Two weeks ago, I was hanging out with a large group of people when one of them made the comment, “Well, you know how it goes… the money comes in, the money goes out … and maybe a little bit more!” This comment was met with laughs by several people.
I just kind of half-smiled, looked down at my drink, and said, “Well, that’s one way to live, I guess.”
The other person turned to me and said, “What do you mean? That’s just the way it is.”
That’s just the way it is?
The Bureau of Economic Analysis reports that the average savings rate in America has hovered between 0% and 5% over the last decade. For those uninitiated, this refers to the percentage of personal income that people do not actively spend (meaning they save or invest it).
Now, let’s say the savings rate is 3%. Let’s take ten people and put them in a room together. Three of them are Simple Dollar readers and they’re socking away 12% of their income. Everyone else is spending 1% more than they’re bringing in.
In other words, given that there are a lot of people out there who are saving way more than the national average savings rate, there must be a lot of people who are also saving significantly less than the savings rate.
Thus, the norm for a lot of people is to actually spend more than they earn and just hope that windfalls will come along to help them out. That’s just the way it is, after all.
Staying up late stressing about bills? Having a pile of debts that suck away a big chunk of my income? Going into utter panic mode if something goes wrong? Tied to my job because I need the income, regardless of whether I like it or not?
If that’s just the way it is, count me out.
I prefer a different path. Why not cut back on the things that aren’t important to you?
Instead of a $300 cell phone with fifteen different gadgets and service that costs $100 a month that you rarely use, why not just get a freebie phone with just the text messaging that you do use?
Instead of trading in your 2007 vehicle for a 2010 one, why not subscribe to a maintenance schedule and drive that vehicle to the 200,000 mile mark, since you mostly just use the car to go to work and to the grocery store?
Instead of keeping up with the Joneses on whatever fad happens to be going on amongst your friends, why not just figure out what you’re interested in and stick with it?
For me, that’s just the way it is. I’m not facing a mountain of debts, praying for a windfall, living paycheck to paycheck, or anything like that. I’m living my life quite happily without all of those worries but with all the joys my life can provide.
Whenever you’re facing things you’re unhappy with, most of the time, you can make choices to change it. That’s just the way it is if you don’t bother to do anything about it.