Global Courant 2023-04-13 07:58:42
Eric Hsu recalls a time when he was 10 days away from payday and only had $32 left. He had no savings.
“I used the remaining money I had to buy white loaves of bread and ate that for all three meals until my paycheck came in,” he told CNBC Make It.
“Sometimes I would think, I don’t make a lot of money, I would actually think I’m making an upper middle class salary. But I still feel really poor every month.”
Hsu belongs to a group of people in Taiwan, mostly young and single workers, called the “yue guang zu” – the so-called “moonlight clan”.
The term describes being broke at the end of each month, or as Hsu puts it, “Money comes in from my left hand and from my right hand.”
This behavior is very different from that of their parents, who saved literally every penny.
Chung Chi Nien
Polytechnic University of Hong Kong
The term originated in Taiwan, but is now also commonly used in mainland China and Hong Kong to describe the younger generation, said Chung Chi Nien, a chair professor at Hong Kong Polytechnic University.
A an estimated 40% of young single adults those living in Beijing, Shanghai, Guangzhou and Shenzhen are living paycheck to paycheck, according to a local report.
“This behavior is very different from their parents, who literally saved every penny they have. But the younger generation spends every penny they have,” says Chung, who specializes in economic sociology.
The rising cost of living puts more people at risk of becoming part of the “moonlight clan,” especially those on low incomes, Chung said.
While inflation in Taiwan is much lower at 2.4% compared to many parts of the world, consumer prices and food costs are are still emerging.
For 34-year-old A-Jin, fixed expenses such as insurance, utilities and transportation already take up “more than half” of her salary of New Taiwan dollars (about $985) a month, she told CNBC Make It.
“I would have NT$10,000 left over per month for food and other expenses. Eating out now costs about NT$300 per day. There is no way to save,” says A-Jin, who works in the service industry.
“If an emergency happened to me, like a car accident, I wouldn’t have the money to deal with it.”
Not just inflation
But for some others, it’s the “you only live once” mentality that encourages them to spend what they can – even if it means going into debt.
Since Hsu started working 10 years ago, the civil engineer has struggled to build up savings as he tries to pay off his student debt.
“Instead of saving the leftover money I had at the end of the month, I decided to pay off my debts,” according to CNBC’s translation of his Mandarin commentary.
I let it get out of hand and thought since I have a credit card let’s buy a car while I have it.
But when a serious knee injury left him unemployed for two weeks without pay, Hsu realized he couldn’t make a living.
“I thought since I can use a credit card to pay for things and make my life easier, why not?”
But before he knew it, he had as many as four credit cards and almost 70% of his monthly salary went towards paying off such debts – leaving little to save.
Hsu acknowledged that while half of his debt was for necessary day-to-day expenses, the other half was incurred because of his “lifestyle choices and desires.”
“I let it get out of hand and was like, ‘Since I have a credit card, let’s buy a car while I have it,'” said Hsu, 38.
‘Small, but very sure luck’
The concept of “moonlight clan” reflects the disillusionment young people feel about life today, said Chung, the professor. Are as are other terms that have become popular in China in the past two years, such as “tang ping” and “bai lan.”
“In the context of East Asia, the parents of the moonlight clan have experienced a very successful industrialization and achieved their goals in life,” he added.
“But that’s a different reality for this generation… they see their parents’ success, but simply can’t live up to it. There’s a huge gap between expectation and reality.”
The “moonlight clan” exists primarily because home ownership is no longer viable for young people in Taiwan — thanks to the lack of affordable housing, Chung said.
It could be anything from buying a cup of coffee at Starbucks to an overseas trip – things that will give you a small sense of happiness to make up for the loss of an overall purpose in life.
Chung Chi Nien
Professor, Hong Kong Polytechnic University
According to the UN habitathousing is considered affordable when the ratio of house price to income is 3.0 or lower.
For comparison, Taiwan current ratio is 9.6 and 15.7 in Taipei citysaid the Ministry of the Interior.
“The expectation of buying your own house, getting married and starting your own family is now far too far away,” Chung said.
“Young people prefer to give up on that dream and spend money on things that they are guaranteed to get today.”
These things are called “xiao que xin” – which means “little, but very sure luck” in Mandarin.
“It could be anything from buying a cup of coffee at Starbucks to an overseas trip — things that give you a little sense of happiness to make up for the loss of an overall purpose in life,” Chung told CNBC Make It .
Hsu agreed, sharing a common saying in Taiwan that describes the current state of things: “Houses are not for living, they are for investing.”
“A three bedroom house now costs NT$20 million. How long should I save on my annual salary of NT$720,000?”
“You would only want to do something serious if you have a strong goal. Without the opportunity to buy a house, it’s like, ‘There’s no point in making money if you don’t spend it,'” he added up to it.
No long-term goals
A-Jin said she has no long-term financial or life goals and has “completely given up” on buying her own home.
“As long as I have food and my stomach can be full, I’m not going to die. That’s enough for me,” she said.
“Since everything else is impossible, I just figure out how to be nicer to myself, that’s all.”
For Hsu, he considers the toughest days to be over. After his experience, he canceled his credit cards two years ago and promised to save a third of his salary every month.
Not knowing if you have enough money for food until the next payday was a very scary condition to be in – but that was my own doing and the punishment fits the crime.
However, he still considers himself part of the “moonlight clan” as he remains unsure if he would survive another emergency.
“I still don’t have any long-term financial goals… My priority is to pay off the rest of my credit card debt. I’m only driven by the fear of going hungry again,” he said.
“To not know if you have enough money for food until the next payday was a very scary condition to be in – but that was my own fault and the punishment fits the crime.”
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