May 06, 2010,
J.P. asks from Meridian, ID on April 26, 2010
How Do They Do It?
I have asked this question of some friends before, but everything was vague, so I am hoping that since this site is a bit more anonymous, that I might get some candid answers.
My question is: How do single income families, not only afford a nice life style, but seem to always by buying/traveling, etc. I have a some friends that are sahms, and I am always hearing that the wife/family just got back from visiting this family, or that family, or a family vacation somewhere. Even just some of the stuff they do with their kids on a daily basis can be costly. They have nice houses, and nice "stuff", and nice cars, and nice clothes, etc., even their nails and hair are done. I feel like I am doing something wrong, since we can't afford that in a double income home.
When I have asked before, people have said that they scrimp and save, and don't eat out, etc., but these are the people that seem to be single income families, not those that are living high. The only thing I can think of is that maybe there are some military pensions that contribute, but that doesn't cover everyone. Are these people financing everything with credit cards, do they have family money?
My husband and I are scrimping and saving to pay off debt with the hopes that we have some breathing room, but I don't think we will ever be to the point of me staying at home, nevermind, staying at home, and being able to afford all the extras.
I know that this is a random question, but it is one that just gets me when I try to figure out how to get my son some toys for the yard, and still afford everything else, while hearing that someone who just got back from a girls week in Seattle is now taking her twins to DisneyWorld for a week. I think I just need a reality check.
2 moms found this helpful
So What Happened?™
Wow, it looks like I really hit a nerve. Thank you all for your candid answers. I am actually 9 months into the Total Money Makeover. We have paid off one credit card and are about half way through our car. We also paid off all the OB/GYN charges in advance, and have most, if not all, saved for the hospital for baby #2 that is due in 10 days. I think we should have everything but the mortgage paid off by the end of 2011. As I dole out each paycheck, I know I am doing the right thing, but sometimes need some inspiration. As one post said, they have no debt and are able to save for what they want to do. That is actually what I was hoping to hear to give me that extra bit of encouragement that I need every so often. I see how easily some people live and get jealous and think that there has to be an easier, faster way to get to my goal. Knowing that some are going into debt to achieve it also gives me encouragement because I want to be out of that vicious cycle, no matter how hard it is.
Unfortunately, most of our debt comes from my husband before we were married. He bought and furnished a house with his ex-fiance, who didn’t put anything towards it, but demanded money when they broke up. Then he had trouble getting a job and got deeper and deeper. I had savings (that is how we bought our house and paid for our wedding and honeymoon), and hated debt. Last summer we had our furnace and A/C break, and that gave me credit card debt and put me over the edge to needing to do something about it, and finding Ramsey.
I’m not trying to keep up with the Joneses, and truly not comparing myself…okay, technically I am, but more in an intellectual, why are we so different way, as opposed to, I am unhappy and bitter with my life because I’m not like them. I am very happy with my life, I have a great marriage, a wonderful son, and another wonderful surprise on the way. Maybe it is the hormones that are making me question a bit more, or the thought of only have 66% of my salary for the next 2 months. Or just the fact that we finally got a financial advisor and I really want to work on the savings aspect instead of the debt aspect.
I really didn’t mean any disrespect to those that are doing everything right, just wanted to make sure that I was following in your footsteps. And I am trying to not assume, which is why I am asking the question. The military pension came to mind because two of the families I am thinking of have husbands that used to be in the military. One had eye issues and left and another is now paralyzed (not from the military), but, of course, can’t go back in. I have no concept of the amount of pensions, but if they are currently working, plus getting the pension, I thought that might be enough to help supplement. Looks like I was wrong.
The yard toys were just what I was thinking of at the moment I wrote this…not important in any way. And I have scoured Craigslist weekly, but am always late because I can’t get there before the weekend. There were many ideas and thoughts that you ladies gave me that I hadn’t thought of before – coupons and being able to go to the store during sales if you are a sahm, even family paying for trips and property, and able to watch kids to save daycare costs (oh that would help so much!). I also know that there are people that are making astronomical salaries (and yes, my husband and I both have degrees), and for them, I say, “Do you have any openings?” :)
J.C. answers from Anchorage on April 26, 2010
I am a stay at home, and my husband is an enlisted man in the Air Force, so he does not bring in a lot of money. We know how mush we have each month for extras, and plan accordingly. If we want to buy something nice, we do not eat out. If we want to travel, we plan several months in advance and save a little every month over time. I think it is a matter of only seeing the outside of a family, like when they say the grass is always greener on the other side, until you are standing one it. We all have the same struggles, you are soooo not alone.
2 moms found this helpful
B.C. answers from Norfolk on April 26, 2010
Inheritance is a possibility, at least for some people.
A big lottery win sometimes (wish it could be me sometime).
The wage earner has a big salary (lot of those CEO's making multi-million dollar bonuses a year are married).
Crime - Bernie Maddoff lived high on the hog for years before he was caught.
And credit cards is the way lots of people do it - I know quite a few personally who live this way.
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M.E. answers from Salt Lake City on April 27, 2010
I get it, it is hard to see everyone else get so much more sometimes. However, I do believe a lot of people live on credit cards. I have a friend who does not have money but is ALWAYS taking trips, event caters her daughter's birthday parties, she is always going and always spending. Something else I know? She has claimed bankruptcy twice, lives on credit cards and finds something lacking enough in her life that she has to make up for it by living beyond her means.
I am a single mother with no child support. My daughter has lots of awesome toys and doesn't lack for much at all. I garage sale shop for everything. Her swingset - $25.00. A super awesome climber slide that retails for 199.00 - I got for $10.00. Garage sales are a steal for great deals, great kids clothes and toys.
As far as the trips, yeah, out of my price range. I can dream though..........
R.J. answers from San Diego on April 26, 2010
One of the best things my mum ever taught me was "People spend their money in different ways." And one of the best things I learned as an adult is "Not to judge my insides by other people's outsides".
You've gotten some great answers... but what it all boils down to is everyone's situation is different. Some people save, some people borrow, some people get it gifted, some people inherit, some people get PAID to, some people, some people, some people.
One trick with frequent flyers... is that they almost never pay for airfare. ESPECIALLY frequent international flyers. They use their miles. So the trip that would cost anyone doing it as a "once in a lifetime trip" pays 4000, while the person using their miles pays 400. I'm still kicking myself for "losing" 135,000 miles. Do you know how many free tickets that is??? Other people get "comp" tickets (airline employees have family too, as do air traffic controllers & ground crew). Other's get a cc that lets them get 2 for 1 tickets, others save and use last minute sites and pay pennies on the dollar. Others fly "space-a" (the military is the nations LARGEST employer... not only do all active duty personel get space-A, but so do dependants and retired folks. Millions of people fly space-A every year.) Others have to travel for their work (and their work pays), while still others arrange work that lets them fly (like messengers, airline employees, etc.)
Very few people ACTUALLY know the intimate details of other people's finances. (Btw... did you know that in my city, longshoremen make more money than engineers and doctors... I've run their insurance, we're talking 100-200k a year for the very definition of blue-collar work). The person with the posh job can be paying 3 tuitions, and paying off debt from "the early years" and have no money... a person with nothing to pay but bills can be socking money into savings. A person can sell a house in a city (like mine) where a 2b/1b starter house costs half a mil... and move to a city where a McMansion costs 125k. Someone's beloved mother could have died leaving them money or leaving them with funeral debt. Some people buy new clothes, other people have had the same 3 pairs of pants and 5 shirts for the past 7 years. Some people buy cars, others lease for less, others lease for more. A LOT of kid-activities have sliding scales. Some families "pay it forward" (aka they were broke while raising their own kids, but their parents helped them out and THEY help their own kids out), some families the kids take care of the elder generations. Some people pay taxes once a year, others let the govt collect the interest and use a tax return as "bonus". Some people are paying off debt, others are debt free. (I mean, if you're paying off debt imagine how much more $ you'd have if you had no debt to pay off... no car payment... even no house payment/rent payment... that money stacks up fairly quickly). Some pay for phones and cable that equal out to hundreds every month, others use netflix and free phones and pay $30. Some people pay for gym memberships, others pay for sports, others pay for neither... but walk/bike everywhere or hike for free.
We all live our lives VERY differently, and we all have VERY VERY different priorities. We also come from different backgrounds, have different skills, and make different choices. We all "splurge" on different things, invest in different things. What is a "ridiculous expense" to one, is a necessity to another and vice versa. We all have different "ins" in certain areas, through work/ friends/ family... and we all have different capabilities.
6 moms found this helpful
A.F. answers from St. Cloud on April 26, 2010
I think it's unfair to assume that people who enjoy a nice lifestyle and travel go in to debt to do it
We have a single income family, have zero debt, have a nice car and home and are hoping to travel when our kids diabetes gets under control.
One year my husband and I put a dollar a day away for each of us (without fail), stuck every extra bit of change that we got into a jar, and if there was money left over at the end of the week after bills, savings, groceries, etc. we would put a bit more in the jar. After a year we had a few thousand dollars and went on a trip. After our trip we had enough left over to go on ANOTHER trip but we stuck the rest in savings.
I am NOT bragging, just stating the fact that, contrary to almost every post you got, not everyone who "has" things is in debt. We don't get everything we want, even if we have the money. But we don't feel guilty about enjoying things that we really want if we have the money to do it.
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B.C. answers from Denver on April 27, 2010
I 2nd, 3rd, and 4th the Dave Ramsey Financial Peace.
Don't feel bad about your situation because you are doing the right things for your family. He talks about "Living Like No One Else" so that later you can "Live Like No One Else".
We have dug ourselves out of a pretty big hole and I can say happily that I have no consumer debt as of yesterday....but it was a lot of hard work and budgeting that got us out of our financial mess.
Keep doing what you're doing and don't worry about how everyone else around you is having a great time...because unfortunately, they will not be having such a good time later if they are financing it with credit cards.
4 moms found this helpful
L.K. answers from Kansas City on April 26, 2010
OK, just this morning taking my daughter to school I heard the perfect song to sum up this conversation. "Simple Man" by Lynyrd Skynyrd. The words that caught my ear were:
"Forget your lust, for the rich man's gold
All that you need, is in your soul.
All I want for you my son,
Is to be satisfied"
Have to agree with Anne Marie, we should never assume anything.
For us, without going into our personal finances, we have/do all of the above and I've been home 10 years now. And no, neither one of us have military pensions.
When we were first married 21+ years ago, we didn't go into huge debt buying our house. Several friends bought the most they could buy but then couldn't do anything else. We bought reasonable and I went to garage sales and auctions to furnish it. Plus I took hand-me downs from both our parents. I think the only "new" piece I had was a sofa. When we moved to this house 9 years ago, same thing. We could have had a bigger/nicer house but we had an idea of what we wanted and needed and didn't exceed that.
I guess we drive "nice" cars, but we drive cars until they die so we take care of them. My SUV has 112,000 miles on it and is still going strong. I'm also driving a GMC not an upper end car.
Now I did work, by my choice, full-time as a nurse until our kids were 5 and 9 which allowed us to save a little more early on. I hit garage sales and consignment stores all the time when the kids were little. I found a Little Tykes train with cars and track, barely used at a garage sale once. I would rotate clothes through a local consignment store. I would take clothes in for sale and use the store credit to buy more.
I don't cut coupons much, just because they are usually for things I don't buy. But I look at them every week, just in case. And use them. *I have a credit card, a Target Visa that I use for everything. For every $1000 I spend I get a coupon for 10% off my entire purchase. And now with their new 5% off everything if you use it the savings add up. So I will wait until I get one of my 10% off coupons and stock up then on the toilet paper, paper towels, soap etc.
And I really, really don't mean this the way it may sound but my husband and I worked our butts off for our college degrees. Granted I don't work clinically anymore, but I do some wellness consulting. My husband literally worked his way up the corporate ladder and now makes a good salary at a job he enjoys. I don't think we are any better than anyone else without degrees, but as we are trying to point out to our almost 20 year old son, statistically those with college degrees make an average of 65% more.
We also have ALWAYS had a savings. If your company has direct deposit, they should be able to split it between 2 accounts. Trust me, if it's not there you don't miss it.
You also don't know how they are getting to go on the trips. I know the first time we went to Disney World, it was because of my in-laws. It was their gift to their grandchildren. I just went on a girls trip last fall. I traded in some of my husband's airline miles so my airfare was just $50. And with 13 women splitting the cost, my week was minimal.
I know it probably doesn't help answer your question. But like I said in the beginning, you can't always assume how people are living.
3 moms found this helpful
J.L. answers from Boise on April 27, 2010
That's simple, They are in debt up to their eyeballs. They move their debt around to afford what they want but gain no real ground on their debt. They pay the minimum and will probably never pay it off. I have often wondered the same thing. My husband and I have never taken a vacation since our son was born (and the only one we did take was to Hawaii when we were dating, and that was with the money he earned while in Iraq). However we are in our mid twenties, and almost debt free. we owe 6,000 on our car and plan on never financing one again, we will save and use cash. We have no credit card debt, and we live on a strict budget. Even with all of this I am still able to afford nails and hair appointments that my husband budgets for but if we are short on funds that month those are the first to go. We do not have cable. We live in a tiny house in a nice neighborhood and are saving for a fence. We bought a house we knew we could afford, not one that stretched us. If needed we could survive on my income only, which is meager. We are not well off...in fact we make under 35,000 a year combined. Like you, our dream is that one day he will get a good job (he does have a business degree but has been looking to use it for over a year now) so that I can stay at home and we can have another baby. You are doing the right thing. This new American way of living is dishonest and wrong. Did you know that 2 Generations ago it was DISGRACAFUL to have debt? Even on your Home? Now it is a way of life. We are raised to think that debt is healthy, that it “helps your credit score.” I don't know if you are familiar with Dave Ramsey, but I recommend you listen to him. I have taken his Financial Peace University classes and they are amazing. He lines out how to get out of debt, save for your future, and even explain Mutual funds, Bonds, 401Ks, retirement and how to negotiate deals. He give you a "debt Snowball" that will tell you the day you will pay off your debt, and what steps to take to do it. You are not alone. Many people in America wonder what you do and some look back after years of living the "high life" without the high life income and wonder how they will dig themselves out. The best thing you can do is never get yourself in that hole to begin with. Check out the website http://www.daveramsey.com/fpu/home/ but mostly I want you to know you are not alone in feeling this way. I am also the friend that watches someone drop 200 bucks on a credit card to get new clothes and wishes there was a way I could get those things too. But I remind myself over and over that I am working for my family, and that is sure is nice not to worry about credit card bills and collection calls. We do not even own a credit card. Not even "for emergencies." And while there are things I really wish I could have now, I have the eye on the prize of my future, and my child's future. Believe me, you find you do not miss it as much as you would think.
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M.L. answers from Colorado Springs on April 27, 2010
It's so hard, isn't it, to look around and see other people who have what you wish you had? It sure is for me. Unhappily for you, it also lets you in for a Grandma lecture. Right now.
Always know that everyone - no matter how unruffled and successful he or she appears - is carrying burdens and fighting battles, just as you are. I'm not downplaying your frustration. I've been through it, and it can be EXCRUCIATING to listen to others talk (even innocently) and know you're not sharing in those things and think you may never share in them. But everyone is selective about what he or she shares with others! You're not hearing about the worries, the bickering, the sleepless nights, the dysfunction that the same people may have.
This may sound corny, but sit down and write down a list of absolutely everything you have now to be thankful for! Write down the son you love so dearly. If your husband is faithful and hardworking, write that down. If you get through the month with the bills paid (or even practically paid), write that down. Write yourself down; you evidently have a good mind in a healthy body. HUNT for things to be thankful for! If you see something out your back window that makes you smile, add it to the list. I don't know if I'm allowed to write from a religious standpoint here, but if I could I could add a lot to this idea.
Post the list on your fridge or your bathroom mirror and add to it. There's a serious reason for this. It's part of a vaccination against a disease whose name is a four-letter word: envy. Sorry, I know I'm preachin', but envy has killed more happiness than anything else in the world - growing bitter over what others have that you don't, and eventually hating what you have yourself.
The only way you can see things realistically is to know what you have going for you. I think it's harder to be joyful for someone else's happiness than to weep for someone else's sorrow, but to be able to do that and still be happy with your own life is crucial to living well, whether you're struggling financially or not.
For what it's worth, my children (who are grown) were raised with second-hand toys (yard sales, thrift stores) and second-hand clothes. They went to Disney only once growing up - and only because their grandparents happened to be living in Florida at the time and treated. (We couldn't go on a vacation except to visit relatives.) They missed out on a lot of "things" - and struggled with envy - and have lived to tell about it and (mostly) appreciate their lives now.
End of lecture! Sorry to be so long-winded; as I'm about to post this I notice that you have FORTY-ONE other answers to read. Whew!
2 moms found this helpful
L.C. answers from Washington DC on April 27, 2010
It's simply a matter of priorities.
We chose to have me stay home. It was a priority for us. We scrimped. We saved. We drive our cars into the ground. Both of our cars are at the 150k mile mark. They are Honda. They will go another 150k miles if we treat them right - and we do. We went without. We have carpet in our house from 1986. It is disgusting, but I don't have the cash to pay for the hardwood flooring I really want, so we will wait. We've paid for every improvement to this house with cash - or zero percent financing and then the lump sum payment at the end... If the money is in the account, we purchase if it's not, we don't. For Example: We did windows this past year. We are getting a $1500 energy credit from the government for that. (our tax dollars at work) We did the zero percent. We will pay the bill in July even though it's due in August, just to be sure that we don't have any issues with finance charges. I could pay it right now, but the money in my account is collecting interest for me. :-) I do all the painting, cleaning, and decorating. I never purchase anything unless it's on sale. When we did the crown molding, we had some larger pieces left over - I returned them to the store and got the $ back. :-)
Perception... it's also a matter of perception.
My son has a car - it was purchased for $1 from his grandparents. It was NOT given to him. He drives his sister to school, so I pay his gas. It looks like a brand new car, but it's a 1990 Toyota. The kids all thought he just "got" a "new" car. It has crank windows and push button door locks. It has a radio and air conditioning. That's it.
I purchase all of our clothing on sale -- if it's not on the sale rack, it doesn't get purchased. My kids are well dressed and in style. It takes a little longer to find the bargains, but... it works for us.
We don't usually go on vacation unless we are going to visit family. We travel light and cheap. We book months in advance. We have never ever flown anything but coach. (everyone arrives at the same time... you know?)
As for toys for your yard - Yard sales, Craig's list, Rummage sales, and garbage picking -- make the rounds on garbage day -- if people put it out with the trash, you can take it. I've put out gobs of stuff and taken lots of goodies (my son's dresser came out of the trash and we refinished it). It's freecycling at it's best!
I also shop the sales (after Christmas, but in January) and get stuff for 90% off for the following year. I also hit the department stores clearance aisles or online clearance bins for big bargains. I have plastic bins in my closet where I store my treasures. If the kids need a present, I grab something from there. It looks like I've spent well more than I do. :-)
So - live your life.
Enjoy your kids.
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M.H. answers from Dallas on April 26, 2010
Hi, it could be that the earner makes more money than you assume, they have less debt, etc. My husband and I both work but our mortgage is only 5% of our monthly income. Both of our vehicles are less than 5 years old and paid for. I put 15% of my paycheck in 401K, have IRAs, etc and my husband funds his retirement also. I like to make people believe we have less money than we really do. All I'm saying by my example is you shouldn't assume they are making the same amount of money as your family.
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