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I think both of you are extreme cases.
50% saving rate on your part, while commendable, is a little extreme for me. What are you going to use it for, if ever? In my mind, money saved without any purpose, is silly. I understand wanting to have certain amount as an emergency fund, or saving for retirement, or creating a nest egg and putting it to work through investing. But just wads of cash in the bank? As they say - you can not take it to the grave, so may as well spend SOME of it on, ahem, friends and family.
Personally, I like being in the middle. I save pretty easily, but also spend money without grief. I HATE blowing money on junk, therefore, we all wear very basic clothes, drive reliable average cars, have one smallish TV-set, but go on skiing vacations and pay for expensive sports our kids do. Experiences are valued much more than stuff. I also save much better when I'm saving for a big purchase that I know is not junk. For example, saving for the next car is easy - I know I will need it at a certain point, and I don't want to have a car payment when that time comes. Same goes for saving for college for my kids. Saving just to save? Nah.
Saving 50% could mean the person wants to pay cash for a house, pay cash for a rental property, pay cash for professional or graduate school, retire early, or own a business.
Or maybe they think they just want to keep that possibility open.
50% wow. that's nice. I cant. My saving is left over after spending.
Well there's your problem. Saving should be treated like any other monthly "expense" or bill. Put the money away first, then spending will be what is left over after saving. Before long, you will have a nice bank balance and more peace of mind.
Saving 50% could mean the person wants to pay cash for a house, pay cash for a rental property, pay cash for professional or graduate school, retire early, or own a business.
Or maybe they think they just want to keep that possibility open.
To add to this, just as you can pay cash or credit, some people think it's important to build credit and others think it's important to build cash
Well there's your problem. Saving should be treated like any other monthly "expense" or bill. Put the money away first, then spending will be what is left over after saving. Before long, you will have a nice bank balance and more peace of mind.
Before anything get's paid, I pay my savings account first. No exceptions.
Well there's your problem. Saving should be treated like any other monthly "expense" or bill. Put the money away first, then spending will be what is left over after saving. Before long, you will have a nice bank balance and more peace of mind.
Exactly!! I treat saving like my most important bill. I still have nice things, a nice car, and I eat good food. I get a lot of satisfaction out of saving for my future.
Like someone said before, you're both at opposite ends of the curve. The majority of people are somewhere in between.
It depends what your goals are. I save a large amount towards retirement for my age, have an emergency fund of 6 months expenses and a bit more for padding. I moved recently and wanted nice things for my apartment (that I paid cash for), and had to pay for all the things on top of that that came with moving to a new state. I haven't saved money in months (this doesn't include my retirement savings, that never changed), but I know what kind of person I am so it doesn't worry me.
I guess I'm in a nice position to be able to buy myself decent things, but I wouldn't call myself a big spender by ANY means. I'm in the middle. Healthy balance of buying and saving. I'd say more people may gravitate towards spending (this is just my opinion based on being around my peers in their 20's), but maybe not absolutely everything. It is hard though, a lot of my friends are straight up broke (either due to stupid school debt or just having trouble finding a job). A lot of them are very spendy, and a lot of them are in the middle like me.
I would venture to guess that most people don't save enough and that most waste money or do stupid things with money. Too many people don't ever save at all. As long as you live on much less than you make, saving should be a fairly painless process. It takes planning and budgeting. For some reason, that is beyond what you can expect from most people.
I don't think that person was necessarily referring to race. IMHO it is more about family culture than an ethnic or community culture.
If you grow up hand to mouth, that is how you will manage your money as an adult. If you grow up watching your parents plan for retirement and save for big purchases, you will model those choices.
I read one time that somewhere around half the population doesn't save what they should be saving for the future etc., so I'm guessing no.
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