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I have been thinking of posting the exact same question myself! Do people live on credit cards, families are supporting them? What is it really, with every single person that I know not only going out, travelling, etc. but also having cash to invest with? Very curious in people’s answers!
I have the same question!
I start by maxing out 401k and then use what remains as my actual budget. Setting it in the beginning of the year helps me start mentally with the lower take home pay. Maxing out might not work so start smaller but enough to trigger matching from your company.
Pay off credit cards first though!
Take a hard look at your expenses. Agree budgeting is key. I also max out my 401(K) via automated deposits so it doesn’t even hit my bank account. Then I budget with the rest.
I don’t eat out much, and have some savings on auto-pay. I look for deals and use credit card points where I can (e.g., for flights). I drive a Honda civic and have not moved as my salary increased, to avoid lifestyle inflation.
But to be honest, I have friends who make a lot of money (one makes $280K per year with 2 babies and a mortgage) and have the same issue. They don’t have family nearby to help with the kids -they pay for help so they can work full time and preserve their sanity. Childcare is just REALLY expensive! Mortgage/rent is high, food prices are increasing… Life is expensive! It’s hard.
I feel the same way. I am grateful to earn as much as I do, and I was able to finally start saving for retirement. I am 43, so this is a bit late. So hard to pay for everything with 4 kids and being self-employed.