There are plenty of professionals who don’t live by those “expectations.” Sorry to disappoint. We purposely chose not to go that route. College was the exception.
I agree with @shawbridge. Sometimes a timely gift makes all the difference. When we were both furloughed, with a baby and a toddler, no airline jobs in sight and little savings, it was terrifying. My parents gave us a 2K gift, not due to any realization of how bad things were for us, but because my sister had asked for the same amount to replace their stove, and they were just trying to be fair. To this day, I don’t think they realize what a big difference that made in our lives.
I’m not disappointed. We are professionals as well. I understand that not all professionals live by those expectations. I was merely recollecting what I had read in the book. And, yes, @Ptondad I agree it’s the influence of other doctors, not patients. And, I’m not picking on doctors. That is the example (doctor v. plumber) I remember from the book. But, perhaps I am not remembering correctly. The book makes generalizations - I get that not everyone fits the mold the book lays out - plumber or doctor.
We, too, lived far below our means except for college. It’s what enabled my dh to retire at 55. Though he has since gone back to work.
I suspect family and early life circumstances have as much if not more of an effect on spending and savings habits as professional peer pressure. My parents grew up in a foreign country devastated by WWII. They have been frugal throughout their lives, even after my dad “made it” as a senior scientist/business unit head of a large US corporation. Used to drive my mom crazy that my dad would circle city blocks endlessly looking for free street parking vs pulling into a pay garage/lot. I hear from my friends with parents/grandparents who lived during the Great Depression on how frugal their parents/grandparents are to this day.
For most of my childhood, I grew up in very modest circumstances as recent immigrants with my dad attending grad school. My parents paid for college after the proceeds of my FISL loan. I was on my own for law school. When I started my first job after law school, I banked one paycheck and used the other for expenses. Of course savings was made easier because I had so little time to spend money. To this day, I still look at unit costs of similar products at the grocery store. I contrast that with my brother who had more time growing up when we had decent household income. He and my SIL are not spendthrifts, but they have a different lifestyle than us in terms of vacations, eating out, entertainment – the extras. They don’t have kids and he is a very successful doctor, so who is to criticize their choices. My kids are the beneficiaries of their very generous uncle and aunt every birthday and Christmas.
The challenge for us with our kids was how to create an environment which would foster a hunger to succeed on their own and to look towards the future vs satisfying present needs/wants. I think W and I did a good job not spoiling the kids in terms of not giving them what they wanted when they wanted. We tried to implement a reward/penalty system when it was time to give them an allowance – kind of like our family UBI experiment. So far, kids have turned out fine. I always worry though about “hunger” dilution with each generation.
I don’t see a hunger dilution at all with this current generation. In my experience, they are a very hard working bunch, just with different priorities.
I also find that with my own D, she is very aware of her privilege and has been trying to go overboard to prove that she can do things on her own. I think one of the big reasons she didn’t apply to Cornell is because she would never know if she earned it herself or got in because of her legacy status. She refuses to use family connections for jobs, insists on paying for as much as she can herself, etc…
If anything, she’s more driven at her age than we were.
@CountingDown , I think CCers are a different breed, and I think that many people do fall into the expectations of their milieu. We, too, made different choices a lifetime ago. But I remember having occasion to be temporarily living/working in an area that is very status conscious. I remember thinking, “wow, if I did not know better, I might want fancier cars and more jewelry myself.” After several months there, it was easy to see why people who don’t know any different get sucked into keeping up with the Joneses
I think it can be small things that creep in.
I used to live in an upscale suburb. I live in a poorer rural area now.
When I lived in the other place, people had things done for them. Someone came out and washed your windows and changed your screens. Many had house cleaners and lawn services. It was an acceptable practice in that neighborhood. People had tutors for their children. Your kids went to private music lessons. They played in summer leagues and outside athletic leagues. Everyone sent their children to summer camp. I never met anyone who went to summer camp for the entire summer, but I met people who had and sent their children to the camp. These were just things you saw.
Most went somewhere for spring break. The school had pay to play, I think it cost me somewhere around $600. You were given a list for school supplies and everyone brought them.
Absolutely none of those things happen where I live now. None.
When FIL was alive, because my BIL was constantly reckless with his $, FIL would gift him $ and then give an equal amount to his other 2 kids (sis in law and DH). We greatly appreciated it and banked it (as did SIL). Fortunately our kids are fiscally responsible and currently financially ok. We are considering starting to gift them annually, as my FIL had. As other have said, better now than later
+1
My daughter (from my first marriage) refused any help during grad school, although she had allowed me to pay for undergrad. She wanted to do it herself.
I finally got her to accept $30k/year (the annual exclusion amount) when I had the “aha” moment of reframing it as a gift to me, to allow me the pleasure of making a difference in her life that I could be alive to enjoy, rather than thinking she would inherit at a time (hopefully) when it was just some additional money to throw into the accounts. She does great things with what she has (eg, two years Peace Corps, working with kids at risk, etc.) and I’m really gratified that I have made that a bit easier for her.
I live in a rural area of my state (CT). Every single thing you have listed above was done by us, and our cohort of friends. Believe me when I say, none of us is uber wealthy. Just families who had the resources to do the above…and many where both parents worked (thus the housekeeper and lawn services).
The Thumper parents required both of our kids to take private music lessons starting in 5th grade. We were willing to fund these lessons as long as the kids did their share (practice).
I need to say definitely that we are not the least bit status conscious, and we are not keeping up with the Joneses.
People in less wealthy areas do the things you mention…and also folks in more rural areas.
I will handle all of the yard work, wash windows, rake leaves, clear snow, etc. no matter where I live. My dad mowed his lawn until he was 85. We still have to yell at him not to clear snow from his driveway in his late 80s but thankfully he doesn’t get much snow (if he lived where I live it would be a big problem). So I have what I hope is at least another 30+ years doing the same.
I could afford to pay someone to do those things but I enjoy doing them. Gets me outside and provides some exercise.
Many in my neighborhood do none or few of those things themselves. Talking with some of them over the years it has nothing to do with the Joneses. They would be paying someone to do those things if they were the only ones in the neighborhood who did that. They have the money and do not enjoy doing the tasks themselves.
Similar with cars. In my experience (which varies of course) its very rare the neighborhood/community where every household buys/leases new cars every 2-3 years. And even in those cases where each and every household does and you absoutely have to cave into peer pressure to get by, seems likely there will be many other barriers to wealth accumulation at play.
On the next generation in wealthy families, I have seen where it depends. I have seen a number of kids from wealthy families with strong drives to be successful on their own. One good friend with a son who is extremely determined (graduating college next spring) to exceed the success of his parents. Will be a very tough task as his parents are extremely successful. But the drive/hunger is no doubt there.
But I have also seen kids from wealthy families who were spoiled with little drive to be anything on their own. A surprising number who do not graduate high school much less college. Many in their 30s/40s struggling to find a path and still dependent on parents for support. Remember someone at work asking his kid if he wanted to go to a baseball game that night and the response back as “Is it in the loge?” With the clear implication if it wasn’t the answer was no. Fast forward 10 years and the kid is still looking to launch.
What does this keeping up,with the Joneses discussion have to do with retirement which is the subject of this thread. I apologize for responding myself to that off topic tangent.
My (by some poster’s opinions) entitled and privileged kids are both very hard workers. Both already have retirement accounts. Both are careful spenders, but I wouldn’t call either of them frugal.
Still…in terms of planning for the far away future of retirement, they both have a good start. Did they learn that from us? Maybe some of it. But both took personal finance courses along the way in their studies. Both said this was very valuable because it gave them a good understanding about money management and investments…introductory but good.
Now that I’m retired and DH is closer…we have shared the details of our retirement finances with both kids…plus the strategies we were able to use to get there.
We also discussed our spending priorities as they were growing up, and why we made the decisions to do the spending we did…or not. It makes good discussions!
@deb922, as MND suggests, the effects of a peer group are subtle and often effective, though not everyone succumbs. But, it just seems natural to send your kids to summer camp if everyone else in the neighborhood does. ShawWife and I intentionally moved into a less affluent neighborhood in a very affluent town. The less affluent neighborhood was people who worked at the public radio station and in non-profits but has morphed over time to software engineers. The more affluent neighborhood has CEOs of biotech companies (I know at least 4) and partners at major consulting firms (not sure how many) and CFOs of investment firms among others (also a CEO of a hedge fund company now that I think about it). We wanted the excellent school system the tax base could support but didn’t want our kids growing up in a neighborhood where the kids thought that going to the Cayman Islands over spring break was a birthright.
Now that they kids are grown, we recently moved to the fancier neighborhood. Many houses on the street are probably 5000 or 6000 sf and the yards are perfectly groomed – at any time of any day, there are at least two or three landscaping trucks parked on the street. We are hiring landscapers – there is just too much for one person (ShawWife) to do unless she wanted to give up her career.
I don’t mean this with any animosity or offense. But rural CT is vastly different than rural northern Michigan.
. I was saying that in certain parts of the country, some people have different ideas of what they spend their money on than other places.
Can we move on with this conversation.
I am confused. What is wrong, IF someone can well afford it, with hiring others to do things that can’t or don’t have the time, skill or desire to do? That’s what keeps our economy going. This differs from “keeping up with the Joneses” which seems kinda pointless to me, though I guess there are, sadly, people who do it.
My next door neighbor’s husband has created and sold a few companies. They can hire someone to mow their lawn if they wanted, but she likes to do it, so she does. Its a choice. And our lawns aren’t that big.
My grandmother had a magnet on her fridge that said something to the effect “If you want to hoot with the owls at night, you won’t be able to soar with the eagles in the morning.” If you are busy keeping up with the Joneses (particularly if you have less income than the Joneses) you will likely need to cut somewhere else. And those cuts may well be in retirement savings. Tie to retirement with the concept is greater than many of the other subjects discussed in this thread.
No doubt that different people have different ideas on how to spend their money. But I don’t think its limited to certain parts of the country. Broad brushes are the norm around this place though.
Not sure I see anyone here saying its wrong.
I guess I am surprised at how many people are swayed by peer pressure here. Would think that wouldn’t be an issue with the “elite” that call this place home. Maybe there are just different concepts of “elite.” 
One last thing to add…I definitely agree about different areas of the country. When we lived in Memphis, it seemed as everyone in all income classes were intensely involved in team sports. If your kid isn’t involved in the sport by age four, he’s behind, never gonna catch up! Gotta spend all your time and money on these select sports, spending the weekends and summers traveling, or your kid will be doomed, doomed, I tell you.
In Seattle, the team sports scene is much more laid back. Shoot, we lost our professional basketball team because we weren’t attentive enough. Some kids (gasp) aren’t even involved in team sports at all, and do things like chess or robotics team with their free time, usually much cheaper and far different. Having kids who were striking out in T-ball, it was a nice change.
And now, after Covid? Things that seemed all so important are drifting by the wayside. Does it really matter anymore that your kid isn’t having the optimal experience and opportunities every single second of the day? Maybe it didn’t matter that much in the first place, but we thought it did, when everyone around us was making such a big deal about it.
This thread is about retirement and preparing for it. I don’t care if you made a dollar or a million a year at any point in your life, if you get the chance to retire and to not have to worry about making ends meet - really like I would guess the majority (50+% of the population) than count your blessings.
That is all I’ll say to hopefully put everyone back in the frame of mind of preparing for retirement from meaning you will be able to put a meal on the table at night or that you’ll be able to travel to your hearts content. Don’t ever forget the guy or gal who is preparing that meal and being very thankful for it.
As @saillakeerie wrote, people may be spending to keep up with the Joneses rather than socking it away for retirement. Of course, to say it’s one or the other - to spend or save - would be a false dichotomy. We are all doing both. Allocating ratios properly so one can enjoy what one has AND save for retirement is what the goal should be.
Dave Ramsey says to live like no one else now so you can live like no one else later. I think that sentiment just means not to get sucked into keeping up with the Joneses. Because many people do live in competition with the Joneses.
Those of you who are gifting significant amounts to your kids “now” - How are you sure you won’t need that money for your own retirement?
We are not rich, but my husband and I will both have pensions, and it’s very likely we will have a significant amount left for our kids. However, we have no long term care insurance, and my mom had significant dementia before she died (at 70).
So, we think we need to have a large chunk of money to fund LTC if necessary.
We paid for undergrad degrees and safe started cars, and have “budgeted” a round number for each kid during our retirement, but we worry a little that if we give too much now we Won’t be able to give the gift of them not having to worry about us later.