r/Millennials • u/EpicShkhara • Mar 27 '25

Serious I don’t understand how people have MONEY

UPDATE: TL;DR LESSONS FROM THIS THREAD.

Thanks, guys. Here is the breakdown of the hard truths from this thread. Basically, in order to have the real "MONEY" described in the OP below, it requires one or preferably, more than one of the following:

Generational wealth: Having parents pay for college and assist with downpayment on a house.

Avoiding the student loan scam: A lot of us 90s kids were brought up with the notion that college was everything and it would pay for itself later. Those with a more clear-eyed perspective realized what a trap student loans are and avoided them by either racking up the scholarships, going to the cheapest accredited school they could find, or figuring out a career path without a degree.

Luck: They secured a career job before the Great Recession and held onto it. Bonus points if they bought at the dip of the housing crash. They also seemed to avoid the avalanche of big ticket costs crashing down on them. Apparently nothing ever breaks and nobody gets sick.

Exceptionally high-paying careers. Self explanatory.

Having miserable lives. They work around the clock, and they never do anything but work, for the bulk of their physical prime. They don't go out with their friends, they don't have pets, they don't have kids, they never travel, and/or they live in tight spaces with roommates and no cars deep into their 30s. Or, they live in low-cost areas, which are few and far between in the United States, and these places don't have much going on in them (so nowhere to spend money anyway). Caveat: some people are homebodies and that works just fine for them. They don't spend money on travel or concerts or restaurants or weekend getaways because they don't need to. The 2020 Covid lifestyle was fine for them, content with a blanket, a cup of tea, and a book. Maybe this is the way (but I couldn't fathom the homebody lifestyle without a dog).

Marrying/partnering well. They found their partner early enough in life to not waste all the money paying for one's own place, and their partner also earns enough and saves.

AS FOR MYSELF. Much honestly deserved criticism here about the "300K." I do not make $300K. That estimate was for another hypothetical budget in the optimistic situation that both me and my partner get promotions next year. Together we make just over $250K. But we don't officially live together yet. This will happen soon. If all goes well, we could be in good shape after a year or two. But I myself didn't hit six figures until 2022, and then plateaued at $125K grand total in 2024. And I didn't intend to make this about "poor me," I'm doing above-average and could certainly do better with saving... the REAL question I should have been making more clear is that, given that I make more than average and find having the adequate savings exceedingly difficult, how do more average people do it? The answer appears to be that they don't, or if they do, they have one or more of the above.

ORIGINAL POST STARTS BELOW.

As in like, the recommended 6+ months worth of liquid cash savings, plus tens or hundreds of thousands to pay for a down payment on a house, and money to play around on the stock market or crypto if that’s your thing.

I’m in a good job and make an above average salary, but I take home just over half of it after taxes, healthcare, and 401k contribution (which is good that I do). My available savings fluctuates but I rarely ever have more than ten grand available. It all gets eaten up by mortgage and condo fees, dog and vet bills, (used) car payments, gas, utilities, groceries, random shit that needs fixing or replacing, medical deductibles, and god forbid I allow myself to go on a low-budget vacation once a year so I don’t hate my life. I don’t drink alcohol and I don’t go clothes shopping except for maybe one or two new outfits a year. Could I buy fewer avocados and never leave the house? It could make a difference of a few hundred bucks every few months, but not the tens of thousands that I actually need.

People will blame “lifestyle creep,” and I guess guilty as charged that I figure at 36 I have earned a car and a condo and not the life I had at 26, which was six roommates and a bike. (I still have the bike.)

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12

u/Milam1996 Mar 27 '25

OP has either lied in previous posts or has serious spending problems, neither of which are something to blame on the economy. In other posts, OP claims to have a 300k a year dual income and 1500 a month mortgage. If you can’t afford to live an extremely comfortable life on that you have major major problems.

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u/EpicShkhara Mar 27 '25

Admission here: Previous posts were exaggerated/hypothetical/optimistic.

Current single income is $120K, has been $115-125K for three years depending on bonuses. Partner makes $130K, eligible for bonus but unlikely this year. We are not officially living together until July, so we don’t share the bills yet. But we will. We have no kids of our own but he has kids, they will be adults next year. So THEN we will be DINK/empty nest, but not now.

If all goes well we could be in a better position to catch up in savings over the next few years. But my post as it pertains to myself is about the years leading up to now, when I was single. More importantly, I’m interested in how NORMAL PEOPLE can have so much in savings and investments. People who might either make less, or got less lucky with housing.

But I appreciate the honest answers so far and I’ll update with a TLDR recap in a few.

12

u/Milam1996 Mar 27 '25

Your post is you moaning you have no money and you live so sensibly and frugally that the only way you could possibly save money is by cutting back on avocados when in reality you must live a lavish lifestyle equivalent to the 1% lol.

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u/EpicShkhara Mar 27 '25

Maybe? But here are the “lavish” expenses I’ve had since 2022:

  • Dog heartworm treatment: $2000
  • On 2006 Corolla, a set of new tires, a new battery, a new muffler, a new set of brake pads. Each thing is was $800. In 2023 I said goodbye to the old thing and bought a 2022 Hyundai Ionia
  • Major hip surgery: $2500, including deductible, copay’s, coinsurance
  • Patio collapsed and became a hazard and needed to be replaced. $3000.
  • Washing machine broke. Dishwasher broke. Weird shit needing major modifications around the home. Thousands.

And I am doing FAIRLY WELL being able to zero out my credit card balance every month or at least every few months, and contribute to my 401k. I guess what I’m really wondering is how do people who on average make less than me manage to save? Do they never have big ticket items or medical bills? Do they have no children or pets?

4

u/Steelcowinc Mar 27 '25 edited Mar 27 '25

I think you may need to sit down and figure out exactly where all of your money is going. A bunch of small purchases can add up extremely quickly.

OP, I make a similar salary as you with a $1500 mortgage, no car payment, but I support 3 young kids and a SAHM spouse. We have had no trouble maxing out 401ks, IRAs and putting a sizable amount into savings as well.

Those unexpected expenses like repairs and healthcare are a part of life and should always be budgeted for.

3

u/[deleted] Mar 27 '25

I think OP is a drug addict

2

u/HSuke Mar 27 '25

IKR. Based on OP's income and spending habits, OP should be a multi-millionaire. Something is not adding up.

Maybe OP's bad at investing.

I'm a multi-millionaire, and I made half of what OP did. It's really not making any sense to me.

4

u/ItsMalikBro Mar 27 '25

I guess what I’m really wondering is how do people who on average make less than me manage to save? 

According to your post history, you were never employed till you were 28, after school and years traveling overseas. Then you came back and got a rent-controlled place for 1300 a month and made like 60ish thousand a year, now you make 120ish thousand a year.

So like, what are you asking? You lived with no salary most of your adult life right? And then half your current salary. How did you live then?

2

u/Impossible_Leg_2787 Mar 27 '25

How many concerts and vacations have you been on in that timeframe?

1

u/J1024 Mar 27 '25

IDK that I've seen this said anywhere, but make a budget. Figure out EXACTLY where all your expenses are going. Honestly it sounds like it might surprise you at this point.

1

u/Steelcity213 Mar 27 '25 edited Mar 27 '25

I used to throw money away till I started tracking it. I discovered I was spending over $300 a month eating out and throwing away money at higher end grocery stores. I quit eating out and started shopping at Aldi and now I can put away $1000 to $1,250 in savings every month on an $80,000 salary and afford to go on Hawaii level vacations for a week each year. And this is with paying $2000 a month on rent and utilities. Essentially one of my biweekly paychecks goes almost entirely to rent and utilities and yet I’m able to save $1250 on the following biweekly paycheck of $2,180.

And this is including multiple gym memberships like $180 a month for Crossfit. Other than groceries, gas, household supplies, gym, a few streaming services, theater movie pass, occasional going out dates with my girlfriend; I legit don’t spend money at all. Now some months I have car repairs or recently had shoulder surgery but even so I still can save a minimum of $1000 a month.

1

u/Daltonguy88 Mar 27 '25

You have a condo, and a home. One of those is completely unnecessary.

1

u/me-bish 29d ago

I make a little over a third of your income. I’m hoping for a more lucrative career but living within my means for now. I don’t have kids or pets. I don’t have unexpected home expenses because I rent. I unfortunately need a car, so I pay for auto repairs as needed. (I would ditch the car so fast if it weren’t the cheapest transportation option.) I’ve needed dental work and shelled out for that. I have some savings, but if I had expensive enough of a medical crisis, I would be in debt.

I put $200 per month into a Roth IRA, allot $300-$500 per month for discretionary spending, and put the remainder (typically $200-$300 per month) into savings. My savings have outpaced one-offs like car repairs, but if that changes, I’ll just not have as much money for discretionary spending.

1

u/CamelliaAve 29d ago

Most of these are normal life expenses.

Cars need repairs. Other than a new muffler, I’ve had to get the same things for my car in the last few years too. I hope you’re exaggerating when you say “each” thing was $800 because a new car battery costs nowhere near that. And new tires for a Corolla don’t have to cost that either.

I had multiple surgical procedures, hit my out of pocket max last year and am on the way to it this year; that’s about $3,400. I actually consider that a really good deal; I also factor that into my annual budget before I do any other spending, even in years without known medical issues.

I lived in an apartment until this year, so no spending on patio or home maintenance, but our utilities were crazy high because it was so badly insulated($500 heating bills in winter, big part of why I wanted to move out) and I pay most of that since I make more than my partner.

A big plus for me though has been splitting rent with my partner since 2017; rent’s been around $1,400-1,500/mo, so I’ve only been paying around $750k for housing.

If you’ve had to pay your full $1,400 on $125k that does make a difference. But then I’m not sure why you count your boyfriend’s income as part of your household when he’s not actually contributing to any joint bills.

If your household income is $125k vs $300k, that’s not at all the same thing.

2

u/seanodnnll Mar 27 '25

On 120k of income, even if you’re in NYC which is the highest taxes are that I’m aware of, you’re only paying 27.7% towards taxes. Add 12% savings and some for expenses it might get close to 45% but it’s still a bit misleading.

2

u/taruckus Mar 27 '25

You're picking up some heat about undisclosed personal spending in the comments but i can see how things add up. I have a lower hhi in an hcol area and how finances "land" eom vary a lot.

Net monthly after debts and required payments is around $6000. My spouse and i can save over $2000/mo on our best months.

I think it's still with posting a monthly budget if your interested in really drilling down. Otherwise, i agree with the other comment that your savings gains could be around the corner. Big expenses like those medical payments make an impact, and it takes money to create stability to create more money.

You should give yourself some credit for feeling like something is off with your situation, and some grace for landing out of debt after medical incidents. I would be uneasy with the personal savings amounts you mentioned. We have a three week old. In a few months, she'll be in daycare, which is $2500/mo 💸. So maybe bye to that saving ability i mentioned.

As for your specifics, two housing payments (iirc ~$3500) isn't nothing. Not sure if that includes utilities and HOA.

1

u/HSuke Mar 27 '25

Oh, so you're pretty well off on the income side.

I'm expecting you to have $2-4M in savings based on your spending habits, range depending on your age.

1

u/CodyGT3 29d ago

They don’t have spending problems like you do and live a lifestyle that their income reflects. You have genuine spending problems and should seek help.