Unclaimed Money

Have you ever known people who seems to be broke no matter what? In college they are broke, because after all, they are just students, there is not much income. Then after graduation, they are working, hopefully in their field, and still broke because now they have all those student loans to pay off.

You meet up with them a few years later, they have landed the promotion, and the big raise to go with it. Perhaps they are married and their spouse is also working a good job. They have a big beautiful home, furnished with all the bells and whistles. They are driving new cars, and are dressed to impress. Yet, they still complain of being broke, and just how expensive things are these days. They are broke, no matter how much they make.

The story above is not about any particular person. Parts of it do resemble my financial history, and I’m guessing many of yours. We all have a tendency to spend to, or even beyond, our income level. When our income is small, there aren’t many frills, and we still have trouble making ends meet. When our incomes are comparably larger, there may be more nicer things around our home, but many of us still feel the same stress and pressure of living paycheck to paycheck. The pressure of being broke. How can that be?

It is because we have never learned to live below our means, or to be content with what we have, no matter what our income level. Living below our means takes a great deal of discipline, but it can be done. First commit to not incurring more debt. Don’t use the credit cards, unless you are one of those rare people disciplined enough to get the rewards with out running up the balance. Then to guarantee you are living below your means, siphon off a portion of your income before you start spending it. You can do this as you deposit your check, or set up an automatic withdrawal from your checking. Put the extra money in savings, and/or donate it to charity. If you do get a raise, dedicate most of it to your savings. Of course if you are carrying debt, it would be wise to put that money toward your debt. You will pay off that debt faster, and still be teaching yourself to live below your income.

Contentment is a little harder to develop. It involves a change of thinking and of attitude. If we were truly content, it would be easy to use the next raise for our savings or debt, but for most of us it is not. We see a friend’s new flat screen T.V. and suddenly our model seems inadequate. We are bombarded daily with information designed to create a feeling of need for a 100’s of products. It is hard to stay content with what we have. A couple things that may help put it in perspective; think about the payment that goes along with that item, and the number of hours you would have to work to pay for the item.

We must learn to live below our means, and to be content there. If we don’t, we will stay in debt. We will accumulate stuff, but never the security that comes with accumulating wealth. We will be broke, no matter what our income level is.

This entry was posted on Thursday, October 25th, 2007 at 3:27 pm and is filed under financial life. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.