To be shocked by how many people with expensive lifestyles have no savings?

[SnugBird]

Quite a few people I know have what looks like a very expensive lifestyle - nice cars, business class flights, 5* holidays, but at the same time have little to no savings. I think I’ve always assumed that higher spending like that would go hand in hand with having a financial cushion, so it’s been surprising to realise that’s not always the case.

AIBU?

They could be in debt or lying about their savings.

A) how do you know?
B) maybe they prefer to live for the day, have the liquidity or good credit to deal with emergencies

Are they telling you they have no savings?

If true, then yes, a bit ridiculous. But honestly I don't know anyone who lives like that. Even people who are absolutely loaded! Maybe its a case of those being flashy trying to prove they are something they aren't.

How do you know they don’t have savings though, have they told you themselves?

People who spend a lot don't have savings shocker?

Some people live to their limit, prioritising the “now” over the potential future issues, being happy to accept dealing with future problems in the future. Some people prefer to plan for the worst, live way below their means to save for a rainy day, planning for disaster.

There’s benefits and drawbacks from both. You’ll only know on your death bed if you made the right choice. For every story of: someone who’s saved carefully for the retirement of dreams, never taking that big trip, never driving the fast car or staying in the nice hotel, then died at 65 not having got to enjoy it, you’ll find another story of someone who’s lived to the limit, enjoyed the good times, had all the trappings then something has gone wrong and now they are in poverty having not saved any of the big money, with little but a fabulous insta feed to show for their years of plenty.

As long as both partners have the same attitude to money/savings I’m not sure there’s a completely “right” vs “wrong” way to approach this.

I don’t know exact figures, it’s more based on what people have said themselves or general conversations. And I get that some people choose to prioritise lifestyle or feel comfortable relying on income/credit. I was just surprised because I’d always assumed that level of spending would usually go hand in hand with having a financial buffer.

What are your opinions on grandmothers doing childcare?

Not everyone but it’s come up in conversation with a few people.

What surprised me is that the level of spending doesn’t always reflect what’s behind the scenes. I’d assumed the two usually went together.

I think it is quite often not the case. I used to work with someone who always wore designer clothes with lots of jewellery and several £5k+ handbags who said that she couldn't retire because she didn't have a pension. It seems odd to me, but it is a choice she can make. Just a stupid one.

But they could lying opting not to talk about savings. Prime example is me I bought a new house last year. I bought a new car. I’m going on several holidays this year. Yet in a conversation yesterday in work, we were talking about braces and one colleague said “ I’d love to get them but I don’t have 4k lying around like who does!?” I said.. “yeah I know it’s crazy!” I didn’t respond by saying “well actually I have 120K in the bank why don’t you?” I know from that conversation that she too will assume I don’t have 4K.

Tbf we have enough in savings for 4-6 months if either of us lost our jobs but that's it, there's some equity in the house and basic pensions. DH lost 2 friends before 40 - I absolutely would rather spend what money we have now, while we are in a position to enjoy it and let the family enjoy it than be the richest person in the graveyard.

🤣🤣🤣🤣

This country doesn’t reward saving. Spend all your money, then get bailed out by the state. There was a thread on here the other day about people planning to blow their pension pot in holidays and luxuries before retirement age, and then get government to pay their rent.

Unfortunately, you are absolutely correct 😞

You don’t need savings as much if you have a guaranteed income

And they might have investments but don’t mention it when people say savings because they don’t want people to know

How could you possibly know that? Based on a couple of people you know you've extrapolated it to a general phenomena?

Yep, this is the issue.
My parents were super careful and saved for their retirement. My in laws were definitely not thrifty and as soon as money came in, it went out, often on smoking and drinking and take aways. My FIL passed away suddenly, leaving her nothing, and we prop up her finances by paying her for childcare (even though we dont really need to, girls are in schoom and dh works from home, bit its less cringy than is giving her handouts) , my DH fills her car with petrol everything she visits. She is lovely and we don't want to see her struggle.

Yes - I have relations with paid-off rented-out properties but no real private pensions and minimal savings, so technically they don't have a large savings account but they're never going to be destitute.

The thing is some people earn more in a month than a lot of families have saved over a few years so are living in the knowledge they would be fine in the short to medium term.

So many MNers are so easily shocked. I mean you could save up a ton of money then die randomly so I can see where people get the live for today attitude from. We have a tiny amount in savings. In reality I’m a shit saver as is DH. We’re trying to work on our impulse buys. 👀

Some people really do stretch themselves but if their job is secure it’s not always a problem.

Some people have other safety nets so less worry

Others hide their savings

And you can’t always assume things by what people say eg lots of people will say “I’m broke until payday” but everyone’s idea of broke is very different.

I worked for a senior manager once, who was on a 6 figure salary and 6 figure bonus who ran his whole life off credit cards, moving balances every month, with a view that it won’t be forever, and more money will come in. I often wonder what happened! (We worked in a bank)

I don’t know how you’re so sure they don’t have savings. I’d never tell anyone how much money I had and if they asked I’d downplay it.