Spoiler alert: It’s not the salary or the opportunities.
Photo by MART PRODUCTION
I was scrolling through my Tiktok feed the other day when I saw a video of a “realistic payday routine” by a young girl in her 20s making $70,000 a year.
At first glance I thought it would be a positive video where she would teach me financial tips since the girl started paying her credit card in full until I watched all her payments and realized the big problem of the young population.
Here is the synopsis of the entire video:
“I got paid $2004.66 net. I had a few hundred dollars left in my checking account, so my total balance is $2,421. First, I always pay off my credit card in full, and unfortunately my bill is pretty high right now ($1,8881.76), mainly because I had to pay $500 for a hotel in Chicago as we were visiting some friends this weekend, and I had to, too Pay $700 to do my taxes.
And that leaves me with $539, not enough to save anything and not enough to put anything aside for my big bills coming up like rent and my car payment. I’ll probably have to pull money out of my savings to cover my expenses for the next few weeks, but don’t worry about me as I’ve given up all my financial goals long ago.”
What shocked me the most about all this bogus stuff was that 90% of the comments said “finally someone is making a proper video about finance” and “I love that I’m not the only one.”
But that’s the reality. Almost 90% of people in their 20s are broke. More than 50% of them receive help from their parents and almost none of them have any savings. According to another study, Millennials between the ages of 22 and 30 have an average net worth of -$20,000 (yes, negative).
And many of them even make good money. The problem is one reason: they don’t want to wait until they’re stable enough to be able to afford a lifestyle.
Young people do not know how to prioritize their income. They focus on immediate pleasure and the simple life. Also, they don’t understand the value of money.
The young girl in the video spent more than 1/4 of her net salary ($539 of her 2004 paycheck) on two nights at a luxury hotel “to visit some friends.” And nearly half of her paycheck to “do her taxes.”
She could have paid something more modest that was within her budget range if she had to make the trip, and taxes is a task she could have done herself with tools that give you exactly the same number on the web for free.
But she decided to throw away two weeks of hard work for two nights and a few hours of non-math.
The problem is not to travel and have fun. It’s that you need to know when you can afford a type of life.
A salary of $70,000 is excellent, much more than average. It can enable you to save and invest comfortably while still having certain joys and even having a family.
However, if you don’t know how to lead yourself well, you will never achieve greatness.
I know a lot of people on less than $60,000 in salary, and they travel, go out with their friends, and also save up to buy a house.
However, if you never imagine that sometimes you have to give up certain pleasures that you currently cannot afford, you will always feel that “you can never reach your financial goals”.
Wealth is about making certain sacrifices and you don’t have to do everything you like because “you have to save” but work smart with what you already have.
If you have rent or your car to pay, find a way to learn how to understand your taxes. If you cannot learn it or find it very difficult, then postpone your journey until later.
But don’t try to be a superhero and want everything when you know you’ll have more important things to pay for later because you’ll be in debt forever.
There’s always a birthday, a trip, or bills to pay. If you keep saying you’ll save later because you want to do everything now, then you’ll never make it.
The wealth you will have in the future depends on the things you want to prioritize in your present. And you need to be able to understand what matters most to you, a single overpriced hotel trip for a weekend or financial freedom in your 40s.
i love luxury I enjoy a good restaurant, excursions and buying myself what I want. However, I will never put these things ahead of my financial well-being and future.
No matter how good a restaurant is or how much I like a handbag, there will never be a better time than being able to retire later and have a comfortable life while I’m young.
I don’t want to work my whole life, and knowing that, I will never put immediate pleasure ahead of my financial freedom.
However, I still travel twice a year, go to events with my friends, and pay all my bills and credit cards on time (and I’m not on my $70,000 salary yet). The trick is finding a balance between what I can afford now and what I want to achieve in the future.
The balance of paying for one thing at a time has kept me stable and knowing that has enabled me to achieve great things.
Most young people in their 20s are broke because they don’t understand that they can’t afford a lifestyle.
They earn well but move into a luxury apartment because it has windows and a pool. They don’t have money to pay for car insurance but the restaurant bill last Friday was $150 and they have to pay $700 every year to pay their taxes but they don’t take the time to figure it out from a $50 course to learn.
If you understand your current limit, work to control your lifestyle, and have a balance (even if it means going without certain luxuries for a month), you may be able to save every month.
But don’t spend all your payments in 48 hours and then complain online that you don’t have enough to pay your important bills because the fault isn’t with the government or the system; you’re the one.
