I must say, this summer has been an interesting learning experience for me. As it turns out, my mother has been going into overdrive, talking to my relatives from both in the US AND abroad to consider moving and eventually retiring in our home town here.
Together with a real estate friend of hers, my mom has been going all over the place, buying several houses on behalf of my relatives who are planning to move here. Sometimes, my mom would ask me to tag along because her English isn't very good, so that's how I am finding out about all this.
What really blows my mind is the amount of money that they all seem to have and are throwing around. Typical prices for a single dwelling house in my area is around $150k to $250k, and they're all paying... are you ready for this? They are all paying in cash! Up front!
Insane!
I'm like, "Mom. How in the world are they all able to do this?" Mom is like, "Well, that's just the way Chinese people are. They scrimp and scrounge for 30 years, they help each other with lodging and businesses if necessary, and they always pay everything with cash."
Insane!
It's true though. For example, I'll never forget how, growing up, my mom would have us walk around in the house with our winter coats on, but the thermostat is still set pretty low while it's snowing outside. We also lived with my uncle's family while we were helping him out with his restaurant. I didn't realize until later on that this is pretty unusual.
Another thing that leans very favorably for them is that, in my native country, real estate is extraordinarily high. It costs even more than High Cost of Living Areas (HCOLAs) in the states, and anyone living in an HCOLA will tell you even $250k won't get you much.
So, when they found out how much "house" they can buy in our area, it was like, "Oh OK, great! Yeah, let's move and retire there!"
To be honest though, I am also a little worried about how they are going about this. You see, in my native country, real estate is insanely high, but everything else is insanely cheap. Food, clothing, you name it. And they live cheap anyways.
So, their mindset is that if you can get past a house, you are pretty much home free. I don't know if that's entirely true living here in the US.... For example, my native country still has a very high percentage that rides bicycles and motorscooters. And being so densely-packed, you're never that far from a flea market. So, it's very normal to see even the elderly go out and walk to the market, and 20 minutes later, come back with grocery in hand. In the US where I am, you can't do that.
Plus, I am a great believer in diversifying your money. What they're basically doing is putting most of their life savings straight into the house. Some also don't have retirement savings besides whatever they have socked away in the bank. Again, it's that old school mentality... yeah.
But I tell you what though. So long as they band together, I'm pretty sure they'll work it out. After all, having a fully-paid house isn't exactly the worst kind of financial problem to have....
Anyway, the point of this story is that, sometimes it's easy to feel down and feel like we're not getting anywhere with all the scrimping and saving, and we may even wonder if we ever will. I know I do. But when I look at the checks they cut, and when I step into the houses they've bought-- in cash!-- and realizing that many of them are just simple people with modest living, it really sinks in just how powerful frugality can be!
Insane! 
The power of frugality
September 10th, 2009 at 02:28 pm
September 10th, 2009 at 02:35 pm 1252589709
September 10th, 2009 at 02:37 pm 1252589858
September 10th, 2009 at 03:50 pm 1252594248
September 10th, 2009 at 04:17 pm 1252595844
I would have never guessed.
September 10th, 2009 at 04:31 pm 1252596695
Nika, are you saying I am an alcoholic?
September 10th, 2009 at 06:18 pm 1252603101
It sounds like your family is very wise, though. And what a wonderful feeling it must be to be able to make these purchases.
You make me feel very encouraged. I'm having to refinance my home because of a divorce, and I'm literally right back where I started. But this time I'm getting a 20 year loan and making additional payments. My mortgage banker tells me if I make one extra payment a year I can pay the house in 11 years. She also is prepaying all the PMI insurance up front, which is another savings on interest.
Congratulations and rich blessings to your family.
September 10th, 2009 at 09:06 pm 1252613165
One of my neighbors moved out. The couple is Chinese and I heard they bought a bigger and better house, and renting the old house. I'm sure the new house they bought was a killer deal they couldn't resist. In general, Chinese people seem to be very smart about money.
September 10th, 2009 at 09:23 pm 1252614184
Thank you for saying so, Maismom.
I know that the Chinese are culturally-ingrained to save money, and are fairly frugal by nature. But that comes as a result of having been economically improverished for so long. So, the culture is one born out of necessity. In only very recently have they started to experience western styled prosperity, and as a consequence, consumerism. It will be interesting to see how this latest generation of Chinese handle consumerism (but also their form of government).
I should also add that I'm technically Taiwanese, not mainland Chinese. It does make a difference, especially when we talk about real estate prices being at a premium.
Finally, and in all fairness, while the Chinese do have good saving habits, they tend to not have good investing habits. Again, I believe that comes from having been economically poor, and therefore not having much to invest in the first place. A lot of Chinese have recently dabbled in the Chinese stock market, but also lost a lot of money in that process.
Being a fully-Americanized Chinese, it is my goal to take what I feel is the "best of both worlds", to not just embrace frugality, but to augment it with the American can-do attitude of investing and even entrepreneurship down the road.
We'll see how that works out. For the most part though, my parents are happy to see me finally "see the light" and manage my finances responsibly.
September 11th, 2009 at 01:06 am 1252627560
September 11th, 2009 at 06:04 am 1252645444
The Chinese and US midwesterners have a lot in common!
September 11th, 2009 at 01:05 pm 1252670745
September 12th, 2009 at 04:04 am 1252724654
I wasn't questioning the legality, just curious how they were able to manage it. Sounds like there are plenty of family members here already who can be sponsors.
The only way my in-laws could come live in the US would be if my husband became a US citizen and sponsored them.
September 12th, 2009 at 06:32 pm 1252776742
I never knew you were Chinese. Funny how I project images of people I only know online or by phone. I guess usually I imagine them just like me, male or female.
And I'm glad your parents are pleased with you now!