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There could be a thread about marshmallows, and there would be bickering. Go figure.
IMHO, a good share of the time, people can't distinguish between wants and needs, as another member said. Examples can be found with folks who make a "decent living" and those who don't make much.
Correct. I find it unbelievable when people spend on having their hair highlighted and their nails professionally done and then say I can't pay the rent. OK, well you can't do math, then.
Or some friends of mine who paid rent late every single month, with the fees attached, because each paycheck they HAD to have some fun things. Well, I mean IDK what to say for people like that. It makes no sense.
That couple has a higher income now but they got more stuff too. TWO high-priced muscle cars. Insane. Something really important to have money for will come up and she will say 'We don't have it'. Then why do you eat out all the time? Cook!
I just ...... I don't get it. I remember in college saving up my tips to pay rent. I'd do my calculations and go to the bar after with $10 often. My friends were like how can you budget like that? I'm like how do you not? I'm not going to stress over rent or pay those late fees.
I also liked good shoes. One thing I could never get down with being poor in college was payless shoes. No way. Save my money, look for sales, get good shoes. It was a must for me. Not alot of pairs, just whatever I needed had to be good quality.
The understanding of TVM is not of much practical import to a burger flipper who gets paid next week and needs to pay rent this week. The burger flipper is screwed regardless of understanding.
Burger flippers are the exact kind of people who need to understand it. It would help greatly in their decision making process.
You have not explained why. Interest rates on savings are crap. pennies.
Is sticking it in a savings account the best use of your money? Really?
If you can't see why receiving your money in 10 checks vs. 12 is a better deal, just calculate the present value of that salary over 10 months and 12 months. At any discount rate greater than zero, 10 months is better.
Is sticking it in a savings account the best use of your money? Really?
If you can't see why receiving your money in 10 checks vs. 12 is a better deal, just calculate the present value of that salary over 10 months and 12 months. At any discount rate greater than zero, 10 months is better.
I think that statement: "You can choose to live well now, or later" is way too binary. I think it's too often used as an excuse by people who want to live in the present who don't really want to look too deeply at where their money is going and if their spending is really aligned with their values and/or actually bringing them the sense of happiness they think it is.
This is extremely accurate. And is an in depth way to explain why instant gratification is almost always inferior to long term planned with delayed gratification. Most people just don't have the ability to take the long term route that would actually lead them to have a much better quality of life. I will use a real life example to illustrate just how shortsighted it is (when using pure logic) to make the "instant gratification" decisions instead of going the disciplined route:
I bought a rental property for $70K 3 years ago. This is a real example from my life. Lets say I was a travel addict and wanted to spend that $70K for traveling the world. I could have done the following:
Short term instant gratification route: I could have spent the $70K over 5 years taking approximately 14 $5K week long vacations to 14 different countries.
or
Long term disciplined route: I make $8K net profit from that rental every year. So over 10 years I could take 16 vacations similar vacations like the above to 16 different countries. By the time I'm 60 the amount of countries I have visited will increase to 48!
Short term spending benefit: Yay I visited 14 countries in 5 years, I'm soo awesome!! I gained soooo much "life experience" and became "cultured" in such a short amount of time!!
Long term spending benefit: I visited 48 countries AND I have a property that has adjusted with inflation so I still have my original $70K AND I still have a permanent inflation adjusted $8K income coming in yearly!!!! Also, since I have the money coming in I can continue to travel like this indefinitely until I decide not to.
Yeah...its not even a contest. If the "live for now" spenders actually critically thought about the long term cost of their "spending now" strategy; then I'm willing to wager that a good portion would start to regret their ways.
Bet he had no time for family or dating to try and create a family. Maybe he doesn't want that, if so more power to him. Or maybe he figured he could accomplish it later... but he missed on 3 years of dating/family formation in his 20s. Dating & starting a family only gets harder once you hit your 30s... opportunities get taken off the market, less energy to keep up with the kids, etc... Then again, maybe he had a partner that was on board with the whole strategy.... if so, lucky him..
That's valid...to a point. But he gave up 3 lousy years. A lot more people end up divorced because they never set up a decent financial foundation for themselves. The #1 cause of divorce in America is fights over money. Now if/when he decides to have a family they can probably have kids and be able to afford to have one parent stay at home. I think that's a much better setup for kids and parents alike.
Quote:
Originally Posted by redguard57
Another factor - that guy was lucky that he qualified for the kinds of jobs that made that possible in his 20s. Not everyone does; a day job at Wal-Mart and a night job at IHOP wouldn't accomplish that. Good for him for making it happen, though. .
He did have a good day job. But he also grew up just getting by, raised by a single mom. So it's not like he came from some kind of privileged background, either. He had the odds stacked against him more than most.
Quote:
Originally Posted by redguard57
I could potentially do that... take on some kind of night job & pay off my house in maybe 3-4 years. My marriage would never survive those 3 years, though. So I would have to weigh a paid off house vs. the cost of a divorce and the emotional costs involved with that.
But, you tell me, which is more common? Divorce because people overspend and then fight each other over the resultant stress? Or divorce because somebody is working too much to pay off the house early? I think you know the answer.
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