I\u2019m a pretty fortunate person who lives a pretty fortunate life, and our annual household income at $160,000 is high compared to the rest of the world. However, we are still pretty frugal \u2014 we cook at home, drive old Hondas and do home repairs ourselves where possible.\u00a0<\/p>\n
We put away about 20% of our income into retirement and college savings. We have more than $1 million in retirement funds. This was mostly on a cop\u2019s salary, as I was a stay-at-home mother. My husband is now retired, and I went back to work.<\/p>\n
\n \u201c<\/span>\u2018How are these other people affording this luxe life? And if we stay this frugal, will we wind up rich, but too old to spend the money?\u2019\u201d<\/span>\n <\/p>\n<\/p><\/div>\n I see people with less money and bigger expenses (student loans, giant mortgages, credit-card debt, etc.) living a much more lavish life than we do. Our kids say that our small \u2014 but cute! \u2014 house is embarrassing, and people here in the suburbs see us as poor.\u00a0<\/p>\n Are we missing the boat? We wanted to save aggressively for retirement and our kids\u2019 college costs. But should we be redecorating, going to Cancun and Disney World and getting takeout every night instead?\u00a0<\/p>\n How are these other people affording this luxe life? And if we stay this frugal, will we wind up rich but too old to spend the money? I don\u2019t begrudge anyone else enjoyment and high-end stuff. I just wonder if I\u2019m doing this wrong.\u00a0<\/p>\n Thank you sincerely for reading my letter. It helped just asking this out loud.\u00a0<\/p>\n Frugal Wife<\/p>\n Wealth does not mean that you drive a Tesla Model X Plaid Have you missed out? I think you probably already know the answer to that question. You didn\u2019t miss out on the memories of dinner at home with your family or taking holidays in your old, much-loved car, or by being able to rest your head on the pillow at night, safe in the knowledge that, despite not being part of the 1%, you managed to accrue $1 million in retirement savings and keep your living costs low. Your house is, no doubt, filled with memories. Good for you for not feeling the pressure to constantly upgrade to a bigger pile.<\/p>\n How are people affording their lifestyles? Some people, particularly those in the tech sector \u2014 which, unfortunately, has suffered widespread layoffs in recent months \u2014 have enough to play around with while maximizing their 401(k)s and putting aside 12 months of expenses for a rainy day. But they don\u2019t represent the majority of Americans. In fact, the personal saving rate \u2014 meaning personal saving as a percentage of disposable income \u2014 fell to 2.4% in November from 8.9% in November 2019, before the coronavirus pandemic.\u00a0<\/p>\n \n \u201c<\/span>\u2018You didn\u2019t miss out on the memories of dinner at home with your family, or by being able to rest your head on the pillow at night, safe in the knowledge that you managed to save $1 million.\u2019\u201d<\/span>\n <\/p>\n<\/p><\/div>\n Sure, wealthier people are paying more taxes: Some economists say the personal saving rate could be falling as more investors pay capital gains taxes on stocks they sold in the last year. Still, \u201cexcess savings\u201d \u2014 the amount households saved versus what they would have saved had it not been for COVID-19 and the resulting job losses \u2014 hit $1.7 trillion by mid-2022. And $1.35 trillion of that was held by the top and third income quartiles. To put that mid-2022 figure in context, in the second quarter of 2021, excess savings stood at $2.26 trillion.<\/p>\n But some say the recent loss of jobs in the tech sector does not bode well for those who are only living for today. Tom Siebel, a billionaire serial entrepreneur whose latest title is CEO of C3.ai Ignore your friends and neighbors who are living it up at Disney World. The Disney vacation site Mousehacking said its baseline Disney World Call me old-fashioned, but I\u2019d rather book an Airbnb Follow Quentin Fottrell on\u00a0<\/em><\/strong>Twitter<\/em><\/strong><\/a>.<\/p>\n You can email The Moneyist with any financial and ethical questions related to coronavirus at qf*******<\/span>@*********<\/span>ch.com<\/span>.<\/em><\/strong><\/p>\n Check out\u00a0<\/em><\/strong>the Moneyist private Facebook<\/em><\/strong><\/a>\u00a0group, where we look for answers to life\u2019s thorniest money issues. Readers write to me with all sorts of dilemmas. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.<\/em><\/strong><\/p>\n The Moneyist regrets he cannot reply to questions individually.<\/em><\/strong><\/p>\n More from Quentin Fottrell<\/strong>:<\/p>\n \u2018We can practically finish each other\u2019s sentences\u2019: I\u2019m getting married in 2023. I want a prenup. She wants to merge our finances. What\u2019s my next move?<\/a><\/p>\n \u2018I want to meet someone rich. Is that so wrong?\u2019 I\u2019m 46, earn $210,000, and own a $700,000 home. I\u2019m tired of dating \u2018losers.\u2019<\/a><\/p>\nDear Frugal,<\/strong><\/h6>\n
\n TSLA,
\n
\n live in a sought-after ZIP code, wear a flashy watch and\/or take Instagrammable
\n META,
\n
\n vacations. In fact, that can mean the exact opposite. It can also mean that you are less<\/em> wealthy than the person next door living in a modest house that has not been decked out with electric gates and a McMansion-style extension. Indeed, credit-card debt hit a record $866 billion in the third quarter of 2022,<\/a> up 19% from the same period a year earlier, according to TransUnion\u2019s
\n TRU,
\n
\n most recent quarterly report.<\/p>\n
\n AI,
\n
\n told my colleague Levi Sumagaysay last November<\/a>: \u201cBefore this is over, everyone will feel the sting, large companies and small.\u201d He added, \u201cAll this weird, entitled behavior is coming to an end. No more people working in pajamas at home, being paid in bitcoin. This era will be a zinger, unfortunately.\u201d He further cautioned about a significant downturn ahead.<\/p>\n
\n DIS,
\n
\n vacation for a family of four \u2014 two adults, one child 10 or older, and one child aged 3 to 9 \u2014 costs $6,320, or $316 per person per night, in 2023. \u201cThis includes flights, transportation to and from Disney World, a five-night stay at Pop Century, five-day tickets without park hopper, Genie+ at two parks, and quick-service meals, snacks, and two table service meals,\u201d the site says. <\/p>\n
\n ABNB,
\n
\n in an old market town. Plus, fun-park rides leave me with a headache \u2014 second only to the final bill.\u00a0<\/p>\n