Maybe they have family money & you & your spouse don't? Or you/your spouse have student loans & they don't? Or you or your spouse (or a family member you & your spouse are supporting) has a medical condition that results in large out of pocket expenses? Or you/your spouse are saving $ from every paycheck for your kids' college (& plan on paying for your kids to go to wherever they choose/get in -- public or & private, in state or out of state) & your own retirement years while they either don't expect their kids to go to college, plan on telling their kids they have to go to an in state public university, or are banking on their kids getting very generous scholarships (& expect them to take out loans/find a way to pay for it themselves if they don't) & have little or nothing saved for retirement? Or maybe they are just one mixed paycheck or serious medical condition or accident away from living on the streets while you have a hearty "rainy day" fund?

Anonymous wrote:Don't forget some people also may have started with no debt, inherited money, or sold their first house for a big profit - all of that matters when comparing lifestyles, even when income is the same.

Yup. I'm 40. I bought my first house in 2000, at age 22. I made $225k off that, then bought another, made another 150k, and another made only 50k and now live in a very nice home well above what most people in our income level might afford. Having a $2,300/mo mortgage in a. Neighborhood with homes worth 7 figures allows for a lot of flexibility. I was done having kids at age 28, which has left me in my prime earning years with nearly no childcare costs with my prime earning years in full swing. Many of my colleagues and friends the same age have small children and are facing down the need to move due to schools and are squeezed by housing and daycare, neither of which are financial concerns of mine.

Don't forget some people also may have started with no debt, inherited money, or sold their first house for a big profit - all of that matters when comparing lifestyles, even when income is the same.

Imagine how much extra money you would have if you didn't save for retirement or your children's college. A lot of people don't save anything, ever.

Anonymous wrote:My father was a pretty renowned and successful doctor in the city where we grew up but we never lived in the wealthiest neighborhoods nor did he own any luxury cars because he basically put all his money into savings and me and my brother's education. Turning the clock several years forward, he was able to fully fund my and my brothers grad school education (law and medicine) and put down a healthy portion of the down payment for our houses for which we are eternally grateful. So the moral of the story, different priorities different lives. I'm sure he could have splurged more during his money earning years but I'm more than certain he wouldn't have had such a safety net during retirement.

taking this story a step further, you have no college debt and didn't have to put a down payment on a house. therefore you have much more saved than others, thus more disposable cash than equivalent earners who have larger monthly debt payments.

You have no idea. I work at a company with very generous RSUs and an ESPP. My ESPP alone has had 80% growth in the last 9 months. We dont cash that out, but it definitely is building wealth.

The point is you have no idea where money is coming from. My DH also got a modest 300k inheritance which we put down on a very nice home 10 years ago

1.They may make a lot more than you think
2. They have little savings.
3. Inheritance or a trust.

Don't lose sleep over this. If you have a nice cushion, you shouldn't lose any sleep.

Same income with a SAHM and no special needs private school/therapy/meds means they are living great compared to me.

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Anonymous wrote:I am guessing a lot of it has to do with COL. A six figure salary will let you live very well in most of the country. The exception being here and a couple other major metro areas

I would suggest moving to a smaller city. We moved to Richmond and are living way better than we did in DC and on a lower HHI too

Question - is that all because the housing is cheaper?

Yup housing (biggest expense for almost anyone)

But then you have childcare (1/2 of DC), and then everything else from groceries/restaurants to art and sporting events at a much lower cost than DC and other top-line metros.

I feel like for most folks if your income isn't at least 300k you should move from a major city take a slight pay cut and have your money go a lot further

My father was a pretty renowned and successful doctor in the city where we grew up but we never lived in the wealthiest neighborhoods nor did he own any luxury cars because he basically put all his money into savings and me and my brother's education. Turning the clock several years forward, he was able to fully fund my and my brothers grad school education (law and medicine) and put down a healthy portion of the down payment for our houses for which we are eternally grateful. So the moral of the story, different priorities different lives. I'm sure he could have splurged more during his money earning years but I'm more than certain he wouldn't have had such a safety net during retirement.

Anonymous wrote:Sounds like you’re investing. They likely aren’t. If they’re responsible, they’re maxing out 401ks but then feeling like ok — I’ve saved/invested, time for a vacation and a Mercedes. Think of how much you’ve invested in the last year (or 2 or 3) — couldn’t that amount have bought you a luxury car? I’m guessing it could have.

This. You may also have different financial goals than they do. You see it on here where some people plan to pay for private and graduate school for their children and others plan to pay for undergrad only. Including paying for grad school as part of your financial goals will require you to contribute significantly more of your income to 529s.

My husband is military, and we actually do know what other people in the same job/rank earn. I sometimes wonder where their money goes. I had a couple tell me they were only recently able to get their savings back up over $6000. She makes $170K and he makes another $35K (military retirement). They have two kids in private school (12K for both -- Catholic school), and rent a house for $1500/mo. As far as I know, they don't do cocaine.

I have to assume they are supporting other family we don't know about, or digging themselves out of some kind of real estate or credit card debt or something (no student loans). Because now she's planning to moonlight 2 days a month at a local hospital to pay for the kids' school (she's a doctor)!

So, all I can say, OP, is that you never know what people's whole financial picture looks like.

Anonymous wrote:I am guessing a lot of it has to do with COL. A six figure salary will let you live very well in most of the country. The exception being here and a couple other major metro areas

I would suggest moving to a smaller city. We moved to Richmond and are living way better than we did in DC and on a lower HHI too

OP's post suggests some people may be in Texas or wherever (in which case it's obviously COL) but some are in close-in DC. OP -- the ones without family money are just making different choices re saving vs. investing vs. spending.

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Anonymous wrote:
It's you not investing in the stock market.

Op - I invest a lot between a maxed out 401k (IRS max not co match) plus another brokerage acct but I never feel comfortable pulling $ out of brokerage to buy things.

It's called dividends, my dear. You don't touch the capital.
It's amazing to me how many supposedly intelligent and capable people earning decent salaries are out there, not knowing how to leverage their money.

I'm not OP but I reinvest my dividends, I don't use them to buy consumer goods. I'm trying to build wealth, not spend it.

Then you're not investing in the right things, or have just started investing. After a while, it makes sense to spend the dividends, unless you really don't want to... but then you shouldn't create a thread like this!

Again, I'm not OP, so I didn't create a thread like this. I'm just saying, in my portfolio, I like to reinvest dividends, not spend them. Can you explain why that means I'm not investing in the right things or I've just started investing? I've got about $600k invested including retirement accounts and taxable brokerage. I like to just keep the dividends reinvested to keep that nest egg growing!

Anonymous wrote:I am guessing a lot of it has to do with COL. A six figure salary will let you live very well in most of the country. The exception being here and a couple other major metro areas

I would suggest moving to a smaller city. We moved to Richmond and are living way better than we did in DC and on a lower HHI too

Question - is that all because the housing is cheaper?