I feel like there are a few factors:
- Yes, some people just are borrowing from their future to fuel today. $70,000 cars on $70,000 salaries and replacing the cars every 2 years. In debt up to their eyeballs and if they don't get a raise or a bonus or some overtime this quarter they won't be able to get the credit cards to a number they can cash flow to maintain their perpetual balances.
- Others are maybe not as bad off as you think because sure they enjoy their cars, but they eat at home and don't vacation and do all of their own home repairs - it can be a matter of trade-offs. For close friends you may have a better picture of all of their trade-offs, but for many folks you only casually know they might advertise fancy vacations and yet you won't see that they do their own car maintenance, home repairs, clean their own home (no maids), do their own pest control and lawn service, etc.
- Some people have a lot of family support. This may be monetary in terms of $$ for down payment on house, no student loans, tons of support to move/start first job out of college, living at home for first 1-2 years after college, staying on parent's cell phone/netflix/health insturance plans, etc.......or it may be non-monetary such as free daycare for kids age 0-5.
- Most people simply *are not saving*. If you look at average 401k balances, that shit is depressing. Most people *might* contribute to 401k just to get the match and that's it. If they lose their job they immediately pull from 401k due to no savings.
- Imagine what luxurious life you would lead if you didnt save an extra 10% per year, you had $15k in free childcare, and/or no student loans.
You left off a significant one, which is that quite a few people are just rich, by most people's measures, and can afford nice things and still save a reasonable proportion of their savings.
Even if only 1 in 8 or 1 in 10 households are like this, our selectivity bias can easily make us think this is "everyone", particularly when augmented by some households in those categories you mentioned who are social climbing.
I would also add to this our self-segregation into our own economic spheres. Even being in the US puts me in a relative wealth bubble compared to the rest of the world. I work a nice, professional job, which means every day at work, I am surrounded by a bunch of UMC professionals and well-paid support staff. At home, I live in a "nice" neighborhood with fellow UMC professionals, because of course we all want good schools for our kids and good commutes. So every day, I am surrounded by people who are just like me. That means that if I am in the top 5% of wealth in the US, I am surrounded by other people who are also in the, say, top 2-15%. So I
feel average. Heck, maybe I even feel
below average, because I stretched myself financially to buy a house I could barely afford to get into the "best" school district and make sure my kids had the "right" friends and all that; if you're in the top 5%, but every day you're surrounded by people in the top 1%, then yeah, you're going to feel poor, even though the reality is that you are one of the richest people on earth.
If you want to feel less poor, get out of your wealth bubble. Start noticing all of the invisible people you interact with but don't pay attention to because they're
not driving shiny new cars or being profiled in the NY Times. Spend time physically in other areas outside your own neighborhood or country. Live somewhere where you're not surrounded by all the ShinyPrettyFancy things -- because, yeah, those are tempting, and when you're around them all the time, they start to feel like a totally normal expectation rather than the super-expensive privilege they are.
Best decision I ever made for my own mental health was to choose to live in a neighborhood where the median income is well below ours -- where we share the similar consumption levels, even though our income is much higher. We didn't look for the "best" school -- those rankings are entirely correlated with socioeconomic status anyway -- but rather looked for the school that had good scores and results despite having a much more mixed student body. I don't spend one second looking around and wondering how the guy down the street can afford to take his 4th vacation of the year or buy his third Audi in six years, because people here just don't live like that.