That was the amount of my first paycheck. I was 16 years old, living in Nashville, TN and I might as well been residing in Malibu pulling a 7-digit income. I was on top of the world. As with 99% of all 16 year-olds, the money was burning a hole in my pocket. All of sudden that Blind Melon CD purchase was within my grasp! Instead of putting in $5 of gas, I was filling it up! Look out Wall Street, Josh Crowe was on the rise!
It was at this point that my dad entered the picture. He saw (and recognized) the green gleam in my eye and asked me to sit down. He said, “Son, I’m very happy that you’ve worked hard and made your first paycheck, but there are some things you need to know about money.” I then sat and listened to advice that is nearly as old as the earth itself. It was a defining moment in my life and I’m very thankful for it.
But as I walk around today as a 36-year-old married father of three young girls, I see that not everyone had the great advice my father bestowed on me. Seems they’re living by another set of ‘laws.’ So here (as best as I can see it) are the five ways to be sure you lose what little money you have:
1. Spend what you don’t have.
So you want to empty your bank account? Good! But don’t stop there! Spending money you don’t have is the best way to assure that you will remain in the red for as long as possible. See that new TV? Who cares if you don’t have $1,000 in your bank account. That balance means nothing when you pay with someone else’s money. And get this–they’re literally lining up to give you free cash! People are practically handing you their money to spend. I’m sure they don’t expect too much in return. (1. “The average household is paying a total of $6,658 in interest per year. This is 9% of the average household income ($75,591) being spent on interest alone.” https://www.nerdwallet.com/blog/credit-card-data/average-credit-card-debt-household/)
2. Do NOT budget.
Who knows the future? That’s right…NO ONE! Who can plan for every little expense? Once again, NO ONE! So why plan what you’re going to spend? Plus, if you waste your time by planning what to spend in advance, you won’t be able to pick up those steaks that just went on sale. So don’t plan….go on what feels right. When has that ever let you down?
3. Stay in the dark about your money situation:
There’s a monster under the bed. The good news is that if you ignore it, it will disappear. The monster of finances can’t harm you as long as you don’t stare directly at it, so the strategy is to completely ignore your current financial state. Stay the course and never, ever stop to assess where you are. This strategy takes many forms. Some of the most popular include immediately throwing away any and all receipts, deleting notices from your bank, hiding bills from your many debtors. Stay in the dark…it’s the safest place to be.
4. Hoard the money you have:
You worked hard for what you have. That’s why you should be extremely stingy with where you’re money goes. I’m not talking about spending, of course, but about giving. Why should you give? No one is giving to you! Make those churches, charities and friends in need rip that dollar bill out of your cold, dead hand. (2. “Giving was made for OUR benefit.” “If you can’t live off of 90% of your income, you can’t live off of 100%” http://www.daveramsey.com/blog/daves-advice-on-tithing-and-giving/)
5. Be a sheep:
Keeping up with the Joneses isn’t just a cool phrase. It’s a life goal. Just watch with envy as your best friend pulls up on his new motorcycle. Drive by your neighbor’s house one more time to admire his new boat. These things are motivators. They’re logs to put in the fire of your own spending. Getting behind in the rat race isn’t an option. Play to win and that means following the crowd to the finish line of financial ruin.