AIBU to think most people have no idea how wealthy people live their lives?

[AnneValentine]

Just that really off the back of a lot of threads but most recently one where multiple people were adamant that the only way it’s possible to have no savings if you have salaries of £200k plus unless one of the couple is squirrelling savings.

Followed up with how do they pay for a broken down car with savings? Hasn’t even dawned on them that people on those salaries don’t have cars that are breaking down.

Is it so hard to believe that money literally eliminates money worries? That you can create a level of security that means savings and such aren’t needed?

I must have missed that 🤦🏼‍♀️ So the OP thinks she’s wealthy 🤷‍♀️
This is embarrassing 😂

That's my entire point.

In both cases it's just money sat in an account somewhere. It can be used if needed or not. It's a buffer.

The only difference is in how it's thought about. The poor person has made an effort, the rich person has barely thought about it.

Same money, different opinions on it based on personal circumstances.

You paid for it out of the money you have sitting in your current account. You don't consider that as savings. You just always have thousands in there, and every month another £13k goes in. So if you need to pay £20k for Disney it's there for you to spend.

Some people (me!) would move those surplus thousands every month into an account marked 'savings' - Premium Bonds, an ISA, a high interest savings account for example - and they'd pay the £20k for Disney from those accounts aka their savings. But because yours comes out of your current account, you are different to those people?

OP I think it is you who don't understand. Most people have to have savings to fix the boiler as they have zero spare cash in their current account every month after paying bills and food. You on the other hand have plenty of spare cash in your current account each month so don't need to save up for these things.

Anyone who is super rich and smart also has money in savings at the moment, because they know the importance of putting eggs in as many baskets as possible, you often run out of places to put things as you're hitting limits or massively increasing risk, and you can get 5-6+% interest on your money at the moment with zero risk and often pretty easy access.

Even with a lot of money coming in, the guarantee that will continue across a whole lifetime with no dips or gaps isn't super likely, and it only takes increases in a couple of high cost places (high end private school fees, for example) to result in a lifestyle dip.

I think you mentioned somewhere you have £13k month coming in, we have much more than that and I still worry about money and have savings even though my outgoings aren't even half. Maybe it's a generational thing. I'm a millennial and have a deep distrust of everyone and everything finance related from the 2008 crash.

No we wouldn’t. We could actually both stop working if we wanted to. Some very minor changes would need to be made in that we would have to live off funds that are currently being used for investments etc but we could stop working. We don’t want to though and I’m not sure why we would. What would the benefit be? So no - not in a precarious position at all.

if you have £13k a month ‘hitting your account’ and none of it goes into savings what the bloody hell are you spending it all on?

I know. Which is the point.

Decent investments with returns are a form of savings though. So your post makes little sense.

"money you have left over" = savings

It doesn't feel the same as if you actively decide not to do things that you want to do in order to have left over money. But it is.

And as you yourself say, it's partly about what you want in life.

We also save fairly effortlessly (except when our Victorian house needs repairs) because we don't want some things that others at our income level might.

Of course having high incomes makes life easier and nicer - I think everyone already knows that and doesn't need you to tell them

OP, out of interest, who is earning in your household? Is it your husband?

It can’t be you surely. No one earning a decent amount can be so clueless to think that earning a decent salary alone makes you wealthy. Or so immature as to insist that people on the internet call them wealthy.

Income isn't wealth, property and assets are. A salary can disappear out of nowhere, but assets, well-maintained, do not. I have a car that is unlikely to break down. Previous was a near classic that had issues but was a dream to drive. So I don't worry about repairing a car or not having one when I need it. Wealth also expresses itself in 'retain and repair', where what the previous generation or previous years have accumulated continues to be used, worn etc.

I am not wealthy but know several couples / families that are . They all have these things in common :-
1.They never mention money but definitely have an income of over 250k per year.

1. They have diversified assets with varying degrees of liquidity, including instant access " savings " .
2. They know that no investment is foolproof.
3. They do not boast ( BS) on MN , and if they did they could make their post more understandable.

Hope you get well soon OP , it must be really boring in that NHS hospital bed .

Most wealthy people have no idea how ordinary people live their lives. No idea.

This thread is so bizarre. Well done OP, for being relatively high earners (though nothing special in many financial /tech fields). How fabulous. Don't have some spare cash in a savings account if you don't want to, but accept that many people, including rich ones, prefer to live with a lower level of exposure to unforseen circumstances that you think "won't happen to you ", and that they think your actions are foolish

You did save for it - you paid the flights one month and then the holiday itself the next. That's "saving."

Your income isn't nearly high enough to cope with the intermittent outgoings of a truly "wealthy" family alongside the regular expenditure that always accompanies earning £250k+ a year.

A "wealthy" family I know just treated themselves to a brand new £80k VW camper. Do you think they bought it on finance? Of course not! They just liquified some easy access "savings" and bought it. You can't do that because you are not 'wealthy" and you have chosen not to leave yourself with enough liquidity in your future investments to do so. "Wealthy" people do both.

Why would you do that? Why move it into one account and then pay rather than just pay? Because you can’t afford it.

so again, all these people relentlessly people who are financially secure or whatever you want to call it have to have savings, for what? What is it we are saving for? So far I’ve had it suggested:

broken car. This wouldn’t cost us anything.
boiler. As above.
holidays - we just pay for these.
redundancy - that isn’t something we could “save” for and if it happened - very unlikely - we have assets / investments that would mean we are fine.
life threatening aggressive cancer - I would use the nhs even if we had savings for a condition like that.

No one has actually yet given me an example
of anything that we actually need an emergency pot of funds for.

But a decent salary with money left over is not wealth, it is just income which is not based on assets.

Investments are savings to a lot of people.

But unless you have access to a credit card with a large limit easily, not having an emergency fund is not sensible. If the boiler blows (even if regularly maintained, it happens), someone crashes into your car, emergency illness etc - you will need access to cash at some point. Just to deal with the immediate problems facing you.

And in the current economic and geopolitical climate, something could happen very easily where cash and items to barter may be very important for a period.

We have a good household income but I focus on saving emergency funds first before investments. And both DH and I having our own emergency funds as we are often in different places due to the nature of our work. So we may each need to organise ourselves independently of the other temporarily.

Yes, we can and do keep on top of maintenance, buy quality brands, do all that kind of thing. But emergencies still happen and even quality brands can fail.

That really isn’t saving. That’s just buying stuff. 😂

If we wanted to buy a camper we could pull some investments, not quickly. But we could. We absolutely would not do that though. The investments and income are not for spending on frivolous things like that.

OP, it doesn't matter

So your whole point is that wealthy people don't have to worry about money. And you think this is a brand new, revelatory concept?

Some people organise their money differently to you - they might not be worried, but prefer to have the school fee cash sitting separately from the general-use cash, or the holiday fund earmarked elsewhere for tidiness or a better interest rate or whatever.

Other people scrimp to put money aside in a savings account. It's a struggle and a necessity because they need to have that safety net. I see that your situation is different to theirs, but not to the people in my paragraph above.

I'm also confused as to why this matters to you? Why is it so important for you to insist that you don't have savings, just a load of cash as though these are totally different concepts?

Ahhhhhh, I think I sort of get it now. This is a TAAT.

Maybe you should care less what your financial inferiors think of you, OP.

That just isn't true. It can all stop in a heartbeat. Don't ask me how I know, I just know.

What’s your point? I deal with lots of wealthy people. Most have considerable amounts in cash savings. I’ve not yet met anyone who has such a blase attitude to assuming their income is safe no need to save. But everyone is different.