California Dream for Young Families
“BECAUSE THE FUTURE MATTERS!”
“California Dream for Young Families The Startling Reality”
California is one of the most beautiful places to live with its coastal beaches and cities, mountains, lakes and rivers, forests, and country side.
But it isn’t cheap to live here. In fact California is the third highest expensive place to live in the nation behind Alaska and Hawaii. Just take a look at the table on the left.
Young and middle income families are struggling financially in the Golden State as homes, rent, transportation, income taxes, sales taxes, utilities, child care, gasoline and the like are all higher than the median US average, in some cases much, much higher!
Worst yet it isn’t on anyone's radar to fix it!! California cannot be the place where our youth out of school and young and middle income families struggle to survive financially because it is too expensive to live here and have no options in some cases but to leave the state. It simply isn’t right or fair!
The startling reality is that our youth just out of high school and graduates just out of college with young families have to face the prospect of needing to save for the next 35-years for a 20% down payment to buy a house. Take a look at the chart below:
And California’s top three cities San Diego, Los Angeles, and San Francisco are the most expensive in the nation when it comes to buying a median size home behind only New York in high end homes over $1 Million!
Add to that child care cost of an average of $500 to $1,200 a month for one or two children and no wonder young couples are postponing many things including buying a home, and middle age families are fairing no better as they have older children in school and are struggling financially to make ends meet California.
What about the people who are single, in particular the segment of our population who are single mothers who face the extraordinary task of raising one or two children on their own while working?
Anyone care to take on that budgetary challenge?
What can we do to help, but more importantly why should we help?
“Because the Future Matters!”Our young generation just starting out, our youth in High School and College, young families and our middle income families are the future of California! If we do anything in the next decade is that we ensure that they can affordably live in California without extreme financial hardship or having to leave the State and move elsewhere simply because it is TOO EXPENSIVE to live here! If we do anything in the next decade it is that and anything else quite frankly is of far less importance!
Housing COST in California is high, very high, and if California continues on its current path, it will continue to grow faster than the rest of the nation.
Our Young People, Young Families, and Middle Income Families will suffer as a result. They will have to spend more to buy a house or on rent, take on much more debt, commute further to work, live in crowded conditions and the result may very well be that we will run or young Families out of the State to go elsewhere where it is cheaper to live.
So what does an average person or family pays for or goes without because they cannot afford it? Well how about food, shelter, utilities, clothing, health care, education, child care, insurance, transportation, maintenance, fuel, debt, and let’s not forget entertainment, cell phones, computers, etc.
Here is a typical annual expenditure for a family of four in California.
How do People Survive in expensive areas such as San Francisco, LA, and San Diego?
- People skip essential insurance.
- They take on a lot of credit card debt.
- They band together as a family unit under one roof (Youth either staying longer at home or moving back in with their parents)
- They rent out living space.
- They delay having children.
- They work several jobs.
- They do work shifts within the family.
- They live off their home equity.
Content for graph and list of expenses from Digerati Life. Used with permission. Copyright © 2007 The Digerati Life. All Rights Reserved. Categorized under: Money Management & Planning, Silicon Valley & Family Life — Written by SVB
In my opinion living affordability in California for our young people and young and middle income families should be issue number one! We cannot become a state where only the well-to-do can affordably live here!
There is by no means an easy fix to stem the rising cost of living in California for our youth, young and middle income families and the arguments on how to fix it will be endless I am sure. But where there is vision, insight, and focus we can slowly reverse the trend. I propose the following as the first steps:
- Reduce Transportation cost i.e. reverse the gas tax and price of gallon by $0.24 (see my proposal for California Gas Prices)
- Reduce Insurance costs for cars for our youth and young/middle income families through education (see my proposal on Public Schools in youth) and DMV Programs – A moderate reduction of 30% to 40% in insurance cost is a substantial savings.
- Significantly reduce child care and preschool costs for families and single mothers through new programs, tax incentives for companies, and state assistance – young families cannot spend $400 to $1200 per month on child care – it can be as much as rent or a mortgage. We need to reduce this cost by orders of magnitude!
- Offer free tutoring in our public school system for all struggling students so that young families do not have to pay for it or most likely go without it – this may save a single child family $40 per week and more if they have two children in school (See my Public School proposal on this web site)
- Reduce education costs at public schools for young and middle income families in needed supplies, lunches, and sports participation. This however means the State budget for public schools will have to increase significantly from its current levels – it is time we increase the budget in any event as it is needed! (see my proposal on public schools on this web site)
- Reduce energy costs in particular electricity – California is 14.09 cents per kilowatt hour where as our neighboring states such as Oregon is 10.69 cents, Washington is 9.43 cents, Arizona is 12.49 cents, and Nevada is 12.32 cents per kilowatt hour. In California we should sell excess electricity and reduce the costs to Californians. Even a small reduction will help the family budget.
- Reduce natural gas costs – with the exception of Arizona here again California is higher than its neighboring states at $12.58 Dollars per Thousand Cubic Feet, Oregon is at $11.15, Washington is at $10.68, and Nevada at $8.99 per Thousand Cubic Feet. Even a small reduction will help the family budget.
Graphs Posted on October 28, 2013 by BWBacon. Tagged: Cost of Living in Denver in Comparison to Other Major US Cities (* All statistics came from http://www.bankrate.com/calculators/savings/moving-cost-of-living-calculator.aspx)
Housing! – Home prices and Rental Prices in California’s three major cities, San Francisco, Los Angeles, and San Diego are 2nd, 3rd, and 4th highest in the nation behind only New York!
Restrictions on construction of low and moderate income housing has been a major problem in California as mainly high-end housing construction has outstripped low-end and moderate-income level housing construction. We need to solve this problem by providing subsidies and incentives to developers to create permanently affordable housing and implement programs in cities and counties to manage the balance between high-end and low-end to moderate-income level housing. It is certainly not an issue we can solve overnight, but we must focus on it otherwise home ownership in California will be out of reach for our young and middle income families in the future!
Reference from “How to make expensive cities affordable for everyone again” By Emily Badger February 19, 2016
Reduce State Income Tax in California for both individuals and businesses. California is the highest in the nation (take a look at the chart below). California Personal Income and business Tax Rate is higher than the majority of the other states in the nation because of the large number of programs it funds. Many programs are needed but for every dollar that an individual or a business in California saves by paying less in taxes and puts back into the local economy can result in as much as an $8 to $10 dollar return in goods and services to that local economy. We have to have vision and insight to see it and not fear in paying less.
As part of my personal goal as governor is to work with Federal regulators to ease regulations on local small and medium size community banks. Small and medium size community banks are critical in helping the formation of small businesses by providing good loans and credit to construction, goods, and service companies because small and medium size community banks understand the credit risks better than anybody else. It is the small and medium size businesses that drive the engine of the California local economies.
Individuals and business that have more to spend because of less personal and business taxes, and the banks are friendly to funding new business start ups, may just result in an economic boom in local communities.
If we do anything in the next decade is that we make California affordable for our youth, our young and middle income families, to be able to live in California without financial hardship or having to move out of State because it is too expensive to live here – and why?