how workers should be given more, the question was asked, "Why would businesses invest in equipment to increase productivity if it all went to workers and not profit for the owners and investors of the company?"
This is exactly the point that divides people with different ideals/personalities. Some view workers as just tools the business pays for to operate. Others view the employees as having a larger, fair stake in the company because they're the ones actually running it day to day. They wouldn't have a job without the company, company wouldn't exist without people working the jobs.
Just like anything, you can pay for cheap quality and not maintain it, but it can still run and you should save money if it runs well enough, or you can pay top dollar and maintain the parts well. Maybe it'll run better, maybe it'll run the same.
I think this type of managing is why, in America at least, we have growing inequality with a shrinking middle class (source1, source2). Rising inequality can lead to rising crime, social unrest, and political extremism. It makes sense from a capitalism perspective to only reward the owners and investors, but it also seems short-sighted as there are long-term consequences in a society from this where the owners and investors become an increasingly exclusive class of people.
I blame Managerialism as the source for what kick-started the trend to growing inequality problems, then aided by various government policies that rewarded and encouraged this practice. Managerialism is belief in the value of professional management and practicing ruthless economic efficiency with control, accountability, and measurement. Decision making is done based on number reports only, about maximizing returns for owners and investors only. From a business perspective, it makes sense, but it also takes a negative toll on society.
Family-owned businesses grew into giant, impersonal corporations. Managerialism ruined communities and human relationships. The boomer advice of pounding the pavement and getting a job with just a firm handshake and some gumption is almost entirely an artifact of history. Under managerialism, costs are cut everywhere, so money flows directly to the top as much as possible. Jobs are outsourced and processes are automated, including hiring processes done with computer software sorting resumes. We also now deal with annoying automated phone relays when trying to call offices, having to shout, "Speak to a representative" into the phone over and over. The need for human attendants has been and continues to be removed as much as possible. There is less community support from local businesses as they've gone under or been bought out by larger companies. Little league and high school teams have less sponsors because big companies don't care about that stuff. It's just another cost that's easy to cut.
Some argue that this is good practice because it lowers the costs of goods. Combined with the development of technology, I concede that it has - in some cases; but when jobs are cut and wages stagnant from long-term managerial practices, the low prices don't matter when there's no discretionary spending money left. Owners and investors are heavily rewarded for their risks and investment, but in the long-term it's getting harder and harder for more people to become owners and investors themselves. It's becoming an exclusive class in society. Besides, is there really risk when companies are considered too big to fail and get bailed out by government anyway?
Another argument is that boosting the stock market is good for everyone's retirement accounts. Money in the stock market is good if you own a LOT of stock, but the vast majority of people don't. They have some retirement accounts invested so it's good if the accounts grow safely, sure; but improving wages is far more beneficial in the long term than people's 401K savings. They can use that money to spur the economy, save even more, and upgrade their quality of life.
I was surprised by this Fox News piece from 2019. It sounds like a very progressive concept for them as it discusses the negatives of how certain hedge funds and "vulture capitalism" is bad: https://www.youtube.com/watch?v=IdwH066g5lQ
Again, it's this practice of ruthless economic efficiency. Outsource jobs, liquidate valuable assets, operate on a bare minimum of employees needed and pay them as low as possible while maintaining adequate, necessary staffing. Then lobby congress and buy politicians to set policies in your favor.
I blame these managerialism practices and the rise of hedge fund "vulture capitalism" for destroying everything by depressing wages, killing jobs, and creating the terrible hiring practices we have today. The managers hired to cut costs and increase profits for owners and investors is peak capitalism, but destroyed the human and community connection.
Another financial game being played that is important to note is with stock buybacks. Watch this Vox piece, also from 2019, titled, How American CEOs Got So Rich:
CEOs and executives could get a sweet bonus if the stock price goes up to reward investors. The quickest way to increase their stock price is to use corporate profits to buy their own stock. The Securities Exchange Act of 1934 cracked down on stock manipulation and insider trading, which also, in a way, forced corporate profits to be reinvested in growing/upgrading the company, raising wages and bonuses, and/or pay dividend profits to investors directly.
Laws changed in the early 80s, bringing back buybacks. Companies spend majority of profits buying their own stock. It's not being reinvested nearly as much. Money in the stock market is good if you own a LOT of stock, but the vast majority of people don't. They have some retirement accounts invested, sure, but I already covered how improving wages and bonuses are more beneficial to the majority.
GM comparison with Toyota and Volkswagon. GM was doing buybacks heavily, not reinvesting in their company. They declined. They earned record profits, yet cutting operations. Something else is probably going on, but it's easy to see why so many people are upset to see the same headlines over and over of companies making record profits, but then increasing their costs and/or screwing over their employees.
Southwest Airlines had a loot of trouble during the end of the year holidays in 2022. They previously received a $7billion federal bailout, spent $5.6billion on stock buybacks, gave their CEO a raise to $9.1 million, and spent $0 updating their software. Thousands of workers and travelers paid the price.
In January 2023, Bed Bath & Beyond revealed that the company is considering filing for bankruptcy. In the previous year they spent $589 million on stock buybacks while reporting a $559 million loss. Shouldn't that money have been reinvested into improving their competitiveness and marketing?
The Republican party often pushes for corporate tax cuts for companies to lower costs and keep more money to reinvest in their business and workforce. Instead, we got more record buybacks benefitting the same exclusive group.
Multiplier Effect: There is a chain of damage described and a real life example shown in the video. When big plant closes, or a large employer of any kind that serves as an anchor for the community, so do some of the suppliers feeding into that company and businesses that serve the employees working there. When the big one closes down, it kills the whole community as jobs/income dry up. This was especially prevalent in manufacturing plants that all got relocated overseas. All that money went to executives and investors. Sometimes products got cheaper for those of us still with jobs to buy it, but many just boosted profits for the buybacks.
This is harsh capitalism, but I can't blame them when some companies genuinely go belly up. This is what happened to all the ghost towns when gold rush or other mining operations ended.
I blame the rising inequality problems and people's growing acceptance of "socialist" policies on managerialism and the attitude of people like Bob's boss from The Incredibles when he cried out, "We're supposed to help OUR PEOPLE! Starting with our stockholders, Bob. Who's helping them out, huh?"
Look, you can still make money, while also taking care of your own. It's possible. You'll keep less for yourself, but employee morale is good to keep up productivity and everyone will WANT to promote your business.
One of my favorite subjects to listen in on and discuss is income or economic inequality. It is often a hot topics for debate. Is the wealth gap and income inequality a real problem or is it not? How can it be addressed? Bringing it down to a personal level, does it annoy you to hear about the stupid stuff ultra-rich people spend large amounts of money on? Do you feel frustrated seeing great opulence in the world and the ridiculously expensive luxuries that people actually buy? When contrasted with the struggling of the millions of poor and lower middle-class, some can't help but think of how more should be done to help society.
People despise corporations and rich people for a variety of reasons. The biggest are probably plain envy and jealousy, but also because of the charitable heart, knowing so much good can be done for so many that need it. The other reasons generally stem from negative behaviors or apathy for the well-being of others. The negative stories I hear about rich people generally fall into one of the following:
So HOW, exactly, are they supposed to change the world? Some things get thrown out there like pay people more (not just the executives), charge less for their products/services, provide better working conditions to employees and sources (fight sweatshops/slavery), donate more to various charities, community needs, and conservation "green" efforts.
Sure, it’s easy for all the rest of us to say what people should do with their money, but that's because many, or most families survive on less than $70,000/year while the people being scorned are bringing in many times that amount. If they can live on half of their large incomes, which would still be considerably more than most people, then the rest could be used to help the world while they still live a very comfortable life.
Now when being asked to give away more, how much is enough and how much good will it do long-term? If a family with $20 million in liquid assets, meaning cash or investments and other assets that can easily be sold for cash, gives away half of their wealth ($10 million), that difference could provide a much needed $25,000 boost to 400 families and they still walk away with the remaining $10 million ($100k/year for 100 years)! That’s a nice windfall to help all those families, but it would only be a one-time thing. That wouldn't be effective in the long run if it's just burned up in one instance.
What if, instead, the $10 million was invested like an endowment fund? For every million dollars squirreled away in investments, it is very likely to earn at least $80,000/year, every year, without even touching the original invested amount. Again, that's just one million invested. This is where we come in. Invested Alternative would only borrow the $10 million and then be able to provide an endless source of income for charity that is given to people in need and the donors get their money back to do with as they please. There are a few charities that already have their own funds, but Invested Alternative wants to make donating to help even easier.
I was listening to a money show on the radio one time while driving around that was talking about estate taxes, taking money from rich people wanting to pass a large inheritance to their descendants, and the discussion turned to income inequality. The program right after was a political talk show that eventually led to the same topic. It was a hot topic based on the amount of callers. The general discussion was about how more and more people are in favor of implementing or expanding government subsidies and welfare programs such as Medicare, Medicaid, all the WIC and food stamp programs, and social security.
One conversation that stood out to me, was the debate over why income inequality is bad and why it exists. In the many answers given to this, there were many generalizations and complaints made about poor people having to struggle through life and wealthy people controlling everything; but what everyone failed to answer was specifically WHY income inequality is bad and HOW it directly effects them. How is it more than just a jealousy problem? This is the main question that needed answered: "I earn $65,000/year and my boss earns a million dollars a year. How does that effect me? If my neighbor or boss makes triple the income that I do. How is that going to ruin my life?" None of the callers had an adequate answer. They all just bounced around the ethics of it being unfair and that's really it.
The idea doesn't seem right with me either. How can a handful of people have such vast amounts of wealth compared to the rest of the world NOT be a bad thing? A society of two halves with vastly different economic means and less and less of a middle class CAN'T be a good thing. That has to lead to trouble, but it's hard to describe what that trouble is and what those problems are. I did a brief search on why income inequality is bad and this question is rarely answered directly. Just more random facts and statistics about how the poor have it hard and the rich have it easy because, duh, money, but none of these answers seemed more - scientific. They just seemed like more jealousy problems and the idea that it sure would be nice if people share. There is rarely a direct correlation to answering the question of why it's bad and why it matters. I was beginning to think that the idea of income inequality as a problem needing to be solved is not really a "problem" in society, but really just a desire to improve the quality of life for more people by taking from others through government law and force. Below is my summary of some articles I found and how they don't actually address the issue:
A. "'Rich people are actually living longer than poor people. In the early 1980's, wealthy Americans lived 2.8 years longer than the poor, according to the Department of Health and Human Services. The wealthy and poor were defined as the top and bottom 10% on a number of different economic measures...by the late 1990's the rich were living 4.5 years longer, and the gap has only widened since then,' HHS said.
'The increasing disparity is a result of a variety of reasons including "material and social living conditions" as well as access to medical care', according to HHS."
My Response: So my neighbor will live longer than me because they have more money to pay for healthcare and maybe retire earlier in a life of luxury. Must be nice to have nice things in life, but it's still not their fault that I can't afford these things for a better life myself.
B. "For Americans born in the early 1960s, 5% of poor people went to college and 35% of rich folks did, according to the Russell Sage Foundation. They defined rich and poor as top and bottom 25% for income.
Only one generation later -- Americans born around 1980 -- the number of rich people going to college jumped by 20 percentage points. For poor people, it rose only 3 percentage points."
My Response: This argument is saying, "My boss and neighbor make more money than I, so their kids are probably going to go to college, likely tuition free with parents paying for them, and mine will probably have student loans if they go at all." Why is this someone else's problem? Colleges offer grants and scholarships to low income people all the time! Must be nice to have nice things in life, but it's still not their fault that I can't afford these things for a better life. However, there are some economic opportunity issues attached to people paying for college that I will get to later on.
2) Read this list of cultural problems:
After all the searching nothing seemed to be addressing the real issues. It's all just jealousy and rage that some people were getting more than us. Many of us have had those bad bosses and company owners we worked for that made us upset. We were doing all this work making money for them and receiving mediocre wages and little to no respect in return. These abundant arguments I kept finding against income inequality were poor. They only addressed the issue as being bad because poor people can't afford nicer things to improve their quality of life. To me that's more of a personal issue, not something society should fix by forcing business owners to pay more to their employees.
However, I did eventually find some things that actually started making sense about how society as a whole is effected and how it can be fixed. https://ideas.ted.com/the-4-biggest-reasons-why-inequality-is-bad-for-society/ Below are the things I found and agree with:
I think besides the housing market stuff the rest of this is less likely to be a cause of issue, but still have potential problems.
Part 2) High income inequality starts making it difficult, or impossible, to have equality of opportunities. Kids that have college paid for, especially to prestigious schools, have a much easier time getting a good job and have much higher earning potential. Wealthier people tend to have larger and more influential networks for job hookups and "taking over dad's business" scenarios. There's also a few at the top that receive large inheritances. Once you have such large sums of money in your possession, that wealth can live on forever and even grow further through investments. People with few assets and connections will find it much more difficult to access opportunities, such as dealing with loans and fighting to be on top of the resume pile of job candidates. In short, high income inequality leads to shrinking economic mobility opportunity.
The Income Inequality Debate Rages On over the rate of increasing economic inequality in our society. Inherited & accumulated wealth increasing among the rich, how much company income goes towards employee wages and benefits and company growth investment vs how much goes to executive bonuses and stock buybacks, and whether or not any of this is a problem, and how to address it.
There were some YouTube videos I came across produced by Jamie Johnson from the Johnson & Johnson family company. The two I viewed were about the lives of those that have inherited vast fortunes typically only because they were born into families whose wealth was created generations ago and is passed down, increasing continually. The Johnson movies were interesting, but I didn’t really understand the purpose of them. They do seem to foster a push for more income equality, but not much, if any, indication as to how that should happen. I think they were just eye openers for that world and life style.
This great country professes equal opportunity and “anyone can make it rich,” which I do still believe to be true, but it's becoming harder and requires a lot more luck than hard work. I also don’t believe it right to insist that people struggle miserably in the rat race if they can’t figure out.
Corporate Welfare: Socialism for the rich, capitalism for the poor. Privatize profits, socialize losses.
Another common source of grief among the masses fighting against income inequality is the belief that the holdings of the rich are not legitimate if they are acquired through competition from which others are excluded, and made possible by laws that are shaped by the rich for the benefit of the rich. Government bureaucrats and politicians being bribed with lobbying are to blame! As written in this article which I will then summarize:
In the conservative mind, socialism means getting something for doing nothing. That pretty much describes the $21bn saved by the nation’s largest banks last year thanks to Trump’s tax cuts, some of which went into massive bonuses for bank executives. On the other hand, more than 4,000 lower-level bank employees got a big dose of harsh capitalism. They lost their jobs.
My Response: You get the idea from reading this that the super wealthy are "cheating" because of their ties with government bailouts and tax laws, and I agree. However, I also understand that governments sometimes court relationships with large, influential businesses and industries as an attempt to strengthen or protect economies. The fear with the big banks and very large businesses is that their failures would exacerbate a failing economy by having even more people lose jobs and financial systems fail. There's gotta be a happy balance to this in someway. I just don't know what that is and welcome those that want to discuss this in a future conversation.
I received a response to this conversation already that I want to inject here. This person commented that executives are not owners and continued to say,
CEOs are generally employees who do not own the corporations they run. You need stop confusing management with ownership. Top athletes get paid millions even if their team doesn't make the playoffs. Top actors get paid millions even if their movie flops. Top executives get paid millions even if the company fails. They are employees."
I'll admit, the statements about CEO's being an employee make sense, especially when compared with athletes and actors like they said. That actually makes sense; but they and their fellow executives ARE part owners, since they usually hold a lot of the company stock themselves! I also have a problem with this line where they say, "Top executives get paid millions even if the company fails. They are employees." Why should they? The vast majority of employees get nothing! No cushy severance check. If the CEO of a failed company is just collecting the remaining checks from their contract deal as they depart then I get it, but I am still on the side of executive pay being way too high in general.
Again, commenting that some people being rich doesn't make me poor goes back to that original question I heard on the radio that we struggle to answer. If them being rich doesn't make me poor, then is income inequality really a problem at all?
How I Think It's A Problem
Why does it matter that my boss/neighbor makes more? The answer to this question is not just a short, simple statement. The answer is that it matters because over time, if income inequality continues to grow apart there will be more civil unrest, an increasingly polarized community and nation, and a rise in more extremism in politics.
Why would these things happen? Because despite trying to do everything right, the cost of living continues to go up and the quality of life continues to go down as people struggle to keep up.
In a smaller setting, especially resort towns, we see exactly how income inequality is negatively effecting these communities. When the rich move in and start buying up all the property, housing costs balloon up to cost so much that the working class literally cannot afford to live and work there anymore. This is one of the big reasons people hate short term rentals. Rich investors buy up the housing inventory to rent them out and profit, but this causes all the housing prices to go up so high that locals and employees can't even afford to live there. All the touristy and small town businesses can't even stay open and operable at normal hours because there's no staff. These businesses can't pay enough for the employees to actually live in the same town.
Here's an example of how the rich get richer and the poor get poorer, and how economic mobility becomes increasingly difficult with increasing inequality. In a poor family where the parents, or more often today single parent, are barely making ends meet and weighed down by debts, and the high cost of living, paycheck to paycheck lifestyle. They can’t support their children much more than themselves. Even worse is when their child or children get jobs and have to help pay bills for their own parents & family. Sure there are opportunities for them to get scholarships for schooling or government assistance if they know how, but this is still a struggle to improve their economic situation. Even if they get a college degree, these kids coming from these kinds of situations will then be competing for jobs with the kids that grew up in wealthy families that have business connections and, usually, a padded resume from working for Mom & Dad's business and maybe already experienced in running parts of it.
So again, to try answering the question of why does it matter that my boss/neighbor makes more? On a micro scale, it probably doesn't matter; but in the macro setting, society deteriorates when there is far too much inequality. There will be less of a middle-class and there could be problems rising like those previously mentioned.
A little inequality is good for competition and investment. A moderate amount leads to public strife and small amounts of protests and class warfare. A large amount starts becoming detrimental to a society and economy. However, it's not about everyone making the same, or really close to the same, there needs to be a strong middle class.
One idea I saw floated that I thought was interesting was requiring profit sharing from companies with more than 5 employees, where employee wages/salaries are still different, but at the end of each quarter, a certain portion of business profit is distributed equally among all employees. Even down to prorated by month or weeks an employee has been with them if under a year. As already mentioned above, profit sharing is already being done, but very heavily to the top executives only. Another idea is requiring corporate boards to have 20% representation of the employee interests for the company. I don't know all the details of how that works, but it can be another discussion.
The solution is more than just taxing the rich more and redistributing their wealth artificially through cash payments and free government handouts. How the tax money is used and how the wealth is redistributed is key. Find the problems directly associated with wealth inequality, such as those previously stated, and remove those barriers that prevent equal opportunity. America should be a nation of true economic opportunity, not economic equality of outcome. What are your ideas for reducing income inequality?
There is a lot left off the table here. A lot of "gurus" love to oversimplify messages and sound profound, but also add a little insult as if it's supposed to motivate people to not want to be "that guy." Here's what's missing from the math: $27 is if you earn that every single day. No holidays and weekends. (10,000/365=27.4). If you're only working this hypothetical side hustle for 5 days a week, you'd have to bring in $38.46/day, and that's without taking ANY time off. No vacations. No sick days. Assuming this side hustle income is taxable, you probably need more like $46/day. So if you can get a second job and earn $46/day or more, and not take any vacations or days off, then you can achieve that $10,000 goal. If the job pays less or you take time off, that pay needs to be more.
Also for delivery and travel gigs, and many other jobs, this doesn't account for gas and vehicle maintenance, or childcare for those that need to consider that. While this goal is somewhat attainable, it's not easy or possible for many people. Many people are already working two jobs too and still living paycheck to paycheck, so getting a third to reach this goal isn't practical.
The first part is accurate. I grew up poor and my parents have budgeted the best they could, but you can't just budget your way out over poverty. I worked a second job twice early in my career before I had kids. It was hard, but it worked for us because I didn't have too many other obligations at the time. The extra money was nice to help cover bills and pay off debt, but it would've been nice to have one full-time job that paid well so I could've had my nights and weekends to enjoy life and go on dates with my wife or out with friends.
That last line is just so unnecessary and insulting. "Just work harder, but people don't want to work," right? People should do what they can to improve their lives. Maybe they just don't care to, or maybe they value their personal or family time even more. It's not an ego thing. The rich gurus preaching stuff like this have their own inflated egos on full display.
This recording was made in 2012 and the principles still hold true today. The paradox of unemployed workers trying to get a job and employers not being able to fill positions. People say they won't accept the job because they're making more on unemployment. Yes, at some point, having a job is better than none, but in some cases, taking a lesser job just to fill the space can make it difficult to attend interviews. Most of these jobs won't just let you leave or take time off to interview for the better jobs. I completely understand not taking a job because unemployment pays more, but only if you're actively looking for the next career move that will pay at least equal to or better than unemployment benefits.
Those unemployment payments don't last forever! If your time is running out it's probably good to get something decent at least. I agree that it's foolish to just "wait it out" and again, people need to know that unemployment expires. It doesn't go on forever. People aren't paid to permanently sit at home if they want to. Some states even require active job search and resume building workshops to help you get your new job. I've experienced it personally. Some critics will say people need to just move to lower cost of living areas or places with more jobs and better jobs. Ok, I get the logic and maybe it's a good plan for some, but people don't want to move away or can't move away because either they rely on others for support, others rely on them, or they just can't afford to relocate somewhere new and take risks without support.
The video interviewed young people who didn't want to work in factories or machine shops either because they saw their parents struggle in those jobs. They either didn't make enough money or they were laid off at every economic downturn. One person in this video quoted, "Many just won't take hard jobs at modest pay." Why should they? The job itself and the pay sucks. There are better alternatives. Why do people always call it modest, competitive, or good pay when the jobs don't even pay enough to live on independently? You will still have to live with roommates to help cover the costs of living.
One case they highlighted was a guy out of prison that started out putting up cable wire for $200/week. Must've been part-time because that math doesn't add up to full-time minimum wage laws; then, suddenly, a short two and a half years later he's a manager making almost 6 figures!? Something is missing here. It's DEFINITELY an outlier and he's EXTREMELY lucky or there's a connection of some kind that was disclosed.
They kept asking employers, especially those typically working with immigrants, if they thought American workers are "entitled." Never mind the fact that employers are the one's acting "entitled" to having people do hard labor for slave wages. Pay better wages and be competitive if you want people to work for you. Again, pay better wages, offer better working conditions, offer good perks and benefits and be competitive if you want people to work for you. You are not entitled to cheap labor. People not wanting to work hard or low paying jobs doesn't mean their entitled, it means they know they deserve better and are finding better alternatives. Make it worthwhile to work with you.
In 2022 our economy is hurting because the costs of everything have been going up extraordinarily fast, but the quality of service has been dropping because everything is short staffed. We're all paying more and having to wait longer and get worse service. In the words of Butt-Head, "This sucks!"
Yeah I kind of worked for someone like this once, for a year and a half. The boss/owner of the small company was a high energy individual that wanted to be fun. Sometimes it was good for morale, but mostly I just wanted to get my work done, get paid, minimize problems, and go home. This kind of attitude my boss had made me feel like he was just there to have fun and "play" with his business instead of actually work. This is because no one really knew what he actually did. His work was a mystery, but he was usually there in his own office. All the real work was hired out for me and my coworkers to do.
Here is where I first came across this video:
The comments are fun to read through and see how different personalities react to this in the workplace. Some people commented on this being an atmosphere of toxic positivity, where problems are often shoved under the rug and not discussed as adults trying to make things better. It's where everyone needs to constantly be in a great, upbeat mood and bubbly personality. It's exhausting. In my experience. Problems that kept coming up were never actually discussed. The owner kept dismissing things and reciting the same anecdotes that weren't really applicable. He was more interested in how to make more money than how to actually improve and solve problems.
Some people in the reddit thread commented that this type of atmosphere is the places where everyone gets paid crap, but the "benefits" are a fun work environment they love to advertise.
One person made a joke about how the boss in this video wanted to chat with the employees, play foosball, and go on fun outings, but the employees in reality are probably like, "Hey, I've actually gotta get this sent out today and I just want to go home or hang out with friends instead of play around here." Some others mentioned their dislike of public music being turned up at work as one person commented, "Listening to music I don't like through shitty, tiny speakers in a wooden echo chamber when I need to concentrate on something or be on the phone is going to boost my blood pressure."
Anyways, in case you missed it, these are the 5 ways to boost workplace morale according to the video:
1) Get the vibe going, turn the music on
2) Get your energy levels up. walk around, grab a coffee
3) Challenge people, encourage personal growth & development
4) Break up the day, have fun with your team
5) Get outside, change the environment, have a walking meeting, mix it up a little bit.
I wanted to publish something to get more specific about the motives for the creation of Invested Alternative and its goals. There are six experiences and ideas that went into its creation.
1) I went to church growing up and they'd ask for tithe donations, as they all do, but I was very disturbed when I found out later in life how little they actually gave back to the community compared to what they brought in. Then there's those megachurches and tv evangelists that are fabulously wealthy, acquiring a net worth of tens or hundreds of millions from tithed donations! How much are they actually giving back to their supporters and people in need?
My wife likes to listen to Christian music stations sometimes and one station we were listening to was doing a fundraiser as well as a giveaway of free gas for a year. The fundraiser was to help fund the station and fund the giveaways. It was nice to hear the message of people willing to donate to help others that share the common interest in this religious channel.
How would you like to be a part of a community that does that to help their own? What if this church or community actually gave back 80% or more of the donations to the poorest members in need, or even redistributed the pot equally among all members? I think the poorest members would be well cared for in this scenario, but if funds were distributed equally among all, then people would most likely start giving less when they see others abusing it and the whole thing would be ruined. To fix that, Invested Alternative borrows the donations for investment. The original donations can be returned! People can give more if they have more to help others and they won't feel like they are being leeched.
I created Invested Alternative with the idea of creating a type of community where people can pool money together to pay off each others debts, pay for a month of groceries or gas, and give to each other in other ways. That's what basically all charities are though, right? People pooling money together for a specific cause? So what makes Invested Alternative different?
2) Look at the model of university endowment funds. These endowment funds at universities are used to provide scholarships and help fund school programs. People donate to these funds for the managers to buy investments and the income from those investments continue to bring in money to continuously fund their scholarships and programs. Invested Alternative is doing the same thing, but instead uses the income from investments to help people pay for college after-the-fact by helping to pay off student loans. It doesn't stop there either. Invested Alternative has a goal to help reduce medical debt and give in other ways as well.
3) Every election cycle and campaign season, we hear about the millions of dollars being sent to candidate campaigns. People hope these candidates will enact and support policies that will benefit their interests. Many are left unsatisfied though. It's especially a shame for people that donated to candidates that lose. Supporters lost their money and their candidate didn't win. Ouch!
Politics are important and have a strong influence, but what if all this money could be sent to solving problems directly, instead of politicians that will argue with each other about how to solve the problems, and usually end up not even addressing it?
I read a quote recently regarding the debate on whether or not to cancel student loan debts. It read, "Politicians have no problem giving billions to countries who don't even pay taxes here and we don't ask them to pay it back, but somehow using the money to help Americans in debt is wrong?" This is a topic to debate another time, but Invested Alternative does give money to help Americans in debt! How about donating to a cause that alleviates people's problems, then later getting your money back to donate to your political cause of choice? You can do both with Invested Alternative.
4) I have worked for some good employers and some bad employers. The difference is huge! Employees that are treated well and respected will almost always stay much longer and perform better because they are also invested in the well being of the business. Many business owners are just more concerned about making their profit. Employees are expendable tools to reach their goal. I am a big fan of company profit sharing. Employees that worked to make those profits, deserve a fair bonus beyond the standard wage.
As Invested Alternative grows, a portion of the growth is dedicated to increasing the prize amounts and giving out more of them to participants in "Know Your Neighbors." When we do better, everyone else enjoys the benefit too. The lions share of the growth continues to be given out to help people through our sweepstakes and giveaways.
5) There were a few points early in my career where I had to work two jobs to help us get by. We were able to scrape by paycheck to paycheck originally, but getting the second job is what allowed us to pay off debt and upgrade our lives with new clothes, appliances, maybe a vehicle, tools, etc. The extra income could also help us afford a few other luxuries, vacations, and save. Surviving and living paycheck to paycheck is one thing, but too many people are falling short of that next step of being able to save, upgrade their lives, and enjoy some luxuries and leisure. There's also that issue of people living relatively paycheck to paycheck, even with big incomes, but that's because they fill it up with things like expensive private schools, vacations, power sport toys and other things. That's a different issue entirely.
In my immediate community there are neighborhoods of wealthy people and neighborhoods of poor just one or two streets away from each other. The poor neighborhoods suffer from their lack of capital to "play" with. They cannot invest anything meaningful to have their money work for them. They might have too much debt, not enough income, or some combination of both. Not enough resources to save and upgrade their lives. Invested Alternative works to remedy that to some degree. We can't make everyone rich, but we can work to ease some burdens that will benefit the poor, upgrading their lives to put them in better positions, and the rich can invest in the process, growing their wealth at the same time and strengthening the whole community!
To recap, Invested Alternative is like the following:
1) A church that gives to its community and members instead of its own leaders and organization, a redistribution of wealth where the principal amount can be returned to donors.
2) An endowment fund for the alumni of life's rat race to help those still learning, struggling, and starting out.
3) A political campaign with contributions sponsoring people and solving problems instead of sponsoring candidates that might not even win or solve any issues.
4) A business that shares profits and growth with its employees. As we grow, you grow.
5) A 2nd income to help a poor community pay off debt and make important life upgrades.
Invested Alternative lets people be charitable, by only borrowing money.
How It Started:
The world of finance is a mystery to many, but it is fascinating. There are many tricks and tools people use to make money for themselves and others, sometime making a LOT of money, and sometimes losing a lot of money on investments that go bad. There's an activist side of me that wants to help others. I see so much struggling and suffering in the world right along with so much excess wealth enjoyed by others. Wealthy people use finance to maintain that status and grow even more. I want to use it to help others who don't know how and don't have the means.
I have a dream of growing an organization that can be very popular for the great good we do at bridging these two opposites of the "haves" and "have nots," by providing a safe way for "haves" to give money without losing it permanently, and for the "have nots" to receive the extra boost they need in life.
I started with a lump sum of my savings to get the investment fund started. It will always produce enough to meet current needs, so money isn't just taken from new donors to pay the former donors. That's illegal. Instead, every new donation just grows the fund since there's already a capacity limit to provide for current needs.
Help lift others out of poverty situations and struggles with indebtedness. Make some money for yourself in the process as well. See our "how it works" page to learn more as well.
There is a popular reddit forum titled "antiwork" that describes itself as "A subreddit for those who want to end work, are curious about ending work, want to get the most out of a work-free life, want more information on anti-work ideas and want personal help with their own jobs/work-related struggles." It's been kind of a controversial sub because of the name and political goals, but there was a big deal made in the end of January 2022 when one of the moderators of the antiwork sub did a bad interview with Fox News and embarrassed many in that community. In the fallout of that interview, there was a lot of drama and infighting in the sub which led to moderators locking it down so no new content could be posted. It was closed temporarily.
A new subreddit was created titled, "Work Reform" which describes itself as "a movement fighting for a good quality of life for everyone who sells their labor." I captured one of the early comments on this sub, which I believe does a good job capturing the motive for the movement, why there was a split from antiwork, and explains the frustrations people face in the workforce:
"The antiwork subreddit logo was a stick figure laying down, symbolizing laziness. How many of you talked about how great the antiwork sub was to someone, only to immediately have to clarify, 'Oh it's not actually about quitting your job and not working. It's about pushing for basic workers' rights and calling out bad employers'? The biggest appeal of antiwork to a lot of us was that far too many of us have had similar personal experiences with shitty/illegal work practices that you only tolerated for survival purposes such as:
-Wage theft: the most common form of theft in the United States, which increased during the pandemic. Commonly done via timecard manipulation and skimming tips. Did you fellow Americans know that if you're a tipped employee and your hourly wage + tips is less than the standard employee federal minimum wage (or more in some states), then your boss is supposed to pay you the difference (Https:/www.dol.gov/general/topic/wages/wagestips)
-Hourly employee hell: Deliberately low hours per week so your employer doesn't have to pay benefits and/or overtime, despite having the money and ability to do so. So then you work multiple jobs, none of which will give in to the other over scheduling conflicts or even pay attention to your requested days on or off. One may finally offer more hours for you to quit the other one and increase your availability, only to never do it after you uphold your end of the deal. Or worse, you agree but then they manipulate your timesheets. And of course, there's always shitty customers that managers will side with no matter what, thus encouraging said shitty behavior to continue and grow even worse.
-Low-mid salaried employee hell: So you escaped hourly hell. It may not be a huge salary, but at least you don't have to predict your paycheck amount when deciding what groceries to buy. Welcome to a different hell now. No mandatory overtime pay means you're going way over 40 hours a week. You're now doing the work of 3+ employees so that the owner gets their money's worth out of you. Your boss also doesn't comprehend the difference between free time and availability, so you better be able to come in 24/7/365. Say goodbye to your holidays, because your boss wants them off more than he wants you to have them off. Hope you're not married with a kid, because you now get home after they're asleep and leave for work before they wake up. Every employees fuck up is also magically your fault too because 'you should have known better'
-Job application hell: r/recruitinghell already exists, because the concept is already normalized and joked about. Uploading and sending your resume just to have to type it all in again. Needing 4+ years prior experience for entry level jobs. Needing 10+ years experience and all sorts of certs for an office job when half of the current employees don't even meet the requirements themselves according to LinkedIn. Internships not counting as work experience when you interned at the same company you're applying for. Job postings that lie about pay. Job postings that hide the pay and then get mad at you for making sure you're not about to relocate for a pay cut. Interviewers asking you about your weekends and your 5 year plans, when in reality they want to see if you go to church or if you may become pregnant in the near future. Jobs that say "we'll be in touch" only to never contact you again and leave the job position unfilled. Fake job postings to try to trick you into a cashier check scam or an MLM ( hence why r/antimlm exists too). Fake job postings that were meant to support an internal promotion the entire time. You apply nonstop, yet somehow it's entirely your fault for not finding something every single time.
-Work conditions hell: As if long hours, shitty pay, and shitty people weren't bad enough, a lack of basic regard for your health and safety is also prevalent. You think being sick means that you can go home and avoid infecting others? You think scheduling a day off for a doctor's appointment months in advance means you're actually getting that day off? You think your workplace fire suppression systems and eye wash stations are properly inspected and will actually work if needed? You think that your company getting fined for a hazard was the same moment that they became aware of the safety issue? Just like how OSHA exists because people couldn't do the right thing the first time, Unions are similar in that regard. I've seen both good and bad unions, but to many it's their only hope for change. Don't want to worry about your subordinates unionizing? Rather than paying hundreds per person per day to a company to spread anti-union propaganda, have a decent enough work environment so your employees won't feel a need to fight for their rights by unionizing in the first place.
And that BARELY scratches the surface on any of the bullshit. Then there's also gig economy hell, internship hell, legal ways to pay sub-minimum wage to minors and disabled workers, legal ways to discriminate with hiring practices, corporations against Work From Home solely for power/real estate purposes, lack of overall accountability on issues, and so much more.
According to FRED, (fred.stlouisfed.org/series/UNRATE) peak unemployment in 2019 before the pandemic was 4%, and as of December 2021 it was 3.9%. If your workplace is still struggling to find employees then that's your workplace's fault. Saying 'NoBoDy WaNtS To WoRk AnYmOrE' or 'ThE GoVeRnMeNt Is PaYiNg PeOpLe To StAy HoMe' is a pathetic cop out of an excuse used to preach to the people who have outsourced their critical thinking skills in order to support what they wanted to believe in the first place. Take a wild guess which types of jobs are less likely to be eligible for unemployment benefits in the first place.
These are the sorts of issues that antiwork meant to me and to many others. We now have a new sub with a more mature and more accurate name, and I'm embracing it because way too fucking many of you will read this one day and say to yourself 'I've had one/all of these hypothetical examples happen to me, and also have other examples that many seem to relate to as well.'"
Things I don't like about the antiwork sub is some of the extreme positions which are very dramatic and unrealistic, or irrelevant to the cause. Some posts describe things that employers are doing which are blatantly illegal in a "what should I do" scenario or other instances that are too obvious like, of course you should call police or you have an easy legal action case, duh. However, I do understand that in many cases there are circumstances where people are being abused at work and they can't really fight against it in legal action because they don't have the time or means to pursue that course. Many employers get away with bad behaviors because of this. In some instances, a labor board is a free option that can blow the whistle on illegal practices and fine employers.
What I do like about this sub is the spotlight it shines on shared, negative experiences and how we should change, how we can do better in our society. Many posts have valid concerns and points about work life struggles. For example, this post is an example of what people want and what many Americans want from European "socialism." It's titled, "I moved from the U.S. to Denmark and wow." The author then writes, "It legitimately feels like every single job I'm applying for is a union job. The average salaries offered are far higher (Also I looked it up and found that the minimum wage is $44,252.00 per year). About 40% of income is taken out as taxes, but at the end of the day my family and I get free healthcare, my children will GET PAID to go to college, I'm guaranteed 52 weeks of parental leave (32 of which are fully paid), and five weeks of paid vacation every year. The new American Dream is to leave America."
Most people actually do want to work fulfilling jobs, but they want to be compensated well with good wages and benefits and overall just treated fairly and respectfully. People want an overall better quality of life than we're currently dealt and see this as an example that we can do better.
Here's an interesting round that was started from this post about how practically every job requires a college degree these days. The post read:
Quit requiring candidates to have a college degree when:
a) you pay $14.00 an hour with no benefits
b) the skills for the job can easily be taught
c) you're not invested in their advancement or future
Everyone and their mother.
Juan C. responded to this post saying: "While I agree to a certain extent, how do you make sure that candidates have a certain level of interpersonal skills, verbal skills, and educational skills that may make the candidate fit for the position? Example: a receptionist, just for the sake of the conversation. How do you ensure that candidate knows how to represent the company values and uses the right verbal communications at work? The reason why those requirements are in place is to make a recruiter's life easier. Unless you know the person who is the candidate, it's tough to get a feeling while screening them. I've been screened and have screened people. Most of the time recruiters spend little to no time before redirecting to companies. This is my opinion, good for thought."
Jordan responded to Juan and said, "I don’t think a college degree determines whether or not a person knows the right verbal communications. Can’t tell you how many times I’ve seen a teacher use the wrong form of there/they’re/their....it makes me cringe."
Juan: "Very true. Hence, that's the reason why I said it makes it easier to the recruiter. If that's with a college degree, I can only imagine the ones without. There are exceptions to all cases but it's one way to filter candidates without effort."
Tawonda now jumps in and responds, "Juan, the disadvantage to hiring over qualified/college graduates for lower paying/lower level positions is that they typically leave as soon as a better position becomes available. Ultimately the company loses by paying expensive talent acquisition costs repeatedly."
Brianna now adds in as well saying, "You interview them! If your job is to hire people and find candidates then you should know how to discern a candidate without having to rely heavily on whatever their background says on paper. You should be good enough at your job that you are able to read a candidates acumen for a certain role."
Robert finishes off by saying, "What? I read this and the pay rate is $14/hr and some employers want a college degree? That is insane. Not sure why anyone would want to work for an employer that pays so little for a degreed person. Does this same employer want years of experience also? Walk away from these companies."
Yes, Robert. This is one of the several reasons why there is a "Great Resignation" movement. People deserve better.
I'm going to conclude this post with a few snippets from a fantastic post titled, "What radicalized you to the anti-work movement?" The comments are well worth a read to get an idea of what this is about and why the sub boomed in popularity.
"I've been sympathetic for a long time because so much of what I see here is really just a call for basic human dignity and respect. The thing that radicalized me is becoming friends with Thomas through my church's homeless outreach; he has three jobs but can't afford an apartment. I cannot support such a cruel system."
"I’m a social worker/therapist and I would say that the common thread tying all of us together is how the capitalist system routinely and by design completely fucks 99% of people. There are individuals struggling with depression/anxiety, even PTSD, not because of some childhood trauma - it’s the lack of hope and helplessness people are facing every day, working to barely survive with no long-term benefit."
"After I turned 26 and had to get off my parents health insurance I applied for it at the office I had worked at for five years. The owner of the company told me that providing health insurance for employees was 'a huge burden on the company.' My team had performed so well that year that the owning family rewarded themselves with new cars paid for with company money. The employees received, and I shit you not, a bag of chips and a candle. I realized then that employers are NEVER your friend. They will climb over your dead body to make a nickel of profit."
"Working in bankruptcy law during the 08 crash. I saw people losing everything who had done 'everything right' but got sick or lost their job due to the crash and their whole lives were falling apart. It made me suddenly realize that there was no 'middle class' safety like I’d been raised to believe. It was all a house of cards."
"Got into the same industry my father raised me in. He was able to afford multiple houses, cars, and raised three kids. I make the same as he did 40 years ago, accounting for inflation, and can’t even afford rent."
"When I realized my boss was pulling in almost 500k/yr for a store that I was running while he sat on his arse. Paid me 13$/hr. No benefits. No time off. I worked 6 days a week, open-close every day for 4 years. No vacations or time off in 4 years. Told me he couldn’t give me a raise last year cause my performance was suffering; shocker I was pregnant! Then magically was going to offer me a week paid vacation and 2$/hr raise when I found a job that offered me 17$/hr for much less stress and easier on my body."
Some of the stories actually sound like people that don't know any better got taken advantage of. Some people just don't know they are capable and qualified for better jobs out there. Changing jobs can be a scary thing because it's a big part of our lives to uproot and change. There are several stories of people that have dealt with poor wages and bad jobs/abusive managers for far longer than they should've.
I also wanted to share my thoughts on business investor owners, meaning people that make money from the business they own, but do very little or nothing at all to work for and support the business - all the management and work is hired out. I am fine with this as a way for people to invest and make money, but I have a problem with the ones that abuse it by paying poor wages and little to no benefits to all their staff while taking in large sums of the profit. Please offer meaningful, equitable profit sharing to employees on a monthly or quarterly basis at least. I wish all employers would do this at least.
Many people would like to see more of a political movement grow from the popularity of these threads, with the goals of better pay, maybe less hours with the same pay, better benefits such as increased paid time off, profit sharing/bonuses, and more. I support this cause, but in the meantime, Invested Alternative still provides a way for people in a movement like this to pool resources together into investments which help pay off debts and other donations to help and being able to make money in the process.
In 2013 I finished a job at a temp. agency and had still two and a half months before I moved away for another year of college. Scrolling through the craigslist job ads, I came across one on Monday that talked about a new office opening up that needed staffing. Not a whole lot of information. No business name listed, no address, not specific on anything really. It did say they were offering a $1700 salary. I called the number listed, scheduled an interview, and went in the next day after they gave me the address. The interview was very short and I still didn't get any information really. I was told to call back that evening from which I was informed I made the job. I was very excited to land another job just 4 days after leaving my last job, but was still wondering what exactly the company was and what I'll be doing. Since going to the interview at the business location I had the name of the company, but couldn't find any information about it online.
Wednesday was the first day of orientation. I walk in to see that they hired about 25 people all about my age between 18 and 25 or so - first flag of suspicion. I'm looking at the white board full of writing and information and the phrase that stood out to me was "advertising techniques." That's when I put it all together. Based on the mannerisms and attitude of the interviewer and now orientation instructor guy, the withholding of details, the kind of people they hired, and the "advertising techniques," I figured this was a sales job. I still wasn't 100% sure what kind of sales it was and what I would be doing though. I never wanted anything to do with sales. I hate the job and usually dislike salespeople - not them as a person (usually), but because of my experiences with them trying to hustle me for a sale. It's annoying! Also, several have been known to do some shady things do to get a sale. Anyways, I thought I'd at least give it a try and keep an open mind before immediately walking out then and there. Maybe I could be good at it (later in life I learned I'm not. I'm a terrible sales person).
By the end of the first day of orientation I still wasn't even sure what I'd be doing exactly besides working with Kirby vacuum machines and getting them sold. I didn't know what a typical day on the job would be like and the pay systems or much of anything. Much of the first day of orientation was just talking about how much money we can make if we work hard. Money, money, money. Being rich, owning fancy cars, houses, boats, bling, going on lavish vacations, winning fantastic prizes, and all this jabber about vanity, possessions, wealth, and all the vain things people covet to show off how they're better than the people that went to school for a good job and have to pay off student loans. Yeah this is great to dream about, since a vast majority of people in the room are uneducated, probably have some debts to pay, and just struggle for any money really. Doing the math with figures they presented, I saw that even if all is going well, you're only making thirty to sixty thousand a year. That sounds good for anyone at our point in life, but how much of a future is there in this? Surely you can't be doing this kind of sales forever unless you switch to some other kind of sales or become a part of the business management/corporate office type work. Most of the money earned, will be spent leaving you in the same place you were at the start. My instructor seemed to be doing well for now, but I respect that he admitted that outside of this company he's only worth 9, 10, or 11 dollars an hour. Giving it thought, it's the money that motivates people because sales jobs typically suck, but it's worth it if you do get the money.
During the second day of orientation I got a better idea of what's going on. People are offered a free service like carpet cleaning, but it’s really just an invitation to a lengthy sales demonstration in which the carpets are cleaned in the process of the demonstration. I would be the guy that goes into houses to do the demonstration and also have to find people occasionally to make appointments with. By the way, that $1700 salary that was “guaranteed,” isn’t. Someone asked about it and the instructor wasn’t very straight-forward about the pay. The salary is only paid if you perform a set amount of demonstrations. For example if it was 60 demonstrations that had to be met, he said that you easily do 80 or so demonstrations. It’s not a problem. Performing under 60 demonstrations is working part-time, so no salary. I wasn’t willing to make that gamble on my pay even with the good odds. It’s still more of a gamble than I prefer. Reflecting back on that now I know it was a lie or misleading at best. The whole thing was pretty scuzzy. I mean, do the math. It might've been less than 60 demonstrations as the requirement, but how many do you really expect to be doing each day or week? The money made would only come from selling the very expensive machines. You have to sell A LOT to make anything meaningful.
So after the second day of orientation I was giving myself a headache trying to decide if I was willing to go through with this and give it a try, or walk out now before any more time is wasted. They did make the appearance of people finding success in this, but ultimately, I decided to not show up the next day for orientation. I quit this scam and started looking for a real job elsewhere. I’m sure sales works for some people and some think they’re all scams. I personally will never work sales.
One of the analogies used in the presentation was that most people would be willing to scrub toilets for $1,000 a week, so why not do this job for $1,000 a week? The idea is that scrubbing toilets is looked at with contempt. It’s a gross, terrible job. If you’d do a job of that kind because of great pay, then sales shouldn’t be beneath you.
I don’t know if I fully understand that analogy or not, but it’s not that I think sales is below me. I just don’t want to do it no matter. I hate trying to keep people’s attention for something I don’t think they really need, I don’t like feeling or knowing I’m wasting their time, and I just don’t like doing any kind of door-to-door or cold calling. I’m not above it or think it’s all a deceiving practice. I just don’t want to do it, it’s a job I wouldn’t enjoy doing, and I know I'm terrible at it when I try sell stuff on craigslist or facebook marketplace.
Another observation I made during the orientation/training process, is that they either tell the stories of successful people, or they bring in the successful person to give a little speech about how it’s possible to become rich in this business. What it looked like to me was that only a few people make it big through sales somehow. As a side note again - unless that money is invested, saved, and managed correctly, they will lose those hundreds of thousands and start all over again. It’s not a consistent, steady job. These successful sales people have become more of a use as inspirational speakers to get the lower-end people motivated. It’s not that loads of people are getting wealthy through sales, but a few have and are just circulated around as examples.
For my last point, when someone is successful at sales, is it really hard work, or were they just lucky getting the right customers, or are they really talented salespeople, or a combination of both? They preach about the harder you work, the more money you make, but I will have to disagree – to a point. In sales, you can’t simply earn more money by putting in more time and effort. You only make money if people are buying from you. You can work two days a week and make 10 sales, or you can work 7 days a week and make only 3 sales. Putting more time in or “hard work” only increases the probability of getting sales and earning commission/bonus. It doesn’t correlate to immediate pay for the time worked. Though you increase the probability, it’s still just probability – chance or luck that you meet with the right customers.
Think about what it means to be a good salesperson. You’re good at convincing someone to buy something. If the product is really that good, it shouldn’t need much convincing. People generally don’t like salespeople because it’s basically their job to trick, manipulate, and convince you to buy from them. This, of course, is being said by someone (me) bitter about the subject and had bad experiences.
This wasn't my only experience with these sales job "recruitment rallies" I'll call them. In fact, the very next year I kept hearing a coworker talk about some financial stuff he was getting into and it was interesting to me since I was taking finance classes at college. I like the subject. He invited me to an event to learn more, which I attended one evening and was annoyed to be met with a similar experience: room full of people in their late teens to mid twenties, current pop music hits playing, flashy presentation about sticking it to the normal people getting normal jobs when you can be rich from doing this and "helping people." It was Primerica. Primerica insurance sales stuff. They tried to get me to sign up a the end of the meeting, right then and there and it would cost $100! Definitely not. They tried giving me all the "why not" scenarios and tried coaxing me into giving it a try and I just wouldn't budge. I'm not wasting a hundred bucks on this. I'm not doing this. I don't want any part in it.
One more time in 2017 I got tricked into one of these is when I struck up conversation with a random person I met at the grocery store. I don't even remember what we talked about anymore, but we talked about some business stuff that I was already a little familiar with in the realm of online businesses and affiliate marketing. I agreed to meet them somewhere to meet this business partner and hear more, but was actually upset to see, once again, the same demographics and same scene being set up; but this time, They were all professionally dressed in suits. The people here were weird though. A few people made similar statements to me about being "accountable," hard working, and other nonsense.that's like, well yeah I'm not a lazy loser or something whatever the alternative is to what you're asking. I just said I wasn't interested and left after that, never contacting them again. This one was Amway's Worldwide Group. This might be a good plug for being anti MLM, but I don't want to go there right now.
I've had an interest in the world of rental properties for a long time. How great is it to be able to just pay a down payment and then have renters pay your mortgage, expenses, and profit with their rent! Huge bonus profit too if there's no mortgage to pay. As you make more money you can just use the money to buy more properties and your real estate empire grows and grows! You can even hire a property management company to take care of all the dirty work for you. Pay 10% or so of your rental income to have 100% of your time. Sit back and enjoy the payments coming in while occasionally throwing in an approval for big maintenance expenses. Lucky for me, I got to experience the property management side of the real estate industry first-hand when I worked for two different property management companies. During my time working in property management I also learned a lot about people and their attitudes and outlook on life, entitlement personalities, and the amount of responsibilities they want to take. I got to interact with various types of landlord and tenant personalities. I learned about and experienced the effects of the housing market on an economy, the pros and cons of having rental properties, and a lot more of what goes on behind the scenes for housing managers and landlords altogether.
In October 2015, I delivered a presentation for a university internship I was working at and afterwards, while walking back to my car I stopped in the student union building to get a drink and use the bathroom. I took a peak at a community board and saw a job offer that caught my eye. A local company was looking for a new couple to hire as resident managers. Rent, utilities, and a stipend all included as compensation if you live on site to manage their apartment community. What a deal! I've heard of these kinds of opportunities and my wife and I were interested in learning how to manage rental properties, so what luck that I just happened to stroll in to see this posting. After excitedly telling my wife about it, she called and had a brief phone interview. We went to an in-person interview together a few days later and met with our future boss at the location we would be managing. Our future boss let us tour the apartment we would inhabit if hired and we really weren't impressed by it actually. If it weren't for the perks of the job, we most likely never would've chosen to live there. It was a two-bed, 1 bathroom unit with the bedrooms and bathroom upstairs and the kitchen downstairs with a closet under the stairs. There was no washer/dryer. Instead, we had to take our laundry to the small community laundry room at the center of the property and pay $1.25 for a washer cycle, and $0.25 for every 15 minutes in a dryer. There was only wall unit air conditioners and electric baseboard heaters, no central air. The unit itself was very small and awkward to position furniture because of the wall units and heaters. It was very clean, just very small and cramped. It was all worth it for the job though. Plus, it also came with a good-sized garage close by.
We were extremely excited to get hired soon after our initial interview and couldn't believe our luck! We were also lucky to be on a month-month contract with our previous apartment, so it was easy for us to get out and move to this new community. We were given a VERY brief training to learn some basics and followed the example of how previous leases were filled out. The rest we had to figure out on our own and learn as we go.
This lack of training became a problem and it didn't take long before we experienced rudeness from our manager. We were asking her too many questions and/or filling out forms wrong. I took a deposit from a new tenant that was going to move in three weeks later and she, our boss, got upset and rudely said, "Clearly you guys aren't understanding this yet," so she scheduled to come out for more training the next morning. I don't remember what she said in that training, but my wife and I were still confused because she kind of rambled on tangents that wasn't actually a training or answering our questions. At the end I had to ask her a question, again, which was the whole reason she came out and didn't even answer it, so I asked again, "How long do deposits hold for? How soon does a new tenant have to start paying rent after paying a deposit?" The answer was one week. That's all I needed! All we needed was some answers to questions. We were completely new to this, so we had a lot of questions that a simple text or phone call could've answered.
Lousy training has bothered me throughout my life. Too many people are really bad at training and/or get frustrated too easily. It's hard for people that have been doing something for many years to imagine knowing nothing about the job or subject and start explaining things from the absolute basics. Yes, some people learn faster than others, but bad training annoys me. There's a difference between a person being bad at their job versus not being trained well to know how to do a job properly. The next level is when I've learned something well and train a new person, and then they now look better than me because they picked up faster by having a real teacher. Yes, because I TRAINED THEM AND ACTUALLY DID A GOOD JOB OF IT, UNLIKE THE WAY I HAD TO LEARN!
So on that tone, there are people in this world that are far too easily upset and they let their emotions effect their work and the people around them. When things go wrong or work is busy, they get stressed and they get mean. That's always bothered me my whole life because I have always been a pretty timid person that "freezes up" around confrontation and feel completely caught off guard. I hate that I do that. The problem in this story is that whenever something went wrong, our manager would get upset and look for things to blame, especially in other people specifically. Someone didn't pay rent on time? Our fault. Someone moved out and the place was very dirty? Our fault. Maintenance or other vendor didn't get there on time or do a good enough job? Somehow still our fault - or at least she sure made it feel that way. Sure, we are responsible for the property as managers, but we cannot control people's actions or monitor their living conditions at all times.
I also need to add here that this manager did strange, illegal things and discriminated a lot. She hated men, didn't like people from other cultures or ethnicities, especially blacks, didn't like "irresponsible" young people who are trying to figure out and manage life on their own, and didn't like young college kids who were given everything from their parents. We learned this when it came to screenings and investigating people she didn't like. When screening new prospective tenants, we did the viewings and took applications, but our manager processed them from the main office. She would always ask what the people looked like and dressed like because she wanted to know their character. Of course she wants as few problematic people living in the communities as possible, but there were several times she practiced illegal discrimination just because she didn't like something about someone, or there was another applicant more "favorable."
There were some occasions where she wanted to investigate a tenant's cleanliness, so when she visited our property and knew the tenant was gone, she would use her master key to peak in without consent. We were shocked to see that, but we're not going to report it since we needed that gig. She would refuse to let in single college student men, even if they paid all 6-months or more up front and parents co-signed, but let in girls with the same exact qualifications or less. They wouldn't allow more than 1 person to live in any of the 1-bedroom units unless they were married because couples, friendships, and partners break up too often and break leases. There were a lot of strange thing this lady did and it was annoying to hear her trash-talk all the tenants she had low opinions of and her disagreements with their life choices and circumstances. She only had respect for clean-cut people that make lots of money.
We didn't have very many issues working at this community. All the tenants kept to themselves and it was mostly single professionals because the property was only 72-units, mostly studio and one-bedroom apartments. Only four of them were 2-bedroom units and one of those belonged to us, the managers. The biggest problems we had were with old ladies. One lady complained about endless maintenance issues and often needed help with regular things. I was shocked at how many regular things she just didn't know about or never experienced in her 65+ years of life. She complained about a hole smaller than the size of a dime in her window screen because bugs could get in. The company didn't want to spend the money to repair it because it was so small and insignificant. She complained about landscapers blowing leaves up to her door, so I went to investigate and saw, like 3 small leaves in the entryway, not even yard dust. I took a picture and showed my wife and said, "This is the type of crap she complains about! Three leaves!" She wanted to rent a garage on the property, but we never told her one was available because she probably wouldn't be able to open and close it by herself. They were not automatic. She constantly wanted help changing bulbs or batteries, or looking into something. By the way, I was a little surprised at how many people were upset that we didn't replace burned out bulbs or dead batteries for them while they are living there. We aren't a full-service 5-star hotel and we expect tenants to take at least SOME responsibility for maintaining the places they live in. We cover all exterior and shared common areas, but in your own unit you can change your own stuff. One time, this same lady called to complain that the smoke alarms were broken. I could hear all of them going off over the phone. I walk over and there's clearly smoke in her apartment from burning something on the stove. She blamed it on the neighbor grilling on his patio upstairs. Maybe that was a little factor, but I doubt it. She was insistent that the alarms were broken or needed new batteries, even after I fanned the smoke out the door and window to stop the beeping. No Joan, they are working just as they are supposed to. There was smoke in here, so they were sounding the alert.
One older lady was ok for her whole tenancy until one accident in the winter. She slipped on some ice getting to her car parked in front of her unit and then sent a notice to our company trying to charge us for her injury treatments and lost wages from missing out on work. That issue was handled by our main office, so I don't know what ever became of that, but I did hear that her work offered her a sitting position because of her injury and she refused it.
Snow and ice was a big annoyance for me when working in property management. People complained no matter what we did. The sidewalks and asphalt aren't heated. Ice melt and shoveling can only do so much. It's going to be slippery in winter! What do you expect us to do? Build a stadium-sized umbrella to cover the entire property!? We plow the parking lot, shovel all walkways, and use ice melt generously. There's nothing else anyone can realistically do about snow and ice.
There were also two entitled older women that were paranoid about everything. One lady changed her own locks, so management and maintenance no longer had access without her being there. Our boss was annoyed, but let it slide for some reason. I think this older lady was meaner than her. This bothered me because I hated that lady and wanted to see some punishment. Our boss gave her chance after chance to correct issues, but if it was a young man she would've fined them or evicted them without a second thought. When she couldn't evict them immediately, she just wouldn't renew their lease and force them out that way.
One woman was certain that someone was sneaking into her unit, messing with stuff, cutting leaves off of her aloe plant, and using red marker on her underwear. Truly bizarre. She even told us she left notes telling intruders how to properly cut the plant and other things to not cause more harm. She also had an 8-year old adopted or foster daughter staying in this cramped little one-bedroom apartment with her, who was suspect number 1 in my mind. They didn't seem to have a very good relationship.
Sometimes people insisted that they be present when a maintenance visit was scheduled or something required entering their unit. The problem is that our technicians or other vendors can rarely work with their schedules or times. They come when they come. When a technician/tradesman does need to come work on your property, understand that they are not just sitting around waiting for one job to come in. They have estimated windows of arrival because they don't know when they'll finish one job or how long the next ones will take. We'd get around this issue by serving a 24-hour notice of entry, to legally enter their unit when they're not there. I was baffled by the suspicions people had in thinking we or other people were up to mischief going into their units, but then I read stories and see videos to know that this stuff actually does happen! I guess I understand the worry, but it was still annoying for me as a manager just trying to do an honest work.
There have been some tenants I've worked with at both jobs, who put in a maintenance request every time they find a scratch, bend, or any kind of slight defect. Some wanted us to upgrade equipment and remodel parts of their units just because they want better stuff even if they've only lived there for a few months or barely more than a year. Please understand that it is expensive to call in any sort of maintenance technician or tradesman. There are MANY things that you need to be or can be responsible for and buy or fix on your own. Sometimes when tenants start having financial issues and being able to come up with rent money they start complaining about problems and poor conditions in the place they live. You chose to live there and were permitted to check it out before moving in. You submitted a move in inspection. If everything was good enough for you at that time, then it should still be good now unless YOU damaged it; and don't try to withhold rent until the owner fixes things. That doesn't work and you will lose that fight unless something drastic has happened like the roof blew off and you made the proper requests for problems to be addressed.
Moving on: I remember one guy gave his 30-day notice to move, but then later asked to extend it by a few more days. Our manager was annoyed, but obliged and rescheduled turnover work. On the day he was supposed to turn in keys, we never got them. Our boss called in the evening to ask if keys were turned in yet and was upset at us that they weren't. What were we supposed to do? Harass this guy and be all up in his business? I guess, but he wasn't answering his phone or door anyway. I finally went over around 11pm at night and used our master key to look in and see what's going on. The unit was empty, so I went back to get my initial inspection stuff to prep for turnover like we are supposed to, assuming he left and just forgot to turn in keys. I was just about done with my paperwork when I hear the door creaking open. Just as I feared, in comes the tenant all annoyed to find me in his unit. We had a little argument about how he was supposed to have turned in his keys by now and he insisted that he still had until midnight to use up the full day. There was no formal notice since he verbally changed the date with our boss, but I think he was technically right. I deescalated the situation because I didn't really care, I just wanted to do my job and go home - it was late; but then he wouldn't stop talking to me about random stuff so after about 40 minutes of talking I'm like, "Look. I'm sorry about coming in here early. I'm glad we could talk, but it's late and I want to get back home. Just finish whatever you need here and drop the key in the drop box." I heard the keys plunk into the box about 15 minutes later.
There were a few times when people wouldn't turn in keys until late and it bothered me because our boss would be nagging us about getting the keys; but I didn't want to stay up 'til midnight hoping they'll drop them in. In one instance, a girl was supposed to already be out the night before, but when the blind cleaners came in the morning the door was still locked. After people move out, we unlock the door for vendors to come in and out to do their work. So I walk over there after seeing that keys were not turned in and knock on the door. No answer. I then slowly let myself in while knocking and holler in, "Hello, management!" I finally hear a groggy, "Hello" come from the bedroom. I politely explain that she was supposed to be gone by midnight with keys turned in, so now we have people here coming to take her blinds and clean them off site. We give her a moment to get presentable since she just woke up, then she lets them in to take the blinds and be gone. She finally left about 45 minutes later and we didn't charge her for the extra day, which is what normally happens when holding over after your lease and notice are expired. She got a free night on us instead of a hotel I guess. I didn't care at all besides the embarrassment of trying to get cleaners in when she's still in there and was sleeping.
There are some inconveniences to being an on-site manager. People can come to you outside of normal business hours for little inconveniences. One guy locked himself out and called our manager who then told us we needed to go let him in. It didn't matter that we were in middle of grocery shopping. We had to leave immediately to go home and let him in because she didn't want to. This made us especially annoyed because that manager also pretended to be tough and say people were out of luck if she wasn't available, yet we couldn't live by that same standard for after hours non-emergencies. One lady locked her keys in her car, which also had her unit key, so we had to let her in to her unit at 6:30am so she could get her spare car key. She did this on two different occasions. One night, the power went out for the whole neighborhood, so of course we started getting knocks on our also dark manager office door asking why their power is out and when it will be back on and that they expect a credit on their rent because of this. "I'm sorry. We live here too and are also sitting in the dark. The whole neighborhood is out, so it's not an issue with our property. The city is already aware and working on a solution. I don't know anything else and no this temporary outage does not qualify for a rent credit."
After this first exposure to property management, I started to see some of the crap that landlords have to deal with. Being a tenant for a few years before, I also knew what was frustrating when things weren't taken care of such as community amenities and cleanliness. I did my best to keep the property clean, including cleaning out the dumpster pens so loose garbage wasn't just laying all over the ground in the pens. I also kept our community laundry room clean and if any machines broke down I got a repair scheduled ASAP. I still don't like that companies insist on maintaining contracts and hate month-to-month. I know they want to guarantee rent for 6-months or a year and turnovers are costly, but people still break leases for any number of life circumstances changing anyway. Plus, if you do it right, turnover work is easy to schedule and shouldn't require a lot of work if you have decent tenants. I really liked how this company started with an initial 6 or 12-month contract, then it just carries over on a month-month basis after that. Every 6 months or so, rates would go up. Sometimes there was a discount if you signed another 6 or 12-month contract instead of staying month-month.
The rent increases always bothered me too and they always will. Unless you're doing some serious remodeling, the costs for the property rarely go up as much as the owners like to make it sound. I know this because at my second property management job I saw what the costs were. Owners initially buy the property and make a decent percent return from the start. Raising the rates just makes their profit margins bigger and bigger to make more and more money from their rental property. It's ok to raise it a little for inflation, taxes, and to anticipate repairs, and remodels, but even old properties were charging higher and higher rates just because they could. I get it. If I had the opportunity to make more money for nothing I'd be tempted as well, but it really sucks for the whole community in general to have higher and higher housing costs.
I'm going to go on a long tangent now about the economics of rental properties:
How the market works: When a property fills up to 100% or very close, they like to see if they can push that price further to make more money. It's a common practice of supply and demand. When there are less units available they make them more and more expensive. The concept of something viewed as rare and hard to come by make it easy to charge more. You see this in many other industries. An increase in costs like property taxes, insurance rates, and maintenance projects are usually only a small factor in rising housing prices. Rental housing companies often do market research to know what similar properties are charging and how full they are. If they see other properties with higher rates and are pretty full with occupancy above 95%, then they can charge similar rates. The prices really start spiking up when a lot of people start moving in and there's a shortage of housing. If most properties are full and waiting lists are growing, you can charge really high and there will still be people desperate enough to pay the high price to get in. Soon all the properties are going to be charging higher prices just because they can. People will pay what they have to to not be homeless or living in a high crime, slum shack. When there's no competition to lower prices because everything's full, prices will continue to go up, forcing more people to work 2 or 3 jobs or cohabitate with roommates just to rent somewhere.
It takes a lot for rent rates to go down. Building more apartments is probably the only real solution. If there are more units for people to choose from then vacancies will be open for longer and longer periods of time. Landlords want people in there paying rent as soon as possible. The turnover time between a previous tenant leaving and a new tenant moving in needs to be as short as possible to make the most money. When vacancies are open for longer periods of time because there isn't a high demand due to more places available to live, you will then see reduced rates and specials being offered. A move-in bonus or special is essentially lowering the rent rate if you spread out the reduced cost over a 6 or 12-month lease. It's a marketing tactic to lower costs and be appealing without looking like the cheaper alternative.
The free markets would conclude that more housing needs to be built to offset the high housing costs. They are correct in that more competition can bring down prices, but if there isn't room or time to build and keep up, then there needs to be other solutions. Building too many luxury apartments doesn't help either. Rental prices are pretty high in the city I live in, so I was happy to see a large complex planned for construction. To my disappointment I found out shortly after that they are going to be more high-end luxury apartments. I feel like that's all they ever build these days. Housing prices are too high? Let's build more luxury units that cost $1,300 or more for just a 1-bedroom! I guess it's better than not building anything though because then the wealthier people that can afford these luxury apartments can compete for those and make room for others to have the "standard" apartments. If wealthy investors and companies can't build or won't build, then the housing crunch goes out of control, resulting in more people trying to cram into units together just to afford it and have somewhere to live, or make an hour and a half commute or longer just to afford housing further out.
Rising housing costs is a pretty normal thing in the real estate world because of the supply and demand economics as I explained, but it's a problem for society if we do not build more. It’s good for rental property owners (usually wealthy people – not always, but usually wealthy people), but bad for everyone else. Tenants aren’t making more money, but their housing costs keep increasing. They might get raises, but not as much or as fast as how much property owners raised rates at both places I worked for in property management. Thus, the poor and middle class continue to be squeezed of life. When rent goes from $625 to $650/month that is now $300/year that these individuals will no longer be able to use elsewhere and their standard of living is diminished. $300 may seem small to some, but when this is combined with costs of other things going up as well it becomes a significant problem for many people because their pay isn't going up to match it. Maybe they did get a raise, but now the new people at entry-level jobs and salaries are having a much more difficult time affording the things they need. The $25/month increase in rent isn't really a lot, but the real problem is that I've seen it go from $650 to $1,000 or more in just three years.
I believe an economy can be ruined or severely stagnated and limited solely by housing costing too much. When a larger and larger percentage of the population's paycheck gets sucked up in rent, there is less to be circulated to drive business - especially if many property owners are located out of the area and take the money elsewhere instead of spending back into the local community. Even if the property owners did spend it locally, I still think the economy would be stronger if more people had more spending power than only a few spending more and controlling the majority of investment and market actions. More disposable income everywhere would help drive more business growth and investment. I don't advocate for communism trying to make everyone equal, but I do advocate for at least a healthier distribution of wealth. If I were to graph it, the distribution of wealth would be poorest on the left and richest on the right side of the bottom line. Society would be better off with a line representing the distribution of wealth that steadily increases from the poorest to the richest, instead of a nearly-flat line until a giant spike for the top 10% of wealthy people. I believe fixing the housing affordability problems would be the best place to start for maintaining a healthy economy. The cheapest rentals available in a market should not be already sucking up more than 30%-40% of people's income on just housing alone.
There are people and politicians out there pushing for rent control policies to fix the maximum amount that can be charged for rent. This is a simple government idea for a solution, but it does nothing to address the real problem of too many people wanting or needing to live in a certain area and there isn't enough housing. Build more housing and they'll have to put pressure on lowering rates or go without getting any rent at all because they're charging higher than other places. A Universal Basic Income is another political idea being discussed, but without some serious changes and enforcement in other areas all it would do is inflate housing and other industries heavily impacted by scarcity. If people started receiving an extra $1,000 a month they might want to use it to move to nicer areas. Just as I described, when the nicer areas fill up they're going to charge higher and higher, thus making the UBI ineffective for many as it'll all just be absorbed by the new, higher housing and other costs.
Another point to add to rising housing prices is because Not In My Backyard (NIMBY) locals are not allowing new communities to be built. They want to keep the open land instead of building new housing developments. They don't want to see new high-rise multi-unit housing in their skylines and blocking their views, or increasing traffic in their area. Ever wonder why the progressive, tech-y, and "weird" places are so expensive to live compared to other cities? It's not just the love of the culture or jobs bringing people in and raising the prices, it's the people themselves. One reddit user commented the following on a "City that thinks it's 'weird' starterpack" thread:
"Most of the OG eccentrics and hippies that gave the place its 'quirky' identity back in the day are now home-owning NIMBY squares who are terrified of change and mob every city council meeting to lobby against anything new or different despite still self-identifying as progressive and tolerant. Thanks to their efforts and an economic boom or two, there is a housing shortage, rent is stupid high and there's a shitton of homeless people — which includes the rest of the OG eccentrics that didn’t 'make it'.
Source: grew up in Quirky Berkeley"
This concludes my long tangent about the economics of rental properties.
Back to my history and experience: After graduating from college I kept looking for an entry-level job for a real career in finance, but I still needed an income to pay bills in the mean-time. The current gig at the first property management job with free rent and utilities, plus a stipend was nice, but it all added up to the equivalent of about a $9/hr full-time job. It's kind of a small amount of pay, but was nice because it didn't really require much active work. The office was connected to our home. We didn't have many expenses because they were covered by this job, but we also weren't making much money to do anything. I needed an income to provide for our family, so I applied to another property management job that started at $14/hr and got in. I only wanted to stay there until I got a better job in finance or maybe grow into a bigger property management firm that could pay a good salary. I was hired on as the manager of a 112-unit apartment complex and I was excited for the new experience. It expanded on what I was already doing to now having me be the one to schedule maintenance, do billings, and manage applications whereas our manager was the one doing all of that at the previous job. I had a lot more control and I was annoyed at my previous boss because she would be cranky, frustrated at things, and complain about being busy all the time, but now that I pretty much did her same job for another company, I found that it really wasn't hard. I found property management in general to not really be that hard. It can be frustrating and stressful when dealing with problems and angry people, but it's mostly pretty easy just to be organized and make a few phone calls for stuff. When the properties were filled up it was very easy - even boring. I had plenty of time to surf the web, watch videos, whatever.
When I started at the new apartment complex in January, the previous manager left with a lot of vacancies, troubled accounts, several move-outs coming up, and she wasn't very organized in general. One of the first things I did was change up the whiteboard in the office. The previous manager would just write notes on lines of items needing attention, open units, whatever. I changed it to try copying what I had at my last job which was basically a map of the property made with thin, black tape and filled in all the info of building and unit numbers, plus the last name of the current tenant that occupied it. This helped me learn the property and easily see who was where and where the open units were. I left a section for other notes but started making everything else digital.
I felt like I was being a very good manager. I was solving problems, keeping the place clean, and even lowering rents for people because we had a lot of vacancies, more coming up, and it was mid-winter. The owner of the property was freaking out because of all the empty units and had my blessing to lower rates or run specials to get people in. Some of the rate changes were pretty significant too, like a $900 one-bedroom down to $765. I personally believed the rates were too high to begin with compared to the quality and location of what they're getting. However, a year and a half later as mostly Californians were arriving in droves, those rates all spiked back up.
This company did not have a very good cleaning or landscaping crew. They kept trying to keep everything in-house to make more money, but they were just bad at it. The owner didn’t want to spend money on it either, so whenever I had some free time, which was often, I forwarded the office phone to my cell and went out on the grounds. The garbage pens on the property were overflowing all the time, even with them being emptied three times a week. I would pick up and sweep up any trash on the ground and throw it in the bins, then sometimes I would bring soapy water and actually brush the pavement underneath to get rid of stinky, smelly, garbage juice that stained the ground. I did some weeding on the property, often changed burned out light bulbs, and even picked up dog poop on the grounds. I made sure the clubhouse and gym were clean and orderly. A treadmill had a broken part, so when maintenance was taking too long to fix it, I just learned how to do it and fixed it myself. All these things annoyed me as a tenant in the past, so I wanted to make a difference by being a manager that actually took care of things.
A part of me enjoyed fixing things, learning how they work, and learning how to do a few handyman maintenance things. The most common problem people reported was a kitchen sink drain disposal not working and these are usually very easy to fix. Every single time it was because something jammed it up like a piece of plastic, small pebble or metal piece, whatever didn’t grind up or flush on down the drain. Most of the models had a slot on the bottom under the sink to manually spin the blade in either direction with an allen wrench. This usually dislodged whatever the blockage was and I could pluck it out of the drain. There is also a little red reset button to push sometimes after clearing it and then it worked just fine. Other models didn’t have those features, so I had to use a stick to carefully dislodge the jam, but same story. Me doing this for people saved them, the renter, a $75+ charge for not having to call in a maintenance service. There’s a lot of things people can safely and easily do in their own rentals that will save a lot of money and hassle, just by looking up how-to videos on youtube. I don’t know why more people don’t do that. Some companies will fix things free, but others do not. You have to be careful to clarify who’s footing the bill for maintenance stuff. This company I was working for loved to charge people for everything they could and I wanted to help people avoid that.
Another fairly common problem was clogged vents. People don’t always properly clean the lint out of their dryers, so they clog up the vents. One guy cleaned his dryer regularly, but we found that the hose connecting the dryer to the wall outlet was badly clogged. The heaters also needed a clean vent. In the summer, bugs and birds would build nests in the dormant heater vents. I cleared out a few old nests and fixed heater problems that way too, again saving lots of money on service calls. On two or three occasions we had an issue of an air conditioner not working. I learned from a technician an easy fix is sometimes the unit has frozen over from a combination of excessive use and a blocked air intake. We just had to clear the intake vent if there was a blockage and run the unit on fan mode only for an hour or more to defrost the unit, then it worked fine again.
Two more maintenance things I learned was how to adjust the temperature in a water heater and how blocking windows for darkness is bad if done improperly. A tenant complained that the water wasn’t getting hot enough for their liking, so I looked up the model and a video of it to learn to do it myself. All I had to do was unscrew a panel and use a screwdriver to turn the thermometer setting a little hotter. Easy. For the mold issue, a tenant was moving out soon and found mold in their bedroom window sill. They were using blankets to completely seal up the window to darken the room. The problem was that it still gets humid between the blanket and window, so with no ventilation, mold or mildew was growing in the now moist, warm windowsill. Of course they tried throwing it all on us to fix the mold problem, but they caused it directly because of their actions, so they were charged the cost to fix it.
A big problem I dealt with early on was that the previous manager signed a contract with an obscure construction company that was hard to find any information on. They housed a bunch of their workers in, I think, 5 units. When I came in I found that they hadn't paid rent in like 3 or 4 months. The first thing I had to do was try contacting them. None of them responded and they all only spoke spanish, or at least pretended to not know english. The next step was to post a 24-hour notice of entry to investigate what was going on. Most were abandoned, but one still had guys in it and another had a young family. One of the workers made a shady deal to illegally sublet the apartment. This new guy paid the previous worker scammer a deposit and some rent and then the scammer bolted, but the new guy had keys and moved into the unit. We had to make a lot of adjustments to get this new guy, his wife, and young child onto a proper lease and convert him to an actual tenant. He's lucky we were able to work with him because sometimes people that fall victim to this type of scam just get the boot.
I had to post an eviction on the last one and notice of abandonment on the others. We never received a notice they were vacating or had keys turned in and my investigating of the abandoned units found a few things in the cupboards and fridge and some small, cheap furniture items still there, so technically I couldn't just change the locks and throw it all away without proper notice and time. Eventually, we were able to get all of the units cleared out, cleaned up, and re-rented. The turnovers for all the units and the months of missing rent cost the owners a lot and despite hiring an investigator to find and sue the company owner, I don't think they were successful in doing so to recoup any of it. Too bad.
Another early issue I had to deal with was finding that some people paid cash for things that didn't get recorded properly. Their accounts were accumulating late fees because it's an automatic system. Luckily for all of us, they had receipts to prove they were current on everything and always were. It definitely looked like the previous manager was engaging in some crooked theft activity or grossly mismanaging and failing to document things. Of course the tenants were upset when I told them of the situation and I knew what happened was very wrong, so I'm glad it all got sorted out. I was shocked at the lack of controls in the business and that nobody caught these problems until I came in and started sorting through stuff to get organized. From what I heard from a tenant that was close with the previous manager was that she stopped caring and became dissatisfied with the company.
The freedom to run the place as free as she wanted must've been nice. I would've loved that, but I would've done a good job. Of course, now that the company was aware of the messes that were made, I wasn't going to have the same freedoms. In fact, the controls clamped down so hard that it actually hindered my work. Any change or authority to do things had to pass through 2 or 3 people first. The fact that policies were constantly changing every few months made it a disaster of organization. Even though they've been in business for 10 years, this company still didn't even have solid lease terms and policies figured out. It wasn’t even minor adjustments either. I can understand things evolving to a certain degree over time, but we were often undergoing big policy and lease changes and often trying to implement new programs, some for ease and efficiency, bust mostly attempts to make more money. Tenants saw right through the schemes too as attempts to money grab. Such a headache! To make things worse, a new person was hired and basically given authority to make changes to documents and processes that would improve company efficiency. The company owner loved what they did and constantly praised them publicly. Of course they’re doing a good job! They were given the power to make changes and had the freedom to settle issues and fix things! They were being praised for doing the job just like the owner wanted because the owner gave them everything they needed to do it. They made the exact changes the owner wanted and got praised for it!
My second year at the company was getting worse with controls. I felt like I was fighting with my own company more than just managing properties. It took so much time with discussion meetings and paperwork turnover to make little adjustments like removing fees or something because the system was so automated and management loved to stick it to people hard. I always felt like they were being unfair to tenants in any way they could to make a buck and punish people for not abiding by every word of the 30-page lease. The most common problems were turnover charges and lease renewals. The company had no concept of “normal wear and tear.” Even if the unit was properly cleaned, they’ll still send in a cleaning crew for a two or three hour minimum just to make sure it is indeed clean and the renter pays for it out of their deposit. Many or most maintenance charges were billed to the tenants’ deposit as well, so it was rare to get much of your deposit back, if anything at all. People complained all the time, and even though I agreed with them, I as the property manager had to face their fury. There was nothing I could do to change it because that’s what my boss decided the policy will be.
Lease renewals were my favorite glaring example of hypocrisy. If a tenant had an old lease that my boss didn’t like because it had certain lines that worked in the tenants’ favor, he said it was an old lease that had no value anymore and we are signing a completely new lease, even though they’re staying in the same unit, managed by the same company. However, if there were changes that worked in our company’s favor, such as changes that added charges, then it was a standard lease renewal and they need to pay for the changes to their lease even though the new lease is changed a little just like the other scenario. For example, a tenant wants to add a pet or additional people at their lease renewal because they’re signing a new lease for the renewal which originally didn't have extra costs. My boss would charge them the fees for changing the lease because it’s considered a renewal; but if there were lines that served in the tenant’s favor like a line stating rent cannot be raised by more than 5% and my boss wanted to raise it 10%, it was excused that they are signing a whole new lease, so they will have to pay the increase after “renewing.” I guess it makes sense because we can just evict the tenant to get a new one paying the higher rate, but this case actually happened and it bothered me - a lot. Are some of these things my company did illegal? Probably, but no one has the time, knowledge or money to go about pursuing a lawsuit for just a few hundred dollars or less in charges.
There were a few people that made legal threats, but we just ignored them. They never followed through except for two occasions. The first was a paranoid woman that stopped paying rent and basically ghosted us. She was evicted and then quickly moved out last second before we changed locks and took possession. She left a mess in the property. There were old, leftover parts of furniture that needed to be removed and she painted sections of the exterior without permission that needed to be fixed. She wanted to pick up her deposit, but when she opened her envelope to see that she owed us quite a bit of money instead (missed rent payments, late fees, eviction fees, cleaning and maintenance fees) she angrily called in and threatened to sue us and hung up. Digital phone slam! Sure enough, a few weeks later we get a court summons. After gathering all of our backup documents in preparation to defend, I attend court on our hearing day and she didn’t even show up! The case was immediately dismissed and that was the end of it.
The second case was more interesting. We had a problematic tenant in the apartment complex that was late on rent, or I should say just didn’t pay rent for 2 months and was in middle of the eviction process. Their apartment flooded pretty badly one morning because the guy used the toilet, which clogged, and went to work before anyone else woke about an hour or so later I guess. When I got the call first thing that morning just after 8am, I went to investigate and found that the little chain in the tank connecting the flush lever to the drain flap was a little too long and got stuck under the flap, allowing water to endlessly flow from the tank into the bowl, which was clogged, so it overflowed and flooded the place. It was also a second-floor unit so there was damage below. I don’t remember the total cost of the damage, but of course it was a few thousand dollars. The owner was going to cover half the cost because of the long chain issue, but they were still charged the other half for causing the clog and letting it flood for so long. They disagreed with having to pay at all, so they sued our company to remove the charges and pay for their furniture damages.
The court visit wasn’t as interesting as I expected. The judge heard both sides of the arguments and it didn’t look good for the tenants who have caused a minor flood before and had many delinquent account issues. He agreed with the owner in covering it 50/50, so we won the case. The rest of the issues of eviction and collections was a separate issue for another day. To end it all, the woman had an outstanding arrest warrant for something, so the judge had the officer arrest her and taken away right after his decision. It was pretty funny to me to not only end this problem with those tenants, but that she showed up to court, lost her case, and was taken away in cuffs.
One of the first angry tenant issues I dealt with within my first two weeks was a truck that got towed. We shared a part of our lot with another business that was very strict about their parking spaces. They even had it painted on the ground but people still parked there and got towed. It happened three times while I was working there. Tenants or their guest would come to me all upset about it, but it was easy for me to defer them to the other business that towed them. In my first case, the guy tried for half an hour or more to prove that he was safe parking on the lot and they had no right to tow his truck. Obviously he was wrong and there was nothing he or I could do to stop it. I never ordered any cars to be towed while I was working there. People rarely parked in places they shouldn't, but even if they were, they were gone within a few hours anyway. I had a personal policy to not tow until after I placed a 24-hour notice on a vehicle unless they were blatantly blocking a red zone like in the way of garbage removal or something important. I didn't want to deal with the headache of more angry people and charging someone hundreds of dollars for a first-time offense. If the same vehicle parked in someone else's spot more than once after being served the first time I would be much more willing to have it towed, but I never had that problem.
Everyone's a good tenant until they pay late or have issues. When people would fall on hard times or have requests to fix issues, I would often be reminded about how they've been good tenants and they want some sort of reward because of that. Yes I can be helpful to first time offenders for minor things, but EVERYBODY is a good tenant at first and no, you cannot do random favors that aren’t asked for like cleaning the property in exchange for me to look the other way when you're late on rent or a complaint is filed against you.
There were two or three times when tenants missed rent and when I called to check in I was told they’ve been wanting some maintenance things done. We do have an easy system for maintenance requests, but some issues are not as urgent as others. Some owners will agree to fix things up and others won’t unless they HAVE to. Again, withholding rent or other payments due will not work. You will get screwed worse in the end unless you REALLY know the law and know what you're doing. It's always amusing to me when people get upset about problems on their account and make comments that they're going to be looking for other places to live and moving out. That’s great news for me! A problem tenant is letting themselves out the door! Going to leave a bad review? Fine. I’ll just leave my owner remarks about how you screwed up and were a bad tenant. Nobody cares. All those people that withheld rent for whatever reason always lost. They were all evicted and now had a tainted rental record. They never had the money to pay and were just making up excuses to try and stay longer or get a discount.
Even if they had the money, the simple act of turning it over to pay the rent proved difficult for some people. Many people waited until the very last day and the very last hour to pay rent. This was a problem sometimes when the software automatically assesses a late fee and then I have to argue with my own company to get it removed because they slipped it under the door or paid it at 11:59pm and it didn’t load until 12:01am. If the first or fifth lands on a weekend or holiday and you're paying with a check or cash, you need to pay ahead of time if this office is closed. If you don’t pay it online and demand to pay in person when the office is open again, you’ll be late if it's not already in the box. If you don't get paid until a few days after the due date, that's your problem to figure out. The landlord doesn't have to accommodate your pay days or job losses or any income changes. You must be responsible for your own budgeting and make sure that rent gets in on time.
When I was working in the on-site office as manager of the apartments complex, several people would try to use the excuse that I wasn't in the office for them to pay rent, so it was late, even though there's a rent drop box right by the door. Rent does not need to be paid IN MY HAND! It can be paid online or left in the drop box. You not feeling comfortable leaving it in a drop box or paying a $2 on-line portal fee is not our problem. It is free to pay in my hand if I'm there, or you can pay for free in the drop box. Should the drop box ever be broken into, the thieves wouldn't be able to use the checks written to us anyways and we don't take cash payments. You would get a chance to write a new check without any late penalties.
I was also very annoyed at how many times people incorrectly filled out checks or money orders, or paid the wrong amounts. I couldn’t get ahold of them after emailing, calling, and leaving messages, then they complain about all the late fees and problems. It was so frustrating because I’m trying so hard to be on their side to make sure everything’s right and so they don’t get unfair hefty charges, but it sometimes felt like they were purposefully being difficult with their screw ups and lack of communication. Don’t wait until the very last second to pay, pay the right amount, and don’t ignore me trying to reach out to you when there’s a problem. I’m reaching out to avoid problems. Many other managers, including my boss, love to trap people and make them suffer the consequences for not handling things on their own in the proper way and on time. “It’ll teach them,” they say. My future boss at another job also subscribed to that method of training. Let people learn through mistakes and get them in trouble. If it’s a hard learning, they’re more likely to remember. I hate this method! People MIGHT learn better, but it also breaks down the relationship and makes people resent you when you simply could’ve been more proactive in giving advice on how not to fail. Be on their side.
I was always on the tenant’s side as much as possible. I wanted to be very fair and give people a good home with things taken care of and no problems, but I also hated conflict so I did everything I could to avoid it and sometimes people just have to own the penalty charges. I can’t completely bend the rules or hide charges in our software because I still have my own boss to report to and, like I said earlier, they really clamped down controls. I tried everything I could reasonably do to help tenants avoid problems and charges, but doing favors for people sometimes backfired. Not only did they often become repeat offenders, but it also gave me a headache trying to cover my tracks for when I was able to help the first time and they were never grateful I helped in the first place. I took a chance on renting to a young couple one time because I knew they were desperate to get a place. The problem was that they BARELY qualified, they were renting an expensive 3-bed/2-bath unit when it’s just the two of them, and I knew they would struggle with the rent if they weren’t careful, but I wasn’t going to stop them if they think they could make it work. Of course it failed after a few months, they broke lease, moved out early, and issued the penalty and cleaning charges. I really hoped they would make it work, but I wasn’t surprised. I felt guilty for allowing them to get in, but they did technically qualify – barely. Of course the parents were mad about all the charges, but they probably should’ve advised the kids to make better choices in picking a place to live.
One subject that angered people in different ways was pets. I can’t believe how many people have pets and how many pets some people have! Pets are scary to landlords because of the damages they can cause and issues with neighbors. Both dogs and cats will sometimes scratch and chew the floors, baseboards, walls and doors, and just stink up the place. There were three or four times we had to completely replace the flooring in rentals because the cleaners could not get the smells out. The renter was charged the pro-rata charge for replacing flooring early. We had a rule to replace old carpets that were worn out every 7 years. If we needed to replace them sooner because the tenant and/or their pets damaged them, they would have to pay the balance of the remaining time. For example, if it cost $2,000 to replace the carpets and they were only 4 years old, the tenant would be charged $857 for the three years of use left in the carpets (2000/7 x 3 years left). My wife and I don't like cats. They're cute creatures, but almost every house we go into that has cats stinks!
Dog poop all over the grass on the property was always a problem. It was difficult to find out who was leaving it and we tried a few tactics that helped a little, but it was incredibly annoying. So many people are such irresponsible pet owners! There were only about two cases of noise complaints for barking dogs, but that was also a problem that I couldn’t do much about. I’m not going to put listening devices out to prove the neighbors’ dogs bark too much, but I can talk to the tenants about it at least. We also had to make a new community rule requiring all dogs to be on a leash in public for two reasons: 1) Too many people were letting their dogs out to relieve themselves unsupervised and 2) Not everyone feels comfortable with loose dogs approaching them and pestering them, their children, and especially people with dogs that don’t like other dogs up in their space.
So people had lots of dog complaints, but new prospects also complained about our pet policies. They were frustrated and cried about how unfair it is to limit the number of pets you can have and what size or breed. I made the policy clear to this one guy when he first came in, but then in middle of the viewing, this “son” that he previously mentioned that would be living with him was actually a pitbull dog, which is prohibited. He then proceeds to explain how good and well behaved his dog is and how it’s like a son to him. He was literally referring to it as his son the entire time up ‘til now. I’m sorry, but no. Did you think I can just let you sneak it in and explain to everyone else that it’s ok because he loves his pitbull so much even though it’s not ok for everyone else? No!
Another interesting debate in this area is pets vs children. Some people complain that children can cause more damage and noise problems than pets, yet pets require their own deposits and extra rent. It's an interesting argument and having had young kids myself I know children can cause some damage to properties. However, I still agree with the standard that more often than not, pets cause more problems.
Now the worst scenario with pets I’ve dealt with, started with a problem crazy-lady whose husband recently moved out and she started inviting scuzzy-looking people over and missed rent so she’s facing eviction. I was at a meeting in our main office in town when a tenant called in. One of our employees took the call and we hear her say, “Ok then you need to hang up and call the police.” She then comes and tells me that a someone shot a dog on the property.
There was police and an animal control truck already there when I arrived. Police were taking statements and the situation was under control, but the people outside were all shaken up about what happened of course. So the scuzzy-looking guy that was illegally staying at the trouble tenant’s place brought in a scary-looking pit bull that got out. The dog ran out and proceeded to bark, snarl, and lunge at people unfortunate enough to be out at the moment. The dog also picked the wrong people to mess with as its final victims. It jumped all over one couple and became more aggressive when they tried kicking it away. The husband had enough and decided he had to shoot the dog with the pistol he carried on him to end the threat. He was actually pretty shaken up and didn’t want to from what I’ve seen and been told by people, but he felt like he had to.
The fall-out from this was that we reiterated our pet policy with everyone, evicted the problem tenant, and deal with new complaints about people not feeling safe because of the shooting. One old lady came in and cried about how it’s not right that the other person could shoot the dog, he didn’t look harmed, and it’s against the lease rules and city rules to discharge a firearm. She wanted them evicted too. I was actually surprised by how many people came to the defense of the dog! On a side note, I don’t actually know if it lived or died. It was alive when the owner placed it in the animal control vehicle, but after that I don’t know if it lived or died later. Since the guy acted in self-defense the police issued no ticket or penalties to the shooter, but did take his weapon for a time for evidence or some sort of legal reasons. I agreed with the police and so did my boss that they were right to act in self-defense in that moment against a loose, aggressive dog. People do not have to wait until they’re bitten, mauled, and torn up to prove they need to kill an animal for their safety, but of course there should be witnesses to account for whether or not people are just shooting animals they don’t like. I was not there to witness what really happened, but a few others complained about being attacked and threatened by the dog. Several people in the community were divided about whether it was right or wrong to shoot the dog and both sides were upset.
The tenant being evicted was taking her sweet time and not appearing to leave on her own, so I had to have the court deputies served their official 24-hour notice and when that expiration time approached, I had to call them in to let them know we needed them to enforce the order because they still haven’t left on their own. That morning the tenant did finally bring in a small rented truck to move stuff out, but I didn’t trust they’d actually turn over possession or get out on time and this needed to end today. She came over to the office with her two young boys to fake appeal compassion from me to allow more time, but I wasn’t having it. I was so sick of this lady and wanted her gone! I told her I can’t giver her more time, the deputies are taking over and coming to enforce their notice. She scowled and cursed me and pulled her children away as she left as if she was protecting them from me like I was a horrible, dangerous person. I feel bad for those kids. Life is so unfair to all the children that have to grow up in broken homes with parents that can’t manage their lives. This lady wasn’t just a mother down on her luck. I would actually work with people like that to help them. No. She was defiant, breaking several rules, refusing to cooperate, very likely using drugs, inviting people over that made the community feel unsafe, and stirring trouble with neighbors.
When the deputies arrived she swore at me some more and told them how horrible I was. I just didn’t respond. There’s no point and all it would do is escalate the situation. They gave her just five more minutes to leave while we changed the locks with a maintenance tech, then they made sure she was off the property before leaving. In the early morning hours of the following day, she and that guy came back and tried breaking into the back door of her unit but were ran off by another tenant that caught them in the act. She was given the opportunity to come back for what little was left of her stuff, but never responded and her stuff just got scrapped during our standard turnover cleaning and repairs. This lady was charged with it all for being such a pain: missed rent plus the late fees until eviction, court charges and legal fees for full eviction with deputies, unauthorized pet charges, unauthorized guest charges, cleaning charges, and all the repair costs, especially for the damaged door from the attempted break-in. Good riddance!
I used to watch some shows about people being evicted and they almost always acted surprised like they had no idea it was coming or assumed something was being taken care of. No, it’s never a surprise. There are lots of notices and communications that lead up to that point. Plus, an eviction means you won’t get a good reference, but if you let go all the way to court you’re going to have an actual record of it, not just a bad reference, and you’re going to be forced out anyway. It’s much better to leave on your own and not let it get to that point.
Since I worked in property management, I learned a little bit about section 8 and section 42 government housing subsidies which are supposed to give aid to people struggling with finding a decent home on low incomes. Like many people, I don't like Section 8 because it's a clunky mess of organization, bureaucracy, and paperwork. I definitely understand why so many landlords refuse to take it. The second property I worked at was accepting it, but we started to phase out the program because of the headache.
The tenants were required to pay a set amount of their portion of rent and the section 8 program sent us a check to cover the difference. We didn't have a lot of section 8 users and many of them were decent tenants. However, there is a negative stereotype about section 8 people which is another reason why landlords don't like it and the stereotype exists for a reason. It's often true. Again, many were good, but there were still several section 8 tenants that caused problems on the property. They had struggles with alcohol and/or drug abuse, relationship problems with loud fighting inside and outside their units, cleanliness issues inside and outside their units, and even though their rent is subsidized there were some that still often struggled with paying even their small portion of rent on time and had trouble following other community rules.
I started to dislike using section 8 vouchers or company housing contracts because they became more of a burden. They basically had their own lease that we had to accommodate to and restricted our own control. Anytime there were lease changes with renewals, rate changes, or other issues they had to be notified like two months in advance with more paperwork and dealing with the long wait-times between correspondence. The bureaucratic protocols just wasn't worth it. It was much easier to just fill the unit with a new tenant on our own lease and enforce our own changes. We had a contract with a local trade school as well that was frustrating. The school itself paid the rent and was basically considered the "tenant," but they had special lease addendums that allowed them to house their students without us doing any vetting. The only problem I really had was noise complaints and extra vehicles on the property. Why do apartment complexes never seem to supply enough parking spaces? There should always be at least two or one and a half spaces times the number of units. Anyways, besides those complaints it was still just annoying to go through third party people and protocols just to manage our own units and tenants.
When I eventually moved away and started looking for my own place to live, I came across some Section 42 properties. I visited them because they looked nice and had great rates, but found out that you can only qualify to live there if you earn below a set income. It was pretty low too, but I don't remember the exact amount. From what I understand, Section 8 just sends the landlord a check to make up the difference in rent so poor people don't have to pay as much, but section 42 sets an income limit that only people with low incomes can live in, but they are responsible for all rent and obligations on their own. The property company agrees to keep their rates far below market rates and abide by this standard of only allowing lower income tenants in exchange for a reduction in taxes which makes up the difference they would've earned otherwise at normal market rates.
I am more supportive of section 42 properties because they seem a lot easier to manage and instead of paying out money the government mostly just goes without earning the taxes on the property it would normally get; but I've been wondering - why can't the government OWN some rental properties instead of subsidizing them? Do they already do that at all? Someone please explain if so. Not only could it provide more affordable housing to those that need it most, but it could also maybe be a source of income for the local government. Right?
One more situation I want to address is roommates. There were three times we had units rented with roommate situations where roommates would fight, break up, and move out. The problem is, they signed the lease together so they’re all equally responsible for the full payment. If one leaves, it screws over everyone including the one that left. This is why the first company I worked at didn’t allow it. It’s annoying to deal with and you have to manage their drama if it happens. In one case they made it work by going through the proper channels of having a replacement apply and be approved by us and paid to add them on the lease and properly remove the previous person. In the other two cases they couldn’t find a replacement, so the others had to soak up the cost. For one, she only had the one roommate and paid the full rent herself. I felt bad for her, but she paid two months on her own then her lease was up and she left in good standing. The other was a group of four where one left only 4 months into a 12-month lease. The others paid the extra cost for 3 more months then couldn’t take it anymore and all broke lease by moving out early. I still gave good references to the three, but the fourth person that left was also sent a portion of the bill for leaving early and the late fees for the last month they were late.
My final comment on renters is about complaints. In apartment communities, there's only so much a manager can do when it comes to enforcing noise complaints and pet problems. If you live in an apartment, you will hear noises! You share walls and they were not built to be studio soundproof! If you can't live with that and can't resolve problems with your neighbor(s), then you will need to move - preferably to your own home away from neighbors. Many of the people that constantly complain about noise or other issues, will complain no matter what. A cricket can chirp outside their window once at night and they’d be calling it in. A lot of people are shy and timid and don't want to confront their neighbors about issues, but you need to at least try to stick up for yourself first. If anything, it will help your case if the situation needs to be escalated to management. Most people are more reasonable than you think if you just try talking to them in a friendly manner.
Know from the manager's perspective that it is fairly difficult to legally evict someone before their lease ends for any other reason besides staying after a lease has expired, or for not paying rent, or for blatant lease violations with evidence. Managers don't have eyes and ears everywhere at all times to prove the violations and people can’t be trusted. Too many fake stories are used for stupid things people don’t like and just want to get rid of their neighbors. Unless there is hard proof of people in violation, there can't be any real action besides maybe choosing to not renew a lease when it comes due in the future. If there's a violation issued and the offender challenges it, there's nothing to stand on besides someone's word. If you live in an apartment you will hear noises!
The main, underlying problem to everything I’ve dealt with in property management is that too many people do not take personal responsibility for consequences to their actions and do not make rational judgments. A young woman would complain to me about having a hard life and blame the world and various factors for not being able to keep a job or afford rent and whatnot, but maybe it's because she is 20 years old with two kids from two different, non-existent fathers, a new boyfriend every 6 months, and switching jobs every 6 months. I don’t care what you do with your personal life as long as you fulfill your obligations and stop blaming the world at some point. There are still some things you do have control over despite having a rough past. Just because your work hours were cut, doesn't mean your rent amount can be cut as well. It's unfortunate, but now you make me to be the bad guy as if I’m a horrible, immoral person just because I enforce lease rules. I don't own the property. I can’t help people even if I wanted because of how the system works. I can't go to my boss and the property owner and tell them I let one person cut back on rent just because of a hard time - which hard times seem to keep happening to a lot of the same people.
Dealing with Owners
Now back to my job timeline. I worked at this other apartment complex for a year and then was moved to the main office to manage mostly single-family homes and a trailer park. I was used to only dealing with one owner of the mid-size apartment complex, so it was a little frustrating dealing with multiple owners now, managing the properties of all the people renting out their houses. Many people have stories of bad tenants and unusual events, but you rarely hear about dealing with owners.
I've met some rental property owners who had expectations that just aren't compatible with reality or were even prohibited by law. Many owners I've worked with want to push the rental rates as high as they can go and want very strict qualifications to get the "perfect tenant." They want the perfect tenant that will pay the most, but they also aren't willing to wait and let their property sit vacant until they get that match. These are conflicting problems. If you want to charge really high rents, then your chances of units sitting vacant longer and evictions/early terminations go up with it. Even good tenants sometimes lose jobs and have life emergencies causing them to break lease under the pressure of high rents. Owners want to have strict standards and get the best tenants, but if you're going to turn away all the other applicants then you have to be willing to wait and have your property sit vacant until you can get that ideal renter.
Owners often say they want all collections to happen promptly and enforced strictly. All rent needs to be collected on the 1st through the 5th and late notices and fees go out on the 6th. "No working deals and payment plans with tenants." However, once they are made to understand that being very firm and strict with this often means having to deal with evictions in the courts, they'll back off a bit. Evictions frighten owners just as much as tenants because then they are afraid of court costs, legal battles, and possible damages to the property from angry tenants on their way out. I tried to work with tenants as much as possible being firm, but fair; but it’s a careful balance and as I reflect back on my experiences I think it probably would be easier to just stick to the firm rules. The cost of evictions are higher than working with a tenant, but it can be more of a headache trying to manage payment plans with a tenant when you can probably just put a new one in instead.
When a tenant is sent to collections for leaving or being evicted with an outstanding balance owing, I was told that chances are pretty slim that owners will actually get much of that, if anything back. If so, you only get a little bit here and there for a long time. Collections are very regulated and don't produce results nearly as well or quickly as you'd hope. This leads me to believe that people actually can get away without having to pay the full price, as long as they're ok with their credit taking a hit.
I was surprised by how upset property owners would get over maintenance issues. Yes, of course you would like to never have to pay for the upkeep of your property and be a slumlord, but if you want to charge these high rates and stay within legal limits and whatnot, you have to pay to upkeep your property. I thought it was understood that owning and managing property would include maintenance costs, but I was surprised at how many times property owners were devastated and upset at even minor repairs. They didn't budget for it and were relying too heavily on their one rental house for income.
There were other times that property owners wanted to fix things themselves to save money, but they weren't very good at doing things properly or in a timely manner. I've seen owners try to bill and charge tenants for the upgrades and remodeling of their property. No. They're already paying your mortgage and taxes for that sweet, ever-growing equity. They are not obligated in any way to pay for your elective property improvements on top of that.
Some people own rental properties and probably shouldn't because they can't financially support the investment. The last place I rented before buying my first home was owned by a family that were presented an opportunity to buy the rental house from a relative. The problem was that they didn't have the finances to maintain it and pay for it when no tenant was there. They worked really hard to do maintenance upkeep themselves and they were good at that at least, but they struggled managing the financial side of it. Should any costly repairs be needed or long turnover time between tenants, they'd have to get a loan to cover the costs. When I was managing rental houses, one older woman used the rental income from her property as her retire income to live on. The long-term tenant she had moved out and we couldn't place a new tenant because the house was in such bad shape, needing a lot of repairs she couldn't afford. She was very upset and eventually had a friend come to do repairs and I was laid off before finding out whatever became of that situation.
The last interesting experience I want to comment on is my involvement in managing an old trailer park. It wasn't a park with an office or amenities, but tracts of land with plots for home hookups. The owner was a big company that wanted to develop the land, but didn't want the bad publicity of evicting all the residents. The homes on this lot were old and not up to code for transporting on the streets - not that any of the residents could afford to anyway. My job was to manage the property like any other and make sure rent is collected and all lease rules are followed, but also to encourage people to leave. We made deals with people such as free rent for 3 months if they sign over the title to their home and leave. We needed the title to own the home and approve of its demolition and removal. A few people took it and left, but many others wanted to stay. They put a lot of money into their homes and were now being forced to leave it because they can't afford to move it anywhere if it even could be moved. I felt bad for everyone in that sad situation.
The worst part about managing this park was that it was onboarded from another company and it was not managed well, or at all, for many months. Most places didn't even have a lease on file, account balances were all over the place, and there were several problem tenants that were always paying late, or not at all, and a few people we could never get ahold of and questioned whether they were even living there. Some homes were abandoned, but we didn't have a title or contact for the actual owner, so that was a mess to figure out too. I watched this John Oliver video about parks screwing people over and I found it very sad and frustrating. I can relate to knowing what it's like for people to be trapped and screwed over.
I worked at this second property management job for a year and a half until I was let go due to the business shrinking. Unfortunately, I didn't secure a new job in time and it wasn't for a lack of trying. I wanted to get out of there much sooner and even went to a few interviews, but I didn't get hired anywhere so I got to experience being laid off and unemployed for the first time in my life. Two other people were laid off at the same time as I, then two years later everyone else until they were left with just the owner and his wife, plus a receptionist. I don't feel that bad for their business failing because there were a lot of things going wrong in that company with bad business decisions, certain things they did with mistreating employees, and their terrible policies that hurt tenants and sometimes owners.
The company owner made some bad business deals by growing too fast and hiring too many employees and buying a whole batch of management contracts from another shady company that severely mismanaged their properties, and then left all those problems for employees to deal with on their own. It was a small company and employee turnover was pretty high. Most employees there had no prior property management experience at all either. The management contracts purchased were never properly onboarded, so their lease information was missing or incorrect, many had delinquent accounts and missing deposits, and many properties haven't had an inspection for a long time. A year later, as problems started flowing in and untrained employees left dealing with it, plus the ever-changing company policies, the problems grew and property owners became upset. Most of it was the previous management company's fault, but my company's owner didn't do enough to fix it. Since the housing market was very hot, almost every single contract he purchased just the previous year ended up being closed by owners choosing to sell instead of dealing with more rental management problems. The company was small to begin with, already had a bad reputation, no marketing to attract new properties to manage, and hired too many employees. We had monthly meetings to go over how things were going as a company, so that's how I saw the writing on the wall. I was disappointed in being let go, but not surprised. I was more troubled by the fact that I was never able to get into a real job that led to an actual career in the mean time.
I actually enjoyed property management and learned a lot from it. Property management as a service doesn't make very much money because it's usually less than 10% of the rent amount charged to the owners. Property management companies for the most part only make good money by charging expensive fees to tenants, managing a lot of units, or just owning their own properties themselves. I wanted to own my own rental properties some day, but I learned that it doesn’t make a lot of money unless the mortgage is paid off and you picked up the property for cheap and can charge a high rent rate. I've found several REIT investments that give you a better return for your money than actually owning property yourself and there's no management hassle with maintenance or tenant issues. The only problem is that you don't have control over your own investment.
I am very against raising rent on current tenants that are renewing their lease unless costs absolutely require it, not just because the market allows me to. Housing is skyrocketing, but wages are definitely not. Sure the market rate is going up 20% (or whatever high number) each year, but the tenants' income is certainly not - or at least not nearly as much as housing costs are.
When I worked in property management I would raise rent rates between tenants but still keep them a little lower to be competitive and fill empty units faster. If the previous tenant moves out, then at least the new tenants would choose to move in under the new rate since they are already in the market and planning for it instead of raising rates too much on current tenants, causing them to be forced out or screwed trying to make it work to stay there and souring the relationship.
If they were longer-term tenants, I'd raise it by maybe half of what the current market increase is every 2 years with plenty of advance notice. I tried my best to not raise rates on the first renewal. Turnovers are expensive. It's easier to have a good relationship with tenants and keep them longer this way. You can bring up rates slowly with the long-term people, but still grow your income when there are turnovers.
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