How Does Anyone Have Money? A Guide for the Financially Confused
Written by
Cindy Lamothe
Edited by
Jenna Klaverweiden
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You know the feeling — you’re scrolling through social media, and someone your same age just bought a house, adopted a golden retriever and casually remodeled their kitchen all in the same week. Meanwhile, you’re wondering whether you can stretch your last $23 until payday by surviving off ramen.
Money, apparently, is a thing people have. But how? Between rising costs, inconsistent income and the eternal mystery of where the heck your paycheck actually goes, it’s easy to feel like you missed out on some crucial adulting class.
If you’ve ever asked yourself whether you’re doing it wrong, welcome. This guide is for the financially confused, the money-curious and anyone who’s ever panicked at the checkout line after seeing their crazy bill.
Also see the essential components of a solid financial plan.
Some Who Seem To Have It All Together Might Not
Many years ago, Andrew Lokenauth, money expert and owner of Fluent in Finance, discovered that his seemingly wealthy neighbor was actually drowning in credit card debt.
“He had the fancy car and designer clothes, but it was all smoke and mirrors,” he said.
Lokenauth noted that a significant number of Americans are living paycheck to paycheck, including people making over $100,000. In fact, Gagan Saini, CEO of We Buy Houses in Central Valley, said he meets families earning $150,000-plus who live paycheck to paycheck because of lifestyle inflation, while others making $70,000 build substantial wealth through strategic habits.
The difference, Saini explained, isn’t always about how much you make — it’s about financial education, money psychology and opportunity access.
Some Keys for Managing Money
Lokenauth started tracking every single dollar he spent. While it wasn’t enjoyable at first, he stuck with it. Cutting recurring subscriptions, for example, can alleviate your wallet significantly.
Another important point: Get real about your “fun money” spending. Most people go overboard with these funds without realizing it until they can’t pay their electric bill at the end of the month.
“The biggest game-changer for me was adopting the 50/30/20 rule,” Lokenauth said. Here’s a breakdown of what this looks like: use 50% of your income for necessities, 30% for wants, and 20% for savings and debt.
“It’s not perfect — sometimes life throws curveballs — but it’s helped me build $5,000 in savings over eight months,” he said.
Build Multiple Income Streams To Grow Wealth
Something people may not think of when trying to save money and build wealth is having multiple income streams. In fact, according to Benzinga, the average millionaire has seven income streams.
Building multiple income streams is crucial. As a young adult, Lokenauth said he started a small side gig doing freelance work that brought in an extra $400 to $600 monthly.
“Not life-changing money, but it all adds up. Plus, it gave me some security knowing I’m not totally dependent on my main job,” he said.
Speaking of Jobs, Negotiating Salary Is Essential
Negotiating your salary isn’t just a nice-to-have skill. It’s a nonnegotiable if you want to build long-term financial stability. Yet, many people avoid it out of fear, discomfort or a lack of preparation.
“I used to be terrible at this — like seriously awful,” Lokenauth said. But after bombing three salary discussions, he said he finally learned how to do it right. He said he received a $20,000 raise by documenting his wins and practicing his pitch until it felt natural.
Keep in mind: Negotiating isn’t about being pushy; it’s about advocating for your worth and normalizing a conversation that should be part of every professional’s toolkit.
Build Financial Stability
Understanding the reality of wealth distribution — and taking concrete steps to improve your situation — can seriously help break the cycle of feeling perpetually broke.
“Remember this isn’t about becoming a millionaire,” Lokenauth said. It’s about building stability, creating a buffer between you and disaster, and maybe, just maybe, getting to a place where you’re not checking your bank account before every purchase.
“One last thing — comparison is the thief of joy — and financial sanity,” Lokenauth said. That’s why you should focus on your own progress. Remember: Those people posting vacation pics from the Maldives might be charging it all to credit cards anyway.
More From GOBankingRates
Sources
- Andrew Lokenauth, Fluent in Finance
- Gagan Saini, We Buy Houses in Central Valley
- Benzinga, “The Average Millionaire Has 7 Sources Of Income – Here Are 3 You Can Start Building Today.”
