One of my favorite quotes has always been “Stop thinking in cents – Anybody can make a buck” and when it comes to saving money so many people think about today but forget about tomorrow. Living paycheck to paycheck is a harsh reality for some but it’s also a lifestyle choice for millions of people.
Living Paycheck to Paycheck a Choice?
We live in a society where expensive instant gratification is everywhere. Whether it’s the $5 Venti Mocha at Starbucks (Venti is Italian for 20, the number of ounces in a Venti, if you must know), an instant not-free upgrade to the newest cellphone you really don’t need, a VIP upgrade which will reward you with a croissant in the morning or any number of other things. Life has become more about how much companies can sell you versus how much you really need.
The problem here is not with the companies.
It’s part of any business plan to make you think you need their product. The problem is with you.
Yes, I am saying the fact that living paycheck to paycheck is your fault.
No one needs a new BMW, a Louis Vuitton purse, $300 shoes, $150 haircut or a $12 sandwich. You choose to do this.
No one needs to overpay for car insurance coverage, pay $5 ATM fees, spend $2,700 on a new TV or live in a $500,000 house. You choose to do this.
Americans are not good at math. In fact, we are pretty awful at the whole 1+1 thing.
According to the OECD Program for International Student Assessment, Americans ranked #25 out of 34 countries in 2009 when it came to science and reading. U.S. 15-year-olds had an average score of 487 in math on a 1,000-point scale – they couldn’t even get half the testing right.
Big companies know this and they hire experts to manipulate marketing so you will feel the need to buy their product. Remember the CNBC documentary “Supermarkets Inc.” where experts were interviewed on how they manipulate inventory displays at the grocery store so you will buy more. Well, it happens everywhere you go.
Free will is questionable at best in a free economy
People certainly have free will to buy whatever they can afford (or have a credit card limit for) … but some marketing team is going to spend millions creating how your “free will” mind thinks. We are all puppets to the Benjamin Franklin notes.
“Stop thinking in cents – Anybody can make a buck”
This quote has always been so strong with me as it applies to you, your friends, your aspirations, your savings and everything. Almost everybody knows someone with money and many of these people are entirely no different than you or me. Some are even less qualified or educated so how did they ever manage to save money or create a successful business?
How many people do you know who often make a few dollars with a decent idea? Probably a few. Why? Anybody can make a buck. While it’s certainly a rush to buy something for one price and sell it for a profit this does not make you a businessman.
Wait a minute. I buy things and flip them all the time? I’m a businessman.
No, you’re not. You are a flipper.
Anybody can do what you are doing. Not everybody can be a businessman (or woman). Get a plan together and make that part time, unpredictable income into a venture somebody will buy from you.
A real business is one which can be sold, not one that only you know about.
Most people with money have one thing in common – A Plan
Most consumers rarely have a plan that extends past the next 24 hours. A perfect example is how many will spend $100 to save 50% on something they don’t need whereas the “saver” will simply look at the $100 cost and analyze whether or not that the $100 can be used in a better way. The 50% savings is not even relevant to the “saver”.
Saving is something we learn.
It’s natural to be tempted by these 50% sales (much like it is to walk by Magnolia Bakery and feel compelled to complete a cupcake transition) but you must learn to accept that you need to learn how to save. You already know how to buy.
For people living paycheck to paycheck the same rules told 20 years ago still apply today. Write down all your monthly expenses and cut out what you need. Don’t worry about how to invest your money. A savings account is just as good as anything to get started.
If you can’t afford a vacation then you really don’t have the capital to miss out on great stock investment returns.
Just keep your money safe and watch it grow. Once you get enough you should start seeing changes in your attitude. Much like losing weight a saver rarely returns to his pre-saving days.
Think about where you want to be in 5 years. Get a plan together and if this doesn’t include the annual trip to your closet throwing out clothes you don’t need (again) then you may just be making some progress.
If all else fails then just accept living to paycheck to paycheck means you’re still better off than most people in this world, except it really is all your fault.