To think living within your means has become the exception?

[SmokeyApo]

Hi all, I just wanted to share some observations and hear other people's inputs.

It seems to me that is becoming more and more rare for people to live within their means and try to save a little money for a rainy day. In my circles I know many people on good and even great salaries, that lead seemingly extremely expensive lifestyles and don't save a penny, or even go into debt to afford extravagant holidays or cars.

A good friend of mine is a senior executive in tech, makes an absolute fortune and had to ask around his friends (me included) to borrow money when he bought a house last year, because he couldn't cover the down payment. Another friend of mine got divorced last year, both spouses on really excellent wages, and it turned out that they had almost no assets to share after being married for 15 years because they had spent everything they got.

I am starting to wonder if I live in a bubble of financial irresponsibility or if this phenomenon is widespread. AIBU to think that saving and being mindful with money has become the exception rather than the rule?

If people want to spend their money it’s up to them, the fun bit comes when they can’t keep up the repayments

Those nice people who lent them the money, want it back with interest and pass that debt over to not so nice people who chase them for the money.

That is when it gets interesting when the debt can’t be paid back quick enough 🙄

A good friend of mine is a senior executive in tech, makes an absolute fortune and had to ask around his friends (me included) to borrow money when he bought a house last year, because he couldn't cover the down payment.

How did he get the mortgage with no deposit?

My parents managed their money very carefully. We did not have a car. They saved money every month. They taught me how to budget and save. I borrowed for mortgages and took a loan to afford holiday home, but for everything else I save to get what I want and if I don't want anything I still save. I have brought my children up to do the same. Even though I can afford not to.i still sometimes buy second hand.

There’s enjoying living though (aka having fun experiences with the kids & holidays that don’t cost the earth) and then there’s drowning in debt, despite your salaries (whatever they are) because you’ve not lived within your reasonable means. I have a colleague at work who earns easily £65,000 - a salary I could only dream of - & yet he & his DW nearly split up recently due to the fact that they blow their money on ridiculously expensive school fees for their 2 DS which they simply cannot afford.

It’s ruined their marriage, & they’ve now taken the reluctant decision to pull the kids out of the school next year as they just can’t afford it.

I appreciate everyone makes their own choices in life but some of those choices do at times seem crazy. Surely he’d have been better off banking a percentage of his money for something/anything, living cautiously within his fortunate means & having more modest expectations? I’m using this as an example of course but I do think ppl make some mad choices, they can’t hold onto money & it just flies out of their hand. He (the colleague) admitted he only started valuing his salary properly once things went wrong & they had to cut their cloth accordingly. Makes you wonder

We have a small
Amount of savings to literally
Cover things like car repairs.
Otherwise, we just live. We don't really get into any debt - other than mobile phone contract but I don't prioritise saving. I don't work my arse off for it to sit in a bank, I want to enjoy it

I don't know if it's because today's youth are wasteful etc I doubt it

In the late 70's my parents chose to buy a very expensive detached house, both had professional incomes...

but yet felt 'poor' every single day because the mortgage payments were so high and because they we're giving a huge chunk of their income to a premium insurance product which they'd receive at a certain age later on in life. They were also spending every penny on home improvements eg French doors between rooms that didn't need French doors/new kitchen when the old one was perfectly fine/new Minton dinner service when the regular family heirloom Royal Albert Old Roses was absolutely fine...

Consequently on a day to day basis, we had no hot water, no toiletries, (but a lovely looking house), not heating (but a lovely looking house), hand me downs from cousins, no weekly treats, (but a lovely looking house), weekly dinners of slop potatoes and mince. And a violent depressed mother

The household was cold, we were constantly hungry, parents were miserable, parents constantly low in mood etc.

Nothing felt good, my parents behaviour affected the entire household.

So my point is, it really is not worth getting a huge house on a huge mortgage just to say you live in that particular house.

Basically I think I'm trying to say that the behaviour you're describing OP, isn't a recent thing at all

I’m a bit meh about the zero debt thing as long as it’s done wisely. We furnished our home using the 0% finance. We have beautiful furniture that I am hoping will last us forever or very close to it. It’s now paid off but saving for it would have taken us a very very long time (all was spread over 4 years). So in the meantime I would have had to for example either have no wardrobes or buy cheap ones and then replace them. In my mind, the latter was more wasteful than credit options. We have a car on finance too.. again, I don’t really see it as a big deal.
However, I am not a fan of big unnecessary spending. I probably wouldn’t go on holiday that I can’t afford or buy the newest phone/laptop/whatever flashy things there are. I don’t necessarily judge people who do though, it’s a matter of priorities, isn’t it?

Oh it has, you only have to look around at the cars on the road, and see the people who drive them. The huge trollies of shopping in the SM's to see it too, lots of other things as well.

There's usually tears at some point when you spend money you do not have, or someone else's.

Mr Micawber had it right.

There’s enjoying living though (aka having fun experiences with the kids & holidays that don’t cost the earth) and then there’s drowning in debt, despite your salaries (whatever they are) because you’ve not lived within your reasonable means.

Exactly. It's an odd line of thinking from some posters that "living within your means" entails some Dickensian horror show.
And the idea that we're all hoarding money for shits and giggles. Not for our pension, not for a house deposit, not for a holiday, or a car, not because we simply don't have a lot of money...

@Saz12

THe 1980’s were a different world. 40 years ago. It’d be like comparing the 1940’s to the 1980’s.

Credit it cheap. Houses are not. Suddenly a £2k sofa bought interest free over 4 years looks like a drop in the ocean against an enormous mortgage.

I don’t generally want “stuff” and so am a saver almost by default.

I would expect a £2k sofa to do the cleaning. £2k!

I think you are right. It irritates me so much when I see cars, kitchens etc advertised at ££s per month rather than the total price.

A 2k sofa though will last 40+ years and will provide hours of comfort etc on cold nights

Meaning, I'd save for the 2k sofa rather than put up with the shit ugly fake leather sofa that gives me a sore back and eyesore every time I look at it

I've lived in houses with beanbags until I could afford a decent sofa

Next used to do a really fab furniture clearance store in some cities where we got most of our furniture after our wedding

I guess people now realise how short life is, dont believe in the afterlife and want to live it up while they can. A friend in healthcare says she gets no pleasure from seeing money build up in the bank as most of her patients are at death's door. She has a point.

Dh is the opposite, has a v good income and absolutely loves saving, constantly planning how much to put into pensions, investments, holiday savings etc. He’s saved up for both dc school fees to 18 and bought investment properties to hand over to them when older. We do have nice holidays but our house could do with quite a lot of work, we drive nice but not new cars. I doubt anyone would really be able to tell our finances, we’re not outwardly flash. I do sometimes think he saves at the expense of us having fun with some of the cash, but it would be totally frivolous spending on utter non essentials.

What’s so wrong about a £2k sofa though? Mine was somewhere in that range. It’s beautiful, super comfy and can be unfolded and be an extra bed in an emergency.
MN is such a strange world were everyone is a high earner, £150k salary is not much really but a £2k sofa is outrageous

As with all these things there is a balance to be struck. We work in healthcare and see people coming in to be told they have incurable illnesses on a daily basis so I do think life is for living now. However, perhaps that is best achieved by saving rather than credit.

Horrible stereotype OP. My family (myself, husband, daughter) haven't had a holiday for five years, don't go out (even pre covid) and a takeaway is the only luxury once a month.

A lot of people like ourselves rent and save what we can but still struggle to save for a house even though I work part time and DH has an above average salary.

The issue is wage freezes while everyday necessities increase in price. It really is next to impossible to rent and have savings.

@MerryGoRoundBrain

What’s so wrong about a £2k sofa though? Mine was somewhere in that range. It’s beautiful, super comfy and can be unfolded and be an extra bed in an emergency. MN is such a strange world were everyone is a high earner, £150k salary is not much really but a £2k sofa is outrageous

It's fine if you want it and can afford it

But it is very expensive and it's a funny world when people think it's not expensive.

Nope both work and have good jobs and we save a good proportion each month. We have paid for our cars outright and over pay the mortgage each month.

I do think others seem to eat out quite a lot and buy more luxury items. We occasionally splurge but not often as we are nervous about money.

Oh and a £150k salary is immense on my planet.

we live to what we earn, which is ££££££££, not much savings either. Have lots of equity in the house though.

High debt has happened before, in the 1980s and 90s everything became "designer" and expensive, stores issued cards and lent money to their customers at a non-trivial interest rate. Some people ran up huge credit debts because of this.

I live within my means and always have done. A friend was building a new house with a huge mortgage even though her husband was only guaranteed 6 months more work but it didn't seem to bother her at all.

i've reached the stage now when I can afford to buy what I like as I don't want to end up like my mother with 80K in the bank when she died

The issue is wage freezes while everyday necessities increase in price. It really is next to impossible to rent and have savings

It can’t be next to impossible or no one would ever buy as the majority need somewhere to live first before buying. It depends on other choices made, many commit to the expense of children, part time work or one parent not working etc and those choices then have an impact on house buying. Easier to get on the property ladder pre children when it’s easy to do overtime, take a second job etc for those that want to own.