Do you have friends with very different financial outlook?

[Silverclocks]

I was chatting to a friend/aqaintance this morning, he has applied for a new job, salary £45k. He's so excited, £45k is apparently huge to him, much more than he ever thought he'd earn (he's in his late 40s). I have what I think of as a fairly ordinary job, salary £45k. I certainly don't feel rich, but I have enough.

I don't ever tell anyone what I earn or anything else about my finances, but now I'm wondering what I do wrong, he seems live a similar lifestyle to mine! We're both single with adult children, FWIW.

@MySecretHistory 1 of my DBs told me when he got a pay rise, the other is public sector - and most public sector jobs have set pay scales, so if you know how long someone has been employed you can make an educated guess as to what they earn.
As to our friends- they mostly earn in the same ball park as us. We have a few friends who earn significantly less and I’d take that into account when making plans with them(obviously without saying anything).

My friend and I are both retired. I get a generous pension that I worked hard for. I'm very comfortable. My friend is a millionaire.

Our friendship is totally equal, neither of us (I think) envy each other. I know what she lost to gain her fortune, she knows what I did to ensure my comfort.

But, we are still, forty years later, the same single parents who didn't have a penny to scratch out arses with (sorry, a bit of my qualocialism creeping in) thirty years ago.

We were talking of this just after the last budget. Both of us saying we wouldn't have survived this recent catastrophic rise of living.

I am in my 40s and am on UC. Should I be found fit for work, all I could do is minimum wage stuff, which at £17k, would be 10k more than what I am on now... and let me tell you, I would feel rich on that.

Yes funnily enough my sister and I. We grew up very poor. Now I am married to a high earner, around £200k per annum. My sister and her partner earn roughly half of that combined.

They spend more on food than us, plus takeaways/ eating out most nights, easily around £20 each time. They have several wardrobes bursting at the seams with clothes but mostly from places such as Asda, Tescos, New Look etc. They like their holidays and have one luxury holiday per year plus several weekends/ spa breaks a year.
They both have nice cars but nothing fancy and brought at a decent price.

In contrast, we spend very little day to day but we do sometimes spend more on some items. We don’t have very many clothes but prefer to spend a little more on them (think Boden type prices), although I also get some bits from EBay. We also spend between 2-4 times as much on cars but still keep them for years. However, our food bill is roughly £40-45 per week and we rarely eat out or get takeaways. We enjoy quite a simple lifestyle and much of our money goes into savings. We do like to go away on holiday but they tend to be mostly short Uk breaks with the dog. I love a holiday abroad but we are happy to just do this every few years atm. However when we do go abroad I suspect we spend a fair bit more than my sister. But overall they spend much more on holidays than us.

So I think except for cars, we spend considerably less than them overall. But they are sensible with their money and enjoy their lifestyle, as do we, so I don’t see the problem.

I think median is always gonna be skewed coz of the super high earners. Mode would be most interesting to know. £45K is our combined household income. So £45k for one person would be amazing. We could earn more but both choose to work part time.

45k is not an ordinary salary.
Minimum wage is around £18,500.

No ,is my answer to OP's actual question, friends are pretty similar to us in being mostly frugal and having similar assets to us.

I notice younger ppl spend more than older ones (my parents are like this, too, they spend on experiences & services & durable goods, little on physical things or things that don't last for years).

DC...omg. Younger 2 are much like me & DH, careful, frugal, not that materialistic. But adult DC not like us: DC1 is in huge (car-related) debt but has done huge amount of planning (way more than me in my early 20s) how he can afford it & still be a home-owner by age 27. DC2 is just plain spendthrift, but slowly learning to budget, still does plenty of impulse purchases & considers it a frugality victory if she takes bus not Uber.

@LittleSnakes

I think median is always gonna be skewed coz of the super high earners. Mode would be most interesting to know. £45K is our combined household income. So £45k for one person would be amazing. We could earn more but both choose to work part time.

I think you're confused, they use the median precisely because it isn't skewed by the super high earners. That would be the mean.

However, our food bill is roughly £40-45 per week

A week? That’s incredibly low.

@moonlight1705

I have a very complex fundraising job and in charge of development for a charity...I earn 26k so would love a job that had 45k but it simply doesn't come up much in my line of work.

If you’re in charge of development for a charity and they’re paying you £26k you need to find a new job or your charity needs to do some benchmarking. £26k in fundraising is an officer level role with no additional responsibilities. Whilst £45k Is a low “head of” salary. My grads with a couple of years experience and no line management or budget responsibilities are on £26k

Retirement planning can make a big difference. Most of us should probably be putting much more into our pensions than we are. Someone who earns £45k who makes proper provision would probably have a disposable income of someone earning £35k. In other words you can make your income stretch further, and have jam today, but there'll be no jam tomorrow!

@Housetreecar yes because its so easy ti just find a new job
Your area you live in can also play a part and many many jobs Around here are paying just over minimum wage despite needing experience and a lot of responsibility

@Summersolargirl

However, our food bill is roughly £40-45 per week

A week? That’s incredibly low.

Yes a week. I cook from fresh and we are vegan so no meat/ fish etc which adds up to a lot for many people. Our biggest expense tends to be fruit and veg. Then I keep a store cupboard of nuts, grains, beans, lentils, herbs & spices etc which I just top up accordingly.

I shop at Tescos, Asda and occasionally grab a few bits from Waitrose. I’m sure it would be even lower if I shopped at Aldi/ Lidl

Pension and insurances can make a big difference, as can spending on food and general tat!

@worriedatthistime actually no. Charities are crying out for fundraisers and as a sector has embraced remote working, my team work from home all over the country. It really shouldn’t be hard for experienced fundraisers to find another job if they want one. In addition it is often an incredibly flexible industry,

@Housetreecar is your firm recruiting then? Maybe the person does it as they like the charity and its not all about the money
But people on here are very snobby about money and think £40000 salaries are the norm, when for most thats simply not true

Our retirement wage is £49,000,before tax, we are mortgage free, where we live it will pay the bills and maybe a bit more, but certainly doesn't feel huge.

We also have a pot of £230,000 with another £200,000 to come in inheritance, perversely this feels massive because inheritance aside we saved hard for the back up fund.

It is all relative to the individual.

I guess it is all relative.

I was literally having this conversation with friends today. House prices have gone bonkers and we have two friends who are selling locally and upgrading to houses which are over £1m - AND need work doing. I always assumed that DP and I earn a good salary (public sector full time workers with a combined salary of £100k pa, both of us have Masters degrees in our profession) but it seems that others earn substantially more - like over £250k pa combined. I will never earn that and wouldn't be able to live with that huge a mortgage. I don't think these people are any better at their jobs or work harder, they just chose industries which pay very well.

@lljkk

DC2 is just plain spendthrift, but slowly learning to budget, still does plenty of impulse purchases & considers it a frugality victory if she takes bus not Uber.

Her brother lives in this house.

I can never understand people who are just needlessly tight. I don’t mean on a low income and so need to watch every penny just to make ends meet, but constantly counting up monies.

We know a couple who have been together for several years, decent-ish incomes, have separate finances, but tot up which of them paid for what and when and argue over it: “it’s your round, I bought the stuff in Tesco on Tuesday which was £5.76, you owe me a beer”; “yes, but I spent £2.50 on the car parking last Sunday so that’s basically half what you spent in Tesco” and so on - and each will also actively chase up minuscule amounts of money (£1) they lent to a friend even if said friend has more than paid them back on several occasions in buying them drinks etc.

DO and I are both absolute spendthrifts and generous with money. Partially because we have high incomes but also because, well, it’s only money and more can always be earned and I’d far rather be a good friend, good company and have a good time than be a miser.

I agree with @Housetreecar, anyone working in a valued/niche role within a charity can earn much more than £26k, especially as many charities have embraced home working so doesn’t matter as much where you live (might be required to do one day a week in a London office, but not necessarily if a hard role to fill) and there’s massive demand for good/experienced candidates. Take a look on charityjob.co.uk @moonlight1705, you could secure a big payrise.

@ComtesseDeSpair

My mother used to say, if you are keeping count like that it is already over.

Well I'd say ur on a very good salary especially for what you do. I'm a chartered accountant and my full time salary is £40K working for government. This wld be higher at private sector but excellent holidays, pension and flexi time etc.

I think my salary is a high salary. I know many people that are on Min wage so only earning around £17K. It's miles always from that. I also have friends that have higher incomes. The difference is usually house, cars, holidays etc. So they go 5 star luxury AI and drive Tesla type cars etc. Its all relative you like within your means.

I know what my friends and family earn as they've either told me or I can tell. For example work on checkouts at Morrisons = probably not much more than min wage. Another friend is also an accountant and has more experience than me and is a mgr so I know she prob earns about £20K higher.

One lesson I always take from these threads is that those of us who swear that we are living on the breadline and cannot cut back anywhere very often forget that there are people living on significantly less than us who would regard our income as aspirational.