We’re about to start getting into the good stuff. Not just getting yourself out of debt, but building some savings, and before long, some wealth. But before delving into the logic and numbers, I want to talk about emotions. Because money, especially spending money, and emotions go hand in hand. Marketing depends on it.
How we feel about money, and spending and saving, starts with what we learn (or don’t learn) and see (or don’t see) in childhood. For some people, image is highly important, for others security is much more crucial. Some people learn to save and budget, others learn to spend uncontrollably, and some never have much personal interaction with money in childhood and don’t learn much of anything.
Scott and I both had odd childhoods when it came to money. My parents were both more than comfortable when I was little (they each owned homes and cars and never worried about paying bills, and even took vacations once in a while). But when the economy took a turn in the late 80s, their financial situations drastically changed. My mother’s income went down by more than 75%, and my father went from running his own successful business to working 2 full time jobs. I never went hungry, and the mortgage always got paid, but things were rough for a couple years. They rarely talked about money in front of me (who wants their kid to know that they might not be able to pay the electric bill?), but the stress they were under was palpable, even to a kid. When I got older, I was not allowed to work during the school year, except babysitting on the weekends, and they started giving me an allowance when I was a junior in high school, so I got little practice at earning, saving and spending money before I was an adult.
Scott grew up both well off, at his dad’s house, and poor, at his mom’s. On his mother’s side, most of the family was pretty conservative with their money. They planted gardens, canned food for the winter, hunted, shopped yard sales and bargain hunted. At the same time, on his father’s side, image was incredibly important. How you dressed, what you drove and what you did for a living (and consequently, how much you made) were all important. In school, after being ridiculed for his clothes and sneakers, off-brand items that his mother bought at inexpensive department stores (kids can be such fucking assholes), he asked his father to buy him expensive new clothes that stopped the cruel comments. This would be a formative event in his life.
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All this to say, our upbringing has a significant impact on how we view money. But it isn’t the only thing that affects our spending and saving.
Buying things makes us feel happy, and inexplicably, in control. Sometimes, we feel like we deserve to buy ourselves something for all our hard work. And sometimes, we want to keep up with our friends or neighbors or coworkers. But appearances can be deceiving. Driving a fancy car and living in a huge house looks wonderful from the outside, but you can never tell how leveraged someone is, how much debt they’ve taken on, to show the world how perfect their life is.
There is a science behind marketing (using everything I mentioned in the previous paragraph, and a whole bunch more) to make you want to buy all those bright and shiny pieces of junk that fill up thousands of square feet in department stores. We use them for a short period of time and then they end up in a yard sale or a land fill or a storage unit. We don’t really need this year’s phone or this year’s car, when the one we got a year or two ago still works perfectly. Marketing makes us think we do.
So, how do we combat our childhood and our asshole reptile brain and a materialistic society and advertising companies, all working together to get us to buy as much crap as (and for some, a whole lot more than) we can afford?
You have to stop buying things without thinking about them before hand. No more mindlessly adding things to your shopping cart and leaving with a car load of crap when you went into the store for one or two items. And if you do decide you need or want an item, after really thinking about it, try buying it second hand, if you can.
Avoid buying cheap throw away versions of items you do need. Spending a little more money on something of higher quality (and/or buying it second hand) instead of replacing the made-to-be-broken version you saved a few bucks on every year or two.
Consider what you are giving up before making a purchase. If you knew you could have enough money in the bank to not worry when an emergency popped up, or you lost your job and it took a month (or longer) to find another one, or to actually retire someday, would you give up that $4 a day coffee? Trade instant gratification for financial stability.
Buying stuff may feed some primitive desire and make us feel happy in the moment. But being financially sound removes a whole layer of stress from your life. What does Walmart sell that’s better than that?