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Sometimes it's easier living in a less monied and status-conscious place. I have a friend living in Scottsdale and she says it's pretty posh.
It's easy to increase ones spending in response to ones environment - happens very easily.
You still sound like you are doing pretty well though ...good for you
Never said I feel poor or always broke. I still save money but it seems everytime I get a raise or a bonus, I'm inclined to spend it rather than tuck it away. This is that total lack of self discipline that I spoke of. Not having the ability to ignore the raise to save it for later when there is a justifiable need. I have enough money in an emergency fund for a year without working as well as a good chunk of change in mutual funds and stocks.
I merely wanted to make a point that it seems with making a higher income, one adjusts their lifestyle to spend more as well. Didn't really need a lecture on how to spend my personal money although I'm hoping to see myself on a motorcycle pretty soon This is what I mean. You are not focused on the goal (motorcycle?) enough to hold back the money for it.
Like millions of other people you suffer from what I call "frittering". That is the spending of every penny that comes to your hand!!
I think it's actually very easy to live below one's means. The problem that most people have is that they make upgrades on things that continue to add expense to their lives, namely:
1) Car
2) House / rent
3) Luxury items
Never buy a new car. Always get a slightly used one for best value. Also, pick a car that has low gas mileage, cheap parts, easy to maintain (so you can do your own oil changes or other maintenance), and high resale value. Insurance and maintenance rates go up accordingly as well.
Home: Gone are the days of investment homes. When people upgrade their homes or rent in a better neighborhood, their costs of maintenance, upkeep, or fees increase exponentially.
Luxury items. The best way to avoid throwing money away on things that are actually not much different than their cheaper counterparts is to squirrel the money away in a RothIRA or 401K. Max these out if you can. Then find a high interest rate location to put away a good portion of your paycheck such that you can't do anything but to live frugally. That way you will have money left for a rainy day and you won't overspend.
Buying new clothes isn't really warranted unless they are work clothes, and your old ones are unacceptable. Avoid the temptation of donating old clothes so you can buy new ones.
I had an interesting conversation with a co-worker this morning about living above/below one's means. I haven't really noticed it before but it is pretty difficult to live below your means. With a spike in income after a promotion or raise, you adjust your lifestyle accordingly to your new income. Most people don't simply put that new income into a bank or mutual fund, they seem to add another expense to their current lifestyle which takes away that new money. I've even noticed it with myself (ashamed to admit it).
When I started out working, I was making less than half of what I do now but I still lived fairly comfortably. 8 years later, I make more but seem to have more expenses that eat away at the larger income I have. If I was intelligent, I'd sink that money away into a mutual fund and let it grow and live on the amount of money I was making many years ago.
Does anyone else feel it's very difficult to live a lesser life even if you're making an income that allows you to live better?
I can now understand how some lottery winners blow all their money within 5 years simply because they cannot manage such a larger amount at one time, they live like a king even though they don't understand all the costs associated with their new lifestyle.
Not really a profound thought but it was sort of like one of those "Duh!" moments!
Not at all. You have to have a plan and goal. Just because I got a raise/promotion does not mean I am going to spend more. Its discipline. I save about 30-40% of my paycheck. The money I save is going to Stocks and/or Mutual Funds. You have to sacfifice some stuff early to get more later and you will be proud and thank yourself later. The ones that play the lottery are the poor according to the stuff I've read because they can't a another way to getting money. Knowledge is definately power.
Sounds like all you have to do is make an adjustment. Sure you can spend more if you earn more, just don't spend more than you earn. Like dieting, you can eat more if you work out but if you eat too much you'll get fat.
If you eat more then you have to burn more calories too.
Yes, agree it's hard not to spend the extra money when income goes up.
What helps is to have it automatically deducted on payday so you don't miss it.
Also.....I have found I feel better when I have quality around me. When I do have to buy something, I plan ahead to buy a quality item on sale. This way, it will last much longer and look better ...and be less expensive in the long run.
Exception being cars ....most of them are money pits....always buy decent secondhand and drive it forever
I went from eating processed cheap pasta with potted meat in college to fresh organic produce and farm meats. You'd be surprised how eating more healthy costs much more. That was the only lifestyle change we adopted, we didn't buy fancy cars or houses or go out more just because we had more disposable income. Of course, when you work 80 hour weeks, how much time do you have to really spend that money?
Organic is just a name. No real difference.
Cooked food from a regular grocery is just as good.
Well, online shopping takes 1 click and thats like 1 sec to buy.
Never said I feel poor or always broke. I still save money but it seems everytime I get a raise or a bonus, I'm inclined to spend it rather than tuck it away. I have enough money in an emergency fund for a year without working as well as a good chunk of change in mutual funds and stocks.
I merely wanted to make a point that it seems with making a higher income, one adjusts their lifestyle to spend more as well. Didn't really need a lecture on how to spend my personal money although I'm hoping to see myself on a motorcycle pretty soon.
Whats so hard about tucking it away? 6 months to a 1 year is great for Emergency fund.
The key is to BE rich and not ACT rich like many do.
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