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I think you need to read "The Millionaire Next Door".It says that most people who look and act rich are broke i.e. "30,000 dollar a year millionaires".
Apparently I keep getting the 'real deal' thrown in my face all the time...people who clearly own their own businesses,houses,cars...where's the debt there? If anything they were able to invest wisely...
But that's the catch: the folks we're talking about can't.
How do they keep getting the credit to run all of that up? A soon as I miss a payment my rating starts to snowball and I have trouble getting more credit...
How do they keep getting the credit to run all of that up? A soon as I miss a payment my rating starts to snowball and I have trouble getting more credit...
That's what happens to them eventually. Usually because some event "no one could have expected!" (but which any sensible person knows will happen eventually) occurs, and they start missing payments and the whole house of cards collapses. Then they declare bankruptcy and begin a new cycle.
But absent such a triggering event, they can keep the facade of being well off up for quite a long time simply by making minimum payments faithfully. Lots of credit cards (which they only make the minimum payments on), using a HELOC to drain off the equity in their house, car loans, personal lines of credit...
They seem to actually have everything, but actually own almost nothing. It's an illusion propped up by debt.
Often they are very good at mooching off of others as well.
Alot of times when I talk to someone I used to know it always seems they're rolling in money,while I continue to struggle. Was I just born with bad financial genetics? Made too many bad choices? It's not like I ever squandered it,I've always worked...just nothing to show for it now.
What's the norm?
Try this. When you have a chance to talk with some of your seemingly well-off friends, ASK THEM. Just say, "You know, John, you seem to be doing very well, what's your secret"? Trust me, they will love to answer you, but you might be surprised by the answers.
I tried this once when I was going through a tough time in my life. I wasn't very happy and it "seemed" like everyone around me was happy, in a good relationship and doing much better than I felt I was. I read in a book to ask the three happiest people I knew about their lives. What a wake up call! Of the three "happiest" people I knew, one had a wife just diagnosed with cancer, one was about to file for divorce and one had a teenage child in jail for raping a girl. It helped me to realize that those people that I assumed were happy were just as or MORE miserable than I was. Needless to say, I stopped feeling sorry for myself and started doing positive things to increase my own happiness.
I always liked this saying, " I cried because I had no shoes, until I met a man with no feet." Maybe you should take a ride down to the real poor side of town and look around. It might help you to appreciate what you have.
Alot of times when I talk to someone I used to know it always seems they're rolling in money,while I continue to struggle. Was I just born with bad financial genetics? Made too many bad choices? It's not like I ever squandered it,I've always worked...just nothing to show for it now.
What's the norm?
The norm is most people suck at money. We don't know for sure, but I suspect you are the same. However, it's not inevitable. Most people don't think they squander money, but they do. We generally assume we need things that we really don't and we're sometimes not even aware of the assumptions we're making (can't tell the difference between a need and a want). We also think buying certain goods and services will make us happier than they really do.
If you are serious about turning things around, there is Mr. Money Mustache to the rescue.
You won't tell us how much you earn, so it's hard to know if you have an income problem or a spending problem--or both. If it's an income problem...then you have to make a long term plan to earn more money and you need to be very realistic (go into a field that has a high probability of good employment prospects) and strategic about it. Basically, you will have to work both hard AND smart if you want to earn more...and then once you do earn more, you don't upgrade your lifestyle--or at the very least you upgrade it at a much slower rate than the increase in your pay.
Last edited by mysticaltyger; 10-08-2016 at 12:22 AM..
There's no such thing as "bad financial genetics", unless you're talking about the financial situation you were born into. Family wealth does have a large effect on the wealth of an individual over their life. Ex. those born poor are more likely to stay poor over their lifetimes than those born middle class. That doesn't mean someone who was born poor can't become rich during the course of their life, but the chances are a lot slimmer than someone who was born middle class or rich. But there is no gene that causes you to be bad at accumulating wealth. The most likely reason you're in the situation you're in now is because of the choices you've made. Blaming anything else is just a cop out IMO. Granted there are other factors beyond your control like luck, but your financial situation is largely what you make of it. If by "norm" you mean average, then you'll have to look at statistics (average income, net worth, etc.) to figure that out.
i grew up in a nyc housing project and swore to myself i would never raise my family in one ever . that has been a lifetime motivating force . i learned early on who the smart people were and learned from them .
on the other hand i am still friends with some of the guys from the projects where i grew up . guess what ? they are raising their own family's there now . they had the same opportunity as i did to be successful .
i am comfortably retired and they are still slaving at menial jobs living their lives in the same projects we grew up in . we took different paths from the same situation and had totally different outcomes
So how is she 'broke'...does she just say that? When most people say they're broke they mean they're broke to do the things they want to do,not flat broke.
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Credit
Crap tons of debt.
If you owe more than you have or make (and it's not mortgage), you have no real assets, you're stringing your bills along, and you live with yer mommy, you're broke in my book.
i grew up in a nyc housing project and swore to myself i would never raise my family in one ever . that has been a lifetime motivating force . i learned early on who the smart people were and learned from them .
on the other hand i am still friends with some of the guys from the projects where i grew up . guess what ? they are raising their own family's there now . they had the same opportunity as i did to be successful .
i am comfortably retired and they are still slaving at menial jobs living their lives in the same projects we grew up in . we took different paths from the same situation and had totally different outcomes
God's chosen people are not rich and powerful Mathjak, they are poor and outcast. Maybe all your friends are God's chosen people and you are not. Maybe you are worshiping the Devil, who knows. The American Dream has become, quite expressively, the LOVE OF MONEY. How does America measure success? By the size of a man's house, his car and his bank account, or by the quality of his character? Jesus answered, "If you want to be perfect, go, sell your possessions and give to the poor, and you will have treasure in heaven. Then come, follow me." I'm not saying that success in the world IS sinful, I'm saying it was sinful in the eyes of Jesus.
Part of our problem as a culture is that we define success only one way, in terms of money. There are a lot of different forms of success. Was Vincent Van Gogh a success? He sold one painting when he was alive. Herman Melville wrote the greatest American novel so far...he died penniless and his name was even misspelled in his obituary. William Blake died penniless and unrecognized. We won't be a great culture/civilization if we only value money and power, forgetting about the other, the humanitarian, side of the circle: knowledge, art, culture, music, philosophy, and literature. Was Mother Theresa a success? Her bank account says she was a 'loser'.
We are afraid of death, so we put all our energy into money, which represents (we think) distance from death. This is an illusion, of course. Rich people get cancer. Rich people die. Rich people turn to dust. And always will.
Is the mother who raises three children and helps them become hard-working contributors to our society a success? Not by the monetary scale, she isn't.
We have a very narrow, limited view of life in America. The American Dream should not be about living in a Mc Mansion and driving a German car, to show your neighbors you made it - it should be about fulfilling your potential on whatever path chooses you. A good school teacher who helps even a handful of students find themselves out of the forest of confusion may be a success, even if he has to take a second job to try to keep the bank from taking his house away from him.
Every one is a winner and a loser and moves throughout his or her life between these two poles regularly, being a loser at one time, in one endeavor, and a winner, later, in the same or a different direction. Be slow to judge others. Others are, in truth, yourself, at a different stage on the Time-Wheel. When our FED finally raises rates you may end up being a loser again because this upcoming Depression will be much greater then the one we had back in 1929-1942.
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