Young people in Greater China live from paycheck to paycheck

Eric Hsu remembers a time when he was 10 days away from payday with only $32 left. He had no savings.

“I used the remaining money I had to buy loaves of white bread and ate it for the three meals until my paycheck came,” he told CNBC Make It.

“I think sometimes, I don’t make a little, I actually think I make a higher average salary. But I still feel really poor every month.”

Hsu belongs to a group of people in Taiwan, usually young men and single workers, called “yue guang zu” – the so-called “moonlight clan”.

The term describes the fraction at the end of each month, or as Hsu puts it, “money comes in from my left hand and goes out from the right.”

The term originated from Taiwan but is now also frequently used in mainland China and Hong Kong to describe the younger generation, said Chung Chi Nin, chair professor from Hong Kong Polytechnic University.

that Estimated 40% of young people are single Those living in Beijing, Shanghai, Guangzhou and Shenzhen live paycheck to paycheck, according to a local report.

“This behavior is very different from that of their parents, who literally saved every cent they had. But the younger generation spends every cent they have,” said Chung, an economic sociologist.

Zhong said the rising cost of living has put more individuals at risk of remaining in the “Moonlight Clan,” especially those with lower incomes.

While Taiwan’s inflation rate of 2.4% is much lower compared to many parts of the world, consumer prices and food costs Still on the rise.

For 34-year-old A-Jin, fixed expenses such as insurance, utilities, and transportation already take up “more than half” of her NT$30,000 (about US$985) per month salary, she told CNBC Make It.

“I’ll get NT$10,000 a month for food and other expenses. Eating out now costs about NT$300 a day. There’s no way to save,” said A-Jin, who works in the service industry.

“If an emergency happened to me, like a car accident – I wouldn’t have any money to deal with it.”

But for others, it’s the “you only live once” mentality that encourages them to spend what they can — even if it means taking on debt.

Since Hsu started working 10 years ago, the civil engineer has struggled to accumulate any savings as he has been trying to pay off student debt.

According to CNBC’s translation of the Mandarin comments, “Instead of saving the remaining money at the end of the month, I decided to pay off my debt instead.”

But when a serious knee injury put him out of work for two weeks without pay, Hsu realized he was unable to support himself.

“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 up to four credit cards and nearly 70% of his salary each month was paying off such debts – with little left to save.

Hsu acknowledged that while half of his debt was for necessary daily expenses, the other half was due to his “lifestyle choices and desires”.

“I let it spiral out of control and said, since I have a credit card, let’s buy a car and I have it,” said Hsu, 38.

“With online shopping you’re also exposed to a large number of things that you can buy and the fact that you can make purchases so easily hasn’t helped that.”

Chung, the professor, said the concept of “moonlight clan” reflects the disillusionment young people feel about life these days. It is very similar to other terms that have gained popularity in China in the past two years, such as “Tang Bing” and “Bai Lan”.

“In the context of East Asia, the parents of the Moonlight Clan witnessed a very successful industrialization and achieved their goals in their lives,” he added.

“But that’s a different reality for this generation… They see their parents succeed, but they simply can’t make it happen. There is a huge gap between expectation and reality.”

Chung said the “Moonlight Clan” exists mainly because homeownership is no longer possible for young people in Taiwan — thanks to the lack of affordable housing.

According to the non-habitathousing is considered affordable when the home price-to-income ratio is 3.0 or less.

In contrast, Taiwan The current ratio is 9.6 and 15.7 in Taipei Cityaccording to the Ministry of the Interior.

“The expectation of buying your own home, getting married and building your family is now out of reach,” Chung said.

“Young people would rather give up this dream and spend money on the things they are guaranteed to get today.”

These things are called “xiao que xin” – which means “small but very sure happiness” in Mandarin.

“It could be anything from buying a cup of coffee at Starbucks, to going on an overseas trip — things that will give you a small sense of happiness to make up for missing out on an overarching goal in life,” Chung told CNBC Make It.

Hsu agreed, sharing a popular saying in Taiwan that describes the current situation: “Houses are not for living, but for investment.”

“A three-bedroom apartment now costs NT$20 million. How long should I save on my annual salary of NT$720,000?”

He added, “You’re only going to be serious about doing something if you have a strong goal. Without the possibility of buying a house, it’s like, ‘There’s no point in making money if you don’t spend it.'”

A-Jin said she has no long-term financial or life goals and has “completely given up” on buying her home.

She said, “As long as I have food to eat and my stomach is full, I will not die. This is enough for me.”

“Since everything else is impossible, I just think how can I be kinder to myself, that’s all.”

For Hsu, he considers that the hardest days are behind him. After his experience, he canceled his credit card two years ago and committed to saving a third of his salary every month.

However, he still considers himself part of the Moonlight Clan as he is still uncertain about whether he will survive another emergency.

“I still don’t have long-term financial goals,” he said. “My priority is to clear the rest of my credit card debt. I’m just afraid of going hungry again.”

“Not knowing if you had enough money for food until the next payday was a very dreadful condition – but it was my doing and the punishment fit the crime.”

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