Do you ever look around your peers and think "where do you all get your money from??

[lovelydaffodils]

This is in chat not aibu so could do without a massive pile on

Feeling a bit blue and frankly a big dose of the green eyed monster as I look round my peers.

We earn well enough between me and oh but so many ppl in our peers have second homes and massive new cars frequently and big holidays and kids at private school
Where on earth does it all come from?
What do they know that i don't?!

To answer you question op about where does the money all come from, in our own experience with those of our friends who have a lot of money, none have been through a sizeable inheritance/parental handouts - although appreciate this is a route to explain a lot of peoples wealth (but not currently in our circle). The general path we’ve seen to explain their increasing wealth, and this includes ourselves too, has been a combo of two people with well paid jobs, normally London based in the financial sector - many of these jobs have been paying out big year end bonus’s year after year.

All on first marriages with no divorces or children from previous marriages to provide for. Bought first homes pre-2005/6 in the South East/London, so have made good amounts with buying and selling their way up the property ladder. And lastly, and maybe most importantly, having children later in life (35+), which has allowed for both people to work full time for as long as possible with no breaks for maternity/going part time/childcare costs whilst establishing careers etc.

I never question this because there are so many possible explanations, but I do find myself wondering the reverse. I have very senior colleagues who I know must be earning much, much more than I do and yet seem to live very modest lives. There are a few I can think of where I genuinely wonder where it goes. I assume they must have have plenty of savings, but then they like to talk about how hard it is to pay the (relatively small) mortgage and so on. These are people who in some cases are earning very good salaries and live in a part of the country that still has (relatively) affordable housing. I also wonder who the hell is buying all the very expensive houses I see in our nearest city if it’s not these people!

I suppose I’ll find out when they all retire at 42.

Sort of. But we have a high household income relatively late in life and lots of kids and several divorces between us. So a lot of diluted assets, massive mortgage for a crap house - unlike friends who married young and stayed together are are now mortgage free with older working teens and no associated kids costs.

I have a lot of assets and savings, and I know where people around me got some of their money from. In my case, my wealth comes from inheritance, business/ job income and property deals over decades (turning around fixer uppers). I don't think my friends wouldn't know how I make my money. I also save and buy bargains online and offline. I am not mean, but my frugal ways have helped me in my younger days to acquire property deposits quickly. My friends have similar philosophies on economic matters. I never owned a car until my late 30's, buy second hand clothing where possible, buy wholesale pallets/ end of line food/ drink and buy furniture off gumtree where possible. My own an 8 year old car and have no plans to change it until it falls apart. Some people who live local to me find it hilarious that I don't have a Porsche in the driveway and the latest gadgets. Personally I don't covet that flashy stuff, and reckon you cannot take all these material goods with you when you die.

I know they both earn a good salary (tech), but they seem to be made of money!

This jumped out at me as I have a non tech role in a tech related company. I think most people can’t fathom how much people earn in some of these these roles.

We employee huge numbers of “tech people”, the sort who are wearing jeans and trainers on the school run and sitting at a desk all day doing actual tech (rather than BD or Investor Relations - so “average” tech not senior leader tech) and they make the guts of half a million a year by the time salary, bonus and stock is factored in.

I reckon if you survey people they’d assume those were £80k a year jobs.

It may not always be quite what it seems.

We have neighbours who from outward appearances you’d think were very well off - big extension, very flash cars on the drive, etc. But I know from a spy in the camp, that it’s all debt/mortgage, and a huge outstanding tax bill not long ago was a near breakdown-inducing catastrophe.

Was also startled to learn not long ago that another family - nice holiday home, big extension, etc., had a frighteningly colossal amount of cc debt. Not my conjecture - it was told to a family member by one of the couple.

In genuine cases, nice fat inheritances, very high salaries, bank of well off mum and dad, etc. But unless people are open to an unusually high degree, it’s not often that we can know which is which.

I work in retail and DH is a tradesman in a 'white van', we probably have people wondering how we afford our house, cars, holidays etc. The answer is a few reasons. Tradesmen, good ones, earn a lot more money than people think. I didn't always have what people have called a 'wee job' I went to uni, had a professional job etc pre kids and I invested in property at a younger age than most. This meant we had a lot of equity and we were savers. Some people are just fortunate in ways that aren't apparent unless you know them.

Sounds awful but generally it seems to coincide with having dead relatives. That or well off parents. People don’t talk much about their finances but generally I think a lot of people have help when they seem to have all this extra cash. Not just financially but I’m other ways too. I used to pay for childcare while many of my friends seemed to have a grandparent to hand to do childcare - so they were already quids in there. My BIL and SIL don’t pay for any holidays, they always go with SIL mum and she pays.

I have a friend who is a single mum, living in a housing association property, works 12 hours a week in a minimum wage job. She has 3 holidays abroad booked for this year, she spends £250 per month on a personal trainer, hair and nails always done. I know she doesn't have any help from her parents (none contact) and minimum payment from ex.

DH and I work full time. We are having one holiday in the UK, I cut my own hair, I can't even afford gym membership.

It's fucked up.

I was staggered a few years ago when a friend revealed they constantly carried a $10,000 ( Australian dollars) credit card debt to maintain their lifestyle, despite them both working.
Fancy cars are often leased, grandparents pay school fees.
One family I know of permanently leased a second house in popular beach town and pretended they owned it to keep up with other private school families.
And some people just do earn a lot of money!

Not friends, but we are selling our house (cottage but has some land, 400k) and wonder at the viewing couples who are decades younger than us, and wonder how they can buy such a house at that age.

I don't have people to look around to who have that amount of money (I'm in my 20s, I don't think anyone in their 20s is doing what you describe unless they were born wealthy), but I do often wonder how my peers are affording holidays (any!)/cars/expensive housing decor/constant nights out/new clothes/etc.

I always felt that DH and I were a few (financial) steps ahead as we both (unfortunately) inherited young, but we're drowning with the inflation at the moment and I can't see how anyone can look at a time like this and say, "ah, yes, great time to book a holiday for the summer".

Property luck is a huge factor along with lifestyle choices. People sometimes assume my husband’s salary is much higher than it is, because I can afford to work in a lovely but low paid part time job.
It’s the property luck and then the lifestyle things that make the big difference for us. No mortgage (paid off most of it pre-children), no car, no childcare costs and cheap tastes in some areas (no make up/hair costs/beauty treatments etc).

@ENoeuf

Sort of. But we have a high household income relatively late in life and lots of kids and several divorces between us. So a lot of diluted assets, massive mortgage for a crap house - unlike friends who married young and stayed together are are now mortgage free with older working teens and no associated kids costs.

This is a good point too. The simple luck of still being together after a couple of decades gives a couple a financial advantage over people who’ve split up/divided assets and had to start again with property.

@ginghamstarfish same here I’ve sold my late parents house for 415k and it needs 50k of work doing to it
The buyers are first time buyers in a rented house that cost around 1600 a month to rent
They have a little girl about 7
I would love to know how they are affording it 😂😂

It depends who you mix with I guess!
In my peer group, and I guess it's probably not the same, we have hit our 50s from fairly aspirational working class background, small market town. What makes the difference isn't inheritance (none of us have) is
A) staying married- having a consistent double income, even allowing for part time for some years, critical difference in ability to borrow fir larger house
B) Having healthy children, enabling full time work and career choices
C) Making good career choices and picking one with good benefits
And therefore
D) Good luck, cos as you can see much of it is luck.
Hasten to add, I've had some but not all of these.
We are all likely to have our retirements differently funded. Hopefully some will inherit (unless it goes on parent care). Some will sell up and cash in. Some have good pensions, most just some pension.
But what I have learned more than anything is its people that matter. Reign in the green eyed monster cos life is a marathon, not a sprint and no one gets out alive.

My DD friends are all very MC but would never use the describe themselves as MC. They are all slightly 5/10 years younger than me. None of the them or their DH have high paying jobs. They all have decently paying jobs and all the mums work PT. Yet they all have expensive houses (where did the deposit come for that), newish cars x 2, expensive looking weddings, expensive holidays like Skiing and shop at Boden not the supermarket for kids clothes. It’s really obvious that the bank of mum and dad must have helped with Uni, house deposit, wedding, etc but no one ever mentions or admits that their parents helped.

@Paperthin282

I have a friend who is a single mum, living in a housing association property, works 12 hours a week in a minimum wage job. She has 3 holidays abroad booked for this year, she spends £250 per month on a personal trainer, hair and nails always done. I know she doesn't have any help from her parents (none contact) and minimum payment from ex.

DH and I work full time. We are having one holiday in the UK, I cut my own hair, I can't even afford gym membership.

It's fucked up.

I assume you and your husband own your house and your jobs mean that you have pension plans?

It’s easy to look at what’s happening today, but think of what your comparative future will look like. You’ll be very secure in your own home, have an income from pensions, have a valuable asset in your home should you need to raise equity, have choices around where you’ll love if you want to retire by the beach, and are likely to leave something to your children/grandchildren to help them up.

Your friend will rely on state pension which, depending on her age, may not kick in until she’s pushing 70, if she’s in HA she has a secure tenancy but she’ll never be able to raise equity from that property.

When you’re retired and (rightfully) enjoying being mortgage-free and having a pension which has risen hopefully at least in-line with inflation, she’ll still be renting and on benefits that absolutely won’t be as valuable in years to come.

So it might seem unfair now, but over the course of your life, you’ll be so much better off. Maybe she knows what’s to come so living the good life while she can, knowing she’ll struggle in future?

This again? We have one of these every few weeks. People make different choices about spending money, if you want to know how your friends do it, ask them.

Some people care a lot less about being in debt too (massive mortage, car on finance, no savings)

And some people work to live within their means and have been fortunate not to have ever relied on debt.

The only debt we have is our mortgage. One of our cars is a motability car and is bigger and newer than we could easily afford to buy, but we wouldn’t need that spec without my daughter’s disability. Pre-covid we took regular trips for long weekends and a big holiday per year. We also have a decent savings pot. We’ve had no input of finances from our parents beyond our student years. For us it is as simple as, we have decent jobs, with decent money and haven’t spent out on stuff we don’t need, and have done that for our 2m years together. Not everyone living a nice looking life is mired in debt.

*20 years together.

@Dreamstate

You would probably wonder the same about me. Earning £40k single, own house. But I am renovating my garden, bathroom and kitchen this yr plus several holidays planned. All paid for through my crypto investments which have been providing me with on average £8k a week. I even give my mum money every month to top up her pension.

Sounds very interesting. Is it too late to jump on Crypto wagon? How did you do it? I'm thinking, my options are only this or Only Fans

The 'bottomless wealth' people I know mostly made money on the London property market then moved out of London. Sadly also some through inheritance so they have no parents on the scene. Another inherited a substantial amount as only grandchild so was able to buy outright from the start.

It's not a fixed position though 10 years ago I was a SAHM so we were down to one salary, living in our first home we bought, no spare cash, mortgage company wouldn't extend our mortgage to allow us to move.

Now 2 salaries, 2 electric cars, nice detached family home 3 bathrooms etc - the real difference is dividend payments which is the equivalent of receiving my part-time annual salary an extra 3 times a year.

If it were down to just me though we would still be skint. We have consultants come in to do what I do routinely with work and they charge half my part-time monthly salary for a days work. Some people just have the balls to value / charge their work highly.

I know people who look to be living the dream but have been on interest only mortgages for years, now in their 40s and suddenly facing the fact they still have huge mortgages that will need to be paid or downsized.

I’m hiring in work at the moment and it’s incredible that for the same role, we will offer one person £35k and another more experienced person £65k. Pretty big difference for same requirements from a person. I imagine it’s the same at a higher scale too.

@Fairyliz

Yes. I live in a very ordinary Midlands town where people generally earn average salaries, no investment bankers here. I keep reading on MN about everyone living in poverty, having to choose between heating and eating etc. Then I look around at the extensions, new cars holidays etc and think how?

You’re assuming there are no high earners - or “investment bankers” as you put it - living in the area. Which is just an assumption, not fact.

Not quite the same but a couple I know have a newer car than us, house is done up beautifully, 5 kids in the best of clothes all the time, after school activities etc. etc. and at the time he worked part time and she was a SAHM.
Saw the husband out once and ended up chatting for ages and he mentioned that he'd been out at the bank to discuss their mortgage arrears, it was in the 10s of thousands...