It looks like avocados aren’t just slashing hands worldwide, the fruit is also hurting our wallets. Akin to the Latte Factor of the 1990s, today’s generation of consumers are suffering from the Avocado Effect.
Tim Gurner, an Australian millionaire and real estate mogul, recently lambasted millennials for their financial habits. Speaking in an interview with Australia’s “60 Minutes” on Sunday, Gurner blamed millennials’ overindulgence, great expectations and frivolous spending for holding them back.
All of the millennials’ problems can be condensed to $19 avocados and $4 lattes:
When I was trying to buy my first home, I wasn’t buying smashed avocado for $19 and four coffees at $4 each.
We’re at a point now where the expectations of younger people are very, very high. They want to eat out every day, they want travel to Europe every year.
The people that own homes today worked very, very hard for it (and) saved every dollar, did everything they could to get up the property investment ladder.
Gurner believes reality television is the culprit for influencing millennials’ pecuniary behaviors. They think, he says, everything Kim Kardashian does is normal and that “owning a Bentley is normal.”
Not everyone is pleased by Gurner’s remarks. Here are just some of the responses made on Twitter:
When we put Tim Gurner in the guillotine we could place a bowl of fresh guacamole where the basket normally is
— KillEveryBillionaire (@LuckyPierre) May 17, 2017
Yes, #TimGurner. Couldn’t be because of sky-high student loans we all have to pay or anything. No, avocado toast is why I’m broke. Silly me????
— Whitney Elizabeth (@wdwlibrarian) May 16, 2017
— Michelle Wachman (@Michywishy) May 17, 2017
Even The New York Times took exception to Gurner’s statement. The newspaper decided to fact-check Gurner and concluded that cutting avocado toast from your budget wouldn’t be enough to buy a home (yes, seriously):
The truth is, even if millennials assumed the eating-out habits of baby boomers, it would take around 113 years before they could afford a down payment on a home (assuming a 20 percent down payment on the median price for a home in the United States, $315,000 in March 2017, and a 1 percent yearly yield rate)…. The average price of a single avocado in March was $1.25, according to the Hass Avocado Board. One Twitter user, Nora Biette-Timmons, calculated that a serving of avocado toast cost her about $1.65 — or one-477,896th the average price of a home in Brooklyn.
Everyone, including the distinguished New York Times, seemed to think that Gurner was being literal.
If you read between the lines, the $19 avocados and $4 lattes are symbolic of millennials’ monetary troubles. When he cites smashed avocado and expensive coffee, Gurner is referring to the unconscious spending on little everyday items that do not provide us any significant value. If everyone added up the cost of their daily lattes and saved or invested that money instead then they would all be wealthier.
No one will argue the fact that younger people today are tackling $30,000 student loans, a costly real estate market and a changing economy. But, at the same time, there is a plethora of data to suggest that younger people are frivolous with their spending.
Earlier this year, the USA Today reported that 45% of 18 to 23-year-olds and 35% of 24 to 35-year-olds spend more on coffee than on investing.
Other studies have discovered that millennials are eating out or ordering in more than any other generation. In fact, millennials spend nearly half of their food budget on eating out as they visit restaurants or order pizza on average thirteen times per month.
A November 2016 study by qSample revealed that millennials are allocating their resources to their “hashtag goals.” The survey found that a majority of millennials are spending their money on taking vacations between five and seven times per year. Researchers note that most millennials value experiences over owning a home, paying off debt or funding their retirement.
Let’s not get into how much money and time millennials are spending on smartphones.
It is true that some of the money troubles millennials face stem from the economic collapse a decade ago. It is also correct that their parents may not have placed value on home-cooked meals or saying no.
That said, the issue isn’t whether you can eat avocado toast or not. The issue is that millennials want to shield themselves from the truth: they are responsible for their own actions. Just because a successful investor is recommending that millennials should deny themselves the pleasure of a latte, it doesn’t mean he should be sent to the guillotine. It is wise financial advice.
PragerU recently published a video called “The Quarter-Life Crisis.” The video can be summed up by this: if you don’t like your life or where it is going then it is up to you to meet the universe halfway and change it. You won’t get anywhere by blaming the 1%, your parents or President Donald Trump for your troubles.
If it means giving up avocados to help you reach your objectives then there are other alternatives: artichokes, squash and bananas.