Credit Risk Indicators (Vanity Metrics)
The original poster may work in the lending industry. They discovered a fairly common pattern: when spending on non-essentials exceeds 40% of spending on essentials, the person’s debt is very likely uncollectible. (For example, if car expenses exceed 40% of housing costs.)
Moreover, this indicator has no correlation with age—it holds across all age groups. In other words, a person’s baseline doesn’t change. Contrary to the common belief that young people are vain and flighty but become steady and grounded as they age, the data suggests otherwise. If someone is vain and flightful in their youth, they are extremely likely to remain so in middle age and old age. Likewise, if someone is grounded and practical in their youth, they are extremely likely to stay that way for life.
In short, data suggests that “once a prodigal, always a prodigal” is essentially true. (Comments on the post also seem to confirm this applies broadly.)
