“Take it home today and make no payments for one whole year!”

“He who dies with the most toys wins.”

“Bling bling!’

The messages are all around us in bumper stickers, ads, movies and music.  The culture screams: “You work hard – spend it and enjoy it.”  Or better yet, spend money you don’t have yet.  They’re more than willing to give you a shovel to help you dig yourself in a hole you’ll never get out of.  Do you need it?

He Who Dies with the Most Toys Has… Nothing

Or, as noted financial sage and budgeting guru Shania Twain sings in the classic “Ka-Ching!” :

“We’ve created us a credit card mess
We spend the money we don’t possess
When you’re broke go and get a loan
Take out another mortgage on your home”

Many from older generations only bought what they could afford.  If they needed a car, they’d save for it.  That is the biggest problem I see out there today:  no one saves.  Not only do people not save for what they want or need, no one saves for the inevitable rainy day.  And into every life, a little rain shall fall.  What happens when that rain comes?

“Consolidate so you can afford
To go and spend some more when
you get bored”

I recently wrote about how many people don’t have a budget.  This is an important step.  But once you do budget and do have a clue about how much you take home each month, and then how much you’re spending monthly on necessities like food and gasoline, how do you make the most of the money left over?

Save Money by Paying You

The ideal solution is to Pay Yourself First, that is to save 5% or 10% of your take-home right off the top.  Save your money. But competing against that is the “buy now!” mentality of getting all that your heart desires. It’s therapeutic to go out and shop and come home with shopping bags filled with clothes or DVDs or new Apple Phone or iWatch that used your remaining disposable income or were put on a credit card.

“Can you hear it ring
It makes you wanna sing
It’s such a beautiful thing–Ka-ching!”

However, unless you’re paying off your credit cards every month, you are using these “buy now pay later” shovels to dig deeper and deeper into the credit card trap.  One day, you’ll need to pay it off.  When will that day come?  The next big fat tax refund?  The sweet bonus that you’ll get next year?  Winning the new super mega lotto jackpot?  Even if those things come through, is paying off the debt you created going to be your #1 priority?  Or will you just buy more things?

“Lots of diamond rings
The happiness it brings
You’ll live like a king
With lots of money and things”

In Closing

If you’re like a lot of people, you’re keeping up, doing “good enough.” Chances are, you’re just making minimum payments, which is like treading water. One day, the music will end. No one ever predicts that a coronavirus shutdown would lockdown the economy and millions of people will be out of work all at once. At  that point, saving tips don’t help. Either things will get maxed out, the income will go away or some sad tragedy will cause a real cash management crisis. What will you do then?

Don’t be stuck holding the shopping bag of debt when the music stops.

Make an appointment for financial advice and counseling.