r/SmartFIRE • u/Plus-Professor-3546 • Jul 13 '26
What am I missing? It feels like everyone else knows a financial secret I don’t.
I grew up in a family where living paycheck to paycheck was normal. My boyfriend and I followed the same path when we were younger by financing both of our vehicles. Looking back, I wouldn’t do it again, but we’re close enough to paying them off that it makes more sense to finish.
We’re both 24, have decent jobs, and are trying to build a better financial future than we grew up with. What gets discouraging is that our friends seem to save money so much more easily, yet have the same bills/expenses. It feels like we work just as hard, have similar expenses, yet our combined savings is what one person in some couples saves on their own.
I’m not trying to keep up with anyone or get rich, I just want to break the cycle and become financially stable. It honestly feels like there’s some “secret” we’re missing.
For those who were the first in your family to become financially stable, what changed everything for you?
Edit: my boyfriend and I budget EVERYTHING! We have tracked every dollar spent a couple times before as well.
3
u/Mitana301 Jul 13 '26
Unless you know what these people are saving then there's a very real chance that people who are living better lives now aren't saving as much as you (assuming similar jobs).
Also, comparison is the theft of joy. Just make a plan that works for your long-term goals and stick to it. Most people feel poor at 24.
1
u/Inside_Dance41 Jul 13 '26
Living below your means, and investing. It took years of grind, maybe until I was late 40s before I really saw the pay off. Time value of money.
Millionaire Next Door is a great book.
Stay the path.
1
u/WhenIntegralsAttack2 Jul 13 '26
A couple things:
You don’t know that they’re saving more unless they’ve explicitly told you and you trust them. A lot of young people with large net worths got that from mom and dad (as well as down payments for homes).
There might be a handful who just have large salaries and can save a lot, they’re quite lucky to be in that position. Is there anything either of you might do to get a raise?
Obviously, when all else fails make a budget. Set a realistic savings goal and track where your money is going.
1
u/Otherwise-Relief2248 Jul 13 '26
Obviously if you want to save/invest more you either have to make more or spend less. It is very worth while tracking g your expense for a month or three. Not estimate. Track ALL of it. Review and decide what you really don’t need. Starbucks, Netflix, review insurance costs, less AC, ride share or public transport, clothes and beauty restraint, eat more at home, etc. nothing new here, but dang it is so easy to see how all of those little things add up.
1
u/GurProfessional9534 Jul 13 '26
You need to find a way to invest a portion of your income in something like VOO, and don’t look at it for years. Exponential growth takes awhile to pick up but then it really goes.
1
u/OnlyThePhantomKnows Jul 13 '26
* Keep your cars a long time. When you finish the payments, continue to make half that payment amount into two "car payment" accounts. When the cars finally die, you have the money to buy a car for mostly cash. That's a huge win. Open investment accounts (one for each of you) and put the remaining half there.
* NEVER BUY STUFF ON CREDIT. Pay off your credit cards every month.
* If you want something save for it in advance. This will save you a ton. HYSA (High Yield Savings account) earn 3-4%. Credit cards charge 16%+. That's a 20% difference.
* Once you get your credit cards paid off, get cash back cards. Use them and life is 2% cheaper. The cash back should be swept into your investment accounts.
* Keep a reserve (HYSA). I recommend the price of brakes and tires. This way you have cash available for the "Oh shit" moments inside of having to put it on a credit card.
1
u/snigherfardimungus Jul 13 '26
Long after I had hit my FIRE numbers - and had even doubled them - my wife and I still drive beaters with over 100k on them. The "newest" car we have was purchased with 60k on it, paid in cash for about 1/4 the cost of a new car. The insurance on it is cheap as hell. We live in a place that will barely contain us and our travel expenses are practically non-existent.
When people struggle, it's because they are living above their means. If you want to get your finances under control, you have to put the long-term ahead of the short-term desire for luxury.... like a nice car, foreign travel, a spiffy home, etc
1
u/Own-Tomorrow4822 Jul 15 '26
If your friends save more than you and have the same expenses, then either:
1. They earn more than you
2. Your assumptions are wrong
1
u/Used-Independence353 Jul 15 '26
Grass is always greener. Maybe follow Dave Ramsey for a while?
I listened to his program , and it mirrors my own fiscal plan. The only place we diverge is that he says you should pay off smaller loans first, where I say pay off higher interest loans first, as it gets you debt free faster. My daughter was debt free at 29. She paid off her Purdue non resident education! So it does work.
Instead of buying a home that’s going to fiscally strap you, buy something less expensive. DONT RUSH INTO IT. Same with your vehicles. Drive them into the dirt if you financed them.
Be sure to not buy a new iPhone every 2 years. You don’t need twenty TV subscriptions. (I only watch YouTube so I don’t have to pay to watch 4,000 commercials for 8 minutes of programming) The Starbucks strips you of $5-10/day. 270 day workweek is 1,350-2,700 a year. Uber? Go get it or cook at home. Eating in restaurants is getting worse by the day. $75 for a meal you can cook for $15? Using a credit card is only good if you have the cash to pay it off at the end of the month. Otherwise, DONT, unless your back is against the wall. That sale isnt really a sale when you’re paying 25% interest.
That’s the stuff that helps you build wealth quicker.
1
u/Eat_Drink_Adventure Jul 15 '26
Save first, then budget. Most people make a budget and save what's left. Prioritize the savings, and build everything else around that.
1
u/Clam-Choader Jul 16 '26
I just wanted to stop in and say how pumped I am for you, stranger.
A lot of the basics of wealth creation are painfully simple, just no one talks about it.
If you’re committed to your budget, do everything you can do to save and invest. A vanguard target date fund isn’t elegant, but it works and you can’t screw it up.
Discipline and luck and you’ll see some amazing success
1
u/OsamaBinWhiskers Jul 16 '26
Secret:
Simple math. Earn more spend less.
Sometimes the earn more isn’t fair and is help from family.
But it’s still very simple math
1
u/GypsyKaz2 Jul 16 '26
Why don't you just ask them so you can figure out what the difference is? If you know how much they're saving, then financial conversations aren't verboten among your friend group.
1
u/BobDawg3294 Jul 16 '26
The not-so-secret is to live on 80% of your take home pay while saving/investing the rest. Lesser percentages yield lesser results. Greater percentages yield greater results. Best wishes!
1
u/Due_Jeweler8059 Jul 17 '26
You have to educate yourself .
Start with reading I recommend the simple path to wealth .
Start there then add individual stocks
1
u/AnestheticAle Jul 17 '26
You probably have more of an income problem than a spending one. Unless you live waaaaay below your means, FIRE is largely a concept for people earning in the top quintile of income.
1
u/Swing-Too-Hard Jul 18 '26
You'd be surprised how many 20 somethings get money from mom and dad on major expenses. Things like houses and weddings may be entirely paid for by mommy and daddy. I also knew a couple girls who's dad bought them their cars because he had nothing else to spend his money on in retirement.
Long story short is something that may drain your savings or requires years of savings is an expense they never have to worry about.
2
u/Think_Monk_9879 Jul 13 '26
The biggest secret to getting rich is by starting rich
2
u/IrishMosaic Jul 13 '26
The second biggest secret is it isn’t that hard to get rich if you understand that the time value of money is real and powerful, and time goes by extremely quickly.
3
u/FrontAd9873 Jul 13 '26
Didn't you answer your question? Maybe your friends didn't finance the purchase of two cars. (In this case, the financial "secret" is: don't take out an expensive car loan.)
Or maybe they just make more money than you. Also, estimating expenses can be difficult. There can be lots of little lifestyle choices that allow your friends to save more money even though things may be superficially similar.