A Penny Saved and other thoughts

Our culture is full of phrases and cliches about money. Some of them are true and some of them are just crap.

Is a penny saved really a penny earned?

There is an idea in the personal finance world called the rule of 10. Basically, every dollar you save now is 10 dollars you will have in retirement if invested properly. This assumes wise investments and paying off high interest debt. It may not be actually 10 fold depending on a vast number of circumstances but a penny saved is actually much more than a penny earned if you treat it properly.

A fool and his money are soon parted.

This old classic means that a fool will spend his money foolishly and will soon be without. It is, unfortunately, all too true. With 76% of Americans living paycheck to paycheck it is clear that we have a nation of fools. Even when you drive through the poorest neighborhoods you see satellite dishes, nice clothes and I can’t tell you how many crappy cars drive by my house with killer stereos. We feel the need to live a lifestyle greater than we can truly afford and it pushes us further into debt.

The borrower is subject to the lender.

If you have debts you are working for the people you owe that money to. We are all enslaved to one degree or another to the debts that we owe. Many people struggle to get out from under their college loans to pursue their dreams. The more money we borrow to finance the lifestyles we think we deserve the longer we are forced to work for our debt holder.

Riches have wings.

Money, if given a chance, will fly out of your hand and out of your control. This is why I encourage people to run a tight budget. Accounting for every dollar in some way and moving the money into accounts that are not easily accessible. If you do not plan how you will spend you money it will be spent in ways you did not plan and of course those ways will be less effective than you intended and will be a waste.

It’s Never Enough

It doesn’t matter how much money you make, if money is your idol and you are seeking satisfaction in it; it will never be enough. Lifestyle creep will slip in and you will always feel like you don’t have enough money. Satisfaction will never come from the trinkets that you are able to buy in this world. Jesus said “What does it profit a man to gain the whole world and lose is soul?” If your life is focused on more important things than money becomes secondary and becomes a tool not your master.

Image by puuikibeach

A Penny Saved and other thoughts