By Stacy Williams
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It might sound cliche` or old fashioned, but we could all really learn a lot from our grandparents. The generation that lived through the Great Depression learned a little about everything but one thing they learned a lot about was money. In fact, they learned so much about money that a lot of them actually ended up making A LOT of it over the course of their lifetime. The Great Depression aside, there’s a pretty simple reason that most ofour grandparents were/are usually pretty great with money. There isone fact about it that they knew but most of us have forgotten.
Now I want your promise that before you continue reading this post that you won’t throw things at your computer screen because this is so simple. In fact, it’s so simple that it has been staring you in the face everyday of your adult life. Are you ready?
You can’t spend more than you earn.
I can see you now. Palm on face yelling “REALLY?!” at your computer screen. Simmer down for a sec and let’s chat.
The #1 Thing Your Grandparents Knew About Money
We live in a society where the norm is to spend more than we earn. We do it every single day of our lives and no one thinks twice about it. The ability to do so hides within our wallets, in our desks, on our computers where it is made so easy to do that we often don’t blink and eye at it.
The ability to spend more than we earn lurks in the background of our lives in the form of a credit card, a payday loan, a personal loan or anything else that you buy on credit.
Too often we jump at the chance to take a loan or to borrow money. We basically lie to ourselves telling that inner voice that says not to do it to hush and be quite. Let’s be real for a second though. While it’s incredibly easy to say yes to borrowing that money or putting that new item on your credit card, those loans and charges are making you broke. You may only be looking to borrow $1,000 worth of whatever, but by the time that you pay interest, loan fees and more you’ve paid considerably more than that. To put it mildly? You’ve paid someone your hard earned money for the privilege of borrowing their hard earned money.
What we don’t realize is that debt adds up. Sure, it starts with a single loan, maybe a few hundred dollars, but before we know it, we’re buried under hundreds of thousands of dollars. Did you know that the average america family is more than $225,000 in debt? That’s INSANE to me! Why is it okay for us to spend more than we make? I know that I personally don’t earn even $225,000 per year. Not yet anyhow.
There are some who will say that using credit is smart. Noooo, what is smart is saving for the things you need. Instead of buying a new car on a loan, make a car payment to yourself and save yourself the financing fees and interest. It sounds hard, but when you take it down to the bare basics it really isn’t.
Instead of taking a personal loan to cover that pop up expense, build an emergency fund that will be able to handle it instead.
Instead of buying new clothing every month or year, shop your own closet to see what you may have that you’ve forgotten about.
Use what you have in your home to make extra money to spend for the things you can’t afford instead of swiping your credit card to pay for them.
If your budget isn’t working and you’re having to rely on credit? Figure out why your budget is failing.
Live simply.
The very, very simple truth about it all and the entire point of this post is simply this:
You can’t spend more than you earn.
Stop listening to convention, stop living like everyone else, stop relying on money that you don’t have. You might just be surprised at how big the difference is in every single aspect of your life. After all, a lot of our Grandparents did.
