BE UNIQUE
This is Why Most People Live Beyond Their Means
and carry the burden of debt for a lifetime.
Dave Ramsey said in his book Complete guide to money -Debt is a product-the best-marketed product in history.
And rightly so.
As per research, almost 80 % of the people in the world have some or other kind of debt.
The personal debt takes the biggest chunk in the cake. Earlier, at least, the personal debt used to be for some big expenses only.
But now, people have started taking loans for holidays, for partying, for buying flight tickets, for buying regular stuff, for things which can be avoided.
People do it all the time knowing full well that they can’t afford it. I know some people think that bro, I have paid all the EMI’s on time, I can afford it.
I also thought so until I came across this quote from Jay-Z.
“You can’t afford something unless you can buy it twice.”
If we go by that rule than most of the population won’t be able to have a decent house. For the middle class, it is almost impossible to buy a house without a loan and that is okay to an extent. Its a big expense and they need support for that.
The problem arises when they do things that are not needed and are beyond their budget.
Credit cards have also made it easier to get into this debt trap with buy now pay later concept as people think that they can pay later while in reality, they can’t.
But the instant satisfaction of owning a thing is more important than worrying about the future payment. This habit of living beyond their means is the biggest financial mess most of the people are in.
But the real question is not about what they do, it’s about why do people do such things.
Why do they go and buy stuff which is beyond their means?
Why do they go and take a loan for the things which are not important to buy?
Why do they go and buy a 48” television while they could have done with a 32” TV as well?
Why do they go for a foreign holiday when they can afford a local holiday only?
Why do they go for a luxury car when all they could afford was that normal middle-class car?
Let’s find out.
Spending more makes them feel rich
“You cannot keep out of trouble by spending more than you earn”-William J.Boetcker
When I first started working, I spent whatever money I earned. It made me feel good, it made me feel richer than I was but very soon I got the taste of it when I got into a credit card mess. Fortunately, I realized my mistake early on and corrected myself.
But until then I worked under the pretext that rich people spend more that’s why they are rich. I worked under the pretext of fake it till you make it. Nothing can’t be farther than the truth.
Rich people are rich because they save more, invest more. Most people only see how rich people are spending their money on fancy cars, fancy holidays and other stuff. What they don’t see that this is only a fraction of their income. If they are studied closely, we will find out that most of their income is either saved or invested.
So faking it till you make it will work if we follow the practices they have followed for making more money and making their money work for them.
Because spending has come after that only. Whereas we want to copy only the spending style but not the earning style and that creates problems for us.
To follow the peers
“Fitting in” is one of those horrible diseases that turn reasonable minds into sheep-gelatin hive minds.”― Alida Nugent
The Law of Nature is growth. We as humans are looking for growth all the time. And we work for that.
Problem is that some other fellow has worked harder than us, or maybe he started earlier than us, or maybe he got lucky, or maybe he is just f****d up and still posting photos of his loaned holiday on social media, whatever is the case, it looks like, he moved a little ahead of us in those material aspects.
And that gave a big jolt to our self-image.
Because most people see themselves and value themselves based on what material possessions they have, that is the definition of good quality of life according to them.
Physical health, mental health, & spiritual health is of the least importance for these people.
All they are bothered about the latest gizmo that has come into the market.
That latest car, latest trend which the neighbor is having and they want that to come to the level of their neighbors, even if it means going beyond their means, taking loans and struggling for years to have that mental peace which comes only by having your finances in control.
This process keeps on going until someones understand that your value and quality of your life doesn’t depend on what kind of material possessions you have, it depends on how much in control of your life you have, it depends on how much you respect and value your current situation in life.
Moving ahead in life is not a crime, everyone wants that and doing that. But it becomes a crime when you take that decision to just to come to the level of your peers.
That is the reason why not everybody in the middle class or rich class is financially controlled as they are always trying to match with their peers.
But once they work on their self-esteem, their self-image and realize that these are not the things which add value to their lives or them, they will make better decisions and will be in better control of their lives.
They enjoy their present at the cost of their future
“Some debts are fun when you are acquiring them, but none are fun when you set about retiring them.”- Ogden Nash
Most of the people in this world live in instant gratification mode. That is also the reason people prefer jobs over the business. Because a job gives immediate results in the form of salary while the business takes time in giving a profit.
The same concept works when we are given this option of EMIs when we go to purchase some stuff.
We always go with a certain budget in mind but end up buying something which is higher than the budget.
Reason?
Anyway, we have to pay later only, let’s take it, a few more thousand only right.
We can afford it.
No, we can’t.
Remember that Jay-Z quote, we can’t afford that, that’s the reason we are taking it on loan.
Why take something which we don’t need. Just because we have to pay later.
That’s the biggest lie we tell ourselves and believe as well knowing deeply fully well that we are committing a mistake here.
Lack of self-control
“Self-control, stop, think, what could happen? Is that what you want?”-Anonymous
How often you have come across something while roaming in a mall and you liked it?
Almost all the time.
Most of the time it will happen that we will like something or others in the market. Then we will think about the budget we have. And we have most of the time. If not the debit card, we have the credit card. Money is there, the source doesn’t matter.
We give all sorts of reasons to ourselves why we should buy it, why we should pamper ourselves, why we should not put too much control on ourselves, why its okay to lose yourself sometimes.
What we have completely forgotten is that last week itself we had bought those new shoes which we aren’t going to wear for the next nine months and we are yet to clear that debt we are having.
And this lack of self-control only makes most of the people keep going beyond their means and ultimately land them in the financial mess which either takes them years to clear or they live with that mess for their life.
