It’s More Than Just Dollars & Cents
Time to think
Growing up, everyone seemed to talk about money so negatively. It was always “paycheck to paycheck” or “saving every penny” or even the worst - “I’m on a strict budget.” There was no positivity in it. But, I can’t blame people for thinking this way. The world around us is always negative with money. Between headlines saying the market is crashing, or that inflation is skyrocketing, or that social security won’t be around much longer, it is ingrained in us to have a negative view of money. It starts to feel that no matter your actual financial situation, you feel like everything is truly bad. But, what if you could look past the negativity and see that you can be in control of money.
“Why do we think about money this way?”
It begs the question - why do we think about money the way we do? I admit, it’s tough to not feel so negative about money today. As I write this, inflation is sky-high, gas is the highest it’s been in over a decade, and the stock market is taking all of us on a ride we’d prefer not to be on. Combine that with the average American having $90,4601 in debt in 2021, with a median family income of $79,900, it’s easy to see why everyone is surface level with money. Why would you want to talk about something so stressful? Yet, I think it goes deeper.
“We’re not helping each other”
Every generation piles up more debt than the previous, outpacing the average 3% bump in income the average American receives. This is passed down to the next generation. “Having debt is a necessary evil, and you just pay it back slowly over time”, is what we’re told. I’m not going to lie - sometimes it is! I wouldn’t have made it through college without loans. When I graduated, I took out a personal loan so my wife (girlfriend then) and I could take a trip to Boston to celebrate graduating. I was starting a full-time job one month later, but still had that college-level checking account. The difference though was that I had a plan to pay it off. In my opinion there’s nothing wrong with doing what we have to do, or even want to do, when it flies in the face of conventional personal finance dogma. There are times where you feel you have no choice, and that’s ok. But, we need to make a plan. Embrace the reality, and part of that reality is failing to make a plan means you’re planning to fail. No financial plan = financial stress.
I think this is where the previous generation often fails the next. Okay, you took on debt. Now what? Just go through life knowing you’ll die with it, or hope the government pays it off for you? That seems to be the mentality of so many today. Maybe the freedom is in embracing the responsibility. Think about the feeling of creating a plan and executing it. Then, you have so much room for that next thing that you WANT to do. Visualize making a plan to pay off your debt, and the day arrives that you’re debt-free. Think about how great you would feel on that day, and that you are in complete control of your financial future.
“Why is it taboo to talk about money?”
Another area where we fail ourselves, and each other, is a lack of talking about money. Part of the problem is that we weren’t really taught personal finance. Many of our parents were rarely taught the basics of money by their parents, leading to many of us starting off in the same knowledge boat. Public schools are just beginning to teach finance, and the youngest among us are getting their advice from TikTok. Why is it so taboo to talk about something that has such a major impact on our life? Having open conversations about money when we’re celebrating, struggling, and questioning should be happening! Far too often we hold in our fears and questions with money, then we don’t plan, then we fall into the same cycle with no end in sight. Are we so afraid to talk about money that we’re fine with potentially ruining our financial future? Why do we feel we can’t discuss money with those we care about, and vice-versa? Being in community with others, and discussing important topics like money, can spark ideas. This is true in my own life. In Kelsey and I’s marriage, I am the CFO (don’t worry she’s the CEO). I think about our future when it comes to money and plan accordingly. But, she has had just as much impact on our finances as I have. I can get so deep into making a decision that I forget to myself how simple money can be. She centers me on the simplicity we have set up for our finances. Though she admittedly doesn’t know a lot about money, her outside take on things can spark a new idea, or bring me back to our reality. If I didn’t talk openly about our finances with her, I’d still be making $3 decisions instead of $30,000 ones (shoutout Ramit Sethi). Sometimes we just need to talk to each other, even if we’re afraid we don’t make sense.
So, what now? What can we do to alleviate our financial anxieties and improve our so-called “relationship” with money? First, don’t look at money as a relationship. We have relationships with people! Money, on the other hand, is a tool. We decide what to do with it, and those decisions carve our path. Second, seek out knowledge to sharpen your tool of personal finance. Reading, researching, listening to podcasts: these are all free ways to learn about money. Equipping yourself with the necessary basic skills to navigate this world is a necessity to simplifying your financial life. Finally, talk to someone important to you about money. Whether money has put a strain on your life, or you have questions, talk to someone close to you. There’s a chance neither of you know anything about money, but that’s okay! Make a plan together to figure out your next steps. If you don’t feel like you have someone to talk to about money, reach out to me! I’m always looking to talk dollars and cents.
https://www.debt.org/faqs/americans-in-debt/demographics/#:~:text=The%20average%20American%20has%20%2490%2C460,18%20to%2023)%3A%20%2416%2C043